City Council Approves Additional Funds for Grossinger Motors Arena
$376K Deficit at Grossinger Arena
VenuWorks has been managing the arena for less than 2 years
At Monday’s meeting, the Bloomington City Council unanimously approved an ordinance that will add $375,000 to the Grossinger Motors Arena FY 2018 budget.
Arena manager VenuWorks sought additional funds from the city to cover a projected $376,411 operating deficit for the rest of the fiscal year. The city hired VenuWorks to manage the former U.S. Cellular Coliseum in April 2016, when former manager Central Illinois Arena Management did not renew its contract after 10 years.
VenuWorks reported a $104,900 deficit between budgeted and projected income, including revenues from rent and ancillary income from concessions; facility fees from revenue-sharing agreements with promoters; and parking fees collected at the parking garage.
Ward 8 Alderman Diana Hauman voted “reluctantly yes” to the ordinance. “I was disappointed that they didn’t make the numbers,” Hauman said after the meeting. “But we have to fund it. We’ve got the building. It won’t be profitable, but we have to try and make it bleed as little as possible.”
Grossinger Motors Arena Executive Director Lynn Cannon said the largest variance in the arena’s budget came from reduced naming rights income, at a $561,517 loss in revenue.
Cannon cited media attention on the arena’s former management company as a hurdle to securing sponsorships for the venue. Five former CIAM managers face 111 criminal charges in an alleged money-skimming operation that cost the city over $1.1 million, The Pantagraph reported.
The facility went a year without naming rights revenue after the U.S. Cellular Coliseum did not renew its 10-year contract in April 2016. Normal auto dealer Grossinger Motors agreed in June 2017 to pay $175,000 annually for the next five years for naming rights.
Cannon says the arena also lost revenue from five scheduled Central Illinois Flying Aces games that did not play at the facility. According to the Flying Aces website, two of the five games were rescheduled at other arenas "to allow for upgrades to the dasher board and glass system at Grossinger Motors Arena." The reason for rescheduling the other games is unknown.
“We should have been much busier in the fall. Normally we would start getting busy in September and be busy straight through April," Cannon said.
To assist with filling the deficit, the arena reduced expenses by $200,000 across payroll, occupancy costs and the arena’s general expense fund, Cannon said. “We have been very careful in making sure we’re not overspending wherever we can.”
The arena also hired a new sales manager in October, who Cannon said is “just getting off the ground now on sales, sponsorships and suites.” Cannon said activity is expected to pick up “dramatically” for the arena beginning at the end of December.