Loading...
HomeMy WebLinkAbout2002-01-14 02-71 ORDERDate: I-Iaaz Item/Subject: Order, Receiving and Accepting the Report of Me Special Committee on the Future of the Bangor Auditorium Responsible Department: City Manager The Spedal Committee on the Future of the Auditorium has submitted a report covering its recommendations as to the nature of the new facility to be constructed to replace the current complex, a recommendation that a new f ldlity be built at Bass Park, and that it be funded through a targeted and limited local option sales tax. The Committee devoted a great deal of time and attention m Its work, particularly on issues relating tu the nature of the facility that should be constructed. As you are also aware, the Committee was broadly representative of the City of Bangor and its citizens, other local governments, and the business community. The members of We Committee are to be applauded for their constructive efforts. The attached Order would accept and adopt this report and direct staff to work toward its implementation. Department Head ManageeS Comments: I wish to commend the members of the Committee for their hard work and commitment to this project. Their efforts have underscored the support of the region for a new complex at Bass Park. I would recommend your approval of the attached Order, as does the Business and Economic Development Committeeao; city Manager Assodated Information: Order, Report Finance Director Legal Approval: Solidtor Introduced for X Passage First Reading Page_ of Referral 02-)I l A ignetlMCouncilor Palmer Jam,ary 14. 2002 CITY OF BANGOR (TITLE.) Order, Receiving and Accepting the Report of the Special committee on the Future of the Auditorium By the ay Coux//of the CXy ofAvoar. ORDERED, That the Report of the Special Committee on the Future of the Auditorium is hereby accepted including recommendations as to the form and function of a new complex, that it be located in Bas Park, and that a targeted and limited local option sales tax be pursued as a mechanism for its financing. BE R FURTHER ORDERED, THAT The City of Bangor and Its staff are hereby directed to continue to work toward the Implementation of this report. IA CITY COUNCIL January 16. 2002 Motion Made and Seconded for passage eaceea 02-]1 ORDER Title, Receiving and Accepting the Report of tM Special Comitree on rhe Future of the Auditorium Asdpmd Uv� D�undlor i�� REPORT OF THE SPECIAL COMMITTEE ON THE FUTURE OF THE AUDITORIUM DECEMBER, 2001 UkL 02-]1 BACKGROUND AND EXECUTIVE SUMMARY The Bangor Auditorium and Civic Center are important economic resources to the Greater Bangor Community. R is conservatively estimated that these facilities have an annual $30 million impact on our economy and that they are important elements in our efforts to bring meetings and tourist to our area in support of the visitors industry. At the same time, these structures are also important in their role of offering cultural and entertainment events and supporting organizations in our community by offering a venue for their larger meetings and events. At the same time, it has been long recognized that these facilities could have a significantly greater impact. The current Bangor Auditorium is nearing its fiftieth birthday and suffers from inadequate design and visitor amenities. The current Civic Center, while newer and in better condition, is not well suited for hosting large meetings and conventions. Beginning in 1998, the City undertook a series of actions designed to evaluate these structures, their importance to our community, and to develop a plan for their future. This process began with an in-depth analysis of the current condition and shortcoming of these structures which identified the costs associated with either their renovation or replacement. Based on this information, the City Council undertook a public information and involvement effort designed to determine the opinion of Bangor citizens and the greater Bangor business community on whether these facilities should be renovated, replaced, or closed. Through a series of neighborhood meetings, a survey of the members of the business community, and meetings with other local municipal and county officials, the City Council determined that there was Widespread support for replacing these facilities with a new state of the art complex. This conclusion was formalized in June of 2000, when the Bangor City Council adopted a resolve indicating the intent of the Council to replace the current Auditorium and Civic Center with a new structure. In September of 2000, the Council adopted a second resolve indicating its determination that sufficient support exists for replacing the current complex and indicating its desire that work continue toward identifying and implementing a financing mechanism for such a project. This resolve indicated that the City Council would review progress on the project and its funding mechanism at its first regular meeting In January of 2002 at which time the Council would determine whether to continue this effort. If inadequate progress had been made, the Council indicated that a decision to close the complex as of December 31, 2004 would be considered. In December of 2000, the City Council established a Special Committee on the Future of the Bangor Auditorium/gvic Center. This Committee induced widespread representation from the City of Bangor, the business community, facility users, and other local governments. The Committee was charged with advising the City Council and other interested organizations on a variety of issues related to the adopted policy goal of constructing a new large event facility. In particular, the Committee