THE VIRGINIAN-PILOT Copyright (c) 1996, Landmark Communications, Inc. DATE: Sunday, February 11, 1996 TAG: 9602110045 SECTION: FRONT PAGE: A1 EDITION: FINAL SOURCE: BY HARRY MINIUM AND KAREN WEINTRAUB, STAFF WRITERS LENGTH: Long : 193 lines
A vision shared by some Virginia Beach and Norfolk leaders for a 20,000-seat sports arena, most likely for downtown Norfolk, might evolve into a more ambitious concept for regionally funded projects throughout South Hampton Roads.
One of these projects might be a long-sought convention center in Virginia Beach.
The Virginia Beach and Norfolk city councils will be asked Tuesday to consider hiring Rick Horrow, a Miami-based consultant with a track record of planning and coordinating big municipal projects, said Paul R. Riddick, Norfolk's vice mayor. One of Horrow's first tasks would be to determine whether Hampton Roads businesses would purchase enough luxury boxes to make a sports arena financially viable.
If the region agrees to build an arena and if Horrow finds there is enough corporate support, Norfolk City Council members say the city would then hire Bob Walsh, a Seattle-based consultant who specializes in forming ownership groups and attracting pro sports franchises. Walsh's likely target would be an NBA team.
It is expected that an arena could cost as much as $140 million, consultants say.
The cities of Hampton Roads have never cooperated on a venture so ambitious.
Norfolk and Virginia Beach have been searching for a consultant since last month when, after rejecting a Canadian Football League team, the cities promised to work together to bring a major league sports franchise to Hampton Roads.
But Horrow offers more than just arena consultation. He has indicated in brief meetings with regional leaders that, if hired, he would propose a package of projects similar to a package he helped create in Oklahoma City. His pitch has impressed some Virginia Beach and Norfolk city leaders, who think it might be the only way for the region to agree to build an arena.
Horrow was hired in 1992 by Oklahoma City to help the city find a way to finance a proposed downtown arena. Two years later, when the arena proposal was submitted to voters, it included eight additional projects, including a minor league baseball stadium, a convention center, a new library, and arts and cultural facilities. Many of the projects were in localities outside of Oklahoma City.
``There was something in it for everybody,'' Oklahoma City Mayor Ron Norick told The Daily Oklahoman recently.
The $285 million proposal called for a 1 percent sales tax increase, which would expire after five years. Oklahoma City officials credit Horrow with skillfully transforming arena opponents into proponents. More than 58 percent of the voters approved the package.
In January, Horrow told a small group of area business leaders at the Hampton Roads Chamber of Commerce's Norfolk office that it would take a similar effort to make an arena work in Hampton Roads, one of the nation's most politically and geographically fractured regions.
Horrow has asked for a $6,000 a month retainer, which would be split by Norfolk and Virginia Beach.
Horrow, Mayor Meyera E. Oberndorf of Virginia Beach and Mayor Paul D. Fraim of Norfolk all declined to comment on Horrow's contacts with area leaders.
But other area leaders expressed support for his concept.
Virginia Beach Vice Mayor W.D. Sessoms Jr., who attended a regularly scheduled meeting with Norfolk officials last week at which the subject of hiring Horrow was first discussed, said he thinks the project needs to benefit all the cities of South Hampton Roads to be successful.
``What I would love to see is more cooperation between the cities because I think it would be of benefit to all of us,'' he said. ``At some point in time, the whole community has to get behind a project like this if it's going to be successful.
``I just think it's clear that everyone has to be a part of it if this is going to happen.''
Fraim and Riddick met with Horrow two weeks ago in Scottsdale, Ariz., at a seminar on the building and financing of sports arenas. Virginia Beach economic development director Don Maxwell also attended the seminar.
``Rick Horrow was one of the presenters,'' Riddick said. ``And he was the most impressive of them all.
``While he was there, he got a call from (NFL commissioner) Paul Tagliabue to go to Pasadena to check out the Rose Bowl for the NFL,'' because the Seattle Seahawks had asked to move their franchise there.
``He's a leader in his field.''
Horrow headed successful efforts to build the Miami Arena and to attract NBA and major league baseball teams to the Florida city. He is employed by the Ladies Professional Golf Association and the Behia Province of Brazil, for whom he is helping to plan an arena and convention center.
Walsh has a similar resume. Seattle officials credit him with bringing the Final Four championship games of the NCAA national basketball tournament to their city three times, as well as the NBA All-Star game and the 1990 Goodwill Games. Walsh also successfully landed Vancouver, British Columbia, an NBA expansion franchise two years ago.
Regional officials say privately it is too early to speculate on how long it might take Horrow to piece together a successful package, the other projects in the package, or even whether Norfolk and Virginia Beach will agree to hire him.
Virginia Beach and Norfolk city leaders have discussed the proposal once. The Chesapeake, Portsmouth and Suffolk mayors were briefed Friday. A number of city council members in the region's cities have yet to be informed.
``It's very early in the process and we have a lot of selling to do,'' said a Virginia Beach official, who asked not to be identified.
