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Convention Center seeks RAD funds to offset operating losses
Wednesday, September 03, 2008

Whether it's to curb an operating deficit or to repair leaking roofs, some of the city's most prominent buildings are looking to the Allegheny Regional Asset District for help.

Representatives for the David L. Lawrence Convention Center, the Benedum Center, Heinz Hall and the Senator John Heinz History Center made pitches to the RAD board yesterday for funding to cover the cost of repairs or to help erase budget shortfalls.

Tops among them was the city-county Sports & Exhibition Authority, which is requesting $2 million to cover chronic operating deficits at the convention center.

Mary Conturo, SEA executive director, told the board the money is needed in addition to $1.7 million a year in operating support coming from state gambling revenues. She said building expenses, at nearly $10 million annually, are about $3.8 million higher than revenues.

Ms. Conturo said it is not unusual for convention centers to be "loss leaders" and to charge below-market rents to attract events and visitors. She said the losses are more than offset by the $379 million in estimated direct spending by visitors since 2004, the first full year of the operation for the new convention center.

While the SEA's goal is to increase building revenues and cut expenses, the gap "will never get to zero," she added.

"You can't charge too much or you'll price yourself out of the market," she said.

The Pittsburgh Symphony Orchestra, meanwhile, is seeking $145,000 in RAD capital funding to make repairs to the roof at Heinz Hall. It also is asking the board for $1.25 million in operating funds to support its $31 million budget. That's $250,000 more than it received this year.

After encountering operating deficits topping $1 million a couple of years ago, the symphony had a balanced budget last year and is less than "1 percent away" from the same this year, said Larry Tamburri, PSO president.

"Our goal is to have a balanced budget," he said.

The symphony also is running a campaign to boost its $118 million endowment.

Officials at the Pittsburgh Cultural Trust are seeking $555,000 to repair the roof at the Benedum Center and to replace the marquee and make other exterior improvements at the Byham Theater.

The trust, with a $51 million budget, also is asking for $1 million in operating support, up $250,000 from this year. The increase would, in part, offset a decrease in state funding, said Rona Nesbit, senior vice president of finance and administration.

At the history center, officials have requested $200,000 in RAD capital assistance to separate storm water and sewer lines and to repair the roof on the building, erected in 1898.

"When you're housing the nation's treasures ... a roof leak takes on greater importance," said Andrew E. Masich, history center president and chief executive officer.

The RAD board took testimony last night but did not act on any of the requests. It expects to adopt a preliminary budget around Oct. 1.

Mark Belko can be reached at mbelko@post-gazette.com or 412-263-1262.
First published on September 3, 2008 at 12:00 am
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