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HomeMy WebLinkAboutCity Council Committees - Public Facilities District Board - 01/29/2015 (2) KENT KENZ Y/ASHINGTOH I Public Facilities District Board Minutes January 29, 2015 4:00 p.m. ShoWare Center 625 West James Street Boardmembers present: Mike Miller, Cass Prindle, Lew Sellers, and Jeff Piecewicz Others present: ShoWare Center General Manager Tim Higgins, ShoWare Center Director of Marketing Ryan Hart, ShoWare Center Director of Operations Josh Holmes, City of Kent Finance Director (Board Treasurer) Aaron BeMiller, City of Kent Economic and Community Development Director Ben Wolters, City of Kent City Clerk (Board Secretary) Ronald F. Moore and Reporter for the Kent Reporter, Steve Hunter I. Call to Order. The meeting was called to order by Chair Mike Miller at 4:00 p.m. a. Introductions. No formal introduction took place. b. Motion to approve the minutes of October 29, 2014. Lew Sellers moved to approve the minutes of October 29, 2014, seconded by Randall Smith. Motion carried 4-0. II. Finance Reports. a. City of Kent. Aaron BeMiller, City of Kent Finance Director/Board Treasurer reviewed the Kent Events Center Operating Fund handout. He noted that the document addresses the City's ShoWare Center Operating Fund and not much has changed with it. He noted that the estimated actuals show that there will be $264,000 in admissions tax which is fairly strong. Expenditures are estimated to be $920,000 and an overall loss of $224,000 in the City fund. He noted that at the Council will be considering on Tuesday whether or not to allocate additional General Fund monies into this account to alleviate the debt. BeMiller responded to Piecewicz that this allocation would be a one-time allocation to relieve the current negative City ShoWare fund balance. He added that this fund pays the SMG each year. He continued and reviewed the PFD Fund and stated that for the most part the balances are pretty good. He stated that Kent Special Events Center Fund beginning balance is $131,000 and anticipating collecting $755,000 in sales and use tax monies. Additionally, the City will be depositing funds as a part of the intergovernmental funds and the total resource will be about $3.9 million. However, the debt service at the end of December 2014 was approximately $3.8 million which left an ending PFD Fund amount of just about $120,000 at the end of 2014. b. ShoWare Center. Arletta Voter, ShoWare Center Director of Finance discussed the 4th quarter and year-to-date calculations. She stated that the ShoWare ended the year with a $752,324 loss which includes unanticipated capital expenses (ice issues) of $182,373. She stated that the 4tn quarter was more successful than 4tn quarter 2013. She handed out and highlighted the 2015 budget and proposed income statement for 2015. Miller announced that the admissions tax is given directly to the City and the revenue for 2014 was $264,000. Higgins further explained that the admissions tax is 5 percent of all Public Facilities District Board Minutes January 29, 2015 ticket sales at the ShoWare Center. He noted that there was a $28,000 loss for October, almost a $50,000 profit for November, and a $4,800 loss for December 2014. Therefore, for the last quarter in 2014 the ShoWare showed a profit of $24,781 for operations. Higgins noted that there were more than 60 events held at the ShoWare during the 4cn quarter of 2014. Higgins discussed the utilities and said the costs are similar, but Comcast is new and costs $25,000. Wolters confirmed that they are looking into having another competitor provide cable services for the facility at a better rate. Miller highlighted repair and maintenance expenditures. He stated that the facility was a little over budget in October, slightly under in November, and significantly under in December. He stated that this resulted in the facility being under budget for the quarter. Wolters communicated that the City is continuing to move forward with the issues on the compressor system and moving forward to having potential litigation. Also, he stated that there have been some lessons learned on the system and one once the maintenance contractor has looked at the entire system there will be more to learn. He added that one of the hot water heaters has been replaced at a cost of $56,000. Piecewicz confirmed that the piping will be redone at the end of the season and adjustments will be made to it. BeMiller explained that since the compressor was capitalized in the beginning and it is being replaced it is considered maintenance. However, if it was ten years from now it would have been replaced. He also highlighted the State Auditor's Office exit conference and stated that the City is continuing to work on changing the contingent loan agreement and are working with bond counsel. He noted that the revised language