PEABODY — The finances of the James McVann – Louis O’Keefe Memorial Rink, which has been leased by the city since the ’90s, have come under scrutiny as its margins have remained frozen in the red.
Several members of the City Council raised concerns about the issue during the review of June’s fiscal year 2024 budget proposal, when they grilled General Manager Paul LoGiudice on the financial issues the rink has faced compared to the city-owned and operated golf course, the Meadow, which has shown a profit.
“We’re showing the golf course bailing out the skating rink, I know it’s not the first year and it’s probably not going to be the last year,” Ward 5 Councilor David Gamache said in a June 16 meeting. “Is there any outlook about this somewhere along the line returning to break-even point with the skating rink?”
Councilor-at-Large Jon Turco was one of the councilors who championed the effort to combine the enterprise funds for the golf course and skating rink that started a few years ago, something he said would make the rink less of a burden on taxpayers. However, he explained that when looking at the finances of each, the golf course has bailed out the rink year after year.
LoGiudice, who has been the GM of the rink for almost 15 years, defended it. He pointed out that none of the rink’s funding comes from taxpayers and that it has been allowed to operate without tax funding because of the arrangement with the golf course.
“Do we take some money from the golf course? Yes,” LoGiudice said. “That’s what the whole entity fund is all about.”
According to LoGiudice, the rink had been at least breaking even, or making a slight profit, until 2012, when it went into $1.4 million in debt for renovations, which he said the rink is still paying off.
He said the rink would likely be in much better financial shape if it was not starting around $80,000 in the red after debt payments every year.
“We always made enough to pay our bills and pay the staff currently,” LoGiudice said. “Currently, we would be doing that if we didn’t have that huge debt.”
Mayor Edward A. Bettencourt Jr. explained that the golf course, which is expected to make more than $1 million in profit in 2023, at one point was also losing money due to construction and maintenance debt. He said that he expects a similar turnaround for the rink once its debt is paid off.
“I feel like at that point we’ll probably be breaking even or around there,” Bettencourt said. “I don’t want to be quick to do away with the programs and offerings for the city.”
Another issue raised by councilors was the thousands of dollars in delinquent payments owed to the rink from organizations that used the facilities.
LoGiudice said he has notified his superiors at City Hall that $22,000 in outstanding debt, which he said has been owed to the rink by a select league hockey program for around four years, has continued to go unpaid despite his efforts to collect the debt via invoices.
“It seems like nobody wants to go through the hurdles of trying to collect it,” LoGiudice said.
Bettencourt said the issue had been brought to City Hall’s attention, but the collectability of the team’s debt and costs associated with legal action were reasons that further action to collect the debt has stalled.
The city leases the rink from the Commonwealth, but foots the bill for expenses like maintenance and renovations. The current lease, signed in 2007, expires in 2027, which is when the final installment of the renovation debt payments is due.
Bettencourt said he wants the city to look at its options before making any decisions about the future of the rink.
“I don’t want to throw away something that is good for our city and provides a lot for the community without really looking at other ways in which to make some money and utilize that space,” Bettencourt said.
Turco said that he loved the idea of having a rink and that it was a point of pride for him to have one in his city. Still, he questioned the management of the rink and said that to him, the writing was on the wall for the viability of the rink in terms of being part of the city’s future as an enterprise.
“I wish there was a solution,” Turco said in the meeting. “I can’t support this any longer… I’d like to see us cut our losses and move on from this.”
LoGiudice stressed that to him, the importance of the rink goes beyond just being a revenue creator for the city. He said the rink does its best with what it has to support not only the 10 youth, high-school, and select hockey teams that call the rink home, but also the young people and families that use the facilities.
“It was never about the money when I first took it over,” he said. “It was about providing an opportunity for the kids from the surrounding communities to have a place to play and skate.”
