Cleveland approves $140M Cavaliers arena renovation deal
- In order to make city financing of the $140 million Cleveland Cavaliers arena renovation more attractive, the team has agreed to a series of guarantees and measures that will benefit the Cleveland community, according to Cleveland.com.
- The NBA team agreed to the concessions in advance of a Cleveland City Council vote on Monday that extended the admissions tax for the Quicken Loans Arena. A portion of the tax's revenue will be directed toward the overhaul, Crain's Cleveland Business reported.
- The team announced the deal "sweeteners" just hours before the city council voted in favor of the tax extension. The move aimed to help sway some members who were not keen on the city's financial role in the project and who were under pressure from local activists to vote against the deal.
As part of the deal, which was written into the city's admissions tax extension legislation, the Cavaliers have promised to: Reimburse the city if the portion of admissions tax going toward the renovation exceeds the amount going into Cleveland's general fund, refurbish community basketball court floors, and donate admissions revenue from the arena's "watch parties" to Habitat for Humanity.
The admission tax was extended to 2037 and is expected to raise $88 million to help pay for renovation loans. The Cavaliers are also putting up $70 million toward the modernization plans, with Cuyahoga County picking up the rest of the tab.
The Cavaliers have played at Quicken Loans Arena since the early 1990s, and agreed to extend its lease there until 2034 in exchange for city and county help with the renovation. The Cavaliers and the city hope that the interior and exterior upgrades to the facility will boost fan attendance and draw high-profile events like the NBA All-Star Game and big-name concerts.
This is similar to the arrangement between the City of Atlanta and the Hawks. The city agreed to kick in $142.5 million toward a $192.5 million renovation of Philips Arena in exchange for the Hawks organization extending its lease until 2046. If the Hawks move before that date, they’re on the hook for penalties up to $200 million.
- Cleveland.com Cleveland Cavaliers sweeten deal for arena renovation plan
- Crain's Cleveland Business Cleveland City Council approves Quicken Loans Arena renovation deal
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