Does the flap over the proposed Las Colinas Entertainment Center really stem from a simple business rivalry between two big live-events companies? That’s what proponents of the $250 million Irving complex contend.
They say the LCEC story–which has been all over WFAA-TV and the Dallas Morning News in recent days–is the result of a “well-funded, undisclosed” opposition led by an outfit called AEG Live. AEG’s a Los Angeles-based company that operates DFW concert venues whose revenues allegedly would suffer from a successful LCEC.
But Channel 8 reporter Brett Shipp, whose investigative stories jump-started the recent coverage, calls the AEG theory “hilarious,” adding, “It’s a slap in my face. Anybody who knows what I do knows I don’t carry water for any corporation.”
Even so, you can sort of see how this conspiracy business got started.
The 600,000-square-foot Las Colinas Entertainment Center would go up next to the Irving Convention Center. Planned to open in late 2012, it would include a big concert hall as well as restaurants, draw more than million people annually, and host nearly 300 events a year.
A public/private partnership between the city of Irving and the Las Colinas Group LP along with strategic partner Live Nation, the mega-complex would be financed with $200 million from the city, plus $50 million from Las Colinas Group. Irving voters OK’d a sale of municipal bonds for the project, backed by a hotel occupancy tax, but the city still needs a judge’s OK before it can offer the bonds for sale.
Shipp’s initial reporting focused on potentially questionable expenses incurred by the Las Colinas Group, which is led by chairman Bill Bueck and president Dave Hanlon. They’re teaming on the project with Billy Bob Barnett of the Texas Hospitality Group, who would run the center’s concessions. So-called “soft costs” incurred by the group for the likes of unidentified airplane flights–and even chauffeuring services by Billy Bob’s personal driver–came under fire in the various news reports, since they were reimbursed to the group out of hotel tax revenues.
Bueck and Hanlon, however, insist the soft costs incurred for the “shovel-ready” entertainment project aren’t out of line at all. In fact, they provided a study said to have been prepared by Dallas’ Beck company showing that soft costs for the LCEC have come in at 8.8 percent of the total cost, compared to the “industry norm” of 11 percent to 13 percent. By comparison, the Beck document says, soft costs for the Irving Convention Center and the Federal Reserve Bank Dallas were 11.7 percent and 14.2 percent, respectively. (Beck didn’t return calls seeking comment.)
“We’ve been good stewards of the [city’s] money,” Hanlon says.
The bigger picture in the flap, LCEC backers contend, is the behind-the-scenes role played by AEG. That company operates several DFW venues like Grand Prairie’s Verizon Theater whose ticket sales could drop if the LCEC opens, backers of the Irving project insist.
LCEC proponents point out that law firm Thompson & Knight LLP, whose James Harris represents opponents of the project in a lawsuit over the LCEC, has provided legal services to AEG Live for several years. They also contend that Thompson & Knight recruited Joe Putnam, a former Irving mayor, to challenge the project publicly. (Putnam and a group called Irving Taxpayers Opposed to Illegal and Wasteful Use of Tax Money say the LCEC project is illegal on several fronts.) The LCEC backers further insist that opposition to the project really kicked into gear after Live Nation persuaded one of AEG’s key local executives to defect to Live Nation and open a Dallas office for the company. (AEG didn’t return a phone call seeking comment.)
Harris of Thompson Knight says that “it’s common knowledge that AEG Live supports the legal challenge” to the project. However, he adds, AEG’s support has “no bearing” on the case: “AEG Live’s involvement in the lawsuit should not distract attention from the legitimate questions that have been raised” about the project.
Shipp, for his part, acknowledges Irving Mayor Herbert Gears’s contention, aired on Channel 8 yesterday, that AEG Live funded a new report blasting the LCEC project. But he says any involvement by AEG–an outfit he was unfamiliar with until Gears mentioned it–is by no means “the meat of our reporting” about the project’s possibly “questionable” operations.
