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Covelli Centre has its most profitable year



Published: Wed, February 5, 2014 @ 12:10 a.m.

Center takes in enough in 2013 to return $76,000 to the city

photo

Annual operating surpluses, losses for the Youngstown-owned Covelli Centre.

By David Skolnick

skolnick@vindy.com

YOUNGSTOWN

The city-owned Covelli Centre finished last year with record revenues — and enough money to cover Youngs-town’s principal and interest for the year on money it borrowed to build the facility plus return $76,000 to the city’s bottom line.

Total revenue from the facility to the city last year was $546,052, according to financial figures released Tuesday by the center. That amount includes the operating surplus, a 5.5 percent admission tax and food-and-beverage sales.

Center officials had projected to raise $535,300 from the three categories at the beginning of 2013.

The city’s total revenue from the center in 2012 was $498,906.

Last year was also the second- consecutive year that the center’s revenue was more than the principal and interest the city paid on an $11.9 million loan it borrowed in 2005 to pay for its portion of constructing the $45 million facility. The city paid $315,000 last year on the loan with $154,140 in interest for a total of $469,140. The city still owes about $11 million of that loan.

With revenue and expenses considered, the center made $76,912 for the city in 2013. The 2012 amount was $67,261.

“This is the most we’ve given back to the city,” said Eric Ryan, the center’s executive director. “It was our best year ever.”

The center hosted 104 events last year with about 210,000 people in attendance. Among the highlights were four sold-out concerts by Rascal Flatts, Kid Rock, Carrie Underwood and Justin Moore, Ryan said.

The center saw a decline in its operating surplus from $320,787 in 2012 to $256,098 last year. Center officials had budgeted a $300,300 operating surplus for 2013.

Also, the center expected a $107,269 operating surplus in the final three months of 2013 and ended up with an $8,774 deficit. On the flip side, the center’s operating surplus for the second quarter of last year was $100,000 more than projected.

“It’s just the way the shows fell,” Ryan said. “It’s difficult to project and budget how and when you’re going to get these shows, but at the end of the day, we got there.”

That’s largely because money from a 5.5 percent admission tax and food-and-beverage sales exceeded projections and the 2012 numbers, he said.

The center had estimated making $175,000 in admission tax on tickets sold for events, but ended 2013 with $197,231. It collected $156,793 in admission tax in 2012.

Having Ryan’s company, JAC Management Group, handle the center’s food-and-beverage sales resulted in $92,723 for the city. The company had estimated that amount to be $60,000.

JAC took over that work from Centerplate in May 2012. The city made $21,326 in food-and-beverage sales last year.

“The food contract is a big help to the bottom line,” said Kyle Miasek, the city’s deputy finance director. “The city is pleased with the numbers. It bodes well for the center’s future.”

This is the first time since the center opened in October 2005 that 20 luxury suites are rented for the year, Ryan said. There are six other suites — two are used by the center on an event-by-event basis; four others have blocked views of concerts and other events and are rented when the view isn’t obstructed, Ryan said.

As for the 2014 center budget, Ryan expects the operating surplus to be about $275,000 and for the admission tax and the food-and-beverage revenue to be about the same as it was last year.

Saturday’s record-setting Elton John concert was a great way to start the year financially, Ryan said.

The city also is moving ahead with hiring a firm for $90,000 to design an amphitheater at the center. City officials say the outdoor facility is needed to compete for shows in the summer.

The estimated cost of an amphitheater is between $2 million and $3 million with the city seeking to raise the money through naming-rights deals, state funding and water and wastewater funds for utility expenses.

But Mayor John A. McNally said plans to have it done during the first half of the year are too fast for him.

“I’m very happy to consider the amphitheater project, but we will have the funding in place before we do the project,” he said. “I want to make sure we do it in a methodical way. We need to have it as part of a vision of how it complements future plans near the Mahoning River or be the driver of future plans for the river and a tie-in with the Mill Creek Park system.”


Comments

1glbtactivist(255 comments)posted 8 months, 2 weeks ago

This mess has cost the taxpayers millions of dollars and returned a tiny fraction of that to a handful of downtown businesses. A terrible investment. Those who saddled the taxpayers with this burden should be investigated and reported on.

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