A new arena for Savannah — should we just throw in the towel?

My last two City Talk columns talked about Savannah’s proposed new arena, which will replace — eventually, I hope — the aging Martin Luther King, Jr. Arena at the Civic Center.

Last Tuesday, I talked about the woefully inadequate current venue after attending the Elton John concert there.

On Sunday, I took a look at the costs and financing options for comparable new arenas in other cities.

Because of the deep economic downturn, a sharp decrease in the funds available from the current Special Local Option Sales Tax (SPLOST), and the reallocation of some of those one percent tax levies, we have only $19 million (I thought it was $22 million until today) earmarked for a new arena, as opposed to the $70+ million in available tax money that was promised when voters approved the current SPLOST back in 2006. In 2006, it was also assumed — not unreasonably — that plenty of other revenues would be available to move ahead with the arena project.

The $20 million currently earmarked has been the subject of a good bit of discussion, including a push from the Sand Gnats owners to build a new stadium on a portion of the Savannah River Landing site.

But now City Manager Rochelle Small-Toney has proposed shifting the vast majority of that money to pay for renovations at the existing Civic Center. From Lesley Conn’s City Manager asks Savannah council to use arena’s tax funds for Civic Center fixes in today’s SMN:

Savannah City Manager Rochelle Small-Toney is asking City Council to consider using most of the $19 million in SPLOST funds set aside for a new arena for extensive renovations of the Civic Center.

“This facility is well beyond its life expectancy,” she said.

She explained it was inefficient to operate, and because of its obvious age, increasingly was losing bookings to newer venues. She added that without a significant investment, the arena “most likely won’t last beyond five years.”

Renovations were projected at $16.2 million. The proposal was put before council members near the end of the first day of a two-day financial overview workshop, and clearly surprised most council members.

Neither Mayor Edna Jackson nor others were quick to embrace the concept, and some rejected it outright.

Even if the entire $16.2 million were spent on the arena and not in other areas of the Civic Center, it couldn’t address the arena’s fundamental inadequacies:

• insufficient capacity for many types of shows
• bad acoustics
• a rectangular design that literally leaves thousands of patrons having to sit with their heads turned
• cramped walkways and public spaces
• uneven steps

The arena is not a lady who needs a good makeover as Joe Shearouse, director of Public Facilities, Events and Services, apparently said at yesterday’s retreat to discuss finances. It is a fundamentally inadequate facility that needs to be replaced.

And I suppose we could just throw up our hands, say that we can’t replace it for another 20 years or longer, and spend that $20 million on other things.

But that’s likely political suicide: the odds of voters approving another round of SPLOST will fall dramatically if the city scraps its signature initiative used to sell the current SPLOST to voters.

Instead of giving up on the idea of a new arena and deciding that we just won’t have a decent one for years, we need some folks to create a vision for one — and then see if that vision is shared by the majority of Savannahians.

Ideally, this vision would be coming from the city manager’s office. I’m shocked that city officials seems prepared to throw in the towel on something that has been discussed for the last decade.

So maybe the vision needs to come from the mayor and members of council — who seem to be pretty serious about the commitment made to voters. And maybe other economic development folks — like the Chamber and SEDA — should get in the game here too.

At yesterday’s retreat, Small-Toney said that a new arena would cost $150 million.  I don’t know where that number comes from. Comparable arenas have been built in recent years for less than $130 million — in some cases much less. Maybe she’s assuming inflation and construction years from now, but that high estimate simply seems a dodge.

Consider how Evansville paid for its new $127.5 million Ford Center: long-term bonds being paid through the existing food & beverage tax, riverboat revenues, and a sort of tax allocation district (a TIF in this case).

The city of Evansville and the metro area are both small than the city of Savannah and our metro area. Evansville also has dramatically less tourism than we do.

How about someone with the full expertise working up a financing package for a new arena with the various components:

• the existing $20 million
• some funding from the next SPLOST — $30 to $50 million, I’m thinking, would not be a political disaster in the next vote
• a TAD for the immediate area around the arena, depending of course on where it is built — approximately $20 million over a period of decades?
• a portion of the increased revenues from the hotel bed tax as new rooms are added to the city’s capacity — maybe $20 million over 20 years?

A few sources like those and we’re within clear range of paying for a new arena.

Maybe the general population of the city and of the region as a whole don’t want a new arena. Maybe they’ll ultimately reject one as too expensive.

But throwing in the towel right now — as the current city administration seems prepared to do — could be a terrible mistake for the city’s future.