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Star Center Deal Pays City $100K

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Rio Rancho’s legal battle with the company that formerly managed the Santa Ana Star Center has ended, with Global Entertainment Corp. agreeing to pay the city less than half the amount it was seeking.

Lawyers representing Global Entertainment and Rio Rancho reached a settlement Tuesday after a mediation session with former Attorney General Paul Bardacke acting as mediator.

The settlement requires the Arizona-based company that ran the Star Center from 2006 to 2009 to pay Rio Rancho $100,000.

Global Entertainment must pay $25,000 within 30 days and the balance within 24 months, the settlement agreement said.

“Global is pleased that the parties were able to reach a business resolution of this dispute. We wish the City success in its new direction with the Events Center,” Global Entertainment’s attorney Michael Cadigan said Wednesday in an email.

Global Entertainment filed a breach of contract lawsuit against the city in July 2009 claiming more than $500,000. The city rejected the claims and countersued, seeking more than $200,000 for debts and other expenses, according to court documents.

City Manager James Jimenez said Wednesday he was satisfied the settlement addressed the city’s concerns.

“In a mediation there is give and take,” Jimenez said. “Is it everything we hoped for? No. Is it a fair settlement? Yes.”

The settlement is the end of the relationship between Rio Rancho and Global Entertainment that began in 2004, when the city signed a 10-year contract with the company to manage the Santa Ana Star. Global Entertainment projected Star Center events would bring in sufficient money to cover payments for $36 million in bonds the city sold to build the center.

Instead, it has lost money since it opened in 2006 and the city has spent nearly $14 million to cover the center’s debt and operational expenses.

Jimenez terminated Global Entertainment’s contract in 2009 for failure to meet profitability targets. Rio Rancho later hired Comcast subsidiary Global Spectrum to manage the facility. It is still losing money.

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