By David Skolnick
The city’s board of control is expected today to approve a $175,000, one-year contract, retroactive to May 1, with Covelli Enterprises to retain the naming rights of the city-owned sports-and-entertainment facility.
The contract increases the annual naming-rights fee from $120,000 for the Covelli Centre.
“We’ve done really well in the last three years and [Covelli Enterprises is] getting value for their money,” said Anthony Donofrio, deputy law director, about the increase the city will receive under this deal.
Bruce Zoldan — owner of B.J. Alan Co. fireworks and the Youngstown Phantoms junior hockey team that plays its home games at Covelli — offered $210,000 for the naming rights.
While there weren’t negotiations with Zoldan, Donofrio said that proposal likely would have deducted some money for suites and tickets “that chipped away at the $210,000,” he said.
The deal with Covelli, first signed May 1, 2009, doesn’t require the center to provide a suite or event tickets, and the company is also providing free food-and-beverage vending consulting to the center.
Also, with the city looking to lease or sell the center, it didn’t want to enter into a long-term deal, said Mayor Charles Sammarone, board of control chairman.
“Instead of a new contract, we’ll extend the one we have for a year,” he said. “If someone leases or buys [the center], they may want the naming rights.”
A provision in the contract extension would terminate the naming rights for the facility with Covelli being reimbursed the pro-rated amount of the deal should a sale or lease occur.
While Zoldan offered more money, Covelli officials told the city administration that it’s providing about $1 million in in-kind services by advertising the center at its Panera Bread and O’Charley’s restaurants, Donofrio said.
Covelli is the nation’s largest franchisee of the restaurants.
“I think [$1 million] was a bit high, but how do you put a number on it?” Donofrio said. “The mayor felt it was best to stay with what we have” because of a possible sale or lease of the center.
Sam Covelli, the company’s president and chief executive officer, couldn’t be reached Wednesday by The Vindicator to comment on the naming-rights deal.
The three-year deal between Covelli and the city expired April 30. The company already signed the contract extension and will give the $175,000 to the city when the board of control approves it.
Before Covelli, the center was called the Chevrolet Centre with General Motors paying $175,000 a year for three years with part of that deducted for suites and tickets, and the center paying 100 percent of the signage costs.
That contract, signed in late 2005, expired three years later. The Chevrolet name stayed on the building for about six months at no cost to GM before Covelli negotiated a deal for the naming rights.
Zoldan said he is not upset the city didn’t accept his offer because Sammarone told him he wanted a short-term deal while looking for someone to buy or lease the center.
Zoldan said he’d be interested in pursuing the naming rights next year to rename the facility the Phantom Centre.
“I have a hockey team there with a $1-million-a-year budget, nationwide [fireworks] stores and a website with 1 billion hits in a year,” he said. “We’d have reciprocal value to the Covelli Centre.”
Also, Zoldan said he and a group of investors are interested in talking to city officials about leasing the facility.
“Leasing the facility would be the best option,” he said.
As for buying it, “it’s not sellable for a price the city would want to sell it for,” Zoldan said.
Also, a sale would almost certainly no longer make the facility tax-exempt, city officials have said.
The Phantoms are entering their fourth season of playing home games at the Covelli Centre. Attendance hasn’t been strong for the team that plays in the top junior hockey league in the country.
The goal was 2,000 a game, Zoldan said. But Zoldan said he hopes to average about 1,700 a game around late November/early December.