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UPDATED MONDAY | Covelli not excited by mayor’s idea; see link to what a similar facility is doing



Published: Sun, December 16, 2012 @ 12:00 a.m.

By Todd Franko (Contact)


A Tennessee consulting group gave the city and Mayor Charles Sammarone about 50 points to make a better Youngstown.

Another consulting firm out of Rhode Island will, by January or so, give the city probably as many suggestions — just on the Covelli Centre.

And Sam Covelli, without any consulting contract such as the above, gave the city 10 million ideas to think differently.

Last month, Covelli, owner of Covelli Enterprises and the largest Panera Bread franchisee in North America with more than 250 stores, plopped down $10 million for a new sports facility at Ohio State University.

Part of the reason, as Sam explained, is a marketing investment in Columbus, where he has many stores.

But part of it, too, is his fondness and passion for OSU.

Covelli has the same passion for the Youngstown facility that bears his name.

And he’s not too excited with what has transpired regarding Sammarone’s handling of the facility. The mayor has said the city cannot afford to be wrapped up in such a facility. It’s too much of a burden. It needs to be sold or leased.

That, of course, despite the center being a key pillar for downtown’s rebirth. (Hold that thought.)

It’s reasonable to think that Covelli’s $10 million OSU investment could someday be available for Youngstown — if his current passion here remains.

“When we got involved in 2009, we wanted to do something that would be helpful to the [Mahoning] Valley and show support,” said Allen Ryan, Covelli Enterprises’ director of corporate affairs (and no relation to the facility’s boss, Eric Ryan).

“This was Mr. Covelli’s way of helping,” Allen Ryan said. “He believes the money [$535,000] helps give the arena a chance to grow and be successful. If the facility is put into private hands, it would change the main reason Mr. Covelli got involved in the facility in the first place.”

Ryan speaks to the core issue that I think has been missing in the mayor’s Covelli Centre death drum beat.

Yes, the facility is a financial liability to the city in some ways. So are police cars.

But the facility is a financial gain for the city in so many other ways.

The mayor and the cast of critics whispering their loaded agenda into his ear have artfully misrepresented the facility’s true financial impact.

Just Friday, in another news publication, the mayor was linked again to the claim that Covelli costs the city $900,000 per year.

That number is as mythical to the city as its restaurant inspections.

The highest the Covelli interest payment ever became was $818,720 in 2007.

It was as low as $579,925 in 2011.

In that same 2011, the city also made its first principal payment on the $11.9 million loan — about $275,000 — to make for a grand total of $840,000.

All of those numbers are substantial. And ownership opponents, such as the mayor, make the costs look worse when they hyperventilate on them — and do so while not including city revenues from Covelli.

Ticket taxes, income taxes, operational surpluses, downtown businesses’ revenues, etc.

Add all of those up, and there is no $900,000 cost to the city.

Further aggravating is that the mayor did not acknowledge in the Friday news report that this year — in interest and in principal — the city will pay just $413,250 to own the Covelli, and that the facility will make a true, honest profit this year.

He just wants to keep pounding the drum of these mythical costs.

In costs, there are gains.

It’s not just Sam Covelli’s $10 million to OSU that the mayor should measure.

He should add up all the corporate-suite holders and facility sponsors — and their collective revenue and potential downtown investment interest. They, like Covelli, bought into the facility for goodwill more so than for good investment, says Ryan, who believes those groups would, like Covelli, lose interest if the facility was leased to a private group.

“A change now would be a step backward. We invested, and others invested in the arena because it was a way to support the city and the Valley,” Ryan said. “If that changes, that would certainly give us reservations going forward.”

There’s a study due out soon on the facility. It will be interesting to see which reality it shows — Covelli’s reality or the mayor’s reality.

I’ve said that putting Covelli on the market when it is on an up trend is not a bad idea.

But the mayor’s packaging of Covelli as bad for the city is bad salesmanship.

Further, the desperation in his message conveys that it’s a “get-rid-of-this-to-anybody” approach. We had “anybody” when the place first opened, and it was run at a huge loss.

In continuing to participate in stories and opinions that “the Covelli is a $900,000 cost to the city” shows a mayoral stubbornness that has to make you wonder:

Is he viable as a four-year developer of the city which he now is considering, or better being just the two-year whip-cracker that he initially pledged he would be in 2011?

Building up a city is more than tearing down houses and egos.

Todd Franko is editor of The Vindicator. He likes emails about stories and our newspaper. Email him at tfranko@vindy.com. He blogs, too, on vindy.com. Tweet him, too, at @tfranko.


Comments

1shehateme(9 comments)posted 1 year, 9 months ago

Covelli is right. This mayor is a terrible salesman. Time after time he announces what money pits 20 federal and the Covelli Centre are. Yet, he continues to push the sale of properties that define the city. Who wants to buy these so called money pits? Rumor has it, the best results are achieved with this mayor by handing him a brown paper bag with your proposal.

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2nicnac(1 comment)posted 1 year, 9 months ago

why do we get such negative people to run our city,leave the covelli center alone. Covelli is a fine man, maybe he should be our mayor

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3jmagaratz(166 comments)posted 1 year, 9 months ago

Let's face it!

Sammarone is a 70+ year old has been.

He needs to retire and get out of the way.

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4johnsyoung(3 comments)posted 1 year, 9 months ago

there are two opinions samarone sees his and the wrong one. he has done so much damage to the City in a year and a half. I cant imagine what it will be like if he gets in for another 4. This is a huge mistake that will cost him the election if he runs.

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5johnsyoung(3 comments)posted 1 year, 9 months ago

"Sam Covelli will just have to get over it (does anyone have a box of Kleenex to send Sam Covelli to wipe his tears)."

I don't think its about Covelli whining, its about his shaken trust in the City. This Mayor is not a business friendly Mayor, bottom line.

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6toddfranko(99 comments)posted 1 year, 9 months ago

Nice chatter.
• I agree it's not an age issue, but an accomplishment issue.
• Sam could ultimately care less, I imagine. He can take his money anywhere. He'd like to spend it here, and officials should work hard to have him do so. They'll be the first ones, along with the citizens they lead, to raise up and say "why couldn't you do something here? This is your home." They already did so after the $10M story. When the money does go elsewhere and not here, it will be for these such reasons.
• I'm not a publicist for Covelli/Panera or for Covelli City or for any of the Ryans, or for the mayor or for whoever. I am a publicist for logic and an opponent of flawed logic.
• Arenas are an enormous risk, agreed. And they have to be watched and managed closely, and we have that here, and the numbers show it.
To help understand the risk and how bad it could be, read this from similar-sized Rockford:
http://www.rrstar.com/news/x178233606...

You can't just demolish your way to success. You have to invest, too.

And whatever agenda you pursue (it should be both), at least do it with honest numbers. That has been absent from the Centre foes.

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7maxborenstein(27 comments)posted 1 year, 9 months ago

"You can't just demolish your way to success. You have to invest, too."

The private sector should be doing the investments. Demolition recovers the indestructable land for further economical use. It is best to transfer the reclaimed land into private hands, as then reuse will occur far more rapidly than hoarding it in the nonproductive public sector. We will demolish our way to success, as soon as the land can be productively reused by the private sector.

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8Askmeificare(700 comments)posted 1 year, 9 months ago

Keep the Covelli Center. Elton John has touched it.

Paul Drennen for Mayor.

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