was charged with developing recommendations on the size and design of such a facility, its location, methods of financing, and possible governance structures for the complex. The Committee began meeting in March of 2001, and has met regularly since then. Early on, the Committee established two subcommittees to facilitate its work. The first, on Function and Farm, was charged with developing recommendations on the size and nature of a new facility. The second, on Finance, was charged with evaluating various financing options and recommendations on how a new facility could be constructed. The Committee was asked to report Its findings and recommendations to the City Council in January 2002, the date established by the City Council to make a determination as to whether the effort to construct a new facility should be continued. The attached report outlines the Committee's recommendations on the size and nature of a new facility, its location, and a proposed financing mechanism. SUMMARY OF RECOMMENDATIONS The Committee supports the construction of a new large meeting facility. This facility should be sized to accommodate both large meetings and entertainment and cultural events. For meetings, this Includes banquet space for 800 to 1,000, up to eight additional breakout rooms with capacities ranging from 50 to 200, a 25,000 to 30,000 square foot exhibition space, and a full service kitchen. The auditorium, which should have a fixed seating capacity of 6,000, can be used to meet the requirements of exhibition space. The new facility should be designed with adequate access, egress, and loading areas, a quality sound system, state of the art heating, ventilation, and cooling systems, a large lobby space, and adequate and well designed restmoms and concession areas. The facility should also be designed with ease of maintenance in mind. After reviewing a vanety of poteMlal locations, the Committee concluded that this new facility should be located at Bass Park due to its visibility, location near 44 oz—n the waterfront and downtown, adjacent support facility, and its familiarity as the current location of the auditorium/civic center. At the same time, access to the Bass Park Complex should be redesigned, additional on -street parking should be provided, and the City should continue to closely monitor those factors which might have an impact on the continuation (or expansion) of harness racing on this site. For financing purposes, the Committee estimates that such a facility will cost between $15 and $17 million if the current Civic Center can be retained. Should this not be possible, replacing the Civic Center will add approximately $5 million to these costs. Additional on-site parking will be required, and $8 million should be included in cost estimates should structured parking be necessary. In total, the Committee estimates that an appropriate and well designed facility complex may require a budget of $28 to $30 million. The preferred alternative for Financing this capital expenditure is a proposed local option sales tax dedicated to this purpose. The community should vigorously pursue this option and should seek the support of other municipalities in the greater Bangor region should a mechanism be provided for them to join with Bangor in the imposition of such a tax. Additional funding sources should also be pursued to supplement or reduce the need for revenues from such a tax. Special efforts should be devoted to seeking private sector support in such areas as naming rights, concession agreements, and corporate support. The City should also continue to pursue financial support from Penobscot County. Finally, while the Committee recognizes that property taxes in Bangor cannot, on their own, provide financing for such a facility, the option of property tax support for a portion of the costs should remain available to Insure that a new complex is adequately funded and that detrimental compromises are avoided in its design. A more detailed discussion of these recommendations can be found below Ub 02-01 REPORT OF THE SUBCOMMITTEE ON FORM AND FUNCTION SUBCOMMITTEE CHARGE The subcommittee on Form and Function was charged with developing recommendations on the size and configuration of a new large meeting complex to replace the current Auditorium and to discuss and develop recommendations on potential locations for this complex. In furtherance of this charge, the subcommittee has reviewed the utilization of the current Auditorium/Civic Center by type of event, space needs, and attendance; the operational issues faced by the complex in hosting these events; considered other required facility amenities including parking; met with current users of the facility to solicit their views and needs; reviewed location criteria and options; and developed additional information on potential costs. DESCRIPTION OF PROPOSED FACILITY For purposes of developing recommendations on the size and nature of the facility to be constructed, the Subcommittee selected three current events which place the greatest demands on the complex as "design" events, i.e., the events whose needs establish the parameters around which a new facility should be constructed. The events selected were the Maine Municipal Assodation's Annual Convention, the Annual Garden Show, and the Eastern Maine Basketball Tournament. The MMA Convention places the largest demands on the facility for meeting and exhibit space of any regularly scheduled large meeting. The subcommittee met with a representative of the Maine Municipal Association who indicated that the current size and configuration of the Auditorium/Civic Center Complex, while barely