A spat between Luzerne and Lackawanna counties over the proceeds of the sale of the Scranton/Wilkes-Barre Yankees (Class AAA; International League) could imperil $20 million in state money already earmarked for a new ballpark, according to Penn. Gov. Ed Rendell.
We’re talking a pretty serious split here: Luzerne County has already filed suit to prevent any sale proceeds from being put back into a ballpark. Not a surprise, really: the two counties have been fighting over the franchise ever since it was bought and PNC Field was built.
Here’s the deal (and it’s complicated; we’ve confirmed the details with officials from both counties). First: Luzerne County and Lackawanna County agreed to buy the International League team in 1986 for $2 million, with each side putting up a million. The agreement also laid out an exit strategy should the team be sold: proceeds from the sale would be split.
Hold it, says Lackawanna County: we’ve been covering debts on the team and should recoup our losses. Hold it, said Luzerne County: there’s no provision for debt repayment in the sales agreement. Luzerne County subsequently filed a lawsuit to prevent Lackawanna County from claiming debt repayment.
Meanwhile, the New York Yankees and Mandalay Baseball Properties seem ready to pull the trigger on a purchase of the team, an option presented to them when they took over management duties for the SWB Yankees. In fact, they’d rather do it sooner than later: the purchase price right now is $13 million, but that number goes up to $14.6 million. And they’d like to do it with a new ballpark in the mix.
Enter the state, which pledged $20 million toward a new ballpark provided Luzerne County and Lackawanna County matched with $10 million apiece. Here’s where the exit revenues become extremely important. Let’s say the team does sell for $13 million; each county would receive $6.5 million and would turn around and put that toward a new ballpark, needing $3.5 million to come up with a total of $10 million. But if Lackawanna County can recoup some debt, the amount for Luzerne County goes down, which means taxpayers must come up with more than $3.5 million. In other words, every dollar that goes to Lackawanna County in the form of debt repayment is really coming directly from the pockets of Luzerne County taxpayers.
If a new ballpark is built, that is. Rendell is warning there’s a time limit to the state funds and both sides must settle their disputes. A recent meeting between Rendell and reps from both counties didn’t seem to settle things, but we expect another meeting or two involving Rendell and more county reps. In the end, Rendell will probably get his way — he has a way of being rather persuasive when he wants to be — and the two sides will agree on funding for a new ballpark.
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