Entries Tagged 'Event Center' ↓

Sioux Falls City Council avoids the 700 pound gorilla in the room

That wasn’t all entirely true, Councilors Brekke and Starr brought a little reason to the sewer rate increase discussion tonight after Rick Kiley had a total meltdown when Stehly called him out about disparaging the work of staff. Which made it even more ironically funny, because all Kiley does is constantly compliment staff sometimes just for opening the toilet stall door. So when Theresa reminded him that staff helped her come up with her numbers, Ricky Lee went ballistic, twice. Memorable stuff.

Soehl suggested that she share her information in advance (you know, like the rest of the council does with Theresa and Pat . . . LOL!)

But let’s get to the serious stuff. Janet was smart to bring up the history of the 2nd penny and it’s use for infrastructure and Starr quoted Citizen Stanga wondering why so much of the 2nd penny goes towards ‘play things’.

Most people don’t realize, when you buy anything in this town, a portion goes towards paying down the bonds on the Denty from the 2nd penny. Whether you use the facility or not (in which you have to purchase a ticket) you still have to pay for it’s mortgage. You can always sit outside for free and admire the ‘interesting’ siding.

The council totally ignored the gorilla. While they argued up and down that sewer rates must rise to pay for upgrades because it is only fair to charge the user, they avoided the fact that the play palaces bonds in our town are not paid for by user fees, not one penny. Brekke and Starr came the closest to suggesting we have a long term strategic plan to look how we spend the 2nd penny (to which they got crickets). All they could focus on was that Stehly said $300.

If you want to have an honest and fair conversation about user fees and paying down bonds, as several councilors suggested, then we need to start talking about how the Denty is going to start paying it’s own bonds moving forward. I don’t think a person who can afford to pay $150 to see a Jackass in a cowboy hat would blink an eye at paying an extra $3-5 ticket fee for bonds. Heck, most wouldn’t even notice it after there $10 Coors Light and $8 dollar pretzel.

If the council thinks it is fair to raise rates to pay for sewer infrastructure then they need to also pass a city ordinance that attaches a bond repayment ticket fee to all the shows at the Denty. Otherwise they are just a bunch of hypocrites . . . wait?!

There is an alternative that would cost us less

Another portion of the conversation that was left out tonight is the simple word ‘conservation’. Actually, Public Works Director Cotter was the ONLY one who brought it up, recognizing that the conservation programs he helped implement have reduced water usage. And you can’t argue with his numbers, they are astounding and measurable (bravo to Cotter). While he gave this ‘gentle hint’ to the council, no one decided to run with it. We could actually spend a lot less by implementing even stronger and more stringent water conversation programs which would decrease our sewer usage. Many have even suggested eliminating lawn watering by planting more draught resistant natural grasses instead of non-native ones.

Besides just considering the 2nd Penny, we have alternatives to save us money on these projects, but as Brekke has suggested since she ran for the office, it takes PLANNING!

UPDATE: Was the Denty’s GM, Torkildson let go?

UPDATE: It seems Jorgi at Stormy is a bit baffled by Terry’s disappearance;

The man in charge of the Denny Sanford PREMIER Center is no longer there.  It’s a story that has a lot of people scratching their heads. It has a lot of people asking what happened to Terry Torkildson.

As I reported on Friday, it sounds like a lot of internal corporate crap. I do know that Torkildson is in shock. I also heard that it had to do with the lack of brown nosing skills Terry had compared to Chris Semrau. Let’s just say one of them was a lot better at smoozing then the other one. I guess that is why one of them was promoted and the other one was let go. Hopefully we will hear more in the coming week.

I’m hearing from several sources that the GM of the Denty was terminated. Not sure if that happened today? I also no few details as to why or if it really happened.

As you know, Torkildson has been with SMG for many years, and to be very clear, this would have been a decision by their corporate offices and NOT City Hall (I would assume).

It comes as a surprise really, because I felt Terry was doing a good job. He fought like a good soldier to get the Denty, and for attendance records it was doing well (even though SMG hasn’t paid a penny of the mortgage). He also was always up front with me and even pulled me aside a few times at council meetings to set me straight on details I blogged about, which I appreciate.

As you know, Terry was the one that told then councilor Rex Rolfing in a recorded council coffee meeting that the dented up siding on the Denty made it “Look interesting.” That still cracks me up.

With most things corporate America, I’m sure it has to do with internal garbage, and one has to wonder about this taking place so shortly after Chris Semrau left Sioux Falls to take on another position elsewhere with SMG? I have been told some reasons why it may have happened, but at this point I’m not going to speculate.

