Impasse declared over Penguins arena

The on-going negotiations between the Pittsburgh Penguins and government officials over the building of a new arena are not going as well as hoped.

The Penguins have declared an impasse and will aggressively explore moving the franchise to a new city. Kansas City is the favourite to land the Penguins as they have a brand new arena that is missing a tenant.

Penguins co-owners Mario Lemieux and Ron Burkle told Pennsylvania governor Ed Rendell, Allegheny County chief executive Dan Onorato and Pittsburgh mayor Luke Ravenstahl about their decision in a letter on Monday.

According to the Pittsburgh Post Gazette, the Penguins had agreed to pay $4 million annually in rent and capital expenses to contribute to a new area, as well as an additional $500,000 for a parking garage, but the two sides have not been able to reach an agreement. The Penguins had originally offered to pay $2.86 million annually in the offer that was presented by state and local leaders at a meeting January 4.

''Unfortunately, we still don't have a deal and are faced with mounting uncertainty that an agreement can be reached in a time frame that is realistic for our organization,'' the letter states. ''Therefore, we have no choice but to declare an impasse and to notify NHL Commissioner Gary Bettman that we will aggressively explore relocation.

''A project of this scope, with so many complex issues, can ill afford further delays that add more risk and more uncertainty. The risk has been magnified by what we perceive as a lack of collaboration from the public sector in the negotiations.

''Our good faith efforts have not produced a deal, however, and have only added more anxiety to what we thought at best was a risky proposition for us moving forward.''