will be brought to the Council. Miller noted that if the language is adopted by the Council it would be brought to the Board in April. Piecewicz inquired about the language in the contract concerning profits from the ShoWare and Wolters responded that if there is a net profit then those funds reside within the working account under the City of Kent for the ShoWare Center for other expenses. He added that the City can draw upon that account for the General Fund. However, any excess funds would most likely be used for capital replacement or debt service. He added that any renovation would be handled under a public works item and anything over $50,000 would have to go through a public works contracting process. Additionally, anything over $25,000 would need to be approved by the Council. Higgins communicated that the projected loss for the ShoWare Center 2015 budget is $463,675. He noted that this budget is based on what the facility has historically done in the past. Continuing, he discussed Disney on Ice `Frozen" and communicated that the ten shows in November are almost sold out. He also noted that there are more confirmed ticketed events to be held at the facility this year than any other year. Wolters noted that the budget is approved through the contract with SMG and the City. He stated that the admissions tax and the sales tax on goods and services purchased by patrons, the ShoWare Center, and the Thunderbirds equates to about $500,000 that the City receives f per year. He added that the goal is for those funds to go to debt service or replacement. III. Operations Update. 2 Public Facilities District Board Minutes January 29, 2015 a. General Manager/Marketing Update, ShoWare Center. Ryan Hart, ShoWare Center Director of Marketing highlighted radio campaigns and discussed how the facility partners with radio stations and businesses for advertising. Higgins discussed indoor soccer and noted that there were attendance problems with the former team. He stated that the Tacoma Stars will be playing in the facility and there has been an increase in ticket sales. He stated that he is confident that they will be utilizing the facility as their home. He continued and stated that Promise Keepers had 6,000 people at the ShoWare and their event went well. On March 12, he noted that the Rocket Worship Roadshow will be at the facility with 7,000 seats available. He announced the "Hello Kitty" tour and there will are 2,500 tickets available for that event. The graduation events were also highlighted. Hart discussed an article in "Venues Today" for the facility being noted as the #1 Pacific Northwest facility based on size. He noted that the rankings are based on attendance figures for the year. He added that the facility will finish 2014 with an attendance figure of over 370,000. He reviewed the Facebook, Twitter, and social media numbers. He reviewed the success of the Thunderbirds and their work with Hispanic promoters to bring more shows to the facility. He reviewed Disney on Ice and noted that it brings 35,000 people to Kent. He noted that on November 21, the 2 millionth ShoWare Center guest was greeted into the facility and he won two tickets to each event for the year. Hart discussed the partnership with the Wolf radio station. He also highlighted the Harlem Globetrotters schedule and that Mayor Cooke is going to be playing in two of the games. He announced Sesame Street Live will be at the facility in May and they will not be at the Tacoma Dome. He stated that this presents a great opportunity to incorporate more children's events. He discussed high school basketball and that it features both girls and boys teams. He stated that You, Me, We is also going to be at the ShoWare and that the Washington First Robotic State Championships will be held on January 31. b. Seattle Thunderbirds Update. ShoWare Center Director of Ticket Sales Sean Runnels stated that the Thunderbirds have had a good holiday season and crowds of 5,200, 5,500 on December 20, and 6,200 on December 30. He stated that ticket sales have gone well. He reported on the Community Sports Foundation funds, which have awarded $323,149.22 to youth sports organizations. He also discussed the 50/50 raffles and communicated that 11 suites are spoken for on an annual basis and overall suite sales have increased. Piecewicz confirmed that the parking capacity at the facility is 850. It was also noted that people park at the park-n-ride and Kent Station. Wolters discussed the ongoing claim for the compressor. He thanked the board and reminded the board of their terms. He noted that Sellers and Prindle's terms end on September 1, 2015. He stated that the Lodging Tax and Advisory Board have set aside funds to promote the ShoWare Center. The attendees confirmed that the next meeting is April 30, 2015. Meeting adjourned at 5:09 p.m. l Ronald F. bore, C Board cretar 3