Pittsburgh developer backs down on opposition to ticket fee for concerts, to be used for area improvements

In my writings on stadiums and arenas ("Framework of characteristics that support successful community development in association with the development of professional sports facilities"), I was intrigued by how a community organization in the Hill District of Pittsburgh had proposed a surtax on parking at NHL hockey games, to support community improvements, as a way of mitigating the negative effects resulting from an arena in their community.

It was never approved, but I put that in the framework, as something that should be pursued everywhere.

The Hill District was "abandoned" by the Pittsburgh Penguins for a site in Downtown, but they still own and are redeveloping the property.  One of the elements will be a concert venue, and Hill District groups proposed a ticket fee for community improvements, which the developer opposed, as I wrote about in October:

-- "Parking fees/admissions fees for arenas, stadiums, concert facilities to fund neighborhood improvements: Fee proposal for Live Nation Pittsburgh opposed by developer"

Now, they've agreed to it, according to the Pittsburgh Post-Gazette, "Penguins propose $2 ticket surcharge for music venue events at former Civic Arena site."  From the article:

In addition to the letter touting the ticket surcharge and other investments related to the arena redevelopment, the package included a 101-page response to concerns that had been raised by an executive management committee that makes sure that Penguins live up to the promises and commitments they made to the community as part of the $1 billion arena redevelopment. ...

Before Tuesday, the Hill Community Development Corporation had been pushing for the $2 ticket fee as well as a $2 surcharge on each vehicle parked in the garage as a way to help fund infrastructure improvements and development activities in the neighborhood.

Buccini Pollin and the Penguins have flatly refused to impose a parking surcharge, stating it could put the garage at a “competitive disadvantage” particularly given that many such facilities are still struggling to attract customers in the age of COVID-19.

But in its letter Tuesday to the commission and others, including Mayor Ed Gainey, the team and its developer said they “are prepared to deliver an exciting new recurring revenue stream” in the form of the $2 ticket surcharge.

The letter stated that the money would be deposited into the same Hill District reinvestment fund that was the conduit for nearly $7.2 million in anticipated tax revenues advanced by First National Bank as part of the construction of a new 26-story office tower to be anchored by FNB. The money is to be used to help build up other parts of the Hill.

This is an important precedent that can be referenced by other communities.

2.  Related are admissions taxes on tickets more generally.  Groups always fight them, including nonprofit groups receiving subsidies.  They say it will discourage attendance.  I think they are a reasonable fee for the privilege of receiving public monies for the development of such facilities.

And sometimes they are the only way communities get anything back financially from arenas and stadiums.  For example, the admissions tax on the Washington Commanders NFL games is the only revenue that Prince George's County generates from the FedEx Stadium presence.

3.  General discussion about the progress of the redevelopment in dealing with community development concerns.  Interestingly, the article discusses the back and forth between the community and the development group on their provision of various community benefits, which the community says has been laggard.

The documents submitted to the Planning Commission included a 101 page response.  I haven't tracked it down yet.  It probably makes interesting reading.

4.  Privately managed public spaces.  Concern was also expressed by the community in terms of management of the public spaces on the site, which the developer plans to put into a third party nonprofit conservancy. It would be interesting for the community to suggest that the conservancy be run by the community development corporation, not the developer.

See:

-- "The layering effect: how the building blocks of an integrated public realm set the stage for community building and Silver Spring, Maryland as an example," 2012

Other models are community improvement districts and public improvement districts such as the Green Benefits District in San Francisco and other types of special assessment districts for community improvement.