Falcons stadium deal would protect Dome’s ‘legacy events’
The Georgia World Congress Center Authority would carve out special treatment in an Atlanta Falcons stadium deal for some events, such as college football and basketball games, that relocate to the proposed new facility from the Georgia Dome, according to a non-binding term sheet obtained by The Atlanta Journal-Constitution.
The 23-page document, intended by the GWCCA and the Falcons as a step toward a definitive agreement in their long-running stadium negotiations, offers the clearest indications yet of how a deal – if completed – would be structured.
The document states that the GWCCA would own the stadium, that the Falcons would “control” the stadium and its revenue streams under conditions of a license agreement and that the Falcons would be responsible for all cost overruns during construction and pay an unspecified annual fee to the GWCCA for at least 30 years.
The term sheet, obtained under Georgia’s Open Records Act, makes clear the sensitivity about protecting in the transition to a Falcons-run facility the non-Falcons events that have pre-existing, long-standing relationships with the Georgia Dome.
Eighteen such “legacy events” are listed, including the SEC Championship football game, Chick-fil-A Bowl and Kickoff games, Georgia State and high school football, Bank of America Atlanta Football Classic and ACC, SEC and NCAA basketball tournaments.
The GWCCA, which runs the Dome, would continue to manage those events in a new stadium, according to the term sheet. That would include negotiating and entering into contracts related to those events and directing the event-day production.
“There was a desire on both our part and the Falcons’ part to ensure that those relationships going into a possible new stadium were maintained in the basic framework as they exist today,” Frank Poe, GWCCA executive director, said in an interview. “It’s a recognition those are events that … certainly have impacts to the city.”
Falcons spokeswoman Kim Shreckengost concurred.
“The Georgia Dome legacy events have been important for the Dome and Atlanta, some of them for many years,” she said. “So during our negotiations all along, we have been sensitive to the importance of the partnerships that the Georgia World Congress Center and Dome management have built with the promoters and sponsors of the events.”
The plan is for the Georgia Dome to be demolished after a retractable-roof stadium opens nearby. The Falcons hope the stadium will open in 2017.
The GWCCA, a state agency that has been in negotiations with the Falcons for 19 months, cautioned that the term sheet is a work in progress. The document “sets forth certain of the material terms and provisions necessary … but is not intended to be a comprehensive or all-inclusive listing of all terms or agreements that will be required,” according to its opening paragraph.
“We are not at a point that we’ve got a final agreement to solutions on all the business terms,” Poe said. “We’re working hard to get to that point.”
The next step, he said, is a more thorough term sheet, which would be expanded into a “memorandum of understanding” that the parties hope to complete by year’s end. But Poe said the main tenets outlined in the document obtained by the AJC are firm.
“The basic principles … are that the state owns it, there is a public contribution supported by the hotel tax, the Falcons take on the operating exposure risk and the Falcons take on the capital risk beyond any hotel-tax-backed bonds, including any cost overruns,” Poe said. “Those basic principles … aren’t changing.”
The state’s contribution — approximately $300 million, the GWCCA has estimated – “may be positively or negatively impacted” by factors such as market conditions at the time of sale of bonds and actual hotel-motel tax collections, the document states. The GWCCA “will not guarantee an amount greater than the [stadium-allocated portion of the Atlanta hotel-motel tax] will yield” and the Falcons “are responsible for arranging and guaranteeing the remainder.”
The document’s only mention of stadium cost is a reference to the $948 million figure in an architect’s study for building on a site 1/2 mile north of the Dome. A more recent study put the cost on a site just south of the Dome at $1.032 billion, which would push the Falcons/NFL portion past $700 million.
The version of the term sheet obtained by the AJC says the Falcons would be responsible for all stadium operating costs, including utilities, insurance and maintenance. The team would control relationships with stadium clients other than the pre-determined legacy events, GWCCA events (such as conventions) and “city of Atlanta bid events” (such as the upcoming college football playoff).
The document does not go into detail about how stadium revenue from legacy events would be handled but says the Falcons could review contracts “to assure that the economics and potential liabilities to the [stadium] are not inconsistent with historic practices.”
One legacy event is the Atlanta Football Classic, the first college football game played in the Georgia Dome in 1992 and held there annually since. It is staged by the non-profit organization 100 Black Men of Atlanta, whose CEO, John Grant, has been briefed by GWCCA officials about stadium negotiations and legacy events.
“[They] certainly assured us that there is conversation … to assure we will be given consideration when the new venue is completed,” Grant said.
Chick-fil-A Bowl president Gary Stokan also has been briefed.
“In our meetings, we have been told the [GWCCA] would continue to be our relationship in putting our event on in the new facility,” Stokan said. “They’ve been excellent partners and a part of why the bowl has grown and been so successful.”
About the Author
Tim Tucker, a long-time AJC sports reporter, often writes about the business side of the games. He also had stints as the AJC's Braves beat writer, UGA beat writer, sports notes columnist and executive sports editor. He was deputy managing editor of America's first all-sports newspaper, The National Sports Daily.
