Rossford's June target hinges on credit plan

1/15/2001

The Rossford Arena Amphitheater Authority plans to begin having outdoor concerts in June, but it still must line up a multimillion-dollar financial package to get the amphitheater built in time.

Among the hurdles: persuading Lathrop Co. to withdraw a $7.7 million mechanic's lien it placed on the property last year and satisfying a $2.4 million first mortgage on the property arranged through the Northwest Ohio District Council of Carpenters.

Keith Wilkowski, legal counsel for the authority, said Lathrop President Bob Maxwell has continued to work with the agency even after construction stopped in November, 1999, because of financial problems, and he does not expect Lathrop to pull out now.

“We're assuming we can come up with a reasonable business arrangement to convince him to move that Lathrop lien,” Mr. Wilkowski said.

Likewise, the authority will have to work out an arrangement with the carpenters union to pay off all or part of its loan, possibly with whatever financing is arranged to complete the facility. “Those are the two we have to deal with,” Mr. Wilkowski said, adding, “It is a lot to deal with.”

In addition to Lathrop's lien, four subcontractors who worked on the project have filed mechanics' liens against the authority totaling $680,420, according to records in the Wood County recorder's office. But Mr. Wilkowski said Lathrop, the general contractor, included those bills in its $7.7 million lien.

Mr. Wilkowski said he is trying to arrange a conference call today with Lathrop's attorney; RAAA financial consultant, Ralph Caponigro; Steve Edelson from V.S.O.P., the management firm hired last week to run the amphitheater, and a bond lawyer to talk about the financing structure for the project.

The financing largely will depend on anticipated revenue from the amphitheater, including $675,000 a year in guaranteed income to the RAAA from V.S.O.P, admissions taxes, and hotel-motel taxes.

Though Rossford officials hoped to have a management firm and financing in place by year's end, the agency just last week authorized entering into a contract with Chicago-based V.S.O.P. to manage the amphitheater. The firm is a joint venture between concert promoter Jam Productions and International Facilities Group, a development consultant for stadiums and arenas.

V.S.O.P. officials have assured the RAAA board that with some design changes, the amphitheater can be open by June. Mr. Edelson could not be reached for comment.

Perrysburg Township trustees, who gave the RAAA a $5 million unsecured loan to help it start construction in 1999, have asked attorney Dick Wolff to look into how the township might place some type of lien on the property.

Trustee Nathan Hagemeister said the RAAA's debt is $5,408,000, which includes a $200,000 interest payment the agency failed to make June 1 plus $8,000 interest, along with a second $200,000 interest payment due, but not paid, Dec. 31.

He said trustees hesitated to pursue legal remedies against the RAAA because they preferred to work with the project's other creditors to try to get the project back on track, but their patience is wearing thin.

“It's been six months that we've been trying to get something worked out, to get something moving,” Mr. Hagemeister said. “We just had the feeling we should do something more concrete than just talk.”

Initially, Ralph Caponigro said he would try to arrange a financial package for the amphitheater as large as $17 million to include repayment of some debt, including $3.7 million to Lathrop and $1 million to Perrysburg Township. Officials now say they hope to borrow just enough to get the amphitheater finished by June.

Lathrop has estimated it will take at least $6 million to complete the project, though representatives of the authority, V.S.O.P., and Lathrop are discussing several proposed changes to the plans, including the addition of a third restroom facility and third concession stand. No new cost estimates have been made available.

Mr. Hagemeister said his understanding is that the township and other creditors are to be repaid through revenue from the amphitheater, and it remains his hope that the facility will open.

“That's better than just having it there as a sledding hill,” he said.