The Salina Journal from Salina, Kansas on February 2, 1986 · Page 67
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The Salina Journal from Salina, Kansas · Page 67

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Salina, Kansas
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Sunday, February 2, 1986
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Page 67
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The Salina Journal Sunday, February 2,1986 PageSSl BiCenter pays dividends on city's investment By LARRY MATHEWS Assistant News Editor The Salina Bicentennial Center approaches its seventh birthday in 1986, praised by supporters who point to the economic benefits it brings to the city and panned by detractors who point to the economic drain on the city coffers. Critics are quick to emphasize the annual operating subsidy required from the city to keep the center in the black. That has been set at $300,000 for the 1986 budget, the highest required to date. The subsidy has ranged to a low of $225,000 per year. The center's operating and maintenance budget for 1986 is $681,000. Officials estimate the center will generate $385,000 through rent, concessions and commissions, with the $300,000 subsidy making up the difference. The subsidy comes from the city's share of federal revenue-sharing funds. But faced with the strong possibility that those funds will be reduced or eliminated entirely, the city may eventually be required to turn to sales tax revenue to finance the center —at the expense of other needs. The subsidy isn't the full extent of the city's obligation to the center, however. A five-year plan through 1990 sets the total estimated cost to the city at an estimated $1,116,400 annually. The average annual debt service is $488,900 over the next five years to retire the 20-year general obligation bonds which financed the center's construction. (The annual payment toward principle on the bonds is $325,000. The interest varies, dwindling each year toward the final payment in 1997.) To that must be added about $60,000 in employee benefits (Social Security, retirement, workmen's compensation) that was transferred in 1985 to the city's general fund, and an estimated $50,000 in miscellaneous annual services provided for the center by the city's park and street departments. Then there is an average of $117,500 budgeted per year under a capital improvements program, and another $100,000 per year for equipment and major repairs. That brings the total estimated cost to the city over the next five years, including the $300,000 subsidy, to $1,116,400 annually. Officials estimate that the center itself will generate another $385,000 in 1986 toward its operation and maintenance costs through rent, concessions and commissions on sales of novelties. Center backers acknowledge those figures. But in the war of financial arithmetic, they say, the center comes out a clear winner. Bill Harris, who wears two hats as assistant city manager and as manager of the Bicentennial Center, bases part of his pro-center arguments on a 1984 study commissioned by the Salina Area Chamber of Commerce, which was done by Laventhol and Horwath, a firm of certified public accountants in Kansas City, Mo. That study estimated that conventions and trade shows brought $13.8 million to the Salina economy in 1983, the year studied. Of that, $3.2 million -was credited directly to the availability of the Bicentennial Center. The study arrived at those figures by multiplying delegates and visitors who stayed overnight by $56 per day. For those who did not stay overnight, a figure of $25 per day was used. Harris believes those figures are conservative. Even so, he says, using just those figures in projecting the center's budget over the next five years shows an economic gain for the city of $2,083,600 ($3,200,000 in new money minus $1,116,400 in estimated annual costs to the city). And, Harris emphasizes, conventions and trade shows account for only a small percentage of activities at the center. In 1983, conventions and trade shows were responsible for just 14 percent of events and 25 percent of attendance at the center. The remaining 86 percent of the events and 75 percent of the people involved that were not a part of the study also bring people to Salina, Harris says — people who also patronize Salina restaurants, businesses, service stations and motels. The final figure, Harris believes, approaches $4 million in new money generated annually for Salina through Bicentennial Center events — a figure that he also believes is on the conservative side. Few convention/entertainment facilities are ever self-supporting, Harris argues. The Kansas Coliseum in Wichita, a major competitor with Salina for meetings and events, did manage to report a $46,000 profit in 1984. But for 1985, the coliseum reported a $218,000 deficit. Bill Harris manages the Salina Bicentennial Center. One reason for that is the same problem faced by the Bicentennial Center — a decline in the concert business. Wichita's coliseum was host for 29 concerts in 1984, but only 13 in 1985. Salina's best years for concerts were 14 in 1982 and 12 in 1983, but those dwindled to six in 1984 and seven in 1985. Concerts are the best moneymakers for any entertainment center, Harris says. A good concert will net between $12,000 and $15,000 for the center, with minimal time and effort on the part of the center's full- time staff of 13. A large convention of 700 to 800 people, on the other hand, requires a great deal of staff time for planning and servicing the event. Yet the center may clear no more than $2,500 to $3,000. Why are concerts on the decrease? There are a number of, reasons, Harris says. Chief among them is the economy. Road tour expenses keep climbing, and top-name entertainers keep demanding more and more money. The promoter is caught in the middle. Promoters are responsible for rental, advertising, sound and lighting equipment, and liability insurance. They must also guarantee the performers a minimum fee plus a large share—usually 85 percent—of any profit. The promoter usuaDy gets just 15 percent of the profit, if there is any, for all his work. Entertainers also are getting more and more into music videos and other forms of entertainment. As a result, tours are fewer and of shorter duration, and there are fewer people in the promotion business. That means those who remain must concentrate big-name concerts on the primary markets where the profit possibilities are greatest. "We make a nuisance of ourselves with promoters, trying to get them to schedule concerts