>> GOOD AFTERNOON.
THANK YOU FOR BEING HERE THIS
MORNING.
THIS IS A SPECIAL MEETING OF
THE SELECT COMMITTEE ON CIVIC
ARENAS.
I'M EXCITED TO SHARE IT IN THE
ABSENCE OF COUNCILMEMBER JUAREZ.
WE WILL DO INTRODUCTIONS IN A
MINUTE AFTER WE GO THROUGH SOME
OTHER ADMINISTRATIVE ITEMS.
IT IS MONDAY, MAY 20.
THE TIME IS 10:47 A.M.
RESTARTED A FEW MINUTES LATE
BECAUSE OUR BRIEFING WENT OVER
AGAIN.
FIRST, I WOULD LIKE TO APPROVE
THE AGENDA.
IF THERE IS NO OBJECTION, THE
AGENDA WILL BE ADOPTED.
NO OBJECTIONS.
THE AGENDA IS ADOPTED.
I WOULD LIKE TO GO THROUGH THE
PUBLIC COMMENT SECTION.
WE WILL TAKE PUBLIC COMMENT ON
ITEMS APPEARING ON TODAY'S
AGENDA.
WE HAVE MISTER DAVID HAYNES
SIGNED UP.
COME FORWARD.
YOU HAVE TWO MINUTES TO TALK ON
OUR AGENDA ITEMS THIS AFTERNOON.
>> CITY COUNCIL, HOLD ON.
CITY COUNCIL NEEDS TO REJECT
THE PERMITS FOR PERMANENT
TIEBACKS AND RENEGOTIATE THIS
HORRIBLE DEAL TO CO-OP KEYARENA
USING $100 MILLION OF TAXES TO
DIG A HOLE 15 FEET INTO THE
CONCRETE.
THE L.A.
CONSORTIUM IS USING SEATTLE AS
AN INFLATED IS MUST WRITE OFF
WHILE DENYING SEATTLE HE 21st
CENTURY, WORLD-CLASS VENUE.
THE FACT THAT
OVG IS AVOIDING THE NEEDLE,
DOES NOT JUSTIFY DIGGING A HOLE
FOR A RINKY-DINK ARENA, UNSAFE
BECAUSE THE ROOF IS ALREADY
CRACKED, SPARKLED AND REPAINTED
ON THE CORNERS.
THE AMOUNT OF DUST INSIDE THE
ARENA WILL NEVER BE CLEANED
PROPER.
THERE WILL ALWAYS BE DUST
INSIDE THAT VENUE, POTENTIALLY
RUNNING THE FIRST GENERATION
PRO HOCKEY TEAM.
SEATTLE COUNCIL SHOULD PUT AN
INJUNCTION ON THE L.A.
CONSORTIUM, AND RENEGOTIATE A
DEAL TO REPLACE THE ENTIRE
VENUE.
NO NBA TEAM WILL EVER PLAY
UNDER A 60-YEAR-OLD CEMENT SLAB
A ROOFTOP THAT WAS LSD INSPIRED
BY A CARTOON ON THE JUDSON.
YET, TOD LEIWEKE IS
CIRCUMVENTING ARE DENIED
DEMOCRACY FROM A SITTING
COUNCILMEMBER.
THIS SHADY DEAL HAS ALREADY
BEEN SENSATIONALLY INFLATED FOR
BUSINESS WRITE-OFFS, AND TO
FALSELY ENSURE COUNCIL IF IT'S
$1 BILLION, IT MUST BE WORLD-
CLASS.
REJECT THE PRINCIPLES OUT OF
PRINCIPLE.
WE DON'T NEED AN ARTIFICIAL
FOUNDATION TO TAKE THE PLACE OF
A CRACKED STRUCTURE.
ALSO, TOD LEIWEKE IS PUTTING
UP WALLS THAT DON'T CAPTURE THE
ATTACK TOXICS.
THIS SHOULD BE MORE SCIENTIFIC.
THEY ARE CIRCUMVENTING CERTAIN
UNSAFE REALITIES.
DON'T THINK BECAUSE GOLDMAN
SACHS IS INVOLVED THIS IS A
WORLD-CLASS DEAL.
>> THANK YOU.
DEMOCRACY IN ACTION.
THAT WILL CLOSE OUR PUBLIC
COMMENT SECTION, AND WE WILL
MOVED TO OUR AGENDA ITEMS, AND
THANK YOU ALL FOR BEING HERE,
COUNCIL MEMBERS.
BEFORE WE DO INTRODUCTIONS,
LET'S HAVE ITEMS ONE, TWO AND
THREE READ INTO THE RECORD.
OR THE CLERK CAN READ THEM.
>> ITEMS OF BUSINESS, ITEM
NUMBER ONE, ARENA AT SEATTLE
CITY CENTER CONSTRUCTION
SCHEDULED UPDATE.
THE SECOND ITEM ON THE AGENDA IS
THE ARENA AT SEATTLE CENTER
FINANCIAL DUE DILIGENCE REPORT,
AND THE THIRD ONE IS AN UPDATE
ON THE SEATTLE STORM LEASE
MODIFICATIONS.
>> THANK YOU FOR THAT.
I THINK LINDA WAS AT THE HOME
READY TO READ THOSE.
WHY DON'T WE DO INTRODUCTIONS
FIRST?
>> I AM KIERSTEN ERSTAD,
CENTRAL STAFF DIRECTOR.
>> JERRY BRUCKHEIMER, INVESTOR.
>> TOD LEIWEKE, CEO.
>> KIM JOHNSON WITH OVG.
>> LET'S KICK OFF THE FIRST
ITEM, WHICH IS A CONSTRUCTION
SCHEDULE UPDATE, AND LET'S
PROCEED.
>> VERY GOOD.
THANK YOU VERY MUCH.
A LITTLE BIT OF HISTORY BECAUSE
I THINK IT'S IMPORTANT FOR THE
COUNCIL TO TAKE STOCK AS TO
WHAT HAPPENED AND WHEN IT ALL
HAPPENS IN PIECES SOMETIMES,
IT'S HARD TO STAND BACK AND
UNDERSTAND WHAT TOOK PLACE.
INDULGE ME ON A FEW SITES WITH
JUST A LITTLE BIT OF HISTORY.
THE LAST TIME AN ARENA WAS
BUILT IN SEATTLE WAS 1962 AS
PART OF THE WORLD'S FAIR.
IT SERVED A GREAT PURPOSE.
IT WAS NOT ELABORATE.
IT WAS A FLAT FOUR, BUT
FACILITATED THE WORLD'S FAIR,
AND FIVE YEARS LATER, THE
SONICS CAME.
GREAT THINGS DID HAPPEN UNDER
THAT ROOF.
WE WERE ALL PROUD, AS A
COMMUNITY, BUT IT WAS REALIZED
THAT ARENA WAS SIMPLY NOT GOING
TO GET IT DONE.
A FLAT EXHIBITION SPACE DIDN'T
CONSTITUTE, SO IN 1995, A
RENOVATION WAS DONE.
THE RENOVATION DID SOME THINGS,
BUT DIDN'T DO ENOUGH.
IT WASN'T VERY LONG AFTER THAT
THE WORD STARTED CIRCULATING
AROUND TOWN THAT IF THE ARENA
WASN'T FIXED, THINGS COULD
HAPPEN.
EVENTUALLY, PERHAPS, AN NBA
TEAM LEAVING.
I WAS RUNNING THE SEAHAWKS, AND
LOW AND BEHOLD IN 2008, THAT
VERY THING HAPPENED.
BUT, THE COMMUNITY
SENSIBILITIES WERE SUCH THAT IT
WAS A RUBIK'S CUBE WE DID SO
MANY THINGS IN THIS COMMUNITY.
THE ONE THING WE SEEMINGLY
COULDN'T GET DONE WAS BUILD A
NEW ARENA.
THERE WERE SIGNIFICANT
CHALLENGES IN DOING THAT.
IT WAS AN ASSET OWNED BY THE
CITY.
IT WAS IN REAL DECLINE.
NOW THAT WE LIVE ON SEATTLE
CITY CENTER GROUNDS, WE FULLY
REALIZE HOW MANY OF THOSE
STAKEHOLDERS WERE DEPENDENT
UPON THIS CITY COUNCIL FIGURING
THOSE THINGS OUT.
IT WAS AN ASSET NOT ONLY OF
DECLINE.
IT WAS REALLY STARTING TO
IMPACT SEATTLE CITY CENTER.
IN ITS FINAL YEAR OF OPERATION,
WE HAD LESS CONCERTS IN THE
ARENA THAN IN DES MOINES, IOWA.
MANY ASK LEE SKIPPED THE AREA
BECAUSE THE BUILDING WAS IN
DEMISE.
YOU MADE THE RIGHT DECISION
BECAUSE THE ARENA BELONGED
WHERE IT WAS, BUT IT HAD TO BE
FIXED.
IT HAD TO NOT ONLY BE READY FOR
EVENTS, BUT NHL AND NBA.
THAT WAS EXTRAORDINARILY
COMPLEX BECAUSE THE CURRENT
FOOTPRINT AT 400,000 FEET
DIDN'T ALLOW FOR A MODERN ARENA,
AND ITS LANDMARK STATUS
WOULDN'T ALLOW YOU TO GO OUT OR
UP, SO WE HAD TO CREATE THE
FIRST SUBTERRANEAN ARENA IN THE
WORLD.
EXPANDING FROM 400,000 TO
800,000.
THE OTHER CHALLENGE WAS
PRIVATELY FINANCED.
THIS IS NOW WHAT HAPPENS WHERE
TEAMS GO, WHERE CITIES SAY IF
YOU DON'T DO THIS, WE ARE GOING
TO LEAVE.
THE CITY SIMPLY SAID THIS WILL
BE PRIVATELY FINANCED.
IT WILL BE ONE OF THE LANDMARKS.
THE CITY BELIEVED ALL OF THOSE
THINGS COULD SOMEHOW HAPPEN, SO
IN 2017, THE CITY ISSUED AN RFP.
THIS IS A PICTURE, ONE OF MY
FAVORITE PICTURES, BECAUSE OF
THE NEXT PICTURE THAT'S COMING
BUT THIS IS THE CURRENT STATUS
OF THE BUILDING, AND YOU SEE A
BACK-UP HOUSE THAT HAS AN
ANTIQUATED LOADING DOCK, WHICH
CAUSED A LOT OF SHOWS JUST TO
SKIP.
IT WAS A TERRIBLE ENTRY WAY
INTO OUR PARK.
YOU SEE AN OLD, ANTIQUATED
BUILDING, BUT DREAMS DO COME
TRUE, AND THIS NEXT IMAGE SHOWS
THAT DREAM COMING TRUE THROUGH
THE COURAGE OF LOTS OF FOLKS
THROUGH THE SUPPORT OF THE CITY
COUNCIL IN TWO YEARS, THIS
SPECTACULAR BUILDING WILL OPEN.
WE BELIEVE IT'S THE ONLY ARENA
PARK IN THE WORLD.