And there's longstanding animosity and suspicion to overcome. Norfolk and Virginia Beach in recent years have battled over the then-Tidewater - now Norfolk - Tides, as well as water and light rail issues.
Hampton Roads is littered with projects that died for lack of regional cooperation, including a long-discussed regional football stadium. The region was considered a potential NFL expansion site in the 1970s, but the cities could not agree on a stadium site and no official bid from the region was made. Still, the area finished sixth in competition for the two expansion teams, which ultimately went to Seattle and Tampa.
There is general agreement, however, over a probable site for the arena: in downtown Norfolk, adjacent to Harbor Park. Three reports by consultants, including one done by Walsh for Norfolk, have indicated the downtown area is the best place for an arena.
``They never seem to work outside downtown areas,'' Walsh said. ``It didn't work with buildings in Detroit or Cleveland.''
In spite of the unanimity among consultants about downtown Norfolk, Virginia Beach's Maxwell urges area leaders to consider other sites as well. A potential franchise owner, he says, should have several site options. But he acknowledges that wherever an arena is located, all area cities would profit.
``Studies can be deceptive sometimes,'' he said. ``There was a study in Colorado that indicated the baseball team there had a 90 percent chance of failing, and they've broken just about every baseball attendance record.
``I think all of the cities will benefit regardless of where it goes. If it goes in downtown Norfolk, all cities would benefit. But if it went in Virginia Beach or Chesapeake, everyone would benefit, too.''
The Norfolk and Virginia Beach economic development departments, Maxwell said, ``are working very well together on this. As the two leading cities in Hampton Roads, we have to take the lead on this.''
Norfolk officials say they need to work with others because their city can't pay for an arena by itself. Tying the arena into projects in other cities was seen as the only way to make it palatable to other city councils, area officials say.
The carrot for Virginia Beach is a convention center. Maxwell says the Virginia Beach Pavilion is too small and needs to be replaced or enlarged. The center is needed to attract more visitors to fill Oceanfront hotels and restaurants during the slow winter months.
Estimates on the cost of a convention center range up to $100 million.
Yet even with that carrot, sources close to the Virginia Beach City Council say it's far from a sure thing that the council would vote to hire Horrow, even though that would obligate them only to pay for his study. They would not be obligated to accept his proposals.
Fraim approached Oberndorf about Norfolk and Virginia Beach, the state's largest cities, joining to fund an arena on Jan. 10, when they met for 90 minutes in downtown Norfolk to discuss a bid by the CFL's Pirates to relocate to Hampton Roads.
Fraim asked that only the two cities cooperate on the arena and other projects. Sources in Virginia Beach say Oberndorf insisted that any project be funded by every city in South Hampton Roads.
Coincidentally, Horrow came to Hampton Roads that same week to make his pitch to business leaders for regional cooperation.
If the proposal to hire Horrow passes, his most difficult task likely would be gaining regional approval for funding the projects.
The proposal, and any regional tax, would have to be approved by the city councils in all participating cities. The General Assembly and the governor would then need to approve the tax increase. A referendum in each city might also be required.
A report done by HOK Sports and Brailsford Associates for the Sports Authority of Hampton Roads determined that a $140 million arena could be paid for in six years by raising the sales tax a quarter-cent on the dollar in eight area localities. In other words, the tax would rise one penny for every $4 purchased.
The Sports Authority has no funding and is run largely by volunteers and employees of the Hampton Roads Planning District Commission. Each participating jurisdiction - Norfolk, Portsmouth, Virginia Beach, Chesapeake, Suffolk, Newport News, Hampton and Isle of Wight County - has an equal vote.
Another funding option includes taxes on cigarettes and alcohol. Cleveland and Cuyohoga County, Ohio, instituted so-called sin taxes for a maximum of 15 years in 1990 to help pay for a new baseball stadium and arena.
Local officials say they might use a mix of private-money options, including seat licenses, in which fees are paid by fans for the right to purchase choice seats, luxury box revenue and corporate sponsorship, to pay some of the arena costs.
Another option Fraim has pushed both publicly and privately: sharing tax revenues from any regionally constructed projects. Although arenas don't make enough money in direct revenue to fund even their operating revenues, they do create tax revenue, especially admissions taxes, which Norfolk is willing to share with other localities, he said.
Any tax increase probably is years away. It took Horrow two years to get the Oklahoma City project off the ground, and that city's arena won't be completed until 2000, eight years after Horrow was first hired.
The irony for some in the arena discussion is the brief and stormy role of the CFL's Pirates. Not until after the team began wooing the area in November did landing a pro team become a major topic for regional leaders.
Art Collins, administrator of the Sports Authority, said the impetus may have come from Lonie Glieberman, president of the failed CFL team, whose attempt to move to Hampton Roads from Shreveport, La., was blocked by Norfolk and Virginia Beach.
``In the long run, we may owe Lonie Glieberman a debt of gratitude,'' Collins said.
``He helped get the discussion rolling.'' by CNB