On the western edge of the 28-acre former Civic Arena site in Pittsburgh's Lower Hill District, earth movers have begun to prepare the site of First National Bank's coming headquarters tower. Photo by Kaycee Orwig/PublicSource.

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Just as earth-moving equipment starts to reshape the former Civic Arena site, the entire development landscape of the Hill District threatens to shift this month.

Boston-based Fenway Sports Group [FSG] has a purchase pending to the Pittsburgh Penguins, potentially putting the Lower Hill’s redevelopment in the hands of a billionaire whose ownership of the Boston Red Sox coincides with ballpark-area gentrification.

Less publicly, a potential rival to the Hill Community Development Corp. awaits word on whether it will become the neighborhood’s second registered community organization. Such a designation could alter the public processes governing an anticipated billion-plus dollars of Lower Hill construction plans.

Here are the questions we asked, and the answers we got, in a week of uncertainty for the Hill.

Would a sale of the Penguins alter the club’s commitments to redevelop the arena site?

The hockey franchise received the development rights to the 28-acre site as part of the complex deal that led to the construction of the 11-year-old PPG Paints Arena. In 2014, the team’s development arm, Pittsburgh Arena Real Estate Redevelopment LLC, signed a Community Collaboration and Implementation Plan [CCIP], which outlines the community benefits that should flow from the development to the rest of the Hill.

The Penguins have turned over most development duties to Delaware-based Buccini/Pollin Group [BPG]. Site preparation recently began on the western edge, where First National Bank’s new headquarters tower is set to rise on 2.5 acres.

“A change in ownership, if any occurs, would not in any way affect the Penguins’ commitment to the Lower Hill redevelopment effort,” wrote Kevin Acklin, chief operating officer and general counsel for the Penguins, in a response to PublicSource’s questions.

The Lower Hill District site slated for First National Bank’s new headquarters tower. Photo by Kaycee Orwig/PublicSource.

Leaders of the Hill CDC, which held a meeting Thursday night, said they were still gathering information on the potential impact of a sale.

“We have urged elected officials to get information about what this means for the Lower Hill development rights,” Hill CDC President Marimba Milliones told around 45 attendees at the virtual meeting. “We need to make sure the new ownership group understands the commitment that comes with that ownership.”

What is FSG, and what is it saying about the Hill District?

FSG is a sports conglomerate whose best-known assets include the Red Sox and their ballpark, and the Liverpool Football Club and its stadium. Its principal owner is billionaire John Henry. Its most famous investor may well be basketball star LeBron James. And a prominent Pittsburgh connection is Larry Lucchino, an Allderdice High School graduate who became president of the Red Sox and remains an FSG partner.

Questions submitted by PublicSource to FSG Friday were not immediately addressed.

What role will neighborhood voices have?

As the Penguins and BPG redevelop parts of the former arena site, they must get public approvals. Those would come from the entities that own the land — the Sports & Exhibition Authority [SEA] and the Urban Redevelopment Authority [URA] — plus the City Planning Commission.

Since 2018, city code requires that developers try to hold Development Activities Meetings with registered community organizations [RCOs] prior to getting the commission’s approval. The URA board has also tended to consider input from RCOs. None of the bodies are legally bound to heed neighborhood input.

The Hill District’s RCO is the 34-year-old Hill CDC. It has argued that public bodies should hold off on approving the development plans and selling the land until the Penguins and BPG provide a term sheet guaranteeing sufficient community benefits.

The Penguins and BPG have offered $34 million in community benefits — some backed by FNB, and some from funds that would normally flow to taxing bodies — stemming from the tower project. The Hill CDC has countered with demands including resident investment opportunities, affordable office space inside the tower and savings bonds for the neighborhood’s children.

So far, the SEA, URA and commission have allowed the Penguins and BPG to proceed with the FNB tower. Each section of the site, though, will require a new round of community meetings and public approvals.

Is there emerging neighborhood support for the redevelopment effort?

Hill District residents and business people have spoken for and against the efforts of the Penguins and BPG at public hearings, and now some of the proponents are trying to form their own RCO.

“I am in full support of the FNB project, and we are ready to move forward,” said Tonya Ford, in a video montage that the development team played for the Planning Commission on May 4. In that same video, Gilbert Lowe also declared his support. At a May 26 URA board meeting, the two spoke in favor of the sale of Lower Hill land to an entity created by BPG, the Penguins and FNB, and among those who joined them were Sauntee’ Turner.

In September, Ford, Lowe and Turner filed an application to have the newly formed Hill District Collaborative designated as an RCO for the Hill District and the Bluff.

In its application, the collaborative indicated that it has a board of directors of between nine and 21 members, but neither the application nor the collaborative’s website list them. The collaborative declined to disclose its board to PublicSource and opted not to participate in an interview. Turner, who was a member of Pittsburgh Mayor Luke Ravenstahl’s staff, declined to provide answers after the collaborative asked PublicSource to put its questions into writing.

City Councilman Daniel Lavelle wrote a letter endorsing the collaborative’s application. He did not respond to requests for comment.

City Planning Director Andrew Dash indicated this week that his department is reviewing the application and might make a decision later this month.

How did the Hill CDC react to the collaborative’s bid for RCO status?

In response to the Hill District Collaborative’s application, the Hill CDC held an emergency meeting on Oct. 25.

At the virtual meeting with nearly 100 attendees, Milliones said the CDC is “always excited by new people getting engaged in what’s happening in our neighborhood,” but also cautioned that the existence of two RCOs would allow “the city and private interests” to “drive the process.”

“At a time when the Hill District’s future hangs in the balance, this is the last thing we need,” she said.

What would happen if there were two RCOs in the Hill?

If two RCOs fail to cooperate in relation to a given development, it then falls to the Department of City Planning, rather than the groups themselves, to schedule and facilitate Development Activities Meetings.

Milliones said at the emergency meeting that the existence of two RCOs in the Hill could allow developers to attempt a “divide and conquer” strategy to the neighborhood input process.

While the Hill CDC has sought to slow public approvals for the Penguins-led redevelopment of the Lower Hill, leaders of the new Hill District Collaborative have spoken in favor of the plans. Photo by Kaycee Orwig/PublicSource.

Could the Hill District Collaborative take the place of the Hill CDC in Lower Hill negotiations?

The CCIP created a nine-member Executive Management Committee with three representatives of the Hill, three appointees from the team and three picked by government bodies. Its job is to guide efforts to spread the Lower Hill development’s benefits through the Middle Hill and Upper Hill, by solving problems and building consensus among the parties.

The neighborhood’s representatives are chosen by a Lower Hill Working Group. Milliones, a signatory to the CCIP, is one of them. Even if it is approved as an RCO, the new Hill District Collaborative would not automatically get a seat on the EMC.

As the earth shifts, what has the EMC been doing?

The EMC meets every other Friday. As a body created through the signed CCIP, it is not subject to the Sunshine Act, which requires that government bodies hold decision-making meetings in public. So far, it has not allowed the public or media to attend.

PublicSource has been asking since Aug. 10 for an opportunity to observe the EMC process. On Sept. 1, Lavelle said in a short interview that the EMC was “working to open it up to any and all media and public” after “the next two or three meetings.”

Since then, Lavelle has not responded to monthly calls, texts and emails asking for an update.

Rich Lord is PublicSource’s economic development reporter. He can be reached at rich@publicsource.org or on Twitter @richelord.

Develop PGH has been made possible with funding from The Heinz Endowments.

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