WE BELIEVE IT IS DEFENDABLE
THAT THIS WILL BE THE MOST, IF
NOT ONE OF THE MOST BEAUTIFUL
ARENAS IN THE WORLD.
IT SCALES, IT FITS, IT HAS NO
BACK OF HOUSE.
IT HAS A BEAUTIFUL ENTRYWAY.
IT WILL EXPAND FROM 400,000 TO
800,000 SQUARE FEET, AND EVERY
MAN, WOMAN AND CHILD IN THIS
COMMUNITY WILL HAVE A REASON TO
GO CELEBRATE UNDER THIS ROOF.
I AM GOING TO TALK MORE ABOUT
THOSE EVENTS IN A MOMENT, BUT
TO MY LEFT IS KEN JOHNSON WHO
HAS BUILT MANY THINGS IN OUR
COMMUNITY AND WE ARE VERY
FORTUNATE HE CAME AWAY AND IS
LEADING CONSTRUCTION.
>> I LOVE THIS PICTURE BECAUSE
IT SHOWS THE FOOTPRINT, AND IT
EMPHASIZES THAT WE REALLY ARE
PART OF THE TENANT OUT THERE.
WE ARE TALKING WITH TENANTS AS
WE DO OUR WORK, BUT AS TODD
MENTIONED, TO THE LEFT, THE
SOUTH END OF THE BUILDING,
WHICH USED TO BE LOADING DOCKS
BLOCKED OFF BY OLD BUILDINGS,
THAT BECOMES A WONDERFUL,
FANTASTIC ENTRANCE TO THE
BUILDING.
ALONGSIDE THOMAS STREET, WHICH
HAS LONG BEEN TALKED ABOUT AS A
PEDESTRIAN STREET IS A HUGE,
IMPORTANT ENTRANCE TO SEATTLE
CENTER.
EVERYONE WORKING ON THIS
PROJECT, THE ENTIRE TEAM, IS
PUMPED ON A DAILY BASIS.
WE HAVE THE BEST DESIGNERS OF
ARENAS IN THE WORLD.
MORTENSEN IS ONE OF THE TOP
BUILDERS IN THE COUNTRY.
CIA HAS MANAGED THE PROCESS
MORE THAN ANY FIRM, AND WE HAVE
A STRONG ENGINEERING FIRM,
STRUCTURAL ENGINEERS, SO IT'S A
WONDERFUL TEAM.
FROM MY STANDPOINT, I LIVED
THROUGH THE HISTORY OF THE
BUILDING.
I WENT TO THE WORLD'S FAIR.
MY FIRST CONCERT WAS IN THE
SEATTLE CENTER.
I WENT TO THE SONICS WHEN I WAS
10 YEARS OLD.
TO ME, HAVING THIS BUILDING IS
A REALLY SWEET AND MEMORABLE
LOCATION THAT MAKES IT WORK.
THIS GIVES YOU A LITTLE MORE
LOOK AT WHAT THE BUILDING DID.
AS TODD SAID, IT STARTED OUT
FLAT, SO IF YOU LOOK AT THE
LINE THERE, THE PLAZA LEVEL,
THAT'S WHAT WAS DONE WHEN THE
DECISION WAS MADE TO GO DOWN.
IT WENT DOWN THE 38 FEET, BUT
WHAT IT DIDN'T DO WAS GO DOWN
FROM DRIP LINE TO DRIP LINE.
IF YOU LOOK AGAIN, IT WAS A
NARROWER EXPANSION THAT GOT
INTO THE 400,000 SQUARE FEET.
WHAT WE ARE DOING IS BUILDING A
SOLID BACK OF HOUSE GOING DOWN
FROM DRIP LINE TO DRIP LINE,
AND REALLY INCREASING AGAIN THE
SQUARE FOOTAGE OF THE BUILDING,
ALMOST DOUBLING IT, WHICH MEANS
FROM A FAN EXPERIENCE
STANDPOINT, ALL OF THE
FACILITIES WE NEED WILL BE
THERE.
FROM APPROACHING THE BUILDING,
I THINK THIS IS REALLY
IMPORTANT, IT WILL BE VERY
APPROACHABLE BECAUSE YOU WILL
BE COMING OUT OF THE PLAZA
LEVEL.
ONCE YOU'RE IN, YOU LOOK TO GO
DOWN, SO IT WILL BE VERY
INTIMATE.
WITHOUT A DOUBT, IT WILL BE ONE
OF THE BEST IN THE COUNTRY, BUT
BEFORE WE BUILD THIS BRAND-NEW
ARENA UNDER THE ICONIC ROOF, WE
HAVE SOME WORK TO DO, AND WE
ARE IN THE PROCESS OF DOING
THAT RIGHT NOW.
WE ARE CURRENTLY DOING THE
DEMOLITION OF THE BUILDING.
AGAIN, ALL OF THAT WILL GO
AWAY, AND WE WILL GO DOWN
ANOTHER 15 FEET TO HAUL AT
ABOUT 1500 CUBIC FEET OF DIRT,
BUT THIS IS AN INTERESTING
PHASE.
PEOPLE ARE HARD AT WORK ON THE
SITE.
WE HAVE 120 PEOPLE ON SITE
WORKING ON THE DEMO LOOKING TO
THE SOUTH SHOWING SOME OF THE
BUILDINGS REMOVED ALREADY.
IT'S PEAK WILL PROBABLY HAVE
úOVER 1000 PEOPLE WORKING ON TH
SITE.
THIS IS ANOTHER GREAT FEATURE.
I THINK YOU KNOW BEYOND THE
ICONIC ROOF, WE ARE TAKING ALL
OF THE GLASS OUT OF THE
BUILDING.
WE ARE CATEGORIZING IT, HAULING
IT DOWN TO A WAREHOUSE IN KENT,
AND WE WILL BRING IT BACK TO
INSTALL IT AS PART OF THE
LANDMARK STATUS OF THE
BUILDING.
AGAIN, FROM PEOPLE LIKE ME WHO
WALKED INTO THAT BUILDING WHEN
THEY WERE 10 YEARS OLD, IT WILL
FEEL A LOT LIKE THAT UNTIL YOU
GET INSIDE.
THEN IT'S TIME TO ROCK 'N ROLL,
SO TO SPEAK.
THIS GIVES YOU A SENSE OF HOW
FANTASTIC THE BOWL WILL LOOK.
ON THE PLAZA LEVEL, AND ONE
LAST FEATURE I DID WANT TO TALK
ABOUT IS THE BACK OF HOUSE.
WE WILL BE BRINGING IN A TUNNEL
FROM A BLOCK SOUTH OF US THAT
WILL GO UNDERGROUND TO EIGHT
LOADING DOCKS RATHER THAN THE
TWO THAT ARE THERE RIGHT NOW.
THIS ALLOWS THE BUILDING TO BE
APPROACHABLE FROM 360 DEGREES,
AND WE ARE VERY PROUD OF THAT.
>> THE REASON WE ARE DOING ALL
OF THAT IS TO CREATE WORLD-
CLASS EVENTS FOR OUR CITY, AND
CREATE WE HAVE TALKED A LOT
ABOUT THE NHL AND THE NBA, BUT
WE HAVE WORLD LIVE NATION, AND
THEY LOVE WHAT WE'RE DOING HERE
ACOUSTICALLY TO CREATE A BACK-
UP HOUSE THAT WILL BE PERFECT
FOR THE ARTIST.
WE ARE AS EXCITED ABOUT THAT AS
WE OR ANY OTHER PART OF THIS
PROJECT, AND HOW GREAT THIS IS
GOING TO BE FOR MUSIC.
BECAUSE OF OUR DEEP HERITAGE IN
MUSIC, WE DESERVE NOTHING LESS.
IT WILL BE SPECTACULAR FOR
BASKETBALL.
WE HAVE STUDIED THE SIDELINES.
THERE IS FOUR BASKETBALL ARENAS
IN THE NBA.
OUR SIDELINES ARE BETTER THAN
TWO OF THE FOUR.
THIS IS A RENDERING OF THE
STORM.
WE ARE SO PROUD OF OUR
PARTNERSHIP WITH THE STORM.
WE THINK THIS IS GOING TO BE A
DEFINING MOMENT NOT JUST FOR
THE STORM BUT THE WNBA.
THIS WILL INTRODUCE TO THEM ALL
SORTS OF NEW OPPORTUNITIES TO
SERVE THEIR CUSTOMERS, SERVE
THEIR FANS ANY WORLD-CLASS
ARENA, AND WE COULDN'T BE MORE
PROUD.
WE ARE HOPING THAT THEIR
CHAMPIONSHIP WAYS WILL RUB OFF
ON OUR TEAM.
IT WILL BE COMING TO THE
BUILDING SOON, BUT I DO WANT TO
SAY WE ARE FULLY COMMITTED TO
THE NBA PLAYING IN THIS
BUILDING.
WE THINK IT WILL BE PERFECT.
WE THINK IF THIS BUILDING HAD
BEEN AROUND IN 2008, THE SONICS
WOULD NOT HAVE LEFT.
WE BUILT AN ECONOMIC MODEL.
WE BUILT SIDELINES.
WE BUILT LOCKER ROOMS.
THIS'LL BE A GREAT HOME FOR THE
NBA.
>> COUNCILMEMBER O'BRIEN.
>> DID YOU SAY THERE IS ONLY
FOUR?
>> DEDICATED, SINGLE NBA IS THE
SOLE TENANT, SO BUT ONE OF THE
REASONS THE SIDELINES ARE SO
FANTASTIC IN THIS BOWL, AND
THIS WILL WAS REALLY DEVELOPED
OUT OF PRINCIPLE, WE ONLY PUT
IN ONE RING OF SWEETS.
THERE WAS TEMPTATION
FINANCIALLY TO PUT IN A SECOND
RING OF SUITES, BUT IT WOULD
HAVE DRAMATICALLY CHANGED A KEY
SIGNATURE OF THIS BUILDING.
IT WILL BE ONE OF THE MOST
BEAUTIFUL IN THE WORLD ON THE
OUTSIDE BUT THE INTERIOR WILL
BE ABSOLUTELY MAGICAL.
IT WILL BE STEEP AND IT WILL
REMIND PEOPLE OF THE GREAT
BUILDINGS THAT EXISTED IN THE
DAY.
YOU CAN SEE THE STEEP SIDELINES
HERE FOR A STORM GAME.
WE ARE ALSO GOING TO HOST A
HOCKEY TEAM, AND THIS IS
SHOWING THE SIDELINES OF THAT
STEEP BOWL.
YOU CAN SEE, IF YOU DO HAVE
VERTIGO, WE SUGGEST NOT THE
UPPER DECK, BUT THERE IS A
BEAUTIFUL GLASS WINDOW ON THE
NORTH END WHERE PEOPLE WILL
ACTUALLY BE ABLE TO LOOK IN AND
VIEW WHAT IS HAPPENING.
AS WE HAVE STARTED TO GET
BETTER RENDERINGS, AND MORE
LITERATE IN THE RENDERINGS, WE
ARE REALIZING JUST HOW
SPECTACULAR THIS BOWL IS GOING
TO BE.
