The Tribune Democrat, Johnstown, PA

February 28, 2007

MIKE MASTOVICH | Proposal perks up owner

By MIKE MASTOVICH

By nature, Jim Weber usually is a high-energy, enthusiastic person.

But in the past two weeks, the Johnstown Chiefs owner had been more subdued.

That changed Wednesday morning. Weber seemed rejuvenated. The Lancaster businessman displayed enthusiasm and excitement during a telephone interview. A few minutes earlier, he had received a fax detailing the Cambria County War Memorial Authority’s proposal to share revenue from food and beverage concessions sold during the ECHL team’s games.

“It’s as much or more than I would have wanted,” Weber said. “We have a sold-out building (Wednesday night). I know how to pack the house. It’s by lowering ticket prices and by doing special things.

“If this is all a smokescreen where they have unrealistic expenses in there, then it’s not going to work. But if they’re being open, honest and candid with me, I can make this work. I’m optimistic. I think the War Memorial board is trying to do something that works for everyone. In Johnstown, it’s a small pie.”

One point is certain: The Chiefs will stay in Johnstown next season.

The question is, what’s next?

If Weber and the War Memorial Authority reach a formal agreement, Weber probably would continue operating the team through next season and beyond. He is confident he can boost both attendance and concessions revenue enough to make hockey work in a market that has fielded one money-losing team after another.

There are two other scenarios that involve a potential sale to NHL teams.

Both of those NHL teams would keep the Chiefs in Johnstown next season. But one of those then would move the Chiefs in 2008-09 to a city where an arena for its minor-league club currently is being built.

The other NHL team would “make a go of it in Johnstown” for at least one year, Weber said, then reevaluate.

Weber is hoping it doesn’t come to a sale.

“It went well,” he said of a Wednesday afternoon conversation with War Memorial Authority Chairman Larry Giannone. “We exchanged some pleasantries, then got down to business on a couple things. At 9 a.m. sharp on Monday we’re going to sit down and work out details. To be cautious, I wouldn’t say we have an agreement in principle yet because a lot of the details have yet to be fleshed out.”

Today had been Weber’s deadline to reach an agreement in principle on the concessions matter. His original proposal had the Chiefs operating the arena’s concessions, a strategy that was not considered by the authority.

“The authority is willing to share revenue from food and beverage concessions sold during the Chiefs’ games,” Giannone said. “To that end, going forward for the 2007-08 season, we are offering the Chiefs 100 percent of all profits from concession sales in excess of net revenues the arena earned in the fiscal year 2005-06 during Chiefs’ games.”

Giannone said the authority already supports the Chiefs by paying for utilities and providing arena and advertising space. The current lease, which extends through next season, also has a $50,000 subsidy to the Chiefs and other attendance-based incentives.

His presentation also detailed the arena’s financial challenges. Based on the 2005-06 season, Giannone said the arena took in $204,414 in Chiefs ticket revenue, but after $234,155 in expenses, the arena lost $29,661 prior to concession revenues.

The concessions at Chiefs games accounted for $296,193 and was offset by expenses of $170,903. That translates into a profit of $125,290.

When all the calculating was done, the arena had a $95,629 profit during 2005-06 Chiefs games.

“Our numbers last year were audited,” Giannone said. “We tried to come up with a formula. Our bottom line is very, very thin. The more the attendance, the more the revenues will come in.”

Last season, the Chiefs’ official attendance provided by the ECHL was 87,160 (2,421 average). Giannone said the actual number of people through the turnstiles was 66,162 (1,843 average).

The official attendance includes season ticket holders or other tickets sold to people who didn’t attend.

Weber thinks he can fill those seats by dropping ticket prices.

“The bottom line is it comes down to attendance,” Weber said. “I’ve proven two things already this year. I’ve proven that the economic model of $14.50 a ticket does not work. I’ve proven that a slight reduction in tickets, doing special things and getting companies involved drives people through the doors.”