JOHN MOORHOUSE Thursday, February 26, 2009
The total operating budget for the three city facilities operated by Global Spectrum could top $1.1 million this year. However, the chairman of the city‘s newly-established advisory board for the South Okanagan Events Centre says improved fiscal performance - bolstered by a possible deep playoff run by the Penticton Vees - could reduce that shortfall substantially. Global Spectrum is under contract to manage the SOEC, Penticton Trade and Convention Centre and Memorial Arena. Only McLaren Park Arena continues to run entirely by the city. The draft 2009 city budget earmarks $412,000 for operating the SOEC including Global‘s management fees, with $513,000 for the Penticton Trade and Convention Centre, and $145,000 for Memorial Arena.
Final budget figures for the three facilities are now being prepared by the city and Global Spectrum and should be soon ready for presentation to city council. From 2002-2006, the city spent an average of $400,000 a year to operate the convention centre and $250,000 for Memorial Arena, plus administrative costs. Coun. Mike Pearce said Wednesday he hopes to have the budget figures available for review by the SOEC advisory board at its next scheduled meeting on Tuesday. Pearce, who chairs the advisory board, said the estimated shortfall could be higher or lower depending on the operating performance. “I would hope we would be less than $1.1 million and my obvious goal would be to try to get it as close to breaking even as possible,” he said. Council‘s recent decision to reduce ticket prices for Vees‘ games next season will add about $80,000 onto the budget shortfall. However, that figure could be offset by increased attendance and concession revenues. Pearce said a deep playoff run by the Vees this season could also have an impact, especially if they attract 4,000 fans a night rather than 1,800. Playoff revenues are split between the Vees, Global and the city. Concession stand prices could be one of the items under review by the board, although Pearce stopped short of suggesting lower prices may be immediately forthcoming.
The advisory board, he added, is there to recommend policy to council- not to manage the facility. The board includes representatives from Global Spectrum. A public suggestion box has also been installed at the Events Centre for further input. A series of well-attended concerts could also boost revenues immensely, although Pearce acknowledged the reverse could be true for concerts which fail to attract a sizeable crowd. The city has not released fiscal details from concerts and other entertainment events since the SOEC opened in the fall. The figures are deemed as “proprietory information” and will likely remain confidential. “We haven‘t had enough experience with concerts yet to know which ones we should choose,” he said. “And whether the building is rented (to out-of-town promoters) or we‘re the promoter.” The advisory board chairman added he‘d personally like to see about 20 per cent of the Events Centre schedule allocated to “social” or community events that shouldn‘t be expected to generate a profit.
Meanwhile, Pearce wondered at a council budget session this week, whether the city could refinance the Events Centre debt over 25 years rather than the five and 10-year terms currently on the books. He said that would allow more money for road upgrades. However, Jack Kler, the city‘s director of corporate services, said the debt repayment schedule is linked to the availability of DAC (development assistance compensation) casino money which is being used to make annual payments. He said the city could face a substantial penalty if it chose to restructure its debt payments. Kler added 2009 is the final of three consecutive years that the city has directed $2 million from its electrical utility revenues to the Events Centre debt. This money will be available for other purposes in 2010.
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