FOR THE FANS WHO SIGNED UP FOR
TICKETS, THEY WEREN'T YET AWARE
OF THIS, SO WE ARE SO PROUD OF
HOW THIS IS UNVEILING.
LET ME BACK UP ONE MORE TIME.
WE ARE GOING TO INNOVATE
ACOUSTICS, AND OTHER THINGS.
ONE OF THE INNOVATIONS IS TWO
SCOREBOARDS.
ONE OVER EACH BASKET, ONE OVER
EACH GOAL.
WE THINK THAT MAKES MORE SENSE
THAN THE BIG, LONG, DATED
SCOREBOARDS, WHICH TEND TO
BIFURCATE ARENAS.
YOU'RE COMING TO BE PART OF
YOUR NEIGHBORS AND YOUR
FRIENDS.
WE FELT THOSE BIG SCOREBOARDS
DIMINISHED THAT, SO THUS THE
FIRST ARENA IN THE WORLD TO
HAVE TWO DEDICATED SCOREBOARDS.
. TO OUR HOCKEY, THE FANS
SPOKE.
MARCH 1, A YEAR AGO, 32,000
PEOPLE DEPOSITED TO STEP UP AND
GIVE LIFE TO OUR FRANCHISE.
WE HAD TO CONVINCE THE NHL WE
WERE READY, AND THAT SURE
HELPED.
JERRY BURKHEIMER IS HERE.
DO YOU WANT TO SHARE A FEW
WORDS?
>> I'M SO EXCITED ABOUT FIRST
OF ALL THE CITY, AND THE
ENTHUSIASM WE'VE GOTTEN FROM
THE FANS, AND THE PEOPLE, AND
JUST WITH TIM AND TODD DOING
THIS, FIRST OF ALL, TODD WAS
INSTRUMENTAL FOR THE SEAHAWKS,
AND HELPFUL WITH THE SOUNDERS,
SO I THINK THAT IS EXCITING FOR
US, BUT ALSO, TIM HAS BUILT
SOME OF THE GREAT FRANCHISES.
HE BROUGHT TWO STANLEY CUPS TO
LOS ANGELES, TO THE KINGS.
I KNOW HE WILL BE PART OF
CHOOSING OUR MANAGEMENT GROUP
FOR THE HOCKEY TEAM, AND I KNOW,
WITH HIS GREAT LEADERSHIP, WE
WILL GET AN NBA TEAM HERE, ALSO.
THAT'S AN EXCITING PART OF THE
PROJECT FOR ALL OF US, TO BRING
A TEAM BACK HERE.
>> OTHER GREAT THINGS HAVE
HAPPENED, SO SEATTLE DID NOT
HAVE ONE SHEET OF ICE.
THIS BEAUTIFUL CITY OF OURS.
THAT WAS RECREATIONAL ICE.
IT WAS PEOPLE WHO WANTED TO
CURL, YOUNG BOYS AND GIRLS
DREAMING OF'S
SKATING IN THE OLYMPICS, BUT WE
DIDN'T HAVE THE FACILITY.
THIS'LL BE THE CENTERPIECE OF
NORTHGATE MALL, AND WE HAVE A
BRIEF VIDEO WE WOULD LIKE TO
SHOW IF WE CAN QUEUE IT UP.
IS IT GOING TO WORK?
>> SEATTLE, A CITY THAT IS
WORLD-CLASS AND FORWARD
THINKING.
THE CITY WITH A DEEP CONNECTION
TO THE OUTDOORS.
IT IS FITTING THAT IT SHOULD
HAVE A STATE-OF-THE-ART NHL
CENTER REPRESENTATIVE OF ITS
COMMUNITY.
BUILT WITHIN CITY LIMITS, THIS
NEW TRAINING FACILITY WILL BE
SETTLE'S FIRST HOME ICE IN
DECADES.
THREE NHL REGULATION ICE RINK'S
WITH SPECTATOR VIEW WILL OFFER
THE OPPORTUNITY TO SERVE AS A
GATHERING SPACE FOR OUR ICE
SPORTS COMMUNITY.
IT WILL EMBRACE THE NATURAL
LIGHT, AND IMMERSE THE PUBLIC
INTO THE EXPERIENCE OF HOCKEY
WHILE INTEGRATING PACIFIC
NORTHWEST INSPIRED ARCHITECTURE.
A BEST IN CLASS NHL TRAINING
AREA WILL ENSURE TOP TALENT IS
RECRUITED AND RETAINED.
THIS FACILITY WILL INSPIRE TO
ATTRACT THE SPIRIT OF HOCKEY
FOR GENERATIONS TO COME.
THIS FACILITY IS YOURS, SEATTLE.
>> THAT'S UNDER CONSTRUCTION.
WE ARE HOPING TO BREAK GROUND
NEXT JANUARY.
>> JUST FOR THE RECORD, THERE
IS A SHEET OF ICE IN SEATTLE
WITH THE GRANITE CURLING CLUB.
>> THANK YOU.
I AM IN A CURLER.
>> IT'S A LITTLE DIFFERENT
PERSPECTIVE, BUT IT'S GREAT.
IT'S FUN TO HANG OUT AT.
I'M SURE THEY WILL WELCOME
ADDITIONAL CURLING FACILITIES
IN THE CITY.
>> NO OTHER QUESTIONS?
WE WILL MOVE ON TO THE NEXT
AGENDA ITEM.
>> WITH THIS KIND OF
CONSTRUCTION, THERE IS ALWAYS
EITHER UNFORESEEN SURPRISES, OR
SOMETIMES POSITIVE SURPRISES,
AND THUS FAR IN THE
CONSTRUCTION, IS IT GOING
SMOOTHLY, OR HAS THERE BEEN ANY
ON THE AND ANTICIPATED
SURPRISES?
>> WE WORKED REALLY HARD TO
UNDERSTAND THIS SITE, SO SO
FAR, IT'S REALLY PROGRESSING AS
WE WANT.
I WOULD BE EXAGGERATING IF I
DIDN'T SAY HOLDING THAT ROOF UP
WHILE WE ARE BUILDING THE
BUILDING WILL HAVE US
CHALLENGED, BUT WE HAVE A
REALLY SMART GROUP OF
STRUCTURAL ENGINEERS.
I FEEL REALLY GOOD ABOUT WHERE
WE ARE.
>> CERTAINLY, THE PRICE TAG IS
GREATER THAN WE THOUGHT, BUT I
AM SO GLAD OUR OWNERS HAVE NOT
CUT EVEN ONE QUARTER.
I THINK IT WILL BE BETTER THAN
WE EVER IMAGINED.
>> ANY OTHER QUESTIONS FOR OUR
COLLEAGUES?
COUNCILMEMBER O'BRIEN?
>> REALLY QUICK.
YOU SHOWED THE GLASS VIEWING.
IS THAT FROM THE OUTSIDE?
>> YES.
>> SO I AM GUESSING YOU CAN'T
ACTUALLY WATCH THE EVENT BUT
YOU WILL BE ABLE TO SEE THE
SPIRIT OF THE EVENT?
>> YOU CAN SEE THE BASE FOR.
YOU CAN SEE PEOPLE CHEERING.
AT CERTAIN CONCERTS, YOU CAN
CURTAIN IT OFF, BUT IT IS A
NEAT FEATURE.
WE DID THAT AT SAFECO FIELD OR
T-MOBILE PARK, I'M SORRY, WHERE
YOU CAN GO DOWN ALONG AND LOOK
INTO THE BUILDING.
>> IF WE ARE DOWN BY FOUR,
THAT'S WHERE I MIGHT GO AND SEE
IF THE CROWD IS CHEERING.
>> NOT A BAD SECOND PLACE TO BE.
>> EXCELLENT.
>> THANK YOU.
>> THANK YOU VERY MUCH.
BUT YOU BET.
>> THE SECOND ITEM ON THE
AGENDA IS THE FINANCIAL DUE
DILIGENCE PIECE.
I AM TOLD I AM SUPPOSED TO
ESCAPE.
SECOND ITEM.
HERE WE GO.
SO, ON AUDIO, AND HOPEFULLY ON
VIDEO HERE IN A MOMENT AFTER I
GET THROUGH, JUST THE SLIDE
WHICH IS ONLY JUST ONE SLIDE
HERE, I WOULD LIKE TO INTRODUCE
DAVID ABRAMS WITH INNER CIRCLE
SPORTS, AND A QUICK REMINDER,
MISTER ABRAMS WAS OBTAINED
THROUGH OUR CITY ATTORNEY'S
OFFICE TO PROVIDE FINANCIAL DUE
DILIGENCE OF THE MEMORANDUM OF
UNDERSTANDING BETWEEN THE CITY
AND THE OAK VIEW GROUP.
AS YOU WILL RECALL, WHEN THE
OAK VIEW GROUP FIRST SUBMITTED
ITS RESPONSE TO REQUEST FOR
PROPOSAL OVER TWO YEARS AGO,
THE COST OF THAT PROJECT WAS
APPROXIMATELY $600 MILLION, AND
BY THE TIME THE CITY EXECUTED
THE DEVELOPMENT AGREEMENT LAST
SEPTEMBER, THAT COST HAD RISEN
TO $700 MILLION.
THIS PAST MARCH, WE LEARNED
THAT THE COST IS NOW BETWEEN
$900 MILLION AND $930 MILLION.
WE HAVE BEEN HEARING SOME
INFORMATION THROUGH THE MEDIA
THAT THE COSTS ARE CONTINUING TO
RISE, AND THERE HASN'T BEEN
MUCH TALK ABOUT WHO IS PAYING
FOR THAT.
AS WE HAVE BEEN CONSISTENTLY
MESSENGERING THROUGHOUT THE
PAST TWO YEARS, THE COST OF
THIS ARENA IS SOLELY THE
RESPONSIBILITY OF THE
DEVELOPER.
IT IS PRIVATELY FINANCED.
I JUST WANT TO MAKE SURE I AM
EMPHASIZIG THAT POINT HERE.
MISTER ABRAMS WILL BE PROVIDING
HIS ASSESSMENT, MORE
SPECIFICALLY HE IS GOING TO
TALK ABOUT THE MEMORANDUM OF
UNDERSTANDING, AND HOW THAT
WORK HAS LED TO HIS BEING ABLE
TO ANSWER QUESTIONS SUCH AS
DOES THE ARENA HAVE ENOUGH
FUNDS TO COMPLETE THIS PROJECT?
IS THE CITY PROTECTED IF THE
PROJECT COSTS GO UP AGAIN?
PAST THE 930 MARK.
AND, DOES THE GENERAL
CONTRACTOR HAVE THE ABILITY TO
COMPLETE THIS PROJECT AND ONCE
THE ARENA IS OPERATING, WILL
THE DEBT SERVICE BE SERVICED?
I WOULD LIKE TO PUT MISTER
ABRAMS UP ON THE SCREEN.
>> I AM RIGHT HERE.
HOW ARE YOU?
>> GOOD.
INC.
YOU, DAVID.
GO AHEAD, IF YOU'D LIKE.
MAKE ANY INTRODUCTORY COMMENTS
IF YOU'D LIKE.
>> IT'S NICE TO SEE YOU,
COUNCIL MEMBERS.
