Yes, another ‘rosy’ story about our shining purple giant downtown. Things are not so bad afterall;
Looking to build on the progress of his predecessors Larry Toll and Scott Petersen, who served as co-presidents during the Pavilion’s first profitably successful years, Smith is going all in on giving the 350,000-square-foot facility a makeover, authorizing a three-quarter-million investment in the three-level Kirby Science Discovery Center, new paint throughout the building and nearly a half-million worth of new flooring on the way. More changes are planned for the year with a restructure of the attraction’s front lobby and more big dollar investments in the upper floors.
Sounds great doesn’t it? We’ll get back to above paragraph;
While final numbers aren’t in yet, Smith said 2016 will mark another year of gains for the Pavilion and the projection for 2017 is another year in the black. All the while, the amount of public dollars the facility is relying on continues to decrease.
Historically, the annual contribution from the city’s entertainment tax has made up about 20 percent or more of the Pavilion’s operating budget – which was around $7.5 million last year. In 2016, 22 percent of its budget was covered with taxpayer dollars, but that’s expected to dip to 17 percent in 2017, Smith said.
“It will always be important for the city to play a role in supporting it, but I also think a lot of people would like to see the private portion of the pie get larger every year,†he said. “So were going to take a pretty significant jump toward achieving that.
Bravo to Smith for getting subscriber and member numbers up, bravo also to him for trying to reduce the (operational) subsidy. But don’t be fooled by the numbers. Like the Events Center, while the Pavilion may be tackling it’s operational expenses, the maintenance and mortgage doesn’t come cheap, and doesn’t come from operational.
Back to to the first paragraph of the story;
authorizing a three-quarter-million investment in the three-level Kirby Science Discovery Center, new paint throughout the building and nearly a half-million worth of new flooring on the way. More changes are planned for the year with a restructure of the attraction’s front lobby and more big dollar investments in the upper floors.
What is not evident in this story is that these ‘investments’ don’t come from the Pavilion’s operational budget, they don’t even come from private investors. Since the city owns the Pavilion (building) we are responsible for all new construction and maintenance. The WP Management doesn’t spend one single penny on these things. The money comes from our 2nd penny CIP, the same place where are road money comes from. So every time the Pavilion spends $500K on carpeting, that is $500K less spent on filling potholes. It’s easy to talk about the operational success of a facility when you have a separate entity subsidizing your structure. It would be like having a retail business in a building that you don’t have to pay a lease on.
It seems Smith learned well from his old boss at city hall. Smoke and Mirrors.
The city can’t be trusted. Their accounting methods move money around so everything looks rosy. In fact, maybe some something where money is temporarily parked looks great. Meanwhile, the same money gets regularly routed to something else when there’s criticism. At the end of Huether’s term, debt realization and negative cash flow will become evident.
Commander are you running for mayor or for the house.I would like to see you debate the used to be my man Mike,if he decides to run.
Washington Pavilion Management, Inc. is the tenant of the building owned by the City of Sioux Falls. The landlord (i.e., the City) has agreed to paint their building interior and replace some of the flooring. Most renters expect the same from their landlords, and fortunate tenants with responsible landlords who maintain their rental properties will do this.
Maintaining the building is an ongoing City responsibility. Operating the Pavilion is a private, nonprofit responsibility of the management company (a nonprofit corporation). The city looks on the Pavilion’s programming as a community asset that merits limited City support to supplement the attendance revenues, donations, grants, and other philanthropy solicited and received by the nonprofit management company.
Remember that the City names a couple of members of the Pavilion management’s nonprofit board, so the City is always represented in management and operational policy discussions as well as in strategic direction.
Michael, everything you are saying is absolutely true, but it still doesn’t change the fact that whether or not we use the Pavilion, EC or Indoor Pool, we still have to foot the bill on mortgage and maintenance. I just am making it very clear to tax payers that when these facilities like to say they are ‘operating in the black’ they are NOT telling the whole story. Just because you are a non-profit, it doesn’t give you a license to lie.
Basically, the city uses a sophisticated pyramid scheme to make their socialist development look private yet community oriented. Face it, the Pavilion is a dinosaur. In the future, the EC will become a tourist draw something like the coliseum in Rome (big, useless, but looks good on post cards). There will be a Tsunami at Grille 26 when the cinder block at the Aquatics Center decays and fails. Chlorine and cinder block, big design flaw. City leadership brags about these? They’re not one liner pickup lines that work with voters.
I guess where we disagree is that I don’t see it as a”lie” that the nonprofit management company operates in a fiscally responsible manner. Sure, they benefit from an operating subsidy from the City to cover a minority of operating costs, but that subsidy is monitored and, according to the story, has recently decreased as a percentage of the total operating budget.
I was a skeptic when the Pavilion (re)construction was envisioned in the late ’80s-early ’90s, because I knew the money didn’t add up. I always believed the city owed Finance Commissioner Matt Staab an apology for pointing out the emperor’s lack of new clothes .
Time and circumstances have changed the Pavilion math, and we have a City-owned and maintained structure with a nonprofit management company under contract receiving a partial City operating subsidy to supplement admissions, donations, sales, and other revenue.
Given the current conditions, the statements are correct, even if people are uninformed or inexact about the nature of who is doing and funding what.