The city is being asked to contribute another $15.7 million in loans, grants and financing to finish the downtown baseball stadium.
City officials will release details of the deal today, and the Winston-Salem City Council could vote on it as early as Monday night.
The council will consider the deal in a special meeting at 5:30 p.m. Monday at City Hall, and the public will be allowed to comment during that meeting.
Billy Prim, the owner of the single-A Winston-Salem Dash, said yesterday that the collapse of his business partnership with team co-owner Andrew "Flip" Filipowski and the global credit crisis have made it impossible for him to borrow enough money from private sources to finish the stadium.
Prim has been talking with city officials — including Mayor Allen Joines and City Manager Lee Garrity — as well as with private investors and banks.
The consensus, Prim, Joines and Garrity said, is that either the city contributes more money or the stadium does not get built. The city has already contributed $12 million to the project.
"As we looked at this project, we started from the premise that it was just not acceptable to let the stadium go into foreclosure," Garrity said.
They have proposed a deal under which the city would lend Brookstown Development Partners LLC — which is owned by Prim — enough money to complete the ballpark.
Prim and the city are announcing the deal today, giving people the weekend to contact their council members and the mayor to say whether they support the proposal.
Under the deal, the city would take out a $12.7 million loan from BB&T and then turn the money over to Prim and the stadium developers. Prim would use the money to pay subcontractors for work that is already complete, to buy the rest of the land for the stadium and parking lots, and to pay construction crews to finish the ballpark.
The stadium development company would pay the city's loan payments — principle and interest — over the next 25 years.
The city would also give the development company another $2 million, which Garrity said would come from a federal grant. The city would give the money back to itself if the grant comes through. And the city would also finance the purchase of land for the second phase of the project, which would be a multi-use development with retail and office spaces.
Under the original agreement, the development company was to pay the city $980,361 up front for the city-owned land. The company will now pay the city for that land — plus interest — over 5 years.
The cost to build the 5,500-seat stadium has grown to $40.7 million — roughly $18 million more than the $22.6 million that it was supposed to cost when the city council first agreed to contribute to construction in 2007. In December, Prim said that the stadium would cost more to build because of upgrades, including a larger kids zone and a wider concourse.
Construction on the stadium, which is being built at First Street and Peters Creek Parkway, has been stalled for months.
Prim and the development company need another $32.7 million to finish the stadium, according to a memo sent to Garrity by Deputy City Manager Derwick Paige and Denise Bell, the city's chief finance officer.
Under the agreement, Prim's development company would take out an additional $15 million loan. Prim himself has contributed an additional $2 million. He said that a "large diversified group of people" invested the remaining $1 million.
Prim said that when and if the deal with the city is signed, Filipowski will no longer be involved with the team.
The $12.7 million loan would bring the city's total contribution to more than $24.7 million.
Prim said that his development company has borrowed the maximum that lenders will approve.
"Banks were financing and funding these types of projects a year and a half ago," Prim said. "Today, they're not funding them."
Bell said that the city is still negotiating an interest rate on the $12.7 million loan.
Garrity said that no legal contract between the city and the team has been written or signed, but Joines said that the city would be protected. Joines said that Prim's company would pay back the city through ticket sales, sponsorship revenues and money that the company makes off naming rights to the stadium.
Still, the city would be the second in line to be paid — the banks that lent Prim's development group the $15 million would be first.
Joines said he sees no other way to finish the stadium. If it doesn't get finished, the city would have to take Prim's company to court to recoup its original $12 million.
"I think the biggest concern is not getting it done," Joines said. "I certainly don't have another alternative."
Prim said that neither side wants a lawsuit.
"We try to focus on the positives," Prim said, "instead of on whose lawyer would win."
Under the agreement, the Dash would have to sell 300,000 tickets each season to pay its debts, Prim said. That would mean that the team would need to sell an average of 4,000 tickets per game. Team president Kevin Terry said yesterday that the team has sold the equivalent of 1,500 full-season tickets for the 2010 season.
The team, an affiliate of the Chicago White Sox, is playing this season at Wake Forest Baseball Park.
Terry said he is optimistic that the Dash could sell enough tickets to pay the debt.
The team laid off about 10 people last month. Terry said those positions would likely be refilled this fall or next year.
A signed deal would also mean that construction on the stadium could resume as early as the middle of next month, and it could be finished by the fall, Prim said.
Before construction could start, Prim's company would have to fork over at least $475,000 to subcontractors who have not been paid for work already done.
■ Laura Graff can be reached at 727-7279 or at lgraff@wsjournal.com.
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