New Orleans Arena Monster Truck

Ron Forman, chairman of the LSED - the board appointed by Gov. Bobby Jindal to plan, finance, construct, develop, maintain and operate six state-owned sports facilities (including the Superdome and the adjacent New Orleans Arena) - said the commission will recommend to the governor's office that SMG, the company that manages the Superdome and the Arena on behalf of the state, continue in its current role.

SMG is in the fourth year of a five-year contract with the state that expires in June 2012. The deal is slated to be extended through 2017 unless the state notifies SMG by June 30 that it plans to terminate the contract.

Forman said there are no such plans.

Under the terms of the current agreement, the state's payments to SMG are capped at about $1.4 million, which is just less than two percent of LSED's annual $75 million budget. As part of the deal, the state pays SMG base fees of $560, 000 for management of the Superdome and $243, 000 for the Arena. The state also pays incentive fees to SMG not to exceed $411, 000 for the Superdome and $176, 000 at the Arena. The incentive fees are derived from 10 percent of non-Saints and non-Hornets adjusted gross revenue generated by SMG at the facilities.

"The LSED board evaluates the SMG contract and their performance on a regular basis, " Forman said. "There is constant evaluation and review and critiquing of what they are and what they aren't doing.

"(SMG) performs at a high level of expertise. Based on what they did after the devastation immediately following the hurricane (Katrina in 2005) and the continuing improvements that are taking place, the feeling of the LSED is that SMG is doing an outstanding job. We have met with the governor's officials, and we highly recommend that we continue to working with them."

SMG, an international private facility management firm, manages 228 facilities, including five NFL stadiums, three NBA facilities, two NHL facilities and one MLB stadium.

But the New Orleans-area facilities are believed to be among the most significant in terms of scope of services and event activity within the SMG portfolio.

The scope of SMG's management services requires the company to operate, maintain, market, manage and direct all functions related to the two facilities, along with other duties relating to the LSED, according to Doug Thornton, the senior vice president of SMG.