Board OKs food deal for the Sears Centre

The Hoffman Estates village board settled the lawsuit with Levy Restaurants by approving a food service contract with the company for the Sears Centre.

The contract runs through 2013 with opportunities for two one-year extensions at the village's option. The commission-based deal is less risky to the village, arena General Manager Ben Gibbs said.

"In this economy when we don't have how many events we're going to have, we might be super busy, we might be super slow, at least we know Levy is never going to cost us anything," Gibbs said.

The agreement settles Levy's lawsuit against the village, filed on Sept. 18, 2009, was a reaction to Hoffman Estates taking ownership of the Sears Centre through foreclosure. Levy sought a $1.6 million claim against the village, protecting its right to serve food at the arena. The new deal with Levy settles the lawsuit. The village also saves on litigation costs, Village Attorney Arthur Janura said.

The arena hasn't made a profit since opening in 2006. However, its outlook has improved this year after Global Spectrum, a division of Comcast Corp., took over managing the building. At one point the village looked into replacing Levy with Comcast's own food service, Ovations, which doesn't serve a building in the Chicago market.

The Sears Centre projects making about $1.4 million in food and beverage sales in 2010. The commission deal brings in about 10 percent less revenue, compared to the existing fee system. But with the commission deal, the village does not assume potentially costly operating risks, including payroll and product costs.

If the arena does not host events, a fee-based structure would still require it to pay certain fixed expenses even though no money is coming through the building. The village does have the option of going back to the fee structure down the line.

For example, for 2010, the village would make $264,000 with a commission-based system and $293,000 with a fee-based system. But the fee-based system doesn't take into account the expenses.

Trustee Cary Collins cast the only vote against the deal and said he hoped the village would broker a better agreement. He criticized the village staff for negotiating the deal and questioned the education level of his fellow trustees. He reminded the board he went to law school.

Collins again focused attacks on Trustee Gary Pilafas. He said Pilafas, chairman of the now-dissolved ad hoc arena committee, the group charged with helping negotiating the contract, should have personally invited him to the committee meetings. Collins called Pilafas "backstabbing" and said he didn't trust him. Collins hasn't been happy with Pilafas since he was named deputy mayor, a title that Collins once held.

"What kind of college degree do you have?" Collins asked Pilafas.

Pilafas explained he was in the Marine Corps and has a degree in engineering.

"I'm not sure what the questions are for," Pilafas said to Collins. "This has nothing to do with anything. You're actually just scrambling and making things up."

After attacking the resumes of Trustees Anna Newell and Jackie Greene, Collins said, "I'm not trying to embarrass anybody." Village Manager James Norris then laughed. At one point Trustee Karen Mills said, "This is ridiculous."

Collins maintained he was just hoping the village could have made the best deal possible and that the deal needed several tweaks. He also said trustees did not have enough information to cast a vote. Both Pilafas and Gibbs conceded that the deal wasn't perfect but said it was still a good one for the village.

Kincaid sought to eliminate any notion that the village staff lacked the due diligence in preparing the contract.

"Staff has put in a year of investigation on this," he said.