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.


#1 "Very Stable Genius" on 02.28.18 at 11:30 pm

Just for the sake of argument, isn’t this decline in line with overall declines in tax revenues of late, like sales tax receipts, until just recently; and mostly attributed to our weak farm economy?

#2 taxpayer on 03.01.18 at 6:05 am

Beginning with the 2009 EC Task Force, CSL (Conventions, Sports & Leisure International) and then later prior to the EC vote, AECOM, both national/internationally know consultants on leisure and entertainment stated in their reports that the EC could expect to see 2 to 3 major concerts per year.

That is not what has happened.

I wish Jonathan Ellis and Joe Sneve would do an investigation about where all the dollars are coming from that are being used as an incentive to attract so many major concerts.

#3 The D@ily Spin on 03.01.18 at 9:28 am

Keeping the Denty full adds significantly to local sales tax volume in the form of lodging, restaurants, and mall visits. Some decrease in entertainment tax is justified in order to keep ticket prices low. However, this is a dramatic decrease that should be explained.

#4 The D@ily Spin on 03.01.18 at 9:33 am

Is the tax rate the same but this revenue without audits is missing or flowed elsewhere to make the city budget balance?

#5 Bruce on 03.01.18 at 9:56 am

The decrease in tax revenue is similar to a virus feeding on itself. Viruses are opportunistic, often killing the weakest cells first.

The virus was brought in when the city was weak but reasonably healthy. The virus attacked the easiest cells and then before anyone could prevent a major disease, the virus killed the economy.

When $50 to $100 million or more leaves the Sioux Falls area every year to be spent somewhere else the South Dakota economy tanks.

Thanks to Mike Huether, the outflow will be severe for years to come. We won’t have roads fixed, optional entertainment or decent jobs until someone is in office pushing for good solid jobs an economy can be built on.

The virus brought to Sioux Falls by Mike Huether will be hurting us for many years to come.

#6 Michael Wyland on 03.01.18 at 11:23 am

Technically, the chart doesn’t show a decrease in revenues, but rather a reduction in the *rate of annual increase* in tax revenues. Fortunately, we haven’t suffered a year-over year decrease in sales tax collections yet.

#7 LJL on 03.01.18 at 7:57 pm

Nice catch Micheal.

#8 l3wis on 03.01.18 at 10:02 pm

It is a nice catch. But when you compare it to our population growth, we are still way behind. If it was pre-Events Center, I would understand, but we were sold that the EC would bring in all these people eating in our restaurants and staying in our hotels, hasn’t happened, in fact it has turned backwards, and we should be concerned. I have often offered a solution, if SMG started promoting their own shows at the EC we could make a lot more money. I can’t change the location, which has hurt the local economic impact to our local restaurants.

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