Metro Council voted 30-8 at its meeting Tuesday to approve the lease amendment agreement reached by Mayor Karl Dean and the Nashville Predators’ new ownership group last year.
Calling it the best option available to the city, Metro Council approved a deal that increases the overall subsidy given to the Predators to an estimated maximum of $7.4 million.
“Taxpayer subsidy of pro sports teams is probably not where this city is going to go in the future,” Councilwoman Emily Evans said prior to voting for the resolution and then saying maintaining a tenant for the Sommet Center was at the heart of the deal.
The new agreement is a $3 million increase over the previous contract and will be drawn from Metro’s Hotel Motel Tax.
Among the new perks given to the Predators are a $750,000 rent reduction, more favorable concession and non-NHL advertising revenues and the right to draw more money on revenues garnered from certain special events at the Sommet Center.
Most noticeably, the new agreement provides the team with an annual $3.7 million operating loss cap, a guaranteed $2 million management fee and a $2 million incentive payment should the Predators reach their attendance goals.
All told, the deal maxes at $7.4 million according to the budget proposal turned in by Dean last month.
“We’re just grateful for the effort that’s been put forth by the administration and the Council,” Predators legal representative Chase Cole said. “They both were very deliberate in this process and worked hard, as did we, to make this happen for the city. It’s a great public-private partnership.”
At-large Councilwoman Megan Barry was among those voting against the deal. Council members Michael Craddock, Duane Dominy, Rip Ryman, Robert Duvall, Erica Gilmore, Lonnell Matthews Jr. and Buddy Baker joined her.
“I’m basing my vote tonight if this is the wise way to spend people’s money and taxpayer dollars,” Barry said.
The deal does offer Metro some protections. If the Predators fail to reach an average paid attendance of 14,000 fans for two consecutive year and the owners reach a combined accumulated operating loss of $20 million, the owners can terminate the new lease agreement and presumably leave town.
Doing so will cost the ownership group a fee of $20 million in 2010, $25 million in 2011 and $10 million for every year after that.
The ownership group must also notify the Sports Authority if it assigns the lease to another party or if legal residents of Middle Tennessee ever come to own less than 50 percent of the team.
Because the deal will also be retroactive to last July, Metro will have to pay the new ownership group the difference between the two agreements.
The 14,000 average attendance mark comes against the backdrop of the team averaging about 13,400 fans per game this regular season.