adequate to house the convention, has required that MMA modify their desired schedule due to restricted meeting space. This representative outlined the "ideal" convention facility for Meir event as follows: • A banquet room to handle 400-450 for dining. • Three large meeting rooms, without dividers, which will hold 50-250 for educational sessions. • 10 to 15 classroom style rooms handling 25-100. • A main exhibit hall capable of handling 110-150 exhibitors. Lack of kitchen facilities was also mentioned as a problem. The Annual Garden Show also strains the capacity of the facility. The Auditorium is used for landscape displays, the Civic Center for exhibitor booths, and hallway 4v oz -n and storage space for atltltional exhibits and lecture areas. Representatives of this show indicated a preference for a larger Auditorium Floor to allow exhibits to be in one location and for better lecture space. Their primary concern was traffic Flow between areas, which is less than optimal in the current arrangement. The final event, the Eastern Maine Basketball Tournament, generally found the current facilities adequate with several caveats. First, an arrangement which would allow for the sale of reserved seating would positively impact the income of the tournament. Second, additional dressing and shower rooms would also be preferable, given the needs not only of the participating teams but of the cheering squads who accompany them. Auditorium seating capacity was seen as adequate. Some concerns were raised about the need for additional parking. Given the needs of these -design- events, the Subcommittee has developed the following recommendations as to the sizing of a new complex: 1. A banquet space for up to 800 to 1,000 users 2. A full service kitchen 3. Up to 8 additional breakout rooms with capacities of 50-200 4. A 25,000 to 30,000 square foot exhibit area. These recommendations are primarily aimed at meeting the needs of meetings, conventions, and tradeshows. It should be noted that the exhibit area can be part of a separate facility, such as an Auditorium. AUDffORIUM SEATING The most difficult issue the Subcommittee was asked to address was the seating capacity of a replacement Auditorium. The current Auditorium, depending upon event, can seat 6,01 Auditorium seating is configured as follows: • 3,428 Fixed Seats in both wings • 2,520 Bleacher Seats • Floor seating depending upon the event The Subcommittee considered three options for seating size: 4,500 6,000 • 8,000-12,000 In discussing this issue, it was clear that there was considerable initial support among subcommittee members for an auditorium with a larger seating capacity. Members were hopeful that such a facility would result in attracting larger and more popular entertainment events to the complex and that it might allow Bangor to host intercollegiate tournaments and sporting events. At the same time, a review of the events that have been held at the complex over the last five years does not indicate a current demand for a larger auditorium. Over that period, only one concert sold out the full seating capacity of the Auditorium. On several occasions, a championship basketball game has also filled the house. In addition, cost information provided by Carpenter and Associates seems to indicate that there are no significant "economies of scale" which can be realized in building a larger auditorium. While the Subcommittee cannot recommend a larger auditorium at this time, It does believe that a larger facility may be appropriate under certain circumstances, particularly if an "anchor tenant can be attracted or a joint venture undertaken. For example, If it was feasible for the University of Maine and the City of Bangor to jointly construct and operate an arena, a larger complex might make sense. Representatives of the City, this Committee, and the University have held discussions on several occasions regarding the feasibility of a joint facility. At this point, however, It is unclear whether such a joint venture might be feasible and, if so, what the restrictions and limita0ons of such an approach might be. As a result, it is unclear whether or if such a joint venture might materialize. In addition, no other significant anchor tenant is currently interested in such a larger facility. At the same time, the Subcommittee is not supportive of replacing the Auditorium with a smaller structure. We believe that both the number of events held at the complex and the number of tickets sold are negatively impacted by the layout of the building and Its lack of visitor amenities. A new building which is appropriately designed and which offers the visitor comforts which today's consumers demand should be able to attract both more offerings and sell more tickets. As a result, the Subcommittee recommends that: 5. A replacement Auditorium with a fixed seating capacity of approximately 6,000 should be constructed. Fixed seating should be of high quality with goad sight lines. Additional floor seating can also be employed for certain appropriate events. A larger Auditorium should only be considered on a "joint venture" basis or should an anchor tenant requiring such larger capacity be found. OTHER AMENITIES While the Subcommittee did not spend significant time discussing the detailed amenities required in a new complex, It did analyze the problems associated with the current complex. While many of these issues should be addressed during the actual design phase of a new complex, some issues deserve mention. 