Manager of suspended Rupp Arena project to get paid through December 2015

bmusgrave@herald-leader.comJune 29, 2014 

Although a $350 million renovation of Rupp Arena and attached convention center has been suspended, the project manager will continue to be paid through December 2015, city officials said.

Frank Butler's contract, which began Sept. 1, 2012, does not expire until Dec. 31, 2015. Butler receives $200,000 a year plus other benefits, including a $250,000 life insurance policy, according to documents obtained by the Herald-Leader through an Open Records Act request.

Some members of the Urban County Council want to know more about how Butler will be paid.

Questions about Butler's pay surfaced during a June 12 Urban County Council meeting.

Councilman Kevin Stinnett, who raised the issue of what happened to $5.5 million in unspent funds for the Rupp project, said the council needed to know how Butler would be paid and who would be paying his salary.

"If there is a fund balance, we need to know: Is it the state's? Is it the city's? Is it the (Lexington Center Corp.) or Convention and Visitors Board money?" Stinnett said. "If Frank is going to stay on, we need to know what exactly he will be doing."

Butler's contract is with Lexington Center Corp., or LCC, which oversees Rupp, the convention center and retail shops.

A little more than $50,000 remains in LCC accounts earmarked for design and planning for the Rupp project. But there is $313,000 in city money and $313,000 in state money that has not been spent. The city gave $2.5 million for the project, the state gave $2.5 million, and Lexington Center Corp. and the Convention and Visitors Bureau also chipped in for the design phase of the project.

Butler, who left a high-paying job as a vice president at the University of Kentucky to take the position, declined to comment.

Brent Rice, chairman of the LCC board, said the board would discuss how Butler will be paid at its next meeting, on July 17. Rice said Butler would be busy.

"Because of the Rupp project, Mr. Butler has been working with the nation's leading experts in the field, and he brings a lot of knowledge and experience," Rice said. "The board of directors and Lexington Center staff will have discussions with him about his role going forward in examining all assets and ideas to improve efficiencies, including possible development of surrounding parking lots."

The High Street parking lot across from Rupp Arena has potential to be developed into a retail complex. The High Street parking lot was not part of the $351 million Rupp Arena renovation and expansion.

Rice said LCC would have money to pay Butler through December 2015 without having to use funds remaining in the Rupp Arena renovation accounts.

"Butler is contracted through December 2015, and LCC has ample resources to compensate him for the rest of the contract," Rice said. "We are fortunate to have him on board. There is a great amount of work he can do for the remainder of the contract if he and the board can agree on his role going forward."

The LCC board voted in May not to request the remaining $313,000 from the state and not to spend any additional money. The board did not discuss how Butler would be paid.

Mayor Jim Gray called off the renovation project on June 11 because the city could not come to an agreement with the University of Kentucky, Rupp's marquee tenant, on the scope of the project. It had run into other problems — the state legislature did not approve $80 million in state funding for the renovation, and opinion polls showed little support for spending taxpayer dollars on the project.

How Butler will be paid is a key issue. Gray pledged this year to repay $2.5 million the state gave for planning and design of the project.

The Urban County Council will discuss repayment of the $2.5 million at a meeting set for Aug. 28.

The council had discussed holding the meeting July 8, but several members could not attend. The meeting was pushed back to Aug. 28 because the council is on break for much of July.

Vice Mayor Linda Gorton, who is also on the LCC board, said she hoped the board would discuss how Butler would be paid at its July 17 meeting.

"This is one of the things that we need to look at. The board needs to do its due diligence," Gorton said.

Beth Musgrave: (859) 231-3205. Twitter: @HLCityhall.

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