Covelli Centre Earns Enough to Pay Debt Service
YOUNGSTOWN, Ohio -- The Covelli Centre reports an operating profit of $320,787 in 2012, “our single best operational surplus in the seven-year history of the Centre,” says Eric Ryan in a letter to Mayor Charles Sammarone and members of City Council.
Ryan is the president of J.A.C. Management Group LLC, which is paid a management fee to operate the arena.
In addition to the operating profit, the city’s admission tax of 5.5% generated a return of $163,398, Ryan reported. “Therefore, total revenue to the city from Covelli Centre operations is a total of $484,185,” he stated.
According to Kyle Miasek, assistant city finance director, the revenue the city will receive from the arena’s operations and the admission tax is sufficient to cover its debt service -- a payment of $438,250 due in September.
The city borrowed $11.9 million seven years ago to subsidize construction and furnishing of the $45 million arena. Former U.S. Rep. Jim Traficant secured a $26 million federal grant to fund the project.
Before the city renegotiated its loan, the annual debt service amounted to $900,000.
In his letter, Ryan told city officials, “There are many reasons for these positive financials; however, the most important is the overwhelming support of our community as they continue to attend the events at the Covelli Centre. These financials are a direct result of the support from our community, cost-saving measures that have been implemented, and the many changes you have supported over the last several years in order to place the [arena’s] operational finances on solid ground.”
The arena’s ales department was revamped in 2012 and increased sponsorship and suite sales to $166,510. “The support of our sponsors and suite owners has increased nearly 40% over the last three years,” the arena manager stated.
During 2012, the arena hosted 94 events “with nearly 200,000 patrons passing through our doors,” he said.