here," Harris says. But because of its relatively low population, Salina is considered a third-level market and ranks low on the priority scale. Wichita, for instance, is considered a second-level market, while the large metropolitan areas are first-level. But while fewer concerts are being staged, utilization of the center is climbing. Han-is said the center was the site for about 300 events in 1985, which compares with 152 as recently as 1982. Some portion of the building is in use five of every seven days. That extensive use often is overlooked, Harris says. Use of the arena for concerts, sports events and other major forms of entertainment draws the most publicity. The conventions, trade shows and small-group meetings go largely unnoticed. But they are just as important to the center's financial health. Last year, events were scheduled in the arena on 76 days. But Heritage Hall, which is used more than any other area of the building, was in use 232 days. The upstairs meeting rooms were used 122 days. In 1985, conventions and trade shows totaled 15 at the center, and there were 35 sports and entertainment events. Those are down slightly from 1984, when the figures were 25 and 32. But the "other" category logged 248 events during the past year, compared to 219 in 1984. Harris made a study of all events held at the center in 1985 and concluded that 59 either were made possible or were enhanced by the Bicentennial Center. Those include sporting events requiring a large arena, such as the Salina Invitational Tournament, the Harlem Globetrotters, the 4A State Basketball Tournament, the Outlaw Showdown Truck & Tractor Pull, an intrasquad game by the Kansas State University women's basketball team, the Marymount-McDonald's Tournament, the Central-South high school game and the Marymount- Fort Hays State game. Then there were the Salina Homebuilders Show, Lee Company Dealer Show, AMBUCS Leisure Living & Sports Show, Mid-America Farm Expo, Ricky Skaggs concert, Shrine Potentate's Ball and Shrine Spring and Fall Ceremonials, Salina Family Health & Fitness Fair, Golden Years Festival, Kansas Bankers Association, Kansas Funeral Directors and Embalmers Association, various graduation ceremonies, Kansas State Square Dancers, Smoky Hill River Festival, Ratt rehearsals and concert, Miss Teen of Kansas Pageant, Tri-Rivers Fair & Rodeo, George Strait concert, Shrine Circus, Rick Springfield concert, Sports Car Club of America National Solo II banquet, Air Supply concert, Ok- toberfest, Assembly of God Youth Convention, Kansas Special Olympics, Western Kansas Orchestra Festival, Community Christmas Celebration and performance of "The Nutcracker," and many other meetings, parties and special events. In January, the rock band "Lov- erboy" reserved the arena for a week to prepare for a national tour with the concert kickoff in Salina. It was the third time such a group has done so. Last June, "Ratt" used the arena as a rehearsal hall, and a couple of years earlier it was "Heart" doing the same. "Loverboy" apparently has been pleased with its reception. The concert was its third at the Bicentennial Center and ticket sales were strong. Previous concerts in 1982 and 1984 drew 7,700 and 6,200 spectators, respectively. BiCenter has five-year plan for renovations Major renovations and improvements have been completed at the Bicentennial Center in the past two years, and more are planned under a five-year capital improvements program that begins this year. • A shortage of parking facilities remains a continuing problem. In 1984, the city and the county shared the $93,000 cost of expanding the parking area to the west. Scheduled for 1990 is expansion of the east parking lot at an estimated cost of $153,000. • In 1985, many of the center's sidewalks were replaced at a cost of $32,000. Their crumbled condition presented a hazard. • In December 1985, a gas heating system was added to the arena at a cost of $51,000. An electric heat pump system had been used in the all- electric building, which was adequate when the arena was full because of the body heat generated by a large crowd. But with smaller crowds and a low wind-chill outside, there was a problem in heating the arena. The Bicentennial Center, like all facilities, has been hit hard by climbing utility costs. From 1981 to 1984, conservation efforts resulted in a lowering of electricity consumption by Wz percent, yet costs soared by about 49 percent. • In 1986, the lobby will be re-roofed to correct a leakage problem. The estimated cost is $37,500. • In 1986, the arena rest rooms will be expanded, tripling the present facilities that have always been inadequate for large crowds. That project is estimated to cost $200,000. • Also in 1986, two more exhaust fans will be added in the arena at a cost of $5,000. • In 1989, the dressing room areas and other production support facilities will be improved at an estimated cost of $100,000. • In 1990, concession stands will be enlarged at an estimated cost of $69,000. • In 1990, the lobby will be carpeted at an estimated cost of $20,000. • Also in 1990, ceiling fans will be added in Heritage Hall at an estimated cost of $3,000. Horses pulled streetcars Horse-drawn streetcars served Salina from 1887 to 1892. SAUNA TO BUILD EMC5 STARFIRE... AN AMERICAN REVOLUTION IN MOTORHOMES. Proof that "Salina Works" can be found in the new EIDorado Motor Corporation plant at 304 Avenue B in the South Industrial Area. The totally new Starfire motorhome was born in nearby Minneapolis.at EMC, and features new manufacturing techniques that promise to revolutionize the RV industry. Thanks to a unique construction concept EMC calls MonoFrame™, the entire primary body of the Starfire is of one piece. "The body is made of fiberglass reinforced plastic (FRP)," according to Gregory K. Stewart, executive vice president. "Compared with steel, FRP is extremely light in weight. But when you fuse it in a honeycomb pattern, you get an outstanding weight-to-strength ratio. That's why they use it in wide-bodyjets, and why we've been using it for years in our buses." Speaking of buses, EMC also plans to build two of their EIDorado bus models at the same Salina plant site: The new Falcon Express, EMC's smallest bus with perimeter seating for nine; and the MSI a mid-size transit model with seating for up to 31 passengers. EMC is happy to be part of the Salina community after its many years as a neighbor in Minneapolis, and looks forward to a mutually beneficial future. EIDorado Motor Corporation P.O. Box 266 Minneapolis. KS 67467

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