Manager: Finance figures will come

This is a good first step, but it should have come sooner, a councilman says.
By DAVID SKOLNICK
CITY HALL REPORTER
YOUNGSTOWN -- After getting the brush-off for about four months from Chevrolet Centre management leaders about the facility's finances, city officials say they will get that information no later than Wednesday.
City Finance Director David Bozanich said he asked officials with Global Entertainment Corp. of Phoenix and Compass Facilities Management Co. of Ames, Iowa -- the companies managing the center -- numerous times for the information since September.
"I was told, 'We'll get it to you' or 'We have a change of staff,'" Bozanich said.
Jeff Kossow quit as the center's executive director in December.
Bozanich said the explanations for the delays were unacceptable, and he sent the management team a letter last month insisting the center's financial information be given to the city. The city owns the Chevrolet Centre.
Vindicator story
It wasn't until two days ago that center officials told Bozanich that the information would be given to the city next week. That is the same day The Vindicator published an article about the problem. But Bozanich said the article wasn't the reason he finally got a firm date from center officials.
Bozanich said center officials told him the city would have the financial numbers no later than Wednesday and at some point in the next nine days, center officials would give the city and the public a "full-blown presentation" of the information.
Councilman Artis Gillam Sr., D-1st and council finance committee chairman, said he spoke Thursday to Wayne Davis, vice president of Global Entertainment and president of Global Entertainment Marketing Systems, a Global subsidiary, about this issue.
Gillam said Davis told him Roger Swanson, Kossow's interim replacement, would attend Wednesday's council meeting to discuss the facility's finances.
"This is a good first step, but it should have come sooner," Gillam said.
Mayor Jay Williams said he expects the facility's management to provide financial and operational information to the city on a consistent basis in the future.
When asked if the city was considering replacing the arena management team, Williams and Bozanich said it's premature to discuss that.
"We can't do anything intelligently until we see the numbers," Williams said. Attempts to contact Davis and Swanson this week were unsuccessful.
Financial projects from the center's management team in August projected the cost of the facility at $45.38 million in a worst-case scenario and gave a conservative profit figure of $1.15 million for 2006.
The final construction costs won't be known until as late as the end of next month because not all change orders for the project have been given to the city.
"We believe the facility has done well," Bozanich said. "Our intent is for the facility to pay for itself. We'd like to see it make a profit."
Debt service
But the most important aspect is making sure the arena's profits cover its costs, he said.
The first item to be paid out of the profit is the city's debt service, estimated to be $850,000 a year. Under the projection of a $1.15 million profit, about $300,000 would be left after the debt service is paid.
The city gets 70 percent of the center's remaining profits after debt service payment, and the other 30 percent goes to the arena management.
The management fee for this year for the center is $183,288 and is built into the facility's operating fund. Personnel services, including salaries and benefits for all center employees this year, are $1.21 million -- also included in the budget.
The city borrowed $12 million at 6.5 percent interest from Sky Bank in late August to make up a projected funding gap for the arena.
Most of the center's construction cost was paid with a $26.8 million federal grant. The facility also received state funding, money from the city's water and sewer fund, and an Ohio Edison energy grant.