The city-owned Covelli Centre finished the first three months of the year with a $60,248 operating surplus — the third-largest amount for the first quarter of a year in the facility’s existence.
“The center is doing well,” said Mayor Charles Sammarone. “It looks good. Hopefully, it will continue.”
Eric Ryan, the center’s executive director, said, “We’re pleased with the first quarter. We’re in good shape.”
Also, the city’s 5.5 percent admission tax on tickets sold for events at the center generated $45,064.30 during the first three months of the year.
During the first quarter, the center had 33 events, highlighted by sold-out concerts by Rascal Flatts and Kid Rock, Ryan said.
The center provided the first-quarter numbers Thursday.
In 2012, the center finished the year with a $320,787 operating surplus, a record year, and $163,398 from the admission tax.
Ryan said Thursday that the center also made $21,326.09 last year in additional profits from his company, JAC Management, taking over the food-and-beverage service at the facility in April 2012.
With all three revenue sources, the center made $505,511.09 last year. It was the first time since the center opened in 2005 that revenue from the facility was more than the principal and interest paid by the city.
The city paid $325,000 last year toward the principal of an $11.9 million loan it received in 2005 as its portion of constructing the $45 million facility. It also borrowed $113,250 last year to pay the interest on the principal.
The center should have an operating surplus this year of about $300,000 as well as $175,000 to $200,000 in admission tax and at least $60,000, conservatively, in food-and-beverage revenue, Ryan said.
“I fully expect to reach those numbers,” he said.
The center made about $40,000 in food-and-beverage revenue during the first three months of this year, Ryan said.
The center’s operating surplus didn’t reach its targeted first-quarter goal of $98,979.
But that’s primarily because of how utilities are budgeted, Ryan said.
The center’s estimated annual utility expenses are evenly spread over all four quarters of the year, he said.
But utilities are significantly higher in the first three months and last three months compared with the middle six months of a year, Ryan said.
Utility expenses were $103,349 for the first quarter, but were budgeted to be $79,074. That $24,275 makes up 63 percent of the difference between the budgeted and actual surpluses for the first quarter.
Because utility fees are spread evenly over the four quarters, those costs for the second and third quarters are typically a lot lower than budgeted, Ryan said.
The year’s third quarter, July to September, is the slowest for indoor facilities. But the center already has booked three shows — Daughtry and 3 Doors Down, Pat Benatar, and American Idol Live — for indoor concerts during that time frame.
“Our third quarter will be better than most previous third quarters,” Ryan said.
JAC Management’s contract to run the day-to-day operations of the center expires at the end of the year.
City officials will meet with Ryan next week to work out a contract extension, Sammarone said.