Markley: “I am loathe to see the state borrow 10 cents that we don’t have to.”

Malloy Campaigns For XL Center Renovations

(Hartford Courant)

Gov. Dannel P. Malloy used a visit Thursday to the city’s XL Center to campaign for an aggressive, $250 million makeover, as a key legislative committee has whittled away at his initial requests to get to project moving.

Malloy is seeking $50 million in 2018 and $75 million in 2019, one half of the renovations, which would be completed over three or four years. But the request, which would be financed through the sale of bonds, was cut deeply by the finance, revenue and bonding committee to $40 million and $35 million.

Malloy warned that smaller investments would only drive up the costs.

“If you don’t put enough money into those various stages, what you’ll end up with is more years,” Malloy said, in a news conference. “Now, more years means more construction inflation, means more events not taking place in the facility, means a disruption in usage as well as the cost.”

Malloy toured the arena to see the start of the replacement of the failing ice-making system, which will occur over the summer and be completed in time for the start of hockey season this fall.

The project will cost $2 million.

Earlier this week, House Speaker Joe Aresimowiz, D-Berlin, said he met recently with businesses — CEOs of larger companies, grassroots business organizations — and asked them about the need for investing in the XL Center.

“Everybody around the room said it was vitally important, that we need some sort of identity as the city of Hartford,” Aresimowicz said, adding that the arena is a piece of the puzzle to boost after-hours vibrancy.

Late last year, the Capital Region Development Authority, which oversees the state-owned arena, approved a consultant’s recommendation that envisions a dramatic change that would essentially create a new arena.

The renovations include a second concourse to relieve congestion and irritating waits at concessions; more premium seating lower in the arena bowl; and more restaurants, amenities and restrooms. The arena’s heating, cooling and other systems would be revamped.

But the project has provided a flashpoint for legislators who say the state must pull back on its spending, given its precarious budget finances. Recent downgrades in the state’s credit rating also could make it more expensive to borrow.

“I would say, at this moment, seeing our credit rating reduced because of the amount of borrowing, I don’t see how we could consider borrowing a quarter of a billion dollars,” Sen. Joseph Markley, R-Southington, said Thursday. “I am loathe to see the state borrow 10 cents that we don’t have to.”

Markley said he was encouraged that the authority is now seeking private investors for the project.

But what he said he would like to see is the arena taken over completely by private interests, a prospect that is unlikely.

Some legislators have suggested the tribal operators of Foxwoods Resort Casino and Mohegan Sun should be required to invest in the XL or at least underwrite some shows should the state allow the tribes to build a satellite casino in East Windsor.

The state’s southeastern Connecticut casinos have taken a big bite out of the XL Center’s concert business and Mohegan Sun is building a convention center that will put pressure on Hartford’s convention center.

When asked about potential involvement by the tribes, Malloy said, “Anything is possible, and discussions should be had,” but he declined further comment.

Sen. Tim Larson, D-East Hartford and co-chair of the legislative committee that oversees casinos, said the issue has been raised with the Mashantucket Pequots and Mohegans.

Andrew Doba, a spokesman for the tribes, declined to comment directly on the XL Center but said: “We’ve said from the beginning that our project will benefit the region and that goal hasn’t changed.”

The $250 million renovation plan would come on top of $35 million in the last few years to spruce up the arena.

Those renovations were intended to keep the XL Center viable until a long-term plan — the renovation now envisioned by the authority — was developed. Another $3.5 million has been approved to replace the ice-making system and make other improvements.

Physical changes could make the XL Center more competitive with newer arenas and with promoters of concerts and other events, potentially increasing profits for both the promoters and the XL Center.

Competitive pressures are building not only from the state’s two casinos but from the prospect of the casino and entertainment complex under construction in nearby Springfield.

The authority has estimated that a transformed arena is projected to turn a $2.1 million annual profit.

The arena has typically been a money-loser, with the state having to make up the difference, typically about $3 million a year.