by Glenn Tschimpke
Staff Writer
A slow concert season threatens to put venue manager SMG in a financial bind this year. SMG, which manages Alltel Stadium, The T-U Center, the Osborn Center and other city venues, projected a budget deficit of $426,087 in a report issued this month to City Council auditor Bob Johnson.
“We were really hit with the drop in revenues that businesses sustained with the events of Sept. 11,” said SMG general manager Bob Downey. “In the aftermath, there are no stadium shows to speak of this year. We usually have one or two a year.”
Unlike 2001, when ‘N Sync and Tim McGraw drew tens of thousands of screaming fans to Alltel Stadium, Downey said the stadium will remain quiet this summer. A typical stadium show is worth between $250,000 and $300,000 through parking fees, concessions and other income.
“You can’t just create those stadium events,” said Downey.
Couple a season with relatively few entertainment prospects with increased security costs and it adds up to an austere year for SMG.
Other Jacksonville venues have also suffered in the last eight months, including the Osborn Center.
“The convention center took it on the chin early with the lack of catered events,” explained Downey adding that slow business in the Osborn Center has cost SMG in the range of $200,000.
Events at the T-U Center and the Coliseum have also been thinner than in past years, but not to the extent of the stadium and convention center.
Philadelphia-based SMG operates under a contract with the City to manage and maintain five civic buildings with an annual budget of about $10 million. Some of that money is generated by events with the balance subsidized by the City, which for the 2002 fiscal year is $4.9 million.
Despite a revenue shortfall in excess of a half million dollars through March 31, Downey said the company has taken steps to close the gap by the end of the fiscal year in October. While the company has reported no layoffs, it is waiting to fill about eight vacancies on its staff.
“It’s not a hard hiring freeze,” said Downey. “We brought on a person or two with the grounds crew recently because the baseball season started. There are certain times of year that you need to fill jobs.”
Downey added that overtime and other spending has been cut back as well. As of April, SMG has shown “a pretty good reduction in expenses.”
If SMG can’t make ends meet it will likely appeal to the City for more money instead of absorbing the loss. That appeal needs to be sooner rather than later, according to City officials.
“They need to come to the City by the end of June if they can’t make their budget,” said Shari Shuman, deputy director of administrative finance for the City.
City Council would ultimately have to approve additional funding for SMG.