Informational Meeting

MINUTES Informational Meeting Monday, November 18, 2019 at 4:00 PM Carnegie Town Hall, 235 West 10th St., Sioux Falls, SD 57104 1. Call To Order Council Members Present: Christine M. Erickson, Greg Neitzert, Marshall Selberg, Curt Soehl, Pat Starr, Theresa Stehly Council Members Absent: Janet Brekke, Rick Kiley Council Chair Marshall Selberg called the meeting to order at 4 p.m. 2. City Council Open Discussion There was none. 3. Presentations A. October 2019 Monthly Financials and Update on Entertainment Facilities by Shawn Pritchett, Director of Finance Presentation: Approximately 15 minutes followed by discussion Pritchett spoke about the following: Unemployment, is low at 2.3% Labor Force & Employment, a slight reduction occurred in August and September but should return during the holiday season; Inflation, continues to be low at 1.8% primarily due to the negative inflation in the energy sector; Building Permits YTD Building Valuations, there was $155M in building permit valuations added in October due in part to the permitting of Jefferson High School and additional permitting for the new Downtown First Premier Bank location; Sioux Falls YTD Housing Permits (Units), no real change; Sales Tax Collections w/out Audits, 8.2 % year over year growth for the month of October, on track for about 6% growth for 2019; r end; Entertainment Tax Collections w/out Audits, had three months of lagging growth, now it's starting to rebound; General Fund - Revenues YTD, on par with last year; and General Fund - Expenditures YTD, compares with last year. Pritchett also provided a financial overview of the City's entertainment venues. He spoke first about the Events Center Campus, which is managed by ASM Global Financial, formerly known as SMG. He provided a comparison between 2018 and 2019 for Revenue and Operating Income for the Arena, Convention Center, and the Premier Center. Pritchett also included the Orpheum Theater and Baseball Stadium. He spoke about why the Sioux Falls Canaries and Community Theater have receivables that are more than $5,000 and more than 90 days past due. Key upcoming projects and key performance metrics were also discussed for both venues. An 18 month financial review of the Washington Pavilion Management,  Inc., was provided, which also included Key Performance Metrics, Revenue and Operating Income comparison for 2018 and 2019, and the key upcoming projects. Discussion followed regarding: appreciation of the financial breakdown for each facility; plans regarding the Orpheum Board, which currently has three members; what is the philosophy regarding collections; how the farm economy impacts Sioux Falls; when the Events Center Task Force recommendations will be presented to the Council; HVAC system repair for the Event Center; federal transit grant funds; Event Center bookings; guest services; nursing rooms; sponsorships; and premium seating. B. Mary Jo Wegner Arboretum Management Agreement by Don Kearney, Director of Parks and Recreation; and Jackie Nelson, Administrative Manager Presentation: Approximately 10 minutes followed by discussion Nelson spoke about the need for a new one year agreement, due to the current agreement not being extended. The agreement will be from January 1, 2020 to December 31, 2020, while the Arboretum is undergoing Comprehensive Master Plan development. The agreement will be for one year with the removal of the business plan requirement documentation, since it will become a part of the Comprehensive Master Plan. A timeline of events was also provided. Discussion followed regarding: payment structure; the agreement; funding; the Comprehensive Plan; actual costs; and non-profits and the City Budget. C. Special Events Ordinance and Levitt at the Falls Update/Rental Fees by TJ Nelson, Deputy Chief of Staff; and Jackie Nelson, