Welcome

• Sanford Center Operations – Curtis Webb –

Executive Director • City Financing – Ron Eischens – City Finance

Director • BSU Athletics Usage – Bill Maki – Vice President • Economic Benefits - Mayor Rita Albrecht

Presenters for the evening

Reason for the Event • Update community on the Sanford Center

operations • Learn about the venue • Answer your questions • Gather feedback from you on events and

artists • Opportunity for a tour of the Sanford Center

Tonight’s Agenda • 6:00 – 6:45 PM - Presentation • 6:45 – 7:15 PM – Q & A Time • 7:15 – 7:30 PM – Door Prizes • 7:30 – 8:00 PM – Sanford Center Tours

Background

• Revenue Sources • Expenses

2014 Recap • Events • Fiscal year end

Looking Ahead • Upcoming events • Budget Goals

Revenue Sources

• Ticket Sales • Facility Fees • Ticket Rebates • Merchandise • Food and Beverage* • Rent • Equipment Rentals

*Largest revenue source

2014 Recap—Great year! • Increased Economic Impact by $3 M (up to $22

M/year) • Came in under budget

• $6,000 ahead of budget in 2014 • Decreased amount of subsidy from 2013 to 2014

by almost $25,000 • We hosted our first concerts with the nation’s

largest concert promoters – Live Nation & AEG

2014 Events by Category •Concerts - 22 •Family Shows – 5 •BSU Hockey – 40 (Men’s & Women’s) •Axemen Football – 8 •Sporting Events – 53 •Tradeshows – 7

•Banquets – 43 •Wedding – 20 •Conventions – 10 •Meetings – 122 •Ice Rentals - 15 •Community (Commencement, Proms, Non-Profits) - 154

Concerts in 2014 • Fab Four • The Band Perry • Kutt Calhoun • Jake Owen • Trampled by Turtles • Yelawolf • Hairball • Red Green • Chicago • Tech N9ne

• Happy Together Tour • Boston • Machine Gun Kelly • Switchfoot • Mannheim Steamroller • Beach Boys • Bemidji Symphony

Orchestra • Martina McBride

Bemidji State University Hockey • Anchor Tenant • Guaranteed 20 Home Games Per year • In 2015, BSU pays $10,800 per game for RENT • Contract is a 20 Year Agreement between the City of

Bemidji and Bemidji State University • BSU has been a phenomenal partner at the Sanford

Center • As BSU goes, the Sanford Center goes – please

come out and support BSU hockey

Looking ahead at 2015 • Continue to bring in diverse entertainment • Spend more time and resources booking events that

create direct economic impact – conventions, large meetings, etc.

• Continue to decrease expenses where we can – be a good steward of public funds

Looking ahead at 2015 • Introduce our market to new National promoters

while increasing programming with current promoters and agents

• Continue to work with community events, making the Sanford Center affordable to businesses and non-profits

FAQs • Who owns the Sanford Center?

• City owns the Sanford Center, on behalf of the community and City property owners

• The Sanford Center Advisory Board provides guidance and feedback to the management team

Current Advisory Board Members

• Rita Albrecht, Mayor • Ron Johnson, Councilmember • Nate Mathews, City Manager • Ron Eischens, City Finance Director • Tracy Dill, Director of Athletics, BSU • Lori Paris, Chamber President • DeAnn Zavoral, VisitBemidji Board Member

FAQs

• Who is VenuWorks? • VenuWorks is a facility management company. • The City contracts with VenuWorks to manage

the day to day operations of the Sanford Center • All staff are employees of VenuWorks • VenuWorks provides monthly financials to the

City • The City Council approves the annual budget

and monthly bill payments for the Sanford Center

FAQs Continued

• How much is owed on the Sanford Center and South Shore Land?

• Sanford Center construction - $44 Million • South Shore Land - $5.1 Million

• How are the bonds paid? • $44 Million - .5 cent local sales tax and property

tax levy • $5.1 Million – revenue from land sales –

• If not sufficient then additional revenue sources must be used or property taxes raised

FAQs Continued • What are the current Sanford Center annual costs to

City taxpayers ? • Three components:

• Budgeted Operating Deficit $400,000 • Bond Payment Subsidy* $248,000 • Capital Replacement Fund $84,000

TOTAL $732,000

*Subsidy is necessary to meet bond principal and interest payments. *Subsidy level assumes sales tax collections continue to increase 3.5% annually. *If sales tax collections exceed 3.5%, subsidy can be reduced or end sooner.

Is it reasonable for local City of Bemidji taxpayers to pay the entire $732,000 cost? • Original name was BREC – the facility was built as the

Bemidji Regional Event Center • The Sanford Center is a regional hub for conventions,

sports, entertainment and arts • Ticket sales and economic impact are generated from a

large geographic region

Lodging Tax Generated: • 2009 - $275,000 – year prior to Sanford Center opening • 2014 - $356,000 • 30% increase in 5 years since the Sanford Center was built • Two new hotels on the South Shore

• Doubletree by Hilton • Country Inn & Suites by Carlson

How do other Regional Centers fund their facilities? • Grand Forks, Fargo, Duluth, and Mankato each use

a combination of: • Sales tax • Hospitality tax • Property tax

Based on a Regional draw of customers is a hospitality tax a more reasonable method to finance the Sanford Center? • 1% Hospitality Tax could generate $540,000 • Hospitality paid by the consumer, not the business • Property taxes could be reduced

A Regional Facility

Mayor Albrecht: Just a note to let you know how much we enjoyed having you on the air with us during the Governor’s Deer Hunting Opener last November. And, I wanted to congratulate you and whoever else had the vision to build the Sanford Center. It’s a great sheet of ice for hockey….but the value of a venue like this goes much further than hockey games. My radio station has a very nice working relationship with the Sanford Center. We promote most of the concerts as well as other events that they book. This allows us to not only promote the venue, but also give away tickets to many events that people up here would not have a chance to see otherwise. And we both know the economics of having a few thousand people from outside the market make a trip to Bemidji. These people buy gasoline, snacks, meals, groceries and even hotel rooms when they attend an event out of town. But the economic impact goes much further than that. Think of all the vendors that serve the Sanford Center and the Convention Center. Food, beverage, maintenance and other expenses that go along with a venue like this also create more jobs for the businesses that work with the Sanford Center. That’s over and above all the jobs created at the Sanford Center itself. We do business with similar venues in the Twin Cities, Fargo, and Grand Forks. But, it’s more satisfying to me when we keep those dollars closer to home. The area we serve includes a lot of northern Minnesota, along with both Manitoba and Ontario. It would be interesting to drive through the parking lot at the Sanford Center when they hold their next big event. I think everyone would be surprised at the number of Canadian license plates they see. Please know we will continue to help support the venue as long as we can….and I hope that’s a long time. Sincerely, Mike Pederson, Owner/Operator KQ92 Radio, Warroad, MN

Recruiting tool

“When we are showcasing Bemidji to a prospective business or when a local business is recruiting new talent, one important stop on the city tour is the Sanford Center. The impressive building is an indicator that Bemidji is a community where great things happen.”

Economic Impact

Sanford Center is generating

• Full and part-time jobs

• Contracts with numerous local businesses

• Fundraising opportunities for non-profits

• Traffic to our hotels, bars and restaurants, gas stations, and stores

Executive Director

Director of Events

HR - Business Assistant (FT) Banquet & Catering

Suite Coordinator Concession/Bar

Executive Chef

Director of Sales Marketing Coordinator Director of Ticketing

Ticket Sales Coordinator

Convention Sales Managers

Associate Executive Director -

Operations

Conversion Manager Building Engineer

Engineer

ExecutiveAssistant Business Manager

Number of Direct Jobs at the Sanford Center Full Time – 16 in 2014

Part Time – 250

Local Business Contracts at the Sanford Center

Non-Profit Volunteer Groups Supported

2010: $4,404 (October- December) 2011: $19,829 2012: $16,718 2013: $23,211 2014: $27,252 2015: $10,763 (Jan- April 10)

Conventions by Year

2010 - 0 2011 – 0 2012 – 1 2013 – 7 2014 - 10 2015 – 9

2016 – 7* (Confirmed) 2017 – 5* (Confirmed) 2018 – 5* (Confirmed)

Estimated Total Attendance (464 event days) 167,887 Daily Average spending for meals, retail purchases Entertainment, travel, and suppliers: (167,887 x$60) $10,073,220 Overnight Daily Average spending for overnight event Meals, retail purchases, entertainment, travel, suppliers: (2% of Total Yearly Attendance) 3,358 room nights x $100/room $335,800 Wages – Full Time ($738,285) + Part Time ($612,282) $1,350,567 Cost of Goods Sold (*Estimate) $343,919 Contracted Services, Equipment Repair, Maintenance And Supplies (*Estimate) $136,743 Advertising of Third Party Events (*Estimate) $44,569 Sub Total Estimated Economic Impact Multiplier effect on the local economy x 1.8 $12,452,705

JANUARY 1-DECEMBER 31, 2014

TOTAL ESTIMATED ECONOMIC IMPACT $22,414,869

$-

$5,000,000.00

$10,000,000.00

$15,000,000.00

$20,000,000.00

$25,000,000.00

2010 2011 2012 2013 2014

Economic Impact

Economic Impact:

Return on Investment for Community

Annual investment $732,000 Annual return $22,414,869

For every $1 of community investment,

more than $30 of economic activity is generated in the community.

mailto:Mike.Grinager@becmail.com

Questions