by Mike Sharkey
Staff Writer
Monday’s City Council lunch drew a bigger and more influential crowd than usual. The Jacksonville Jaguars were represented as was the Gator Bowl Association, the mayor’s office and the Office of General Counsel. The meeting also may have raised nearly as many questions as answers it provided.
Mayor John Peyton’s Chief of Policy Adam Hollingsworth addressed several Council members on the amended lease between the City and the Jacksonville Jaguars. Hollingsworth went over the 10 amended provisions within the agreement which include rent, present and future signage revenues and concessions. While some of the stipulations are fairly cut-and-dried, others, Hollingsworth said, are quite complicated and will take time to sort out. In addition to the contract itself, the City Council will be asked to approve a sign waiver overlay for specific portions of Alltel Stadium.
“There will be two pieces of legislation introduced (Tuesday night). We will not have specifics at the City Council meeting when this piece of legislation is introduced,” said Hollingsworth.
The new sign overlay will, in essence, create a totally separate sign ordinance for Alltel and, perhaps very soon, the entire Sports Complex.
“We are going to create a zone in which there is a sign waiver overlay and we are looking to make the Sports Complex its own zone,” explained Hollingsworth.
Under the terms of the new agreement, the existing signs in the Pepsi Zone and on the escalators at Alltel can remain, regardless if they violate the City’s sign ordinance in any fashion. Also, the new overlay opens the door for unlimited signage around the Jaguars’ practice fields.
“They will be tasteful signs in the same genre as those in the Pepsi Zone,” said Paul Harden, the attorney representing the Jaguars.
The other sticky issue within the lease will be the transfer of concession operations from the City to the Jaguars. Because concessions involve so many definitions and responsibilities, Hollingsworth said it may take another week to iron out those details alone.
“Concessions are the most complicated aspect,” said Hollingsworth. “We are hoping to get this done by the Dec. 13 City Council meeting. We would like to have it in the Council committees by the week of Nov. 28. It will take that long to get the contract written and approved.”
One entity happy that the process appears over is the Gator Bowl Association. President Rick Catlett said the signing of the new Jaguars lease, complete with electronic signage revenue settled, opens the door for the impending extension of the Gator Bowl lease. This year’s game marks the end of the current 10-year lease with the extension being for another 10 years. Catlett said that in light of the Jaguars amendments, the exact language in the GBA lease hasn’t been resolved.
“We will make some adjustments based on these things to better parallel what the Jaguars language will be,” said Catlett, adding the new GBA lease contains a four-year agreement with the Big East and Atlantic Coast Conference instead of 10 years. “This will allow us to continue negotiating with the BCS (Bowl Championship Series). Within 10 years I can see us hosting the national championship game. There’s no reason we can’t. We have already proven what we can do with the Super Bowl.”
The following is the exact language of the new lease agreement:
This Agreement is entered into this second day of November, 2005, between City of Jacksonville, a Florida municipal corporation and political subdivision of the State of Florida, whose principle address is 117 West Duval Street, Suite 400, Jacksonville Florida 32202 (the “City”), and Jacksonville Jaguars, Ltd., a Florida limited partnership, whose principal address is One Alltel Stadium Place, Jacksonville, Florida 32202 (“JJL”).
Recitals
Whereas, the City and JJL desire to maintain their long term amicable relationship for many years for the welfare and benefit of both the City and JJL; and
Whereas, it is the intent of the parties to in the future incorporate the provisions of this Agreement into the Lease between the City and JJL as an Eighth Amendment to said Lease, which will incorporate and supersede the provisions of this Agreement.
Now, Therefore, the City and JJL agree as follows:
1. JJL waived its right to ribbon boards for commercial use for four (4) events annually.
The four currently City designated events are:
A. ACC game
B. Gator Bowl game
C. FL/GA game
D. ALA/FSU game
No event, group, organization or association may bundle for sale the signage for more than two of the four events in total. The City shall not assign the signage rights herein of more than two events to any group, organization or association. The City may redesignate the four (4) events annually.
2. City may designate up to two (2) non-football community-based events per year wherein the ribbon boards will not be used for commercial purposes.
3. All use of ribbon boards other than described in paragraphs 1 and 2 shall be the exclusive property of JJL at all times and for all purposes including revenue.
4. City shall reduce the rent obligations of JJL due 11/05, 6/06, 11/06, 6/07, 11/07, 6/08 in a total of eight million six hundred thousand dollars ($8,600,000.00). The rent reduction shall be in six (6) installments of one million four hundred thirty-three thousand three hundred dollars and thirty-three cents ($1,433,333.33) each. The rent reductions shall be a credit against JJL obligations for all purposes.
5. City shall reimburse JJL for one million dollars ($1,000,000.00) of capital improvements to be used for additional electronic signage at the stadium. The use of additional electronic signage shall be allocated as the existing ribbon boards are allocated in paragraphs 1,2, and 3 herein.
6. City will introduce legislation to waive the sign ordinance for signage at the stadium at:
A. The Pepsi Zone
B. Escalators
C. Practice fields
7. JJL shall provide the City a letter from the NFL that the NFL has accepted the certification by Bill Prescott of the final accounting of Super Bowl XXXIX. The letter will be provided on or before November 15, 2005. Upon receipt of this letter the City agrees to accept said certification for all purposes.
8. JJL agrees to relieve the City of its obligation to provide concessions for all event days including non-JJL events and all third-party events at the stadium under the following conditions:
A. JJL will assume the City’s obligation for period costs for concessions at the stadium. The current period costs are three-hundred-seventy-thousand-dollars ($370,000.00). In no instance will JJL be required to pay for repairs, maintenance and replacements related to the stadium. The City will be allowed to use the East/West Clubs for up to ten (10) events per year for City and/or philanthropic purposes at no cost to the City provided the City pays the actual costs of such events.
B. JJL shall operate the concessions at the stadium for all purposes. JJL shall not be entitled to make a profit on third-party events such as the Gator Bowl, but will be entitled to cover all expenses for third-party events. Further, JJL will agree to pay to the City or its designee any profit generated on concessions from third-party events. Notwithstanding the foregoing, JJL will be entitled to all profits generated by non-JJL events at the stadium.
9. JJL will be entitled to receive revenue from its current contract with Crown Royal. The contract is to expire with approximately two (2) years. Before the Crown Royal contract expires, City and JJL will negotiate naming rights within stadium, which are not otherwise currently addressed in the parties’ agreement, including Clubs naming rights.
10. The stadium naming sponsor will be entitled to receive eight (8) minutes of advertising on the score board video boards during all non-JJL football events and twenty-five percent (25 percent) of the advertising time on the score board video boards during non-football events.
11. This agreement is subject to the approval of the Jacksonville City Council.