'No question' that Yum Center will survive financially without NBA team, Ramsey says
01/16/2013 05:15 PM
Bringing an NBA team “would be a stretch for Louisville,” and the financially embattled KFC Yum Center will survive without one, said University of Louisville President James Ramsey.
University of Louisville is the main tenant of the arena. In the last year, though, the Yum Center has only paid off the interest on its construction bonds, has seen its bond rating downgraded and switched management companies.
“There’s no question it will survive,” he said Tuesday on Pure Politics (at 1:30 of the video). He said the new management company, AEG Facilities, has helped by reducing staff and overhead costs. The Yum Center did turn a more than $700,000 profit in November.
Ramsey also said the university has no plans to renegotiate its deal with the Yum Center.
“I don’t even think we have a moral obligation. We negotiated what was in our best interest. We made a decision we would come downtown because that’s what the community wanted. We had a responsibility to get the very best deal that we could get for the University of Louisville,” Ramsey said (3:45). “If at some point someone wants to us and say, ‘Hey, this isn’t working. We want to talk about how we can modify this going forward,’ we’ll sit down and talk to anyone.”
He also said he’s confident that one of the key funding sources would eventually pay off. The Louisville Arena Authority was counting on tax increment financing — in which extra property and sales tax income from the area around the project is used to pay off the bonds.
The Yum Center was expected to generate more than $6.5 million a year from that. It’s been bringing in about a third of that.
“The tax increment financing will take time,” Ramsey said.
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