YOU SAID SOMEWHERE AROUND 20
MONTHS AGO, I STARTED WORKING
WITH THE CITY ON SEVERAL
TOPICS.
THE INITIAL ENGAGEMENT WITH THE
CITY BETWEEN THE CITY OF
SEATTLE AND INNER CIRCLE SPORTS
WAS TO REVIEW THE MEMORANDUM OF
UNDERSTANDING BETWEEN THE CITY
AND OAK VIEW GROUP TO DETERMINE
WHETHER THERE WAS A TRANSACTION
THAT COULD BE ACCOMPLISHED, AND
UNDER THE GUIDELINES THAT WERE
ASKED OF US DURING THE
NEGOTIATION PROCESS.
I DID THAT IN THE FIRST FEW
MONTHS OF MY WORKING WITH THE
CITY ON THE SUMMER BEFORE LAST.
ONCE THE CITY ENTERED INTO ITS
MEMORANDUM OF UNDERSTANDING
WITH OAK VIEW GROUP, INNER
CIRCLE SPORTS WORKED WITH CITY
STAFF TO NEGOTIATE ALONG WITH A
LEGAL TEAM AND YOUR OUTSIDE
LEGAL COUNCIL, AND OTHER
CONSULTANTS RELEASE AND
DEVELOPMENT AGREEMENT BETWEEN
THE CITY OF SEATTLE, OR SEATTLE
ARENA COMPANY LLC, WHICH IS THE
DEVELOPER THAT IS UNDER THE
UMBRELLA OF OAK VIEW GROUP, SO
WE HAVE SPENT QUITE A BIT OF
TIME DISCUSSING ISSUES RELATED
TO FINANCIAL SUFFICIENCY, AND
THEIR ABILITY TO OBTAIN THE
APPROPRIATE CAPITAL, AND THE
ABILITY TO FINISH THE PROJECT,
AS WELL AS LOOK AT THE
FINANCIAL MODELS, AND COME UP
WITH A ALGORITHM OR FINANCIAL
METHODOLOGY THAT WOULD BOTH
GIVE COMFORT TO THE CITY, AND
REPAY THE CITY FOR INCOME BUT
IT WAS ALREADY RECEIVING FROM
SEATTLE CENTER, AND I SEE BEEN
THERE, SO I ASSUME HE CAN SPEAK
TO THAT IF NEED BE.
THAT WAS THE SECOND LEG OF OUR
DUE DILIGENCE.
THE THIRD AND PROBABLY MOST
COMPLEX LEG OF THE DUE
DILIGENCE, ONCE WE AGREED TO
DEVELOPMENT, WAS TO REVIEW ARENA
CO.'S SECTION OF THE
DEVELOPMENT AGREEMENT.
AS PART OF THE EXISTING ARENA,
AND CONSTRUCTION OF THE NEW
ARENA, AS WELL AS ADDITIONAL
DUE DILIGENCE RELATED TO THE
CLOSING ON THE ARENA CO.'S
FINANCING.
I THINK THE MOST PIVOTAL ISSUE
FROM THE CITY PERSPECTIVE AND
OUR PERSPECTIVE WORKING WITH
THE CITY IS DID ARENA CO.
HAVE BOTH EQUITY CAPITAL AND
DEBT CAPITAL TO COMPLETE THE
PROJECT?
AS YOU WERE TOLD A FEW MOMENTS
AGO, THE PROJECT HAS INCREASED
IN BOTH SCOPE AND COST, SO THIS
WAS A BIT OF A MOVING TARGET
FROM TIME TO TIME, TO DETERMINE
WHETHER THERE WAS THE ABILITY
TO BOTH BORROW AND PUT ENOUGH
EQUITY INTO THE PROJECT TO MAKE
SURE IT WAS COMPLETE.
PROTECTING THE CITY'S INTEREST
ON A NUMBER OF LEVELS,
INCLUDING MAKING SURE THE
PROJECT WAS GOING TO BE
COMPLETE, MAKING SURE THE
PROJECT WAS GOING TO BE BUILT
TO THE SPECIFICATIONS THAT THE
CITY AGREED TO, AND LASTLY, TO
MAKE SURE THAT THE OPERATING
CAPABILITY OF ARENA CO.
WAS SUCH THAT THEY WOULD HAVE A
SUSTAINABLE BUSINESS MODEL AND
COULD PAY THEIR DEBT SERVICE,
AS WELL AS PAY THE CITY FOR
THEIR OBLIGATIONS.
WITH THAT, I WILL SORT OF STEP
BACK AND LET YOU ASK QUESTIONS,
OR IF YOU'D LIKE TO HEAR MORE
ABOUT SPECIFIC ISSUES, I AM
HAPPY TO DO THAT.
>> THANK YOU, DAVID.
>> YOU'RE WELCOME.
>> FIRST OF ALL, NICE ARTWORK
IN THE BACK OF YOU.
>> I THINK THERE IS A HOCKEY
ONE BEHIND ME.
>> HOW HAS THE -- FIRST OF ALL,
THANKS FOR THE DILIGENCE AND
THANKS FOR PROTECTING OUR
INTEREST TO PROTECT THE
PUBLIC'S INTEREST.
HOW HAS THE RELATIONSHIP IN
TERMS OF GETTING FINANCIAL
INFORMATION, DO YOU FEEL AS
THOUGH YOU ARE ESTABLISHING A
CLIENT RELATIONSHIP THAT THE
FINANCIAL INFORMATION IS WORTH
COMING, YOU ARE ABLE TO
ADEQUATELY DO YOUR JOB, OR HAS
IT BEEN SOMEWHAT LESS THAN
IDEAL?
>> I BELIEVE YES.
THE ANSWER IS YES.
I WAS PUT INTO A SITUATION, NOT
A SITUATION, BUT PUT INTO THE
ABILITY TO REVIEW CERTAIN
CONFIDENTIAL MATERIALS OF THE
DEVELOPER.
AND ALSO THEIR LENDER,
CONSTRUCTION MANAGEMENT COMPANY,
WHICH WERE NOT IN THE PUBLIC
DOMAIN, AND I SPENT A FAIR
AMOUNT OF TIME REVIEWING A
NUMBER OF DOCUMENTS ON THE
CITY'S BEHALF ALONG WITH THE
CITY'S EXTERNAL LEGAL TEAM AND
REPORTED BACK TO THE CITY MY
FINDINGS.
I FOUND THAT OVG, BUT AGAIN
THEY WERE GOING THROUGH QUITE A
BIT OF CHANGE IN THE PROJECT
SCOPE AND PROJECT SIZE, BUT
THEY WERE WILLING TO PROVIDE
THE INFORMATION TO US.
IT WASN'T ALWAYS THE SIMPLEST.
SOMETIMES, WE HAD TO GO TO
THEIR LAWYER'S OFFICES OR THEIR
OFFICES IN NEW YORK CITY TO
REVIEW DOCUMENTS, YOU KNOW IS
UGLY IN FRONT OF US.
WE COULDN'T TAKE THEM WITH US.
FROM THAT PERSPECTIVE, IT WAS A
BIT CUMBERSOME, BUT I BELIEVE
EVERYTHING I NEEDED TO DO MY
JOB WAS MADE AVAILABLE TO ME,
AND I WAS NOT ONLY ABLE TO
REVIEW ON NUMEROUS OCCASIONS
WHEN CHANGES WERE MADE TO THE
PROJECT, BUT I WAS INVITED BACK
INTO REVIEW SPECIFIC DOCUMENTS
AND HAD THE ABILITY TO ASK
QUESTIONS OF THE DEVELOPER, OF
THEIR LAWYERS, THEIR PARTNERS,
INCLUDING MISTER BONDERMAN'S
TEAM ABOUT THE HOCKEY
FRANCHISE, AS WELL AS THE
LEAGUE, AND THE CONSTRUCTION
MANAGEMENT FIRM, SO I FEEL I HAD
ALL OF THE TOOLS AT MY DISPOSAL
TO GIVE GOOD ADVICE TO THE
CITY.
>> THANK YOU, DAVID.
I ASSUME YOU ARE FINISHED WITH
YOUR REMARKS.
>> I AM.
I'M OPEN TO QUESTIONS.
>> ANY QUESTIONS FROM MY
COLLEAGUES FOR THE GOOD OF THE
ORDER?
>> I WOULD JUST LIKE TO
CONCLUDE BY SAYING SIMPLY THAT
MISTER ABRAMS HAS DEEMED THAT
ARENA CO.
HAS ENOUGH FUNDS TO COMPLETE
THE PROJECT, AND THAT IF THE
CITY -- IF THE COSTS WERE TO GO
UP, THAT THE CITY WILL BE
PROTECTED, CORRECT?
AND THAT THE GENERAL CONTRACTOR
WILL HAVE THE ABILITY TO
COMPLETE THIS PROJECT.
>> THAT IS CORRECT.
>> ONCE THE ARENA IS OPERATING,
ARENA CO.
WILL BE ABLE TO FUND ITS DEBT
SERVICE.
ALL IS IN PLACE.
GREENLIGHT.
>> THOSE WERE ELEMENTS OF THE
10.1 CONDITIONS.
ACTUALLY, FOR THE CITY TO CLOSE
WITH ARENA CO.
AND FOR ARENA CO.
TO CLOSE WITH THEIR LENDERS, WE
WERE IN AGREEMENT WITH ALL OF
THIS POINTS YOU BROUGHT UP.
>> COUNCILMEMBER HERBOLD.
>> THIS MIGHT FALL OUTSIDE OF
THE SCOPE OF THE DUE DILIGENCE
REVIEW, BUT I AM INTERESTED TO
KNOW WHETHER OR NOT WITHIN THAT
DUE DILIGENCE REVIEW FOR THE
DELIVERY OF THE ARENA PROJECT,
WHETHER THERE IS CONSIDERATION
ABOUT HOW INCREASED COSTS
ASSOCIATED WITH THAT PROJECT
IMPACTS THE NORTHGATE PROJECT
AT ALL.
>> I HAVEN'T.
I THINK THEY ARE TWO SEPARATE
PROJECTS.
BUT WHETHER OR NOT -- DAVID, I
THINK SOME OF THE LENDERS AND
DEVELOPERS, AND INVESTORS, MAY
HAVE THEIR HANDS IN BOTH
PROJECTS.
COULD YOU ALLEN SIR ANSWER THE
QUESTION?
>> I WAS NOT RELATED TO THOSE
DISCUSSIONS, SO I COULDN'T OPINE
AS TO WHETHER THE OVERLAPPING
INCREASING COST WOULD IMPACT
THE OTHER.
>> WE WILL DO A LITTLE WORK OFF-
LINE TO FIGURE OUT THAT ISSUE.
THANKS FOR BRINGING THAT ISSUE
UP.
I WILL MAKE A CLOSING REMARK.
COUNCILMEMBER O'BRIEN.
>> I JUST WANT TO REITERATE,
AND I DON'T KNOW, IF YOU ARE
COMFORTABLE COMMENTING HERE AT
ALL, BUT ALSO, BUT I APPRECIATE
ALL OF THE WORK UPFRONT AND
ONGOING ON THIS.