The Denty bonds have never been paid for with user fees

Remember former Mayor Bucktooth & Bowlcut’s mantra? Facilities/services should be paid for through user fees.

This has been the argument for raising sewer and water rates to pay the treatment plant bonds.

Yet, all of these facilities have NEVER been paid for through user fees;

Indoor Pool, Admin building, Huether Tennis Center and most famously the Denty.

The idea was certainly pitched that every ticket purchased at the Denty would have a fee attached to it to help pay down the $9 million a year mortgage. The former mayor responded something like this, “We will certainly look at it.”

While the Denty has done a good job covering operating expenses and management fees, it has contributed very little to capital improvement or paying the mortgage, both which come from the 2nd Penny (we all pay it when we purchase something in Sioux Falls).

A $5 ticket fee or more could easily be attached to the ticket price to help pay down the mortgage, other facilities across the nation do it, but SMG has said that artists and promoters set ticket prices and are opposed to it. Phooey!

How much did the city make from the Garth Brooks concert?

Yeah, I know, DaCola asked this question months ago, but I guess it takes a cute reporter from KSFY to get the answers (well not really);

The state made about $810,000 dollars on sales tax alone from Garth’s performances at the PREMIER Center.

The city’s take would be around $540K (1st penny, 2nd Penny and 3rd penny entertainment). As mentioned throughout the story, most of the money made went to Brooks and the promoters, which went straight out the door. This is why I have encouraged SMG and the city to start promoting it’s own concerts and keeping that revenue in Sioux Falls.

Rapid City, be careful what you wish for

Rapid City just approved spending $130 million on a new Events Center. While I don’t live in RC, I can’t speak for what the people there want, but if they truly want it, who am I to tell them no. But as a person who went through this very dubious process in our city, a few words of advice;

Go with the flat siding, no matter what the architect and engineer may say. Trust me on this one.

Consider NOT using a CMAR (Construction Manager at Risk) I would keep the process as open as possible.

Use a local contractor that you can trust.

Make sure you have plenty of parking.

Make sure profits go towards paying down the bonds and not into some mysterious slush fund.

Avoid sponsorships from mega hospital complexes and credit card companies.

Make sure you build it big enough.

Make sure your fire department has a fire truck that can reach the top.

And lastly, when the mayor or the city council tells you to ‘just trust them’ do the opposite and question their intentions.

Not sure why RC residents want to double their per capita debt (or more) but have it, just remember, there will be less headaches if you keep the process open and transparent.

Who signed off on the Events Center Siding?

I know what you are thinking. Haven’t we been down this road already Detroit? Yes. But while we have our suspicions as to who probably signed off on it, we have never had confirmation.

If I was a betting man, it was probably signed off by the head guru, Mayor Huether. That large of a change order would have had his approval in some form or another.

But did he actually sign off on a document or directed one of his minions to do it verbally?

I don’t know. But I have to wonder if it will appear before the runoff election.

While council candidate Brekke was digging through city documents there was no inkling if she came across such a document, doubt she was even looking for it. But I also think her access and finding the confidentiality order has led OTHERS to start digging around.

I know that some in the media and even within city government have gotten rather curious after Brekke’s press conference and I wouldn’t doubt some other documents will appear, soon. Will the change order suddenly rear it’s ugly head?

Even if we do find the smoking gun, I’m sure none of us will be all that surprised that it was the butler in the billiard room using the candlestick.

Dykhouse brags about taking down the naysayers

I guess after 4 years, the gloating continues;

Campaign donations from local business leaders, luck disguised as misfortune, excellent timing and smart advertising — those were the keys to winning public approval for a new arena in Sioux Falls, according to Dana Dykhouse, one of the facility’s boosters.

Dykhouse said those efforts were necessary to overcome a contingent of 6,000 to 7,000 people in Sioux Falls who, in his words, “will vote ‘no’ on everything.”

“We kind of knew that this was our one shot,” Dykhouse said, “and that if we got all the positive people out to vote and could overwhelm them, we could do it.”

And there is a lot of irony in the things Dana is saying. He is right, they had to get a high voter turnout to win this thing. People who have never voted before or who rarely vote in municipal elections.

Ironically, many of those first time voters who cast their vote in the EC election HAVE NEVER VOTED AGAIN in a city election. That’s right, a shiny new dented up building was and has been more important to them than actually electing people who represent us on local issues, like taxes and fees, infrastructure repair, clean water and public safety.

Oh, and the other irony in all this;

Dykhouse said he was part of four task forces and many fits and starts leading up to the 2011 election in which Sioux Falls residents voted 58-42 percent to approve the construction of a $115 million arena.

