A key Aldermanic committee this morning approved plans and financing agreements to redevelop the long-empty Kiel Opera House.

The committee’s Housing, Urban Development and Zoning Committee voted 13-1 to pass the $74 million project on to the wider Board, a week after it held the matter for further study.

In a crowded 90-minute hearing, Board members quizzed SCP Worldwide partner Ken Munoz about the project, which has met opposition from owners of the Fox Theater, who say the city would be subsidizing a new competitor in the region’s theater market.

But ultimately the committee OK’d the proposal, with a few small adjustments. It could be voted on by the full Board by mid-June. SCP has said it wants to start construction in August.

SCP agreed to several changes to protect the city in case the company – which also owns the St. Louis Blues and Scottrade Center – can not pay off $29 million in bonds that will help fund the project. It also agreed to extend limits on Broadway-style shows out to five years, from the original three, a measure designed to reduce concerns about competition with the Fox. The city will also have a 60-day exclusive negotiating period if SCP wants to sell its rights to the building.

SCP will be allowed to hold 36 traveling theatrical shows in the Kiel’s first year of operation, up to 64 in its fifth year. The Fox, by comparison, holds 100 to 110 such shows a year. Munoz said he was hopeful that they could attract enough new shows to fill both theaters, but acknowledged that was somewhat “up in the air.”

SCP also plans to run shows that it produces at the Kiel, as well as concerts and family-style shows – some of which now run at Scottrade Center, Munoz said. The first show, he hopes, would be a four-week run of How the Grinch Stole Christmas, which is produced by a subsidiary of SCP.

Munoz also addressed concerns about the high level of public subsidy – roughly $60 million of the $74 million project will come from tax credits or bonds backed by tax revenue the city now collects.
“We understand that,” he said. “But this is what it takes to get this done.”

SCP hopes for just a “modest profit” operating the building, Munoz said, and noted that it is investing $14 million and is on the hook for the $29 million bond issue, which is to be paid with amusement tax revenue now collected on Blues tickets. If there’s a shortfall, SCP will make up the difference.
“We’re on the hook for that. We’re guaranteeing that,” he said. “The risk is ours.”

Aldermen also raised concerns about the Black Repertory Theater; Munoz and partner Chris McKee said they are in talks with the Black Rep about using a smaller secondary theater at the Kiel when the Rep wants to.

Alderman Shane Cohn encouraged the Kiel and the Fox and other local theater groups to work together to boost the region’s performing arts industry. Alderman Samuel Moore raised concerns about the use of minority contractors and construction workers on the project. Alderwoman Marlene Davis apologized for the level of confusion around the project in recent days and criticized city officials who negotiated the deal for not involving the Board of Aldermen earlier.

Alderman Antonio French raised concerns about the roughly $1.5 million in amusement tax revenue the city will forgo for the bonds. Barbara Geisman, the city’s deputy mayor for development, said much of that money would be recouped in tax revenue associated with construction in the first couple of years, and that the theater itself was expected to generate at least $500,000 a year in new tax revenue once it’s up and running.

See Thursday’s Post-Dispatch for more coverage.