Pikeville pursues East Kentucky Expo Center

PIKEVILLE — The Pikeville city manager is negotiating a contract to assume around $600,000 in debt and take over management responsibilities of the East Kentucky Expo Center.

A contract to lease the 7,000-seat arena and conference center space from the board of directors, for $10 a year for 99 years, is expected to be in place Monday, Pikeville City Manager Donovan Blackburn said. Board members met with city commissioners Thursday and Friday.

The Expo Center, which is owned by the state and opened in 2005, hosts concerts, conventions, and sports events including arena football, high school basketball tournaments, the Pikeville College Bears and a minor-league professional basketball team.

"The facility is an economic engine to the community in many different facets," Blackburn said.

The city has also signed contracts to share parking garage space with a new Hilton hotel being built downtown and is expecting fresh payroll tax revenue when Pikeville Medical Center, courthouse and Pikeville College expansions are complete, Blackburn said.

The Expo Center owes about $201,000 to the city for unpaid utility bills, $300,000 to management contractor SMG Inc., and around $100,000 in other bills, Blackburn said. Under the lease, the city would assume the SMG contract, which currently runs through 2014 but includes some "out" clauses.

When a feasibility study was conducted for the center in 1998, an annual operating deficit of $400,000 to $500,000 was assumed, officials have said. Also, it was assumed that local governments eventually would step in and take a greater role in managing the facility, Blackburn said. The city is now in a position to do that, he said.

"We're in very good health financially," Blackburn said.