THIS IS THE MOMENT FOR I FEEL
LIKE WE ARE MOST EXPOSED.
WE HAVE STOPPED OPERATIONS OF
THE EXISTING ARENA. IN A COUPLE
OF YEARS WHEN THAT'S COMPLETE,
AND UP AND RUNNING, IF FOR SOME
REASON THIS OWNERSHIP GROUP
DECIDED TO WALK AWAY FROM IT,
WHICH WOULDN'T MAKE ANY SENSE,
WE WOULD HAVE SOMETHING
OPERATING THAT WE COULD EITHER
CHOOSE TO OPERATE OURSELVES OR
EASILY FIND SOMEONE TO COME IN,
BUT AT THIS MOMENT, YOU SEE THE
EXCITING PHOTOS OF SOMETHING
PARTLY TORRENT DOWN.
I THINK THAT IS WHERE WE ARE
MOSTLY EXPOSED.
I WANT TO BE CLEAR I HAVE THE
MOST CONFIDENCE THAT WE ARE
GOOD, GOING FORWARD, BUT I JUST
WANT TO CHECK TO SEE FROM THE
BUDGET OFFICE, CONFIDENT
INTERNALLY THAT WE CAN DO THIS
PROJECT.
NOTHING I'VE HEARD TO DATE
IMPLIES THAT THEY WOULD WALK
AWAY FROM THE PROJECT OTHER
THAN THE COSTS GOING UP AS ONE
MIGHT EXPECT ON A PROJECT THIS
BIG.
BUT THE SECURITY SEEMS THERE.
>> THAT'S PRECISELY WHY WE
SECURED THE SERVICES OF MISTER
ABRAMS, TO DO THAT DUE
DILIGENCE WHERE HE CAN SEE INTO
THEIR FINANCES AND REPORT BACK
ON THIS VERY ISSUE.
THE WAY I HAVE DESCRIBED THIS
úTO GIVE PEOPLE A SENSE OF THIS
IS WE HAVE BEEN CONNECTING TO
SOMEONE'S OWN HOUSE.
WE HAVE BEEN BUDGETING SOMEONE
TO COME INTO THEIR OWN HOUSE.
THEY PROMISE THEY WILL HAVE THE
RESOURCES TO REBUILD IT, BUT
YOU WANT TO BE SURE THEY DO
BEFORE THEY TEAR IT DOWN, WHICH
IS WHAT WE'VE DONE.
OBVIOUSLY, THE SCALE OF THIS IS
REALLY INCREDIBLE.
IT'S A BIG HOUSE.
PERHAPS, THE BIG HOUSE.
IN ANY CASE, WE SECURED
EXPERTISE TO REVIEW THAT
PRECISE ISSUE, TO TAKE A LOOK
AT THE EQUITY, AND THE
FINANCING, AND THE FLEXIBILITY,
SO WE DO HAVE THAT PRECISE
CONFIDENCE.
>> COUNCILMEMBER CARR THERE IS
PROBABLY THREE HOLD YOUR BREATH
MOMENTS IN THIS ONE.
ONE IS CAN THEY DO WHAT THEY
SAY THEY WERE GOING TO DO?
SO, THE MOMENT THAT THEY AGREED
TO GET THEIR CAPITAL IN PLACE
TO BE ABLE TO FINISH THE
PROJECT, THAT WAS ONE.
THE SECOND ONE WAS ALLOWING
THEM TO DRAW ON THEIR LINES OF
CREDIT, OR THEIR LOANS FROM
THEIR LENDERS UNTIL THEY HAD
ACCESS TO CAPITAL.
I THINK WE WERE HOLDING OUR
BREATH A LITTLE BIT.
I SAY THAT SOMEWHAT FISHY SISLEY
FACETIOUSLY, BUT WE FELT THE
CONTROLS WERE IN PLACE, THE
CONTINGENCIES WERE IN PLACE,
THE COLLATERAL PUT IN PLACE FOR
THE CITY IN THE EVENT THAT
THERE IS AN ISSUE.
WE ARE SUFFICIENT TO HANDLE ANY
COST OVERRUNS FROM WHERE WE
START TODAY, AND THEN THE LAST
HOLD YOUR BREATH MOMENT IS WHEN
THEY OPEN.
WE ARE ALL GOING TO BE LOOKING
WITH GREAT INTEREST OVER THE
NEXT TWO YEARS DURING THE
CONSTRUCTION PROCESS, AND THE
CITY WILL HAVE OPEN ACCESS TO
INFORMATION ALONG THE WAY TO
MAKE SURE THAT ANY ISSUES THAT
ARISE WILL BE FRONT AND CENTER
BEFORE CITY STAFF.
>> THANK YOU, DAVID.
COUNCILMEMBER GONZALEZ?
>> THANK YOU.
I JUST WANTED TO TAKE A MOMENT
TO THANK EVERYBODY WHO HAS BEEN
WORKING ON THIS PROJECT, BUT
ALSO TO ACKNOWLEDGE THAT AS A
CITY COUNCIL, OF COURSE ONE OF
THE CORE FUNCTIONS THAT WE HAVE
IS TO EXERCISE OVERSIGHT
FUNCTION, PARTICULARLY OF VERY
SPECIFIC CAPITAL PROJECTS OF
WHICH THIS IS ONE, AND I
APPRECIATED DIRECTOR ERSTAD'S
DIRECT QUESTIONING TO MISTER
ABRAMS.
THESE ARE THE THINGS THAT
YOU'RE SUPPOSED TO ANSWER FOR
US.
YOU ARE ANSWERING THESE IN THE
AFFIRMATIVE, SO NOW WE HAVE A
GREENLIGHT.
I WANT TO ACKNOWLEDGE THAT I
HEARD FROM MISTER ABRAMS THAT
HE HAS ACCESS TO CONFIDENTIAL
INFORMATION THAT IS NOT
PUBLICLY AVAILABLE, AND I THINK
IT IS IMPORTANT FOR US AS PART
OF OUR WORK AROUND TRANSPARENCY
TO ALSO ACKNOWLEDGE THAT
INFORMATION IS NOT AVAILABLE TO
US EITHER, AND TO THE ROYAL WE
OF THE CITY OF SEATTLE FAMILY,
AND MISTER ABRAMS IS OUR HIRED
SUBJECT MATTER EXPERT, AND HE IS
-- YOU KNOW, HE HAS JUST HIS
OWN SET OF EYEBALLS ON THIS
CONFIDENTIAL INFORMATION.
I JUST WANT TO ACKNOWLEDGE THAT
IT'S AN INTERESTING SITUATION
FOR US TO BE IN AS A COUNCIL
WHO HAS ULTIMATE AUTHORITY
AROUND OVERSIGHT, AND IT
REQUIRES US TO GIVE MISTER
ABRAMS A SIGNIFICANT AMOUNT OF
TRUST AND CONFIDENCE IN HIS
SKILL SET, AND HIS ABILITY, AND
IN HIS INDEPENDENCE TO PROVIDE
US WITH THE INFORMATION THAT WE
NEED THAT TENDS TO BE
CONCLUSORY IN NATURE AS OPPOSED
TO A FORMULA.
I HAVE A LITTLE BIT OF
DISCOMFORT WITH THAT, BUT I
ACKNOWLEDGE IT APPEARS TO BE
INHERENT IN THESE TYPES OF
TRANSACTIONS.
BUT JUST FOR THE RECORD, I WANT
TO MAKE SURE THAT I EXPRESSED
THAT LITTLE BIT OF ANXIETY, AND
ALSO SORT OF THAT TENSION THAT
EXISTS IN TERMS OF OUR
OVERSIGHT.
AND WHAT FEELS LIKE A PRETTY
SIGNIFICANT DELEGATION TO
MISTER ABRAMS IN THAT ROLE.
>> THANKS FOR THOSE COMMENTS.
APPRECIATE THOSE COMMENTS.
IT'S A PRETTY GOOD SEGUE TO GO
INTO THE STORM LEASE
MODIFICATION.
I DID SORT OF JUST WANT TO SAY
THAT FOR AGAIN MISTER
BURKHEIMER TO BE HERE, THANK
YOU VERY MUCH.
HE HAS A A FEW MORE HOLD YOUR
BREATH MOMENTS.
I AM SURE YOU'RE HAPPY WE ARE
SO CONCERNED ABOUT YOUR OUR
ALLY ON THE SITUATION.
THERE IS SERIOUS CAPITAL AT
STAKE HERE.
THE STRUCTURE WE TRIED TO SET UP
WITH COUNCILMEMBER GONZALEZ IS
I THINK THE BEST MODEL TO WHERE
WE'VE HEARD THE PUBLIC INTEREST.
AGAIN, THUS FAR, THEY HAVE DONE
EVERYTHING THEY HAVE COMMITTED
TO DO, AND I AM VERY PLEASED
WITH HOW THIS IS UNROLLING.
THE OWNERSHIP GROUP HAVE MADE
THEMSELVES VERY ACCESSIBLE.
TO ME, IT'S ABOUT ACCESS AND
GETTING GOOD INFORMATION.
THANK YOU, DAVID.
IF ANY OF YOU NEED DAVID OFF-
LINE, HE CONTINUES TO BE
REACHABLE.
>> YOU CAN REACH HIM THROUGH ME
AND THE LAW DEPARTMENT SAYS HIS
CONTRACT IS THROUGH THE CITY
ATTORNEY.
>> AND I AM HAPPY TO ANSWER
QUESTIONS.
JUST TO MAKE SURE EVERYONE
UNDERSTANDS NOTHING WAS DONE IN
THE BLIND, AND CITY STAFF WAS
APPRISED OF EVERY DECISION OR
EVERY BIT OF INFORMATION THAT I
HAD, AND SO THE LEGAL TEAM OF
EXTERNAL AND INTERNAL CITY
STAFF WERE ALL KEPT IN THE LOOP
ON ALL MATTERS, AND SO, WHILE I
RELAY MY INDUSTRY KNOWLEDGE AND
EXPERIENCE DECISIONS WERE MADE
IN A JOINT MANNER, NOT
SINGULARLY.
ALWAYS IN THE BEST INTERESTS OF
THE CITY WITH NO CONFLICTS, AND
ALWAYS MAKING SURE WE UPHELD TO
THE STANDARDS THAT YOU ASKED US
TO PERFORM TO THROUGH ALL OF
THE DOCUMENTS THAT YOU AGREED
TO.
>> VERY GOOD.
THANKS.
LET'S MOVE INTO THE STORM LEASE
MODIFICATION.
THANK YOU, DAVID.
>> THANK YOU.
I WANTED TO PREVIEW A PIECE OF
LEGISLATION WE WILL BE BRINGING
YOU SHORTLY.
WE ARE SEEKING APPROVAL FOR
MINOR MODIFICATIONS TO THE
LEASE AGREEMENT WE HAVE WITH
THE STORM, AND IN PARTICULAR THE
POTENTIAL PAYMENTS TO THE STORM
DUE TO COSTS AND LOSS REVENUES
THAT CAN BE DISSIPATED TO OCCUR.
