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Chevy Centre ends year only slightly in the red
Photo
The Chevy Centre
The three-year-old arena will make a profit next year, a city official says.
YOUNGSTOWN — The city-owned Chevrolet Centre ended its third fiscal year with its third straight deficit.
This time, the deficit for October 2007 to this past September is $31,506.
But the deficit doesn’t tell the real story of the center, said Kyle Miasek, the city’s deputy finance director and its point man on the facility.
International Coliseums Co., the Tempe, Ariz., company that managed the center for its first two years, received about $91,000 in commissions on its way out the door in October 2007, Miasek said. The commissions were for sales of sponsorship rights and rentals of luxury suites and club seats for this fiscal year, he said.
Without those payments, the center would have turned a modest profit of about $60,000, he said.
Also, the deficit could have been worse, Miasek said.
The payments were part of the separation agreement between ICC and the city. In exchange for those commissions, ICC agreed to not receive its standard 17 percent commission on long-term deals for sponsorship rights and the rentals of luxury suites and club seats, Miasek said.
Though that amount wasn’t calculated, Miasek said it “would have been significantly more” because some contracts are for seven years.
The center didn’t turn a profit, but Miasek said the $31,506 is much more favorable than the $254,388 the center lost during the 2006-07 fiscal year under ICC’s management.
“This building is going to make a profit next year,” Miasek said.
In a letter to city council members, Eric Ryan, the center’s executive director, wrote: “The coming year looks to be a challenging one with the current state of the economy; however, we are confident we can continue to put the Chevrolet Centre on the right track to success.”
The center is moving in the right direction, but there is still a lot of work to do, Mayor Jay Williams said.
The center’s calendar for the fall months is filling up with more events during that time than ever before, Miasek said.
The center went into the fourth quarter — July through September — of the fiscal year that just concluded with a $110,669 profit.
But the center, which held only two paid shows during that time, lost $141,775 during those three months.
“We’re competing with other venues that specialize in summer events,” Miasek said. “We can’t compete with the established outdoor venues that cater to the summer crowd. We know this. It’s a challenge.”
The center’s income for suite and club seat leases dropped by $57,212 in the last fiscal year compared with the previous one.
Also, sponsorship rights declined by $84,754 in the most recent fiscal year compared with the previous fiscal year.
General Motors didn’t renew its $175,000-a-year naming rights contract with the city. The city is negotiating with other entities for the naming rights of the center, but officials have said they don’t expect to match the $175,000 fee it received annually for three years from GM. The center reduced its operating expenses by $516,650 in this past fiscal year compared with the previous one.
Beginning in January, the center’s fiscal year will match the calendar year, Miasek said. That’s being done so it will coincide with the city’s budget year, he said.
Also, SMG, the Philadelphia-based company that is helping to manage the facility, works on a calendar year, Miasek said.
skolnick@vindy.com