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May 26, 2006 10:23 pm US/Eastern
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Devils Newark Arena Might Be In Doubt
New Mayor Wants To Reexamine Deal
NEWARK (CBS/AP) ―
Newark Mayor-elect Cory Booker is no fan of a new hockey arena for the New Jersey Devils under construction in downtown Newark.
In a mayoral debate earlier this month, he called the $310 million building a "betrayal of the public trust" and "a bad political deal."
Booker, who will be sworn in on July 1, said he is reconsidering the deal and is conducting a cost-benefit analysis because he is concerned the city will spend more than the $210 million it has already committed.
"If the project will hemorrhage money for decades, we're gonna stop it," he said in an interview Friday with The Associated Press.
Booker said he questions whether spending millions for a new hockey arena is the best use of money in Newark, which also faces problems of crime, gang violence and poverty. The city and the Devils broke ground in October on the 18,000-seat arena. The team is paying $100 million.
"I'm not wedded to a deal that over the next decade could cause more damage to the city if we don't stop the bleeding right now," he said. "Obviously my hope would be to make the project successful."
The ease getting out of the deal could largely depend on whether Booker's slate gains a majority on the Municipal Council, which will be determined in an election next month.
The Devils did not return messages seeking comment. Booker, 37, won election on May 9 by a whopping 72 percent. He takes over from his former rival, Sharpe James, who beat Booker four years ago and decided not to run for a sixth term. James has been an enthusiastic supporter of the arena for years, and many see it as a cap on his legacy as mayor for the last two decades.
Booker said he estimates the city has committed to spend $300 million for the deal, which he called a "bamboozlement." The extra costs include money for infrastructure, land acquisition, management fees and other residual effects such as building a new fire station that has been torn down in the downtown to make room for the arena.
He said the city is also considering a $30 million to $40 million bond deal that would help pay for improvements near the arena.
If the deal were killed, he said the city still could recoup some of the money it has spent and would free up additional money in the future. But he'd also weigh the costs of getting out of the deal.
"Obviously we're not anywhere near a decision point," Booker said. Richard Monteilh, the city's administrator, questioned Booker's $300 million figure and said the Devils have committed to paying any cost overruns.
More Sports News From WCBSTV.Com"Only $210 million has been appropriated by the council," he said.
Monteilh said the city has hired outside experts to do its own on cost-benefit analysis and determined that the arena would generate millions in tax revenue and would help spur development in the area.
"If he's found something that all the experts haven't found we'd be interested in looking at that," Monteilh said. "No one wants to build a project that doesn't make any money. It will be very profitable for the city."
City officials themselves also threatened to kill the deal earlier this year when they demanded the Devils produce a $100 million written guarantee in order to proceed with construction.
The city has already spent $58 million to $60 million for redevelopment costs of the 14-acre site, including environmental remediating, clearing the land and demolishing old buildings, Monteilh said.
The Devils now plays at the Continental Airlines Arena in East Rutherford.
(© 2006 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)