The Oakland Coliseum Authority has negotiated an
agreement with PA-based SMG and S.F.-based venture capital
company Williams Pacific Ventures to "manage the debt-ridden
Coliseum complex," according to Laura Counts of the OAKLAND
TRIBUNE. The two companies have formed the Oakland Coliseum
Joint Venture (OCJV), and the proposed two-year agreement,
which "includes management of both the arena and the
stadium," will be voted on by Coliseum commissioners today.
The Authority "had planned" to turn over operation of the
arena to a company formed by the Warriors, but the team,
citing various concerns, has "postponed the deal until July
1999." However, the new proposal "gives the Coliseum
Authority the right to hand over management of the arena to
Warriors Arena Management after one year if an agreement is
reached," and "leaves open the question" of who will pay the
extra $4M of the $11.4M annual arena construction debt
service "that the Warriors will not cover this year." The
proposal with SMG and Williams Pacific is "incentive-based,"
where the Authority will pay OCJV a "flat" $75,000 fee for
the first year. If no savings are achieved, "all or part of
that will be returned." If there are savings, the Authority
"will get the first $250,000," and OCJV will get the second
$250,000, as well as 30% of "additional savings up to
$500,000." Coliseum Authority administrator Deena McClain
said the new agreement "may mean that our deficit decreases,
rather than making a profit in the first year" (OAKLAND
TRIBUNE, 5/27). In S.F., Rick DelVecchio reports that the
agreement's purpose is "to reduce operating costs for the
two facilities ... a small but crucial step toward getting
control of the rolling financial debacle that has plagued
the Coliseum" the past two years (S.F. CHRONICLE, 5/28).