6. A new complex should provide: adequate access and egress; adequate loading areas; state of the art air conditioning, heating, and ventilation; a quality sound system; ease of maintenance; adequate and well designed restrooms and concession areas; and a large lobby space to facilitate visitor entrance and egress, particularly in times of bad weather. LOCATION The Subcommittee was also asked to review location criteria and passible sites for a new complex. Based on the facility recommended above, the following location criteria were established: • 20-25 acre site • prominent/highly visible location • Proximity to Interstate • Arterial access from Interstate to site • Proximity to support facilities City staff reviewed a variety of potential sites throughout the Greater Bangor area and evaluated them against these criteria. In addition, each site was also reviewed as to ownership, estimated cost to acquire, and appropriateness of a large event facility given existing and projected land uses. A copy of this analysis is attached. After reviewing the various alternatives, the subcommittee reached the conclusion that: 7. A new large event facility should be located at Bass Park. The Subcommittee reached this conclusion for a variety of reasons, including: • The current location offers goad visibility from I-395; • Bass Park is located adjacent to both the proposed waterfront development and Bangors downtown. By continuing to operate at this location, a new complex will add to the critical mass necessary to both attract visitors and spur appropriate development in this area; • Numerous support facilities (hotels; restaurants; shops) already exist in this area and additional developments are anticipated. • Bass Park offers a familiar and known site, especially for those who travel some distance to attend an event. At the same time, locating a new facility at Bass Park raises a number of issues which must be addressed. While the current site is highly visible, access can be 4� 02-n problematic, particularly for those traveling west on I-395. Parking, while adequate for most events, can be limited for those with large attendance figures and, more importantly, can often limit the ability of the complex to host concurrent smaller events during periods when Auditorium capacity is being used. Finally, while the Bass Park site Is adequate for a new complex, the prominence of harness racing, and the extent of the property devoted to Its use, may be an impediment to the best possible design of a new facility and access to it. To address these issues, the Subcommittee offers the following recommendations: 8. Access to the Bass Park Complex should be improved. The City should further explore the recommendations of Coplon Associates that a new access be located in the Buck Street area. The future of harness racing at Bass Park also must be clarified. The number of harness racing tacks and the live handle at these tracks has been declining, and harness racing is struggling as gambling dollars are diverted to other gambling options. As gambling revenues decline, purses decline as does interest. Under current circumstances, harness acing in Bangor, and perhaps in Maine, is a marginal operation. Several unknowns exist, however. The future of Scarborough Downs is in transition, as us the Maine hamess industry in general. Scarborough operates the most racing dates and is the key to having a level of activity that supports the harness racing Infrastructure. While Scarborough's owners are publicly committed to operating the track, speculation in the industry is that this could change if it is not profitable. If Scarborough were to close, the meet at Bangor might be extended to provide an adequate number of racing dates to support the industry. The sate stipends currently split by the two commercial tracks would shrink, but Bangor would get all of them, a potentially significant windfall. There is also a possibility that a new video gambling referendum will be on the ballot in November, 2002. This referendum will likely ask that video gambling terminals be permitted at the two commercial tracks and at OTB facilities. The proceeds would likely be split between sate property ax relief and support for harness racing. If such an item appears on the ballot and is approved, it might change the entire economic future of harness racing, as it has in other jurisdictions. At the same time, If the situation remains unchanged, current trends suggest that the economics of harness racing will continue to worsen as revenues from gambling continue to shrink. While hamess racing in Bangor may continue to survive under such circumstances, it will not prosper. `1g 02-71 9. Should Ne situation regarding harness racing not improve or be reasonably expected to improve before January 1, 2003, the City of Bangor should consider reallocating Ne property currently dedicated to harness racing to other uses, including additional space for a large event facility and its parking requirements. Should the situation improve dramatically, the City should consider adjusting the current location of the track and its support facilities on the property to allow for improved access to a new large event facility. A final ward on parking. The current parking provided on the property is inadequate at certain times, with approximately 1,000 spaces available. Given the facility which the subcommittee has recommended, 2,000 to 2,400 spaces would be more appropriate. Final design and land uses on the complex will effect the total number of parking spaces that can be provided. Such planning should also take into consideration the availability of additional on -street parking in the immediate vicinity of the Complex. At the same time, however, more parking should be included in any final complex design. IO.Additional on-site parking should be provided in any redesign of the Bass Park Complex. Should harness racing not continue, this parking need may be met by on -grade spaces. Should harness racing continue or should the City desire to include other recreational uses in the future plans for Bass Park, consideration should be given to constructing a parking deck adjacent to the current main parking lot. This will require purchasing the currently vacant parcel of land adjacent to that lot. FSTMATED COST The Subcommittee recognizes that the Subcommittee on Finance has held its work in abeyance pending the development of the recommendations which are outlined above and an estimate of the costs associated with them. As part of its work, the Subcommittee requested that Carpenter and Associates revise and upgrade their cost estimates based on a number of options under review. A copy of their report is attached. It is estimated that a facility such as is recommended above will cost between $15 and $17 million dollars under the assumption that the current Civic Center can be retained and appropriately integrated into a new complex. Should this not be possible, replacing the Civic Center will add approximately $5 million to these figures. Further, should structured parking be required, an additional cost of approximately $8 million is anticipated. Given these estimates and the uncertainties inherent in design and construction costs, we recommend: 11.The total budget fora new complex as proposed, including additional on-site packing, should be set at $28 to $30 million, and the Finance subcommittee should develop financing recommendations to support this level of expenditure. 10 RECOMMENDATIONS OF THE SUBCOMMITTEE ON FINANCE 5o 02_71 The Subcommittee on Form and Function of the Special Committee on the Future of the Auditorium had developed a series of recommendations on the nature of the facility which should be constructed to replace the Cityrs current facilities at Bass Park. Based upon that Subcommittee's recommendations, a target funding goal of $28-30 million has been established. This goal is composed of the following project components: a new auditorium at an estimated cost of $15 to 17 million; an allowance of $5 million to replace the current Civic Center should this be required; and $8 million for additional parking on site. Given the current options available to the City for financing such a project, the only source available is issuing general obligation debt to be repaid through the property tax. Under this option, bond repayment would add approximately $1.60 to the property tax rate. The City Council has previously Indicated that such an increase in property taxes for a single project, especially in light of the regional nature of this proposal, Is not an acceptable option. The task presented to the Finance Subcommittee, Herefore, was to develop recommendations on the most appropriate method of funding such a capital project. The following summarizes the various alternatives which have been discussed or proposed and the views and recommendations of the Subcommittee on Finance. Public/Private Partnerships Larger facilities throughout He country have received significant financial support from the private sector through such partnerships as facility naming rights, luxury boxes, and direct corporate contributions to construction. While such sources should be explored, it is unlikely that they can provide anything close to the amount needed to Finance such a project. Tax Increment Financing Tied W Other Development on the Bass Park Si A second possible source of funding is additional tax revenue generated from ii development on the Bass Park site. For example, the development of a private hotel adjacent to a new facility could produce tax revenue that could be dedicated toward the capital casts of a new complex. However, private development in excess of $100 million would be required to cover annual debt service. Further, reasonable public policy issues are raised should the City of Bangor consider private development on what has traditionally been public space. Finally, the demand for such private development may be limited for some time given the City's on-going efforts to support private development in 11 5: 02—)1 the Waterfront area. While such an approach could help, it is unlikely that it alone could provide an adequate revenue stream or do so in a timely fashion. County Wide Financing The Cumberland County Civic Center was financed and constructed by the County. The cost of the complex is included in the property tax payments from all of its cities and towns. A similar approach could be taken here in Penobscot County. If this approach Is taken, all communities in the county would share proportionately in the cost. The Gty of Bangor would be responsible for about 25% of the annual bill. This would reduce the property tax impact in Bangor from $1.60 to $.40. This option would require the approval and support of the Penobscot County Commissioners and the County budget committee, which is composed of municipal representatives from throughout the area. Based on past experience as well as the controversy that surrounded the Cumberland County building, the wide spread support necessary for full County funding would be difficult to achieve. Meal and Lodaina Tax In many parts of the country, convention fadikies are supported by a local meal and lodging tax. Past efforts to obtain legislative approval for such a tax, while penodically supported by local hoteliers, have been opposed by state organizations that represent the tourist and visitor industry. A meal and lodging tax is also relatively narrow and might not provide a sufficient revenue stream to support such a large capital project. In order to meet debt service needs alone, this tax would have to be set at 2.5%. Direct State Su000rt A statewide committee has completed a study of the state's existing meeting and convention facilities and their markets. This report outlines a statewide strategy to capitalize on the economic impact of the convention and visitor business and identifies the Bangor Region, along with Portland and others, as an appropriate location for a major facility. This group is currently working on a strategy by which the State would take a leading role in underwriting the capital costs of providing the necessary facilities. 