SBD/Issue 245/Facilities & Venues

SMG Reimburses City Of Jacksonville $22,000 After Audit

SMG Manages Several Sports, Entertainment
Venues In Jacksonville, Including EverBank Field

SMG has reimbursed the city of Jacksonville $22,000 after a yearlong audit of the company that runs the city's sports and entertainment venues found “some contract and oversight issues,” according to Matt Galnor of the FLORIDA TIMES-UNION. More than half of the $22,000 was “for costs of employees who were paid for by the city but worked on non-city projects.” Former SMG Jacksonville GM Bob Downey said that “he was forced out earlier this year for blowing the whistle on SMG’s attempt to make an extra $80,000 off a concession subcontract." Downey also claimed the company was “ripping off taxpayers.” But SMG spokesperson Michael Munz said that the audit “proves that Downey is just a ‘disgruntled former employee’ and the company will weigh legal action if he continues to make public accusations against SMG.” SMG runs operations for the city’s EverBank Field and other sports facilities, as well as the Times-Union Center for the Performing Arts. The company “bills the city for the actual costs of operating and staffing the venues, plus $1.2 million for management fees and incentives for keeping expenses down.” The city makes money from ticket sales, parking and concessions. SMG’s contract with Jacksonville runs through ’13, but the city can “pull the plug at any time with two months’ notice” starting next fall. The audit recommended that the city "continue to tighten the contract and that it should be opened to bids when it expires, rather than simply” renewing with SMG as “the city has several times since” SMG started in the city in ’92. The concession contract Downey questioned is with Savor, a company “that has the same parent company as SMG." The audit said the city look at SMG’s concession contract with Savor because of the “inherent conflict of interest” (FLORIDA TIMES-UNION, 9/3).

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