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HomeMy WebLinkAboutCity Council Committees - Public Facilities District Board - 04/24/2014 • KENT WwsninnTnn AGENDA City of Kent Special Events Center Public Facilities District Meeting Thursday, April 24, 2014 @ 4:00 p.m. ShoWare Center 625 West James Street Board members Mike Miller - Randall Smith - Cass Prindle - Lew Sellers - Jeff Piecewicz Officers Mike Miller, Chair - Ronald F. Moore, Secretary - Paula Barry, Treasurer I. Call to Order a. Introductions b. Motion to approve the minutes of January 30, 2014 II. Finance Reports a. City of Kent - Paula Barry, Acting Finance Director b. ShoWare Center - Arletta Voter, ShoWare Director of Finance III. Operation Update a. GM Update - Tim Higgins, ShoWare General Manager b. Marketing Update - Ryan Hart, ShoWare Director of Marketing c. City Update - Ben Wolters, Economic & Community Development Director IV. Seattle Thunderbirds Update a. Thunderbird Sales, Marketing & Attendance Update b. Advertising & Suite Sales V. Other Business VI. Adjournment Public Facilities District Board Minutes January 30, 2014 ShoWare Center 625 West James Street Board Members present: Mike Miller, Cass Prindle, Lew Sellers, and Jeff Piecewicz Others present: ShoWare General Manager Tim Higgins, ShoWare Director of Finance Arletta Voter, ShoWare Director of Marketing Ryan Hart, Seattle Thunderbirds Vice President / Assistant General Manager Colin Campbell, Seattle Thunderbirds Director of Ticket Sales Sean Runnels, Councilmember Jim Berrios, Finance Director (Board Treasurer) Robert Nachlinger, Assistant Finance Director Paula Barry, Acting City Attorney Pat Kirkpatrick, Economic and Development Director Ben Wolters, 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 4:02 p.m. a. Introductions. Participants introduced themselves. b. Motion to approve the minutes of July 25, 2013 and October 24, 2013. Mike Miller moved to approve the minutes of July 25, 2013 and October 24, 2013, seconded by Cass Prindle. Motion carried 4-0. II. Finance Reports a. City of Kent. Ben Wolters, Economic and Community Development Director discussed the retirement of Bob Nachlinger and communicated that this is his last meeting. He communicated that he will miss him and wished him well. Miller communicated that anytime he needed anything from him he got it in a timely manner. He thanked him for all of his work and Wolters gave the details of a farewell celebration for him at City Hall. Bob Nachlinger, Finance Director introduced Paula Barry, Assistant Finance Director. He discussed the financial documents and reviewed the Public Facilities District fund, sales tax collections, and the ShoWare Operating Fund. Miller confirmed with Nachlinger that the sales tax revenues are utilized to pay for the revenue bonds. He added that the sales tax numbers are looking better and Nachlinger verified that they have been getting better every year since 2009. Prindle communicated that the operating fund and the sales tax mirror in this and other industries are doing as well as can be expected. b. ShoWare Center. Tim Higgins, General Manager highlighted the income statement for the facility and that the facility budget for the fiscal year ending 2013 was $495,000 which meant a loss of $370,000 based on the actuals. Higgins discussed the compressor issue and noted that it is something they are working on. Wolters further explained that the claim is estimated to be $150,000 and the work was covered by a bond, so there will be negotiations with the bond company about it in the future. 1 Wolters also inquired if the B&O tax has stabilized and if there was a refund coming to the ShoWare. Higgins communicated that there was a refund of $45,000 even though the State favored with the ticketing company. Piecewicz confirmed with Higgins that the claim on the bond is for the repairs on the compressor. Berrios confirmed with Higgins that the system that assists with the ice had water left in it when it was delivered and the company who delivered it didn't clear the moisture from the system. Higgins noted that over time, the system freezes and it is an ongoing issue. Higgins added that there have been significant band aids put into fixing the system. He confirmed that the compressor costs about $1 million. Wolters responded that the claim is for improper installation of the compressor. He stated it is difficult to get moisture out of the system and it is corroded now. He noted that the corrosion has caused the system to seize repeatedly. Additionally, he said he would be working with McInstry on a permanent fix to this. Berrios confirmed with Wolters that the warranty is for one year and the bond term against defects is seven years. Wolters added that the City is issuing a claim letter soon. Piecewicz confirmed that the claim for this issue would need to be filed within seven years. Mr. Wolters added that the claims company is probably going to want the City to settle and agree not to issue any further claims. Higgins communicated that there were 177 events last year and the capacity is 365 per year. He stated that this number of events is comparable to previous years. Miller communicated that compared to other comparable facilities that number is right on. Higgins added that the same ShoWare crew has been here all year and there hasn't been any changeover in personnel because the facility is booked. Higgins communicated the budget and predicted a net income loss of $484,949 and responded to Sellers that it would take seven sell out events or the Thunderbirds making it to the finals to bring the net income loss amount down to zero. Wolters also noted that generally the numbers industry-wide are down by a third. Higgins added that the community events don't bring in revenues, but they solidify the relationship with the residents. He said that there are seventeen graduations between eleven schools scheduled in 2014. He confirmed that there were fifteen or sixteen graduations at the ShoWare in 2013. Miller communicated that the year-to-date loss of $370,000 doesn't include admission sales taxes. He stated that an estimate for admission sales taxes is $180,000, which would cut the loss amount in half. Wolters communicated that the budget of the ShoWare was adopted as a part of the SMG Agreement. He also stated that the City is looking at the maintenance and operating costs and the cost to repair the major items going forward as a part of the City's capital budget. 2 III. Operations Update a. General Manager/Marketing Update. Ryan Hart, ShoWare Director of Marketing commented that 371,545 people have come to the ShoWare this year and 1,853,796 have been there since the building opened. He noted that there are 6,604 "Likes" on Facebook, 1,000 more since the last meeting. He discussed the 5th Anniversary event and that Mayor Cooke attended. He discussed the "open" ice event and that it is important to share the facility with the community. As far as the Thunderbirds, he said there are 12 home games left in 2014, The Harlem Globetrotters, Bee Gees tribute, Led Zepplin, Crossfit, and seventeen graduations in June will occur at the ShoWare, he said. Higgins also communicated that there are a lot of "hold" dates in the fourth quarter. Berrios inquired what revenues were received from the CrossFit event and Higgins replied that it is primarily a rental with more health-oriented food brought in for the participants. Sellers communicated that there are at least four playoff games for the Thunderbirds right now. b. City Update. Ben Wolters, Economic and Development Director discussed this being the final year in the current contract with SMG to operate the building. He stated he will be discussing it with the Council and explore what a contract extension will consist of. The key question is does the City go out for an RFP or do a renewal agreement with SMG. IV. Seattle Thunderbirds Update a. Sales, Marketing & Attendance Update. Miller commented that the team is doing well and they sold out last Saturday and they are in first place in their league. Wolters communicated that Campbell said he has seen an increase of suite sales which has also led to an increase of advertising sales. Berrios verified that a sellout is 6,200 in attendance and currently eight sellouts out of 20 games. V. Other Business None. VI. Adjournment Miller confirmed that the next meeting is on April 24, 2014. Meeting adjourned at 4:45 p.m. Ronald F. Moore, MMC Board Secretary 3