12 sa oz -n The prospects for state support are, however, uncertain. Direct state support for non -transportation related local or regional projects has been rarely provided in the past. Local Option Sales Tax A final option, and one that the City of Bangor and other municipalities have long sought, is the authority to enact a local option sales tax. A group of municipalities, working with the Maine Service Center Coalition and in conjunction with Maine Municipal Association, has been working to develop a proposal for a local option tax which would both address the need for a funding mechanism for capital projects of regional significance and be structured in such a way as to address a number of concerns which have lead to opposition to this approach in the past. Under the current proposal, a local option sales tax of up to 1% could be imposed after voter approval for a period not to exceed five years for capital projects of regional significance. In addition, this proposal would allow for agreements between local jurisdictions to allow for a group of municipalities to participate in these projects. Municipalities would also have the option of capping the amount of purchases covered by the tax at $5,000 for such large ticket items as automobiles. This legislation has been supported by the Maine Service Center Coalition and the Maine Municipal Association's Legislative Policy Committee. Members of the Coalition have also been meeting with representatives of the King Administration W develop the details of the proposal, and Governor King has indicated that he will support It. The Maine Meeting and Convention Group has also recently indicated its willingness to support this proposal as a potential mechanism for developing and/or improving meeting and conference facilities throughout the State. Such a tax would avoid the Issues and problems associated with the property tax, offer a mechanism through which the various municipalities in the area would be authorized to join together to work toward a project of regional significance, and would tap into the regional economy that is supported by the project. RECOMMENDATIONS 1. The proposed local option sales tax is an appropriate vehlde for funding the facility recommended to replace the current auditorium/civic center complex at Bass Park. This option should be vigorously pursued, and the City and the associated groups with which it is working on this effort should aNvely seek 13 53 02—)t the support of other municipalities and businesses and their organizations for this proposal 2. In light of the provision of the proposal which allows for multiple jurisdictions to join together In asking their voters to approve such a tax, the City should actively approach other municipalities and seek their support in joining with Bangor to expand the area in which such a tax would be imposed t0 a wider regional base. 3. At the same time, additional funding sources should be pursued which can either supplement the funding from a local option sales tax or reduce the length of time such tax would be in effect. Among the options studied, special efforts should be devoted to seeking private sector support in such areas as naming rights, concession agreements, and direct corporate support for construction. In addition, the City should continue to pursue, in conjunction with Penobscot County, alternative for potential County -wide funding participation. Finally, the City should not completely foreclose the option of property tax support for a portion of the costs of the proposed facility. Given that an exact estimate of the total revenue which might be derived from a local option tax is not currently available, supplemental funds may be required to insure that the design of a new complex is not compromised due to limited resources. All discussions of a new complex have led to an agreement that the design of a new complex must not be compromised based on financial considerations alone. If some level of property tax support Is needed to insure that the type of facility recommended by the Subcommittee on Form and Function is constructed, the City should provide that support. CONCLUSION The Special Committee on the Future of the Auditorium would like to thank the Wide variety of individuals who have provided information and assistance in its work, including the members of its subcommittees, citizens, facility users, and City staff. While we recognize that numerous decisions remain to be made and uncertainties to be resolved, we believe that the recommendations outlined above provide a suitable framework for the City b0 move forward on this project. We believe that a new and modern facility is important to this region, both economically and psychologically, and urge the City Council and other interested parties within this region and the State to continue to work closely together in pursuit of the established goal of constructing a new facility by 2004. 14