HomeMy WebLinkAboutCCBD Finance Personnel Minutes 7-19-18 Civic Center Board of Managers
Finance & Personnel Committee
Thursday, July 19, 2018
9:00 A.M. – Sales Room
Present: Staff: Others:
David Varner, Chair Jeff Jarnecke Dennis Andres, Jr.
Aaron Perri Leanna Belew Ben Dougherty, City Finance
Randy Kelly Marika Anderson Ken Glowacki, City Finance
Jen Hockenhull Maricela Juarez
The meeting was called to order by Chair Varner.
2019 PROPOSED BUDGETS
Jarnecke discussed the combined economic impact of the Center and MPAC - $22 million. The restructuring of the operations will generate a net savings of $100,000 which will be used
to create afor a Business Development Fund; the reduction in work force and combining like services provides more efficient operations.
The BDF will be used for identified business that would provide the highest impact such as a large number of hotel rooms; it could be used to offset rent, subsidize the cost of services,
assist with the bidding to host and sponsor new business.
Jarnecke introduced Maricela Juarez, StSenior. Bldg. Building Financial Specialist.
Morris/Palais
For the 2019 budget, operations are expected to be at a net deficit of close to $200,000 for the Morris. The 2017 economic impact generated was $9 million from 115 events. 2019 proposed
budget reflects revenues at $1.2 million; expenses at $1.3 million. Goal is to reduce deficit to $200,000 by increasing events to 125 resulting in a 20% increase in revenue. This could
be accomplished through enhanced efforts with the BTL to add new shows in 2020. To note: the cost to hold a show is $4000; with more revenue, there would be more expenses.
Palais is behind in bookings; may be due to more competitors on line; concentration will be on weddings and corporate business to reduce the loss of $200,000. Also, efforts will be
made to add more self-promoted events that would be covered by the surcharge of $1.00 per ticket sold; $100,000 in the fund. The $1.50 surcharge goes to general fund.
Century Center
Working from new agreement with SMG for 3three additional years. 2017 economic impact is estimated at $12 million. With new hotels on board, the Center will be pursuing new business
with more room nights. Belew reported highlights: revenues are slightly behind budget; last part of the year is typically strong with several large dinners, Indian weddings, and holiday
parties scheduled. Three conventions in June used the new hotels plus the Doubletree; all are expected to return in 21021. The number of events is down from last year due to a change
in business mix. Sales activities have been positive with an increase of site visits by 35% compared to last year. Room nights to date have increased by 153%. Customer service scores
have remained steady with an 92% rating overall. Net Promoter Score for the first 6six months is 76. New menus are in progress with specialty items such as new entrees and salads
and house wine pairings.
Jarnecke reviewed the proposed 2019 budget: gross revenues at $4.5 million with expenses totaling closetotaling close to the same with a $1,000+ surplus. Belew noted there are expected
reductions in utilities. A report will be prepared for November.
Jarnecke and staff discussed the current SB Museum of Art agreement, the space and related utility costs. Hockendull noted the annual rent payment of $65,000 is covered by the City.
Jarnecke recommended the agreement and terms be reviewed before the deadline of January 1 – if no changes are made, the agreement continues as is with an automatic renewal. The Hunden
presentation will outline ideas on the space and recommendations. Perri recommended a meeting be scheduled with Visser for preliminary discussions.
Jarnecke reviewed the Tax Board funding history for operations and capital improvements. The 2019 2020 capital requests were submitted to the their Allocation Committee: for 2019 $1.26
million is requested; however, 2020 the request will decrease. The 2019 operating request is $1.2753 million.
The Hunden presentation may reflect impact recommendations/changes that could alter some of the planned capital improvements.
Perri recommended the budget reflect operating overhead decreasing to add in the
$100,000 development fund.
Morris/Palais Budgets
Jarnecke reviewed details of the proposed budget:
Personnel reflects the Executive Director position – salary shared 50/50 with CC; maintenance
positions are internal transfers
Salary increases up 2%; benefits up 4%
Strategies planned to decrease deficit – pursue new business and F&B services; parking garage revenues are not credited back to the Morris
Work with SMG to retain and book new shows
Work with Navarre Hospitality – pursue more weddings and corporate business events;
upsaleell ticket packages with the renovated Granada restaurantspace.
More aggressive efforts with companies for pouring rights – both sodas and spirits
For the Palais: salaries were taken – now Navarre responsibility. Decrease expenses by 10%.
Navarre to rain building rent. Goal to book 60 events with more weddings. Andres asked if a breakdown of Navarre’s marketing/promotions and sales is available to compare with what is
being done at their other venues. Jarnecke stated all will be discussed with Kurt Jankowsky.
Other plans include developing a capital plan for the building; addressing concretconcrete floor and chair replacements (to be covered through the licensing fund); new uniforms; lobby
upgrades; new sound system; self promotionself-promotions and enhanced efforts with promoters. Capital fund: $300,000 balance to cover repairs, maintenance, new spot lights, concrete
work. Historic preservation fund: will be used for curtain replacement.
Other notes to the budgets: Center’s capital fund – board’s goal to keep at $1 million. CC expenses reflect a net decrease with reorganization. City line items have been adjusted
and some accounts shifted. Break even budget with expenses kept “flat”. Perri noted the NOL is $1.2 million if the Tax Board subsidy is deducted.
Jarnecke stated they are working on data to compare the Center’s performance to like size
facilities across the country e.g. square footage, rental space and services.
With no further discussion, the committee voted to present the 2019 proposed budgets of the Morris/Palais and Century Center to the board for final approval and to the City Council.
With no further business, Varner called for adjournment.
DV:pp
Adjournment
With no further business, Perri called for adjournment.
DV:pp