SEA budget shortfall plugged by city’s stadium authority

COVID-19 has blown a big hole in the 2021 budget of the Sports & Exhibition Authority, owner of PNC Park, Heinz Field, PPG Paints Arena and the David L. Lawrence Convention Center.

And kin — the Pittsburgh Stadium Authority — is riding to the rescue.

SEA board members approved an $11.35 million spending plan Thursday that is covered in large part by a $10 million contribution from the stadium authority, which oversees the land between Heinz Field and PNC Park on the North Shore.

The money is needed because the Sports & Exhibition Authority is anticipating an $8.9 million shortfall in 2021 from the convention center, which has seen its business dry up because of the pandemic.

Mary Conturo, SEA executive director, said the budget assumes that convention center shows and events won’t begin to return to anything close to normal until at least July.

This year the pandemic has wiped out nearly all of the events that were scheduled to take place after mid-March.

Besides the convention center shortfall, another $1.3 million in stadium authority funds will be used to make up for anticipated losses in hotel tax and parking revenues, which the SEA expects to be about 30% of the usual amount.

In addition, a $1.7 million annual allocation from state gambling revenues to help with convention center deficits ended last year.

“Revenues from the convention center will be down and other revenues won’t be available,” Ms. Conturo said.

The convention center typically runs about a $3 million

deficit, in large part because of discounts offered to bring events to Pittsburgh. But shortfalls have ballooned further because of the coronavirus.

Nonetheless, Ms. Conturo, who doubles as the stadium authority executive director, expects that organization’s bailout to be a onetime thing.

The money, she said, came from a surplus built up over the years from parking revenues and the sale of North Shore land. She said about $4 million remains in that fund. Stadium authority board members approved the $10 million transfusion for the SEA earlier this week.

“They still have enough for their budget and to maintain their facilities,” Ms. Conturo said.

There is no legal impediment to the stadium authority giving funds to the SEA, she said. “The two authorities were created under the same enabling act and they have the same purpose. Expenditures by either authority furthers their shared purpose.”

SEA officials also had to deal with a $ 6.3 million shortfall in this year’s budget because of COVID-19. To cover it, the city-Allegheny County authority used $1.5 million in federal CARES (Coronavirus Aid, Relief and Economic Security) Act funding, $2.6 million in hotel tax revenue, and $2.2 million of its own funds.

The convention center hasn’t hosted a major event since March, when the Pittsburgh Home and Garden Show shut down early because of the pandemic. One virtual event did take place in October.

As of the end of August, tourism group VisitPittsburgh had seen 336 business and sports events canceled or postponed this year, representing about $158.7 million in direct visitor spending in the local market.

Because of the cancellations, SMG, which has managed the convention center for two decades, received only half of its $190,000 fee for 2020. The reduction was negotiated between the firm and the SEA.