Wednesday, July 28, 2004

Bengals lawsuit provokes outrage

Heimlich, Portune blame ex-board

By Cindi Andrews
Enquirer staff writer

The Hamilton County commissioners criticized their predecessors, the county prosecutor and the Bengals on Tuesday for potentially putting county taxpayers on the hook for an additional $14 million when they changed the Paul Brown Stadium lease in mid-2000.

"This appears to be a more outrageous giveaway than the original contract," Commissioner Phil Heimlich said. "I can't conceive why they would agree to this."

The 2000 lease amendment eliminated a guarantee that would have forced the county to pay the football team an estimated $2.5 million for shortfalls in ticket sales the first two years.

That provision had prompted a public outcry; so, instead, the county agreed to stop collecting seat-license fees several months earlier than planned and be responsible for any taxes levied on the $26 million in seat-license fees the county collected.

Governments don't pay taxes, but in 2002 the Internal Revenue Service sent Bengals shareholders a $13.3 million tax bill on the seat-license fees that went to the county. The Bengals paid the IRS while the county and the Bengals worked together to dispute the tax.

The unresolved IRS issue resurfaced Monday when the Bengals filed a $30 million countersuit against the county in response to the county's $600 million federal lawsuit against the team and the National Football League.

That total includes $13.8 million the team is demanding to repay the seat-license tax and related legal fees.

"We have to defend ourselves," Bengals President Mike Brown said Tuesday in his first public comments on the legal battle. "We didn't start this."

"... When you're sued for $600 million, which is a lot of money - certainly more than we have here - yes, that will get your attention because it's ruinous if you lose the suit," Brown said.

Hamilton County Prosecutor Mike Allen's office also defended itself Tuesday against criticism for approving the deals between the Bengals and the county.

"For some reason, everything is always left at the doorstep of the prosecuting attorney, when the prosecuting attorney is just carrying out the wishes of the commissioners," Assistant Prosecutor Carl Stich said.

Additionally, Stich said he believes that once negotiations and, possibly, litigation with the IRS are finished, the tax liability will cost the county less than the $2.5 million the ticket guarantee would have cost.

"I'm looking down the barrel of a 50,000-seat ticket guarantee," Stich said in describing the county's perspective at the time. "The Bengals are willing to let me off of that."

It wasn't the county that was let off the hook, Commissioner Todd Portune said Tuesday, but rather then-Commissioner Bob Bedinghaus.

Bedinghaus, a Republican who went on to lose to Democrat Portune in November 2000, was taking a lot of heat from taxpayers for cost overruns at the $451 million Paul Brown Stadium.

"The whole thing was done just to help his campaign," Portune said. "Nobody can convince me otherwise. I blame him; I blame the other commissioners at the time; I blame the prosecutor's office for going along with the deal."

Bedinghaus did not return calls seeking comment Tuesday, nor did then-Commissioner Tom Neyer or longtime Commissioner John Dowlin.

As the Bengals and the county pressed their cases in the media Tuesday, they also raised the possibility that their dispute could be settled outside of U.S. District Court.

Portune and Heimlich have said they only want a new lease that's less generous to the Bengals, and Portune said Tuesday that there's been "a flurry of activity" behind the scenes for the past week and a half laying the groundwork for settlement discussions.

Brown told reporters in pre-training camp interviews at Paul Brown Stadium that the Bengals don't want a court fight.

"None of this makes a lot of sense. Does it? To be contesting this in federal court?" he said. "The better way would be to sit down with the county and try to resolve what they see as problems and resolve what we see as problems. If we go through this court method, it will take years. It will take millions of dollars in attorney fees alone.

"We hope they're going to come to the realization that there might be a better way."


Enquirer reporter Mark Curnutte contributed.


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