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Parking fees pave way for Covelli surplus
YOUNGSTOWN
The Youngstown-owned Covelli Centre started the year with a larger-than-expected operating surplus, which could bode well for the rest of the year, city and arena officials say.
The center had an $89,529 operating surplus for the first three months of the year, according to its income statement released Friday. The surplus comes almost entirely from parking profits.
The center had budgeted $47,800 for parking revenue during the first three months of the year. It ended with $86,831 in parking revenue for that period.
About a year ago, the center added about 500 spots to the 300 it had on the facility’s grounds. Those parking at the center are typically charged between $5 and $20 a vehicle with the higher fees for bigger shows.
Center officials had projected a $54,713 surplus for the first three months, and an operating surplus of $80,405 for all of 2011, said Eric Ryan, the facility’s executive director.
“The year is shaping up to be very good,” he said. “We’re off to a better start than we expected.”
The declining surplus over the year includes a projected $150,000 loss for the third quarter: July, August and September. The summer months are terrible for indoor entertainment facilities, including the Covelli Centre, Ryan and arena experts say.
But those months are looking good for the arena this year with a concert by Motley Crue and Poison, a Jeff Dunham comedy show and an outdoor wing festival, Ryan said. About 80 percent of the tickets for the Motley Crue and Poison show are sold.
“It will bode very well for the facility’s bottom line because of the summer shows,” said Kyle Miasek, the city’s deputy finance director. “It reverses a trend for the summer. We have the possibility of doing better than we did in 2009.”
The center had a $153,950 operating surplus in 2009, its best year and the first time it finished a year with an operating surplus since it opened in October 2005. The operating surplus last year was $110,434.
For the first three months of the year, the facility had 42 events, the most for its first quarter. The biggest events included eight Ringling Bros. and Barnum & Bailey Circus performances late last month, a WWE show, the Harlem Globetrotters, and two weekends of state wrestling tournaments for elementary and junior-high school students, Ryan said.
“Coming out of the gate, this is great,” Miasek said. The center is “doing well in challenging economic times.”
This was the second most successful first quarter at the center in its 51/2-year history. The best first quarter was in 2009 with a $242,390 surplus with a Kelly Pavlik middleweight boxing title defense leading the way.
The city also received $48,418 during this year’s first quarter on a 5.5 percent admission tax on tickets sold for events at the center.
The tax and the center’s operating surplus helps offset the $670,000 the city owes this year in interest on $11.9 million it borrowed in 2005 to help fund the center’s construction costs. To date, the city has paid only the interest and nothing toward the $11.9 million it borrowed.
Beginning next year, the city will make payments towards the $11.9 million principal either through a 20-year or 25-year loan. The city will pay about $1 million annually under that plan, Miasek said.
Also, city council’s finance committee will meet Monday with center and city administration officials for further discussions on a proposal to change the food-and-beverage vendor contract for the facility from Centerplate to JAC Management, Ryan’s company.
City administration officials say the move could increase the facility’s revenue by about $100,000 annually.
As for the center’s second quarter, April to June, facility officials budgeted a $12,000 surplus. But Ryan said he hopes the center will do better.
Earlier this month, the center hosted a Rodney Carrington comedy show and a concert by the Goo Goo Dolls. Also on the schedule is a May 6 Tim McGraw concert [already a 6,000-ticket sellout], a May 22 concert with ZZ Top and Lynyrd Skynyrd, and a blues festival in June featuring Buddy Guy and Robert Cray.