York City fails to give Revs notice, triggering ice arena contract extension
York City officials' failure to notify the York Revolution about a looming contract termination means the company will continue managing the York City Ice Arena for at least another year.
While the Revs' four-year contract was supposed to end in September, an extension clause in the 2014 deal was triggered because the city failed to give 90 days' notice of its intent to seek new bids.
In fact, a request for proposals seeking new management in anticipation of the contract's end was released in June, which city officials say served as an acceptable notice for contract termination.
However, the bid was pulled less than a month after it was published because it lacked clarity, according to Chaz Green, the city's deputy director of public works.
Failure to give notice: City spokesman Philip Given initially denied there would be a contract extension, but he later acknowledged the move after being asked specifically about the clause in question.
"Either party may terminate this agreement by giving written notice of its intent to terminate no later than 90 days prior to the end of the then current term," the contract states.
If the notice isn't given in time, the contract remains in force and the current management is able to continue its role with the facility for another year.
If the city had stuck with the initial RFP, which was filed more than three months before the Revs' contract was to end, the clause wouldn't have taken effect, according to Given.
However, since the city pulled the bid request and has yet to publish a new one, it's no longer possible for the city to give the Revs a 90-day notice, he said.
Revs President Eric Menzer previously said he and the city's former acting business administrator Michael Doweary came to an agreement invoking the one-year extension clause.
The team will now continue managing the arena until July 2019.
Menzer has said the company plans to bid on the new RFP as long as all goes smoothly, but now the company won't have to worry about it until next year.
Financial issues: Since 2003, the city has been paying about $600,000 per year for the arena after assuming responsibility for a $7.3 million bond it had guaranteed to build the two-rink facility.
Menzer, the city's economic development director at the time the bond was issued, supported the construction of the arena.
The bond was supposed to be paid off by 2021, but City Council members voted last year to refinance it with a separate 2011 bond, extending the expected date of payoff to 2027.
Management history: Shortly after taking control of the arena in 2003, the city hired Rink Management Services to manage the facility.
The company, which maintains ice and related equipment at 28 ice rinks, produced more than $1.25 million in operating profits from 2004-2013, according to its proposal to keep its city contract in 2014.
However, that year, management of the arena was instead contracted to the York Revolution.
When the Revs took over management of the facility in 2014, it produced nearly $90,000 in profit during the first few months, but it lost about $130,000 from 2015 through September 2017, according to income statements submitted to the city.
Investigation: Local law enforcement has an investigation involving the arena.
City and Revs officials have been silent about the subject of the investigation, but internal emails provided to The York Dispatch by a former ice arena employee show that the timeline of the investigation coincided with the termination last year of the facility's longtime general manager.
Less than two weeks after the general manager was fired, Menzer emailed arena employees to let them know that "the city has decided to expand into at least a preliminary investigation by city police to determine if sufficient evidence exists for criminal prosecution of the alleged theft."
That same day, Sept. 5, York City's public police log shows that a detective met with city solicitors Jason Sabol and Donald Hoyt at City Hall "in regards to a theft that occurred at the York City Ice Rink."
Authorities said this summer that the investigation was still underway.
An independent audit of York City's finances released late last year found a lack of “appropriate controls and oversight” at the ice arena.
A separate review by The York Dispatch of hundreds of arena-related documents, obtained through multiple Right-to-Know Law requests, also showed bookkeeping anomalies.
Asked at the time to explain the apparent irregularities in the documents, Menzer declined, citing an ongoing police investigation involving the York City Ice Arena.