Voters never really ‘approved’ anything. It was a vote of the city council that authorized the bond sale for the Denty. If it would have been an actual bond vote, it would have had to pass by over 60% of the public vote. That was the ‘trick’ played by Dana and his little promotion group. It was an advisory vote that had no legal standing, that is why the council had to approve the bond sale.

Oh, but what about all the success?

Dykhouse said the arena was immediately successful and sold out 23 shows in its first year.

While that is true. Most of the money pulled in from those shows went straight to the artists and promoters, out of town. The Denty has acted as an entertainment revenue vacuum. It also doesn’t pay for itself, not by a long shot. After operating expenses, maintenance, and the mortgage, taxpayers lose between $6-7 million a year, that comes straight from our roads fund. I guess I would measure success with a building that at least would break even while generating tax revenue. And we don’t even want to go into the problems with the siding and secret settlement that we will be paying for dearly for decades.

My ONLY advice to Rapid City is when you vote on this, make sure it will be 1) equitable to your city 2) be a legal bond vote and 3) Find a different contractor than the one we used.

Why has the entertainment tax collection been dropping since The Denty opened?

Well, I don’t know the answer to that question. BUT, I have speculated quite often on this. I have often argued that the Denty has actually been a financial drain on our city, and not just in a mortgage payment.

So why is it with so many people coming to Sioux Falls for sold out shows at the Denty the entertainment tax has been dropping?

My theory is that more and more people are dropping their entertainment dollars on tickets at the Denty, those dollars go directly to the artists and promoters and directly out of town. In other words, they are not spending that money on authentic local entertainment. Not only has it caused collections to go down, it is NOT getting recirculated in the community.

While it is nice we can see world class acts in Sioux Falls now, it has acted like a vacuum taking money out of the coffers of local entertainment.

Ironically the Mayor had a press conference today peddling more lies about how ‘profitable’ the Denty has been. He said that after operational costs, it made $2.1 million PROFIT last year. Ironically they never discuss the $10 million mortgage we pay out of our 2nd penny road tax. They also don’t mention that the city only holds the account on this FAUX profit that SMG controls. In other words, the city coffers (us) never sees the $2.1 million left over after operational expenses. The only money we take in at the end of the day is the $1.9 million in sales taxes it generated last year, which still leaves us far in the hole after paying the mortgage.

He also thanks the voters for passing the Denty with a FAKE, non-legally binding advisory vote. If the voters would have had a LEGAL bond vote on the EC, it would have never passed.

The Denty (Huether’s Admin) still refuses to tell us the value of ticket sales

While this is great news, there seems to be something missing here;

The Premier Center was ranked 44th in the United States and 84th in the world by Pollstar, based on touring event ticket sales of 239,089, according to a release from the Premier Center.

A couple of big things are missing; 1) is the above ticket sales number just tickets sold by touring acts, not total tickets sold at the Denty? 2) What was the value of those ticket sales?

If you were to do just a rough estimate on sales from the number above, promoters and artists pulled in around $17 million last year from the Denty. This number of course doesn’t include food and beverage sales and other events. Total sales at the Denty in 2017 could have easily been over $30 million. But how much is the Denty itself profiting? Not much. Most of that $30 million gets sucked right out of town.

Like the admission as to who authorized the bent up siding job on the Denty, for some reason the Huether administration wants to keep us in the dark about the sales at the Denty and what the Denty actually gets to keep or spend on operations.

So we have a publicly funded facility that takes $10 million a year out of our 2nd penny road fund to pay the mortgage but for some strange reason we can’t tell the public the sales it generates. Instead they send out vague press releases bragging about attendance.

We could of had 10 million people attend concerts last year at the Denty, if majority of those sales are not re-circulating in our community, does it even matter?

We have known for a long time what is wrong with the EC siding, we just want to know who authorized it!

A letter writer points out the obvious problems with the Denty siding;

Would the mayor and his crew accept that kind of work in their own homes?

Apparently they would, because we speculate that is who authorized the installation. All the arguments over the appearance, structural integrity and silly settlement are secondary arguments to who authorized it.

During the mayor’s last ‘Shut Up and Listen’ episode the mayor said leaders should learn from their mistakes. You can’t learn from your mistakes unless you admit to them first. The mayor continues to deny a mistake was made by putting the flat panels on a curved building. It is obvious from the settlement details and the consultant’s siding review a mistake was made. In fact it is glaring. So why won’t the mayor just say he issued the code red? He continues to ask people to drop the subject, but until he ultimately takes responsibility, apologizes and than learns from that mistake by offering a long term solution it’s hard to drop it.

Please Mike, give us the documentation that shows you authorized the cost cutting installation, otherwise you can continue to hear about this topic until the election and beyond.