REPORT TO COUNCIL
SUBJECT
Title
Action on the Santa Clara Convention Center FY 2019/20 3rd Quarter Financial Status Report [Council Pillars: Promote and Enhance Economic and Housing Development, Enhance Community Engagement and Transparency, and Sustainability]
Report
BACKGROUND
On February 5, 2019, the City approved an agreement with Global Spectrum L.P. dba Spectra Venue Management (Spectra) to operate the Santa Clara Convention Center (SCCC). Spectra began management of SCCC on March 18, 2019.
Staff is transmitting Spectra's SCCC status report to Council for compliance with agreement terms.
DISCUSSION
Submitted for Council information is a Financial Status Report for the 3rd quarter ended March 31, 2020, as submitted by Spectra. This report is unaudited and, therefore, subject to change.
As part of the management transition, there are several reporting additions and changes that are aligned with Spectra's accounting system. Some revenue and expenditure reporting groups are combined differently, and a new revenue recognition policy related to food and beverage activities has been implemented.
As discussed in the attached Quarterly Report, budget to actual financial results are as follows:
Table 1 - 3rd Quarter Summary Financial Summary
Projected in Budget
Actual
Difference
Gross Revenue
$4,741,378
$3,971,786
($823,592)
Total Expenses
$3,782,087
$3,844,009
$61,922
Net Income
$959,291
$73,777
($885,515)
As detailed in Table 1, gross event revenue came in under budgeted projections largely due to cancellations or rebooking of nearly all March events due to the COVID-19 pandemic. Revenue performance in food and beverage (-$331,578 variance), lower rental (-$816,084 variance), audio-visual (AV) rental needs (-$91,402 variance) and IT (-$178,595 variance). Remaining categories generated higher than budgeted net revenue proceeds (+$594,067 variance).
Net expenses were over budget by $61,922. This was due to higher than anticipated o...
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