THEY HAVE TO RELOCATE THEIR
GAMES FOR TWO AND POTENTIALLY
PART OF THREE SEASONS.
JUST A LITTLE HISTORY HERE.
THERE ARE CHANGES WE THINK ARE
CERTAINLY ADVISABLE IN THE
CONTEXT OF THE CIRCUMSTANCES OF
THE STORM BEING ABLE TO AVAIL
THEMSELVES TO PLAY AT LEAST
SOME OF THEIR GAMES IN THE CITY
RATHER THAN OUTSIDE.
WE THINK THAT IS IN THE CITY'S
INTEREST BOTH NEAR-TERM AND IN
THE LONGER TERM TO PRESERVE THE
STORM'S FAN BASE AS THEY BECOME
ONE OF THE TENANTS OF OUR NEW
BUILDING.
SO HERE IS JUST A LITTLE BIT OF
HISTORY.
2017, WE NEGOTIATED.
THE COUNCIL APPROVED A LONG-
TERM USE AGREEMENT FOR THE
SEATTLE STORM, FOR KEYARENA, OR
ITS SUCCESSOR ARENA, IF YOU
WILL.
IT RUNS THROUGH 2028, AND AS WE
NEGOTIATED IN 2017, WE KNEW
THERE WAS THE POTENTIAL, IF NOT
THE LIKELIHOOD OF A RENOVATION
OCCURRING AND THE TEAM BEING
DISPLACED.
WE ANTICIPATED THIS IN THE
ORIGINAL USE AGREEMENT.
WE ARE COMING BACK TO YOU FOR
SOME TWEAKS.
WHAT WE RECOGNIZE IS THAT IF WE
WANT THE STORM AS A LONG-TERM
TENANT, AND TO ENJOY THE
BENEFITS OF THAT LONG TERM
TENANCY, WE HAD TO BE
REASONABLE IN PROTECTING THEM
FROM THE FINANCIAL LOSSES THEY
COULD INCUR FOR BEING DISPLACED
WHILE WE REMADE THE ARENA, IF
YOU WILL.
THAT IS THE CORE REASON BEHIND
THE CITY BEING WILLING TO STEP
UP WITH SOME FINANCIAL
ASSISTANCE TO THE STORM.
PER THE ORIGINAL AGREEMENT, THE
CITY WOULD PAY UP TO $2.6
MILLION PER SEASON PLUS A SMALL
AMOUNT IF THERE ARE PLAYOFF
GAMES, AND THAT MONEY WAS
DESIGNED TO BOTH OFFSET DIRECT
COSTS, SO AS IT TURNS OUT, THEY
ARE GOING TO PLAY BOTH IN
EVERETT FOR SOME GAMES, AND
ALSO ON THE UW CAMPUS AND THEY
WERE GOING TO FACE DIRECT
INCREASED COSTS RELATIVE TO
WHAT THEY PAID AT KEYARENA, AND
ALSO THEY FACED THE PROSPECT OF
LOST REVENUES BECAUSE THE FAN
BASE MAY NOT TRAVEL OUT OF THE
CITY.
THAT IS AN OPEN QUESTION.
TO HIGHLIGHT THE CHANGES WE ARE
GOING TO BRING YOUR FOCUSING ON
THE FIRST TWO SEASONS, 19 AND
20.
FOR THOSE TWO SEASONS, THE CITY
IS DIRECTLY ON THE HOOK.
FOR 2021, THE ARENA DEVELOPERS
WILL BE ON THE HOOK.
THAT WAS PART OF OUR
NEGOTIATION TO THEM, CREATING
NEGOTIATIONS ON BOTH SIDES TO
GET THE WORK DONE AS QUICKLY AS
POSSIBLE, SO IF THERE WAS
FURTHER DELAY, ARENA DEVELOPERS
WOULD FACE THAT COST.
>> THIS FINAL BULLET UNDER THE
CITY AGREEMENT WITH SEATTLE
ARENA CO., THAT'S UNDER THE
CURRENT AGREEMENT PRIOR TO ANY
ACTIONS?
>> CORRECT.
>> SO CURRENTLY THE CITY WOULD
PAY UP TO $2.6 MILLION FOR 2019
AND 2020.
>> CORRECT.
>> AND THEN THE QUESTION OF THE
UP TWO.
$2.69.
IS THAT SORT OF A REIMBURSABLE
REQUIREMENT, GIVEN THAT WE
DON'T KNOW WHAT THE ACTUAL
COSTS ARE AND WE WOULDN'T WANT
TO PAY MORE THAN WHAT THE
ACTUAL COSTS ARE?
>> WE ESTABLISHED HIS BASELINE
ON THE COST WAVE INCURRED.
THEY WERE PAYING AT SEATTLE
CENTER, WHICH WE KNOW WELL.
THE REVENUES AS PART OF THE
ARRANGEMENT THEY WILL HAVE TO
REPORT WHAT THEIR REVENUES WERE
AND WHAT THEIR REVENUES ARE.
IT'S THE DIFFERENCE BETWEEN
THOSE.
WE'RE CONTINUING TO WORK OUT
THE DETAILS OF VERIFICATION,
BUT THAT'S EXACTLY WHAT THIS
IS, A REIMBURSEMENT.
YOU WILL SEE, AS WELL, AS I
WALK THROUGH THIS, THE ORIGINAL
STRUCTURE, AND THE PROPOSED NEW
STRUCTURE, BOTH ARE NOT JUST A
BLANKET PAYMENT.
THEY WERE DESIGNED TO HAVE
INCENTIVES GIVEN THAT THE STORM
IS IN A POSITION TO BOTH
CONTROL COSTS AND POTENTIALLY
MINIMIZE LOSS AND REVENUES.
ALTHOUGH THE CITY WAS GOING TO
STEP UP AND POTENTIALLY HELP
THEM FINANCIALLY, WE JUST
WEREN'T WRITING A BLANK CHECK.
THEY WOULD BE INCENTIVIZED TO
DO THE RIGHT THING.
AMENDMENTS WILL COVER THE FIRST
TWO YEARS.
THE STORM IS CURRENTLY IN
DISCUSSIONS WITH NHL SEATTLE
AND OVG FOR THE TERMS OF THEIR
FACILITY USE AGREEMENT GOING
FORWARD, WHICH THAT THIRD GEAR
IS POTENTIALLY AN ELEMENT.
REAL QUICK ON THE LEFT EAR,
THIS LITTLE BOX DESCRIBES THE
ORIGINAL TERMS.
IT'S A PRETTY HIGH CLIP
DESCRIBING THE SEASON LEVEL
PAYMENTS.
A COMPARABLE STRUCTURE EXISTS
FOR OTHER GAMES, SO IF THERE IS
PARTIAL DISPLACEMENT IN SEASON
THREE, IT MIGHT BE PER GAME
VERSUS THIS SEASON SCALE, BUT
THE FUNDAMENTAL STRUCTURE IS
THE SAME.
ON THE ORIGINAL SIDE, WE WERE
IN PARTICULAR OFFERING
SIGNIFICANT
FINANCIAL COMPENSATION ON THE
REVENUE SIDE.
OUR EXPECTATION WAS THAT THE
STORM IS BEST POSITIONED TO
CONTROL ON THE COST SIDE
BECAUSE THEY WOULD BE DIRECTLY
NEGOTIATING AGREEMENTS WITH AN
ARENA OUT OF THE CITY IS WHAT
WE HAD ORIGINALLY ANTICIPATED.
NOT HARD TO THINK OF THAT BEING
EITHER KENT OR EVERETT, SO WE
HAD RELATIVELY LESS
COMPENSATION AVAILABLE ON THE
COST SIDE BECAUSE THAT WAS
COMPLETELY IN THEIR CONTROL,
BUT WE RECOGNIZE ON THE REVENUE
SIDE, WHATEVER EFFORTS THEY
MAKE, THERE WAS A POSSIBILITY
THEY WOULD LOSE SIGNIFICANT
REVENUE AND THERE WASN'T
NECESSARILY MUCH THEY COULD DO
ABOUT THAT.
WE FELT THE CITY WAS BEST
POSITIONED, IF YOU WILL, TO
OFFER ASSISTANCE.
ON THE REVENUE SIDE, WHAT WE
SAW WAS FOR THE FIRST $850,000,
WE WOULD COVER 100% OF THEIR
LOST REVENUE.
PER YOUR QUESTION,
HOW MUCH THEY WERE EARNING AT S
KEYARENA VERSUS HOW MUCH THEY
WOULDN'T UNDERTAKING IN.
WE HAVE DEFINED THE STREAMS OF
REVENUE THAT ARE RELEVANT FOR
THE COMPARISON, SO WE WILL
COVER ALL OF THAT.
AGAIN THIS IS NOT THEIR FAULT.
THEY GOT DISPLACED.
AT THE SAME TIME, FOR REVENUES
ABOVE THAT LEVEL, AND THESE
WERE NEGOTIATED AMOUNTS, WE
SAID WE WOULD COVER A SHARE OF
THE ADVERTISING REVENUE SHARE.
AGAIN WITH A GOAL OF GIVING
HEM THE INCENTIVE TO TR
MAINTAIN THOSE REVENUES.
IN TOTAL, WE SAID WE WOULD PAY
A TOTAL OF $2 MILLION ON THE
LOST REVENUE SIDE, PLUS A SMALL
AMOUNT FROM PLAYOFF GAMES.
ON THE COST SIDE, TOTAL WE
COVERED THE FIRST $500,000 AT
100% BECAUSE THERE WAS A SENSE
THERE WASN'T GOING TO BE
ANYTHING THEY COULD DO ABOUT IT.
THAT WAS WHAT IT WOULD COST TO
RELOCATE AT A MINIMUM.
ABOVE THAT, WE WOULD COVER A
SHARE.
THE COST SIDE WAS CAPPED AT
$600,000, SO THE TOTAL WAS
ESSENTIALLY $2.6 MILLION.
WHAT WE'VE DISCOVERED SINCE
THEN, AND IT'S REALLY AN
EXCITING POSSIBILITY TO PLAY AT
HACKETT ARENA, THINK IT IS
STILL COLD.
I FEEL LIKE I SHOULD BE GETTING
THIS RIGHT AND I'M NOT.
GIVEN THE FOLKS IN THE ROOM,
THAT'S PARTICULARLY
EMBARRASSING.
THAT SAID, WHAT WE KNOW ABOUT
THAT SITUATION IS IT'S GOING TO
BE HIGHER COST THAN ANYONE
ANTICIPATED.
IN PARTICULAR BECAUSE IT'S NOT
AIR-CONDITIONED, IT TURNS OUT.
ONE NICE THING ABOUT OUR
RELATIVELY FAIRWEATHER IN THE
NORTHWET IS THE UNIVERSITY
HAVEN'T FOUND THAT NEED, SO IN
ORDER TO HOST GAMES FOR THE
SUMMER, THE UNIVERSITY HAS
AGREED, AND ENGINEERING HAS
BEEN WORKED OUT TO PROVIDE
TEMPORARY AIR CONDITIONING,
ESSENTIALLY USING THE AIR
CIRCULAION SYSTEM THAT EXISTS
TO HEAT THE BUILDING, AND A
COMPRESSOR, IF YOU THINK ABOUT
IT.
