- people on the move
Authority next to adjust its budget
Just like the Grand Rapids City Commission did last week, the Convention and Arena Authority is likely to make some mid-year adjustments to its operating budget this week — and for the same reason.
The CAA operates Van Andel Arena and DeVos Place.
Total operating revenues to the CAA are on track to drop by $568,670 from what was expected last summer and lead to a 64 percent reduction in the projected operating surplus when the fiscal year ends on June 30.
The adjusted budget has a year-end surplus of $287,786, a freefall of almost two-thirds from the forecasted number of $808,662. (See related chart.)
Revenue estimates from the arena and convention center have been lowered by $416,254 and from parking receipts by $152,416 — the two sources of operating income. Those changes are expected to reduce the total operating revenue from $11.63 million to $11.06 million. Operating expenses have also been cut in the amended budget, but only by $47,794. So the overall adjustment between operating revenues and expenses results in a loss of $520,876.
As for non-operational items, the CAA expects investment income to fall by $147,000 to $675,000, instead of the $822,000 that was projected.
The board is also being advised to cut spending on capital improvements to the buildings this year by $953,260, and to consider moving at least three arena projects into next year. At the start of this year, the CAA adopted a budget of $1.84 million for those upgrades. Now the board is likely to stop capital-improvement spending this year at $890,840.
The CAA will review the budget adjustments Wednesday morning.