Chevy Centre’s future looks a little brighter

We aren’t ready to break out the champagne just yet, but we are encouraged by the latest news about the Youngstown-owned Chevrolet Centre.

Not only did the sports and entertainment complex turn a profit — albeit a tiny one — between October and December of 2007, but city government is getting ready to hold meetings with companies that have submitted proposals to manage the facility.

The arena is currently being run by JAC Management Group, a local entity headed by Eric Ryan. Ryan, a concert promoter from Struthers, is serving as the interim director.

“I’m very comfortable the building is moving in the right direction,” said Deputy Finance Director Kyle Miasek, who has been in charge of turning the $45 million facility into a money-maker.

Miasek’s comment came last week as he reported that the Chevrolet Centre showed a profit of $151,203 — $6,881 more than was earned between October and December 2006. The city’s fiscal year begins in October and the city issues quarterly reports.

But despite the first quarter profits, the arena was a money loser the first two years of its existence. That prompted Mayor Jay Williams and city council to get rid of Global Entertainment Corp., which was hired by the city to operate and manage the facility from day one. Global’s revenue and profit projections were consistently wrong.

That not only created a public relations problem for the city, but left government holding the bag on an $11.5 million debt. The city borrowed the money as its share of the center’s construction cost and must come up with $775,650 a year for just the interest on the loan.

Global’s failure to generate enough revenue to break even, let alone make an overall profit each year, has meant tapping the general fund.

City’s debt

As we noted in an editorial in December, the $11.5 million debt must be one of the main issues discussed with the prospective operators of the arena.

Mayor Williams should make it clear that there is not one dime in private money in the project and that his predecessor, George M. McKelvey, had insisted that the city’s operating budget would not be used to prop up the facility.

The companies that have submitted proposals are: Golden Spectrum of Philadelphia; SMG of Philadelphia; and a partnership between Cavaliers Operating Co. of Cleveland and International Facilities Group of Chicago.

While none of the three is local, there is an interesting Mahoning Valley connection with one.

Youngstown businessman Bruce Zoldan, owner of B.J. Alan Fireworks and the Mahoning Valley Phantoms hockey team, and Alan Levin, owner of Palisades Baseball, which owns and operates the Mahoning Valley Scrappers, have joined with Global Spectrum.

While that partnership alone does not give the company an advantage, it does enable city officials to look at the proposals from different perspectives.

Regardless, the bottom line for government is to negotiate a deal that provides the public treasury with as much money as possible so it can pay off the debt without draining the general fund.

There is reason for guarded optimism, but the mayor and his advisers should guard against making the same mistakes as the previous administration.