AN AIR-CONDITIONER LOCATED JUST
OUTSIDE THE BUILDING THAT WILL
BRING AIR INTO THE CIRCULATION
SYSTEM, SO THE STORM RECOGNIZED
THEY WERE GOING TO FACE
SIGNIFICANTLY MORE COSTS THAN
ANTICIPATED.
AT THE SAME TIME, BY ALLOWING
THEM TO PLAY THERE OR HAVING
THEM PLAY THEIR --
>> MISTER NOBLE?
>> I'M JUST TRYING TO TRACK
BETWEEN THE PREVIOUS SLIDE AND
THE SLIDE.
ON THE PREVIOUS SLIDE, THE
QUESTION I ASKED WAS WHETHER OR
NOT THOSE BULLETS REPRESENTED
THE CURRENT AGREEMENT, AND THAT
DISCUSSES A 2.6 REIMBURSEMENT.
>> RIGHT.
>> IT LOOKS TO ME THAT THIS
SLIDE SAYS THE REIMBURSEMENT IS
$2 MILLION CURRENTLY.
AND THE PROPOSED NEW
REIMBURSEMENT IS $2.6 MILLION.
>> THAT'S NOT CORRECT.
SORRY.
I AM CLEARLY HAVING TECHNICAL
TROUBLES.
THIS MOUSE IS CAUSING PROBLEMS.
SO, THE TOTAL ON LOST REVENUE
UNDER THE CURRENT AGREEMENT IS
$2 MILLION.
THE TOTAL INCREASED COSTS IS
$600,000 FOR A TOTAL OF $2.6
MILLION.
MY CLICKS SHOULD HAVE BEEN MORE
CLEAR.
WHAT WE'VE DONE ON THE REVISED
TERMS IS LUMP THEM TOGETHER.
WE NO LONGER SEE -- WE ARE
TRYING TO INCENTIVIZE THEM TO
STAY IN THE CITY.
THERE IS MORE COST IN THE CITY
AND LESS LOSS REVENUE.
THE SITUATION HAS SLIPPED
THERE.
THEY ARE NOT GOING TO JUST PLAY
IN THE CITY.
THEY ARE GOING TO DO A LITTLE
OF BOTH, SO MORE SIMPLE FOR
EVERYBODY AND BETTER INCENTIVES
FOR THE CITY, IN TERMS OF
KEEPING THE GAMES HERE AND
HELPING US MAINTAIN A FAN BASE
FOR WHEN THEY DO RETURN.
BETTER JUST TO GROUP THEM
TOGETHER, PROVIDING COMPARABLE
INCENTIVES, BUT WE WILL COVER
THE FIRST SIGNIFICANT SHARE OF
COMBINATION REVENUES AND COSTS
BECAUSE THERE IS NOTHING THEY
CAN DO ABOUT SOME SHARE OF
THIS.
WE WILL PROVIDE AN INCENTIVE
FOR THEM.
WE WILL HELP COVER THE COST BUT
GIVE THEM A REASON TO TRY TO
KEEP THOSE COSTS LESS THAN THE
FULL $2.6 MILLION, BUT WE
HAVEN'T CHANGED THE TOTAL, JUST
THE ARRANGEMENT OF HOW IT GOES.
>> THANK YOU.
>> I CAN GO FURTHER, BUT I
THINK AT THIS POINT, YOU GET A
SENSE OF WHAT WE ARE DOING HERE.
TO ME, IT'S REALLY EXCITING TO
HAVE THEM STAY IN THE CITY.
IT WASN'T SOMETHING WE HAD EVER
ANTICIPATED ORIGINALLY, AND
THIS WILL OPEN THAT POSSIBILITY
WITHOUT INCREASING THE
FINANCIAL RISK.
>> ANY OTHER -- ARE YOU PRETTY
MUCH FINISHED?
>> I AM.
THAT WAS ALL I HAD.
>> TELL ME A LITTLE BIT ABOUT
THE STORM'S REACTION.
I ASSUME THEY ARE RECEPTIVE TO
THIS.
THEY ARE AT THE TABLE.
THERE ARE PLAYS ON THIS CURRENT
REVISION?
>> YES.
THEY APPROACHED US AS WE GOT
INTO THE DISCUSSIONS ABOUT WHAT
IT WOULD TAKE TO RETROFIT THE
UNIVERSITY FACILITY AND SAID
THE ORIGINAL AGREEMENT DOESN'T
REALLY FIT THIS MODEL, AND THEY
WERE RIGHT, AND WE WANT THEM TO
TRY TO DO THE BEST THEY COULD
TO PLAY GAMES HERE IN THE CITY.
THEY ARE WORKING VERY CLOSELY,
AND THEY ARE STRONGLY
SUPPORTIVE.
>> AND THINK OF AAA, ALASKA
AIRLINES ARENA.
THEY GOT THE BEST OF BOTH
WORLDS.
COUNCILMEMBER O'BRIEN?
>> A COUPLE QUESTIONS.
IS THE INCENTIVES TO STAY IN
SEATTLE EMBEDDED IN THIS, OR IS
THERE DIFFERENT LANGUAGE OUT
THERE?
>> IT'S EMBEDDED IN THE SENSE
THAT THEY ARE NOW IN A
SITUATION WHERE THEY ARE TAKING
ON INCREASED COSTS TO AVOID
LOST REVENUES.
IN THE PREVIOUS ARRANGEMENT, IT
DIDN'T REALLY.
THEY WERE ONLY GOING TO GET
COVERED, SO FAR ON COST, AND
REVENUES WERE RELATIVELY OPEN.
THEY MIGHT HAVE HAD AN
INCENTIVE TO PLAY THEIR GAMES
IN EVERETT BECAUSE THEY CAN
KEEP THE COST DOWN.
WE ARE GOING TO COVER THE
LARGER SHARE.
THAT WASN'T WHAT WE WANTED OR
WHAT THEY WANTED.
THIS WORKS BETTER FOR
EVERYBODY.
>> YOU IMPLIED IT MIGHT BE A
MIX.
IS A FOR GEOGRAPHIC DIVERSITY?
>> THEY ARE WORKING AS CLOSELY
AS THEY CAN WITH UW.
I THINK THE PREFERENCE IS TO
PLAY AS MANY GAMES AS POSSIBLE
HERE.
THERE ARE SOME ISSUES AT THE
BEGINNING AND THE END OF THE
SEASON, PARTICULARLY WHEN THE
UNIVERSITY IS MORE ROBUSTLY IN
SESSION, IF YOU WILL.
I THINK THERE MAY ALSO BE SOME
CONFLICTS OVER THE SUMMER, AS
WELL.
>> YEAH, OKAY.
THE OTHER SHIFT ON HERE IS THE
PERCENTAGE OF REIMBURSABLES
ABOVE THE BASE 1.3.
WAS THERE ANY SPECIFIC MATH TO
THAT, OR SOMEWHERE BETWEEN 80
AND 65?
>> IT WAS STILL ALIGNED
SOMEWHERE IN-BETWEEN.
IT SEEMS LIKE A SIMPLE VALUE IN
ALL OF THIS, AS WELL.
>> THIS WILL HAVE TO BE
FORMALLY APPROVED AS AN
ORDINANCE, OR IS IT REQUIRED TO
GO THROUGH?
WHEN MIGHT THE TIMING BE?
>> SINCE WE WRAPPED UP
NEGOTIATIONS, WE ARE JUST
GETTING LAWYERS TO PUT IN THE
PROPER FORM AND GET YOU A BILL
IN THE NEXT COUPLE OF WEEKS.
THE SEASON IS UNDERWAY, SO YOUR
WILLINGNESS TO MOVE QUICKLY
ASSUMING ALL IS IN ORDER WOULD
BE APPRECIATED BY ALL.
>> OKAY.
ANYTHING TO ADD IN CLOSING?
ARE WE GOOD?
>> I THINK WE ARE GOOD.
>> COUNCILMEMBER HERBOLD.
>> THANK YOU.
CAN YOU GIVE US A LITTLE BIT OF
INSIGHT INTO WHY THE PROPOSED
AGREEMENT CHANGES ONLY RELATE
TO THE CITY'S OBLIGATION FOR
THE FIRST TWO YEARS, AND NOT
FOR THE YEARS THAT FOLLOW?
>> THE REASON IS THE STORM ARE
IN DISCUSSIONS WITH, AS
DESCRIBED ALREADY, WITH NHL,
SEATTLE, AND OVG ABOUT THEIR
LONG-TERM PARTNERSHIP.
IT FELT LIKE IT MADE MORE SENSE
FOR THEM TO THINK ABOUT THE
THIRD YEAR, AND THE YEARS THAT
FOLLOW IN THE BROADER CONTEXT,
BUT NOT THAT WE REALLY NEEDED
TO, BUT WE HELPED CONNECT THE
TWO OF THEM, SO THOSE
DISCUSSIONS ARE ONGOING AND WE
WILL KEEP YOU UPDATED.
>> IS THERE A WAY THAT THE CITY
CAN CONVEY ITS HOPES THAT IN
THE NEGOTIATIONS, THAT THEY ALSO
REINFORCE WHAT I HOPE OUR
SHARED INTERESTS TO HAVE THE
OBLIGATIONS INCENTIVIZED WITH
GAMES BEING PLAYED HERE IN
SEATTLE?
>> I THINK YOU JUST DID, BUT I
CAN ASSURE YOU I ALSO HAVE
COMMUNICATED PARTICULAR TO THIS
SLIDE THAT THE CITY'S STRONG
INTEREST AND LONG-TERM
COMMITMENT TO THE STORM, AND
OUR HOPE AND EXPECTATION THAT
THEY WILL BE ABLE TO MAINTAIN
AND HELD ON THE SAME, HE HAS
ASSURED ME THEY UNDERSTAND AND
SHARE THAT INTEREST.
>> WE LOVE OUR STORM.
THANK YOU.
I THINK WE'RE GOING TO OUR
VOTING ITEM, AND SO AS THE
PRESENTER COMES FORWARD, LINDA,
I BELIEVE WE NEED TO HAVE THIS
READ INTO THE RECORD, SO WE CAN
VOTE ON IT.
>> ITEM 4. RESOLUTION 3188.
A RESOLUTION AMENDING
RESOLUTION 31 857, PROVIDING
CONCEPTUAL APPROVAL OF
SIGNIFICANT STRUCTURE TEAM
PERMIT TO SEATTLE ARENA COMPANY
LLC TO INCLUDE THE CONSTRUCTION
OF PERMANENT TENSION TIEBACKS
IN PORTIONS OF THOMAS STREET
EAST OF FIRST AVENUE NORTH, AND
WEST OF SECOND AVENUE NORTH,
AND THE LONG OCCUPATION OF
THESE PERMANENT TIEBACKS IN THE
RIGHT-OF-WAY, TO ENABLE THE
RENOVATION OF KEYARENA AT THE
SEATTLE CENTER.
>> MARSHA, WHY DON'T WE START
WITH INTRODUCTIONS.
