Federal grant bailouts Covelli, amp | News, Sports, Jobs
YOUNGSTOWN – Without a major federal financial grant, the city-owned Covelli Center and Youngstown Foundation Amphitheater – largely closed due to statewide restrictions due to the COVID-19 pandemic – would have lost $ 442,002 in operating costs for the first six months of the year.
But with a grant to closed site operators, of which $ 419,878 was used in the first six months, the facility posted an operating loss of $ 22,124 as of June 30.
SVOG was part of the US $ 1.9 trillion federal bailout.
As a business, JAC Management Group, which operates the city’s two facilities, received around $ 1.6 million from SVOG, said Eric Ryan, its chairman.
The money is used strictly to pay employee wages and benefits, he said.
Approximately $ 800,000 to $ 1 million out of $ 1.6 million will be used to pay these costs for the center and amphitheater workers, with the remainder going to the same expenses at other sites it manages and its operations. business, he said.
âSVOG has been a lifeline,â Ryan said. âIt’s an absolute bailout.
The delay in providing financial information for the first and second quarters was directly related to the long time it took for JAC to get the SVOG money, Ryan said. JAC learned about three weeks ago that he was getting the grant and actually received it two weeks ago, he said.
The first quarter, in which $ 193,072 of SVOG money was allocated to employee salaries and benefits, ended with an operating surplus of $ 4,047. The projection for the January to March quarter was for a loss of $ 169,910.
The second quarter, with $ 226,806 in SVOG money for salary and benefits, ended with a loss of $ 26,177. The projection for the April to June quarter was a loss of $ 298,111.
âI couldn’t budget this money because we weren’t sure we would get it,â Ryan said.
HIGHS AND LOWS
The first quarter has ended with operating surpluses every year since 2009 and is generally the busiest time for the Covelli Center.
The second quarter has been uneven since 2006, with nine years of losses and seven of surpluses.
During the first quarter of this year, the center hosted 12 Youngstown Phantoms hockey games and two state wrestling tournament weekends, with each athlete being allowed to have only two family members in attendance, a Ryan said.
âThe first and second quarters, because we had ice and all that expense, we lost a ton of money,â he said. “Having only Phantom games is an absolute loser for us.”
The Phantoms have consistently had one of the lowest turnouts of any team in the United States Hockey League.
In the second quarter, the center and amphitheater had a total of 18 events, including seven Phantoms hockey games.
âWe couldn’t bill our luxury suite owners, so we lost money there,â Ryan said. âWe started this backup on August 1st. We had to reopen to make the Phantom games work. Not having other events and no costs straight away does not make for a good financial situation.
Governor Mike DeWine lifted attendance capacity restrictions on June 2 at entertainment facilities.
The COVID-19 pandemic has hit the entertainment venues industry hard.
The third quarter was budgeted for $ 62,000 and Ryan said, âI think we can get there. The third quarter is going to be much better because we have a lot of events.
The third quarter, between July and September, includes 12 national shows and 10 community events, he said.
âIt came so fast,â Ryan said. “It was a miracle, but my staff did a great job.”
The third quarter has historically been the worst, with 12 of 15 years experiencing losses.
The fourth quarter of this year could be a challenge, with most events moving inside the center, Ryan said.
âThe problem is this variant (covid-19 delta) and this masking,â he said. âWe have to see how this affects our business. It will be a fourth quarter lighter than what we are used to at Covelli Center because of the variant.
The center and amphitheater had an operating surplus of $ 10,915 in 2020 although there were virtually no events at either location after mid-March of this year due to the pandemic.
The surplus is due to the fact that JAC received $ 353,310.59 from the Federal Paycheck Protection Program to cover payroll and benefits as well as utility costs.
It occurred one year later with an operating surplus of $ 412,684.
The facilities have made annual operating profits since JAC took over management of the Covelli Center in 2008. The center opened in October 2005 and the amphitheater opened in June 2019.
In the first six months of the year, the city collected $ 10,122 of a 5.5% admission tax on tickets, city finance director Kyle Miasek said. All that money came from Phantoms hockey games, he said.
âAs the entertainment industry goes through tough times, we are pleased that JAC has been able to break evenâ within the first six months, said Miasek.
The city paid $ 1.46 million in principal last month for the loan it took in 2005 to pay off its share of the center. This is the highest amount ever paid by the city in the main proceedings, the previous highest amount being $ 900,000 in 2019 and 2020.
The city borrowed $ 11.9 million in 2005 to pay for its share of the construction of the center of $ 45 million. Most of the funds came from a federal allocation.
The city now owes $ 5.1 million.
The city could pay the rest of the money owed to the center in three to four years.
The city paid nothing in principal until 2011, paying only interest in those years.
The interest rate was high in those early years, like in 2007, when it was 6.88%. The city paid $ 818,720 in interest that year.
By comparison, the city paid 1% interest last month and last year, Miasek said.
Youngstown also borrowed $ 4 million in 2018 from the US Department of Housing and Urban Development to pay for the $ 8 million amphitheater. The rest of the money came from naming rights deals.
The city is repaying this loan over 20 years, starting last year. With interest, these annual payments amount to $ 205,180.