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City, SMG sign deal on Chevy
The city began looking for a company to run the Chevy Centre eight months ago.
YOUNGSTOWN — The irony of signing a contract with a company to help manage and promote the city-owned Chevrolet Centre wasn’t lost on Mayor Jay Williams.
“It takes weeks and months to negotiate and it takes less than 15 seconds to finalize” the contract, he said after Tuesday’s board of control meeting.
“Less than 15 seconds” is probably generous.
The three-member board — Williams, Finance Director David Bozanich and Law Director Iris Torres Guglucello — ended the meeting before their seats got warm.
The city began looking for a company to run the Chevrolet Centre after it ended its contract in October 2007 with International Coliseums Co., a subsidiary of Global Entertainment Corp. of Phoenix.
Under ICC management for two years, the center lost about $280,000.
The board signed a five-year-plus contract Tuesday with SMG, a Philadelphia company that manages more than 200 facilities worldwide.
SMG will provide support to the center with marketing services, event booking, risk management and insurance, administration and financing.
As part of that deal, the city is retaining JAC Management Co., a Struthers company that’s handled the center’s day-to-day operation since October, when Youngstown ended its management contract with ICC.
SMG won’t collect a fee from the city through Dec. 31. Its only pay is for travel expenses pre-approved by the city until Jan. 1.
Beginning in 2009, SMG will receive $80,004 annually for its work.
JAC gets $108,000 annually from the city for its services. That drops to $96,000 a year beginning Jan. 1.
If the center turns a profit, something it failed to do during its first two years, the two companies would receive a percentage of net operating income.
That provision doesn’t kick in unless annual net operating income exceeds $100,000, beginning in 2009.
“There’s no guarantees of success,” Williams said. “We’ll still have our challenges. But between SMG as a company and JAC, we’ve positioned ourselves as well as can be expected to ultimately succeed.”
With the SMG deal finalized, Williams said he’s hopeful the center’s fall and winter seasons will be filled with events.
Williams said he anticipates a conversation about hockey at the center to happen promptly.
The discussion would include officials from the city, SMG, JAC and Blue Line Hockey LLC, the parent company of the Youngstown SteelHounds.
The team lost its affiliation with the Central Hockey League, also a subsidiary of Global Entertainment, on June 2 because of a financial dispute.
skolnick@vindy.com