YOU GOT YOUR GAME FACES ON.
LET'S LIGHT IT UP.
MARSHALL.
>> ALWAYS GOT OUR GAME FACES.
MARSHALL FOSTER, DIRECTOR OF
THE CITY'S OFFICE OF WATERFRONT
AND CIVIC PROJECTS.
>> AMY GRAY, SEATTLE DEPARTMENT
OF TRANSPORTATION.
>> LIZ SHELDON, SEATTLE
DEPARTMENT OF TRANSPORTATION.
>> TAKE IT FROM HERE, SHALL.
>> THANK YOU AGAIN FOR HAVING
US.
WE ARE COVERING A LOT OF GROUND
THIS MORNING.
I THINK THIS IS YOUR FINAL
ITEM.
THIS IS ACTUALLY AN AMENDMENT,
COUNCIL MEMBERS, TO A
RESOLUTION YOU HAVE ALREADY
CONSIDERED.
THE KEY THING WE ARE DOING THIS
MORNING IS MAKING A
MODIFICATION REGARDING THE TERM
PERMIT ON THOMAS STREET.
ONE OF THE IMPORTANT ASPECTS OF
THE DESIGN THAT YOU SAW FROM
MISTER TOD LEIWEKE IS
RECLAIMING THOMAS STREET AS THE
FRONT DOOR OF THIS ARENA.
IN ORDER TO DO THAT, WE ARE
PUTTING MUCH OF THE BACK OF
HOUSE FUNCTIONS FOR LOADING,
UNLOADING OF BROADCAST TRUCKS,
MOVING IN AND OUT MAJOR EVENTS
AND CONCERTS BELOW GROUND SO
THAT THE PUBLIC'S EXPERIENCE OF
ARRIVING AT THIS ARENA, AND
ARRIVING AT SEATTLE CITY CENTER
ON THOMAS STREET WILL BE A
GREAT URBAN PLAZA SPACE,
ESSENTIALLY.
VERY DIFFERENT FROM THOMAS
STREET AS YOU EXPERIENCE IT
TODAY.
IF YOU CAN PICTURE WALKING DOWN
THOMAS, IT'S BASICALLY CHAIN-
LINK FENCE AND LOADING DOCKS.
IN ORDER TO DO THAT, ONE OF THE
THINGS THE BUILDING HAS TO DO
IS CREATE A STRUCTURAL WALL
ALONG THE NORTH EDGE OF THOMAS
STREET, AS WELL AS BUILD AN
UNDERGROUND TUNNEL FROM THE
SITE JUST TO THE SOUTH, WHICH
THEY ALSO CONTROL.
IN ORDER FOR THAT WALL TO WORK
FUNCTIONALLY, STRUCTURALLY, IT
HAS TO USE A SYSTEM OF
TENSIONED TIEBACKS.
I'M NOT GOING TO GO TOO DEEP
INTO THE WEEDS OF THAT, BUT YOU
ACTUALLY SEE THESE ALL OVER
TOWN WHEN YOU SEE CONSTRUCTION.
YOU SEE THE EXCAVATION OF SOME
OF OUR DOWNTOWN SITES.
TIEBACKS ARE BASICALLY A STEEL
STRUCTURAL SYSTEM THAT PUSHES
FROM THAT WALL YOU SEE
UNDERNEATH THE SOIL BEHIND IT,
AND CREATES STRUCTURAL
STRENGTHS, SO THAT WALL, AS IT
GOES DOWN, IS HOLDING UP THAT
WALL OF EARTH BEHIND IT, SO IN
ORDER TO REALLY CAPTURE THE
OPPORTUNITY ON THE SITE, THEY
NEED TIEBACKS THAT EXTEND UNDER
A PORTION OF THOMAS STREET.
AGAIN, THIS WAS ANTICIPATED,
BUT AS WE WENT DEEPER INTO THE
DESIGN PROCESS, THE PRECISE
DETAILS ARE NOW KNOWN, AND
THAT'S WHAT THIS AMENDMENT
WOULD DO IS KIND OF GET THE
EXACT PLAN REFLECTED IN YOUR
RESOLUTION.
WITHOUT FURTHER ADO, I WILL
TURN IT OVER TO AMY.
>> AS MARSHALL NOTED, IN
DECEMBER OF LAST YEAR, YOU
PROVIDED CONCEPTUAL APPROVAL
FOR THE TUNNEL AS UNDER THOMAS
STREET, AND JUST A QUICK THING
ABOUT TERM PERMITS.
THEY ARE FOR LONG-TERM
OCCUPATION OF THE RIGHT-OF-WAY.
YOU SEE THE BUILDING THAT
SKYWAYS DOWNTOWN, PEDESTRIAN
BUILDINGS, ALL REQUIRE A LONG
TERM PERMIT PROVIDED BY CITY
COUNCIL.
THEY ARE FOR A LONG PERIOD,
SIGNIFICANT STRUCTURES.
THAT'S WHY WE TAKE THESE TYPES
OF PERMITS TO COUNCIL FOR
APPROVAL.
ON THE PROJECT PROPOSAL, IN THE
RED, YOU CAN SEE WHAT YOU'VE
ALREADY CONCEPTUALLY APPROVED.
THAT'S THE TUNNEL, AND THE
YELLOW NOTES THE AREA OF THOMAS
STREET THAT WILL BE AFFECTED BY
THE PERMANENT TENSION TIEBACKS.
TERM PERMITS ARE A TWO-STEP
PROCESS.
AT THE FIRST POINT, A, WHERE WE
ARE TODAY, COUNCIL PROVIDES
CONCEPTUAL APPROVAL, AND THAT
GIVES THE DEVELOPER COMFORT
KNOWING THAT YOU ARE GENERALLY
OKAY WITH THE IDEA AS THE
PROJECT MOVES FORWARD, AND IT'S
MORE TECHNICAL DESIGN APPROVED,
AND ALL THAT SORT OF STUFF.
WE WILL BRING AN ORDINANCE TO
YOU.
THAT'S THE ACTUAL PERMIT.
THAT SPECIFIES OBLIGATIONS OF
THE PERMIT HOLDER, WHICH WILL
BE SEATTLE ARENA COMPANY LLC.
IT HAS A BOND ASSOCIATED WITH
IT.
IT NAMES THE TERMS.
IF THE CITY NEEDS TO REVOKE THE
PERMIT, THERE IS INFORMATION
THERE THAT REQUIRES COUNCIL
ACTION TO ACTUALLY REVOKE THE
PERMIT.
SINCE IT IS APPROVED BY COUNCIL,
YOU ARE THE BODY THAT GETS TO
REVOKE IT.
AND WE ARE GOING TO BRING THAT
ORDINANCE ON THIS PROJECT AT
THE END OF CONSTRUCTION FOR
YOUR APPROVAL.
THAT IS ALL I HAVE.
TWO PEOPLE HAVE QUESTIONS?
>> COUNCILMEMBER O'BRIEN.
>> A COUPLE OF QUESTIONS.
ONE ON TERM LIMITS.
YOU MENTIONED IT IS REVOCABLE.
WE TALK ABOUT THAT WHEN THESE
ITEMS COME BEFORE US.
IF WE REVOKE THIS, THEN THE
BUILDING FAILS, SO IT'S
TECHNICALLY REVOCABLE, BUT --
>> THAT'S THE NATURE OF THE
TERM PERMIT.
COUNCIL GETS TO DETERMINE THE
LENGTH OF IT, SO WE HAVE SOME
TERM PERMITS THAT ARE FOR 99
YEARS.
THOSE CONVERSATIONS WILL BE
HAPPENING ON THAT.
IT HAS TO BE A TERM PERMIT
BECAUSE IT'S NOT A STREET
VACATION.
STREET VACATIONS ALLOW THE
PERMANENT TRANSFER.
>> THAT'S JUST THE RISK
ASSOCIATED WITH THIS.
>> YEAH, AND IT'S A HIGH BAR
THAT YOU, COUNCIL, WOULD HAVE
TO DECIDE THAT AREA OF THOMAS
STREET IS NEEDED FOR
TRANSPORTATION.
>> I'VE GOT TO ASSUME EVERY
PROJECT HAPPENING IN THE
DOWNTOWN CORE RIGHT NOW IS
USING TIEBACKS TO HOLD THOSE
WALLS UP, BUT I DON'T RECALL
THEY WERE DOING A TON OF THESE
TERM PERMITS FOR TIEBACKS.
IS THERE ANOTHER WAY THESE
HAPPEN?
>> THE TIEBACKS ARE USUALLY
CONTAINED ON THE PROPERTY, THE
RIGHT-OF-WAY.
THESE TIEBACKS WILL BE ON
THOMAS STREET.
THAT'S WHY WE NEED TO HAVE A
TERM PERMIT FOR THEM TO OCCUPY
THAT PORTION OF THE RIGHT-OF-
WAY.
>> JUST TO CLARIFY A BIT,
TIEBACKS OFTEN GO TO THE RIGHT-
OF-WAY, BUT AT THE END OF THE
PROJECT THE WALL IS BUILT SO
THAT IT CAN HANDLE THE
STRUCTURAL LOAD OF BASALT, SO
THEY JUST BECOME LITTLE PIECES
OF STEEL IN THE RIGHT-OF-WAY.
YOU CAN TEAR THEM OUT.
BUT THESE WILL BE PERMANENT,
AND PART OF THE STRUCTURAL
WALL, WHICH IS THE DIFFERENCE.
>> GOT IT.
VERY GOOD.
GOT MY ENGINEERING STUFF FOR
THE DAY.
THANKS FOR THE EXPLANATION OF
WHAT A PERMANENT TENSION
TIEBACKS WAS.
I DID RELY ON WIKIPEDIA TO
FIGURE THAT OUT IN PREPARATION
FOR THIS MEETING.
ANY OF THE QUESTIONS?
WE HAVE A SLIGHT AMENDMENT TO
MAKE.
WE HAVE AN EXHIBIT CHANGE, FOR
JUST A TECHNICAL AMENDMENT.
ANY OTHER STATEMENTS YOU NEED
TO EXPLAIN?
LET ME AMEND THE EXHIBIT.
I MOVED TO AMEND, EXCUSE ME,
RESOLUTION 318 88 EIGHT.
IS THERE A SECOND?
>> SECOND.
>> THOSE IN FAVOR OF
SUBSTITUTING EXHIBIT A PLEASE
VOTE AYE.
MOTION CARRIES.
THOSE IN FAVOR OF THE
RECOMMENDATION OF THE COUNCIL
TO ADOPT 31888, PLEASE VOTE
AYE.
OTHERS PLEASE VOTE NOW.
THE RESOLUTION WILL BE
FORWARDED TO THE MAY 28 CITY
COUNCIL MEETING.
AS WE CLOSE, DID ANYONE WANT TO
MAKE CLOSING REMARKS? I JUST
WANT TO THANK BOTH OUR TEAM,
AND OUR ARENA CO., A TEAM,
THESE ARE EXCITING MOMENTS FOR
OUR CITY.
WE STAND ADJOURNED.
EVERYONE, HAVE A GREAT
AFTERNOON.