by: Diane Benjamin
This information is from the Coliseum Report compiled by the Company hired to manage the Coliseum – CIAM and the contract the City has with CIAM.
CIAM Report:
http://www.cityblm.org/Modules/ShowDocument.aspx?documentid=5459
City agreement with CIAM: (I don’t know why the contract calls them CIA!)
10.1 Management Fee. (page 20-21)
As base compensation lo CIA for providing the services herein specified during the Term and any Renewal Terms, the City shall pay CIA during the Term and a Renewal Term, if any, an annual fee (“Base Fee”) representing 4% of the Gross Revenues, as hereinafter defined, of the Coliseum. Gross Revenues shall be all revenues actually received by the Coliseum under Section 5.6 during such Fiscal Year, less any sales or other similar taxes imposed on such revenues. The Base Fee will be paid on a pro rata monthly basis, such monthly amounts to be calculated based upon annual budgeted revenues in accordance with the mutually agreed budget established prior to each Fiscal Year in accordance with this Agreement. In the event that amounts paid on a monthly basis either exceed or are less than the actual amount due as a Base Fee for a given Fiscal Year, such differential shall be reimbursed to the City or paid to CIA, as the case may be, within 30 clays of receipt of the relevant settlement calculation for such Fiscal Year.
This is the Gross Revenues:
Note: Total Income is $3,674,933.90
So, how much did CIAM pay itself for Management Fees?
They are entitles to 4% of the Gross Revenue – Minus Sales Tax collected.
There is a problem though:
$3,674,933.00 times 4% = $146,997.32. This is within pennies of what CIAM took for Management Fees. The problem? Look again at income. Included in the Gross Income number is Sales Tax Collected-See 432000: $26,303.81.
So CIAM paid themselves a commission on the Sales Tax collected, even thought the contract says they can’t.
Okay, I understand that’s only $1052.15 that they weren’t entitled to, but there is more.
CIAM is also entitled to 10% of the sales of Sponsorship, Premium Seating, and Naming Rights – all of these are included in Total Revenue. Does the City know they are taking their 10% and then taking another 4% because it’s Revenue?
I don’t know how they arrived at $158,003.49. No combination of numbers in Income amounts to 10% being $158,139.40. Of course, the statements are unaudited.
Maybe the Auditors fixed it in their report. Maybe not.
I hope this helps you understand how the City used your tax dollars to build the Coliseum, then, since the City has no arena management experience, they handed the operations to a private company.
The only way this saga would be better is if the CIAM management was related to Tom Hamilton or Judy Markowitz. If I hear anything, I will let you know.
Meanwhile, the management runs a transportation company and a junior hockey league from the Coliseum. They also own the Bloomington hockey team and the Peoria hockey team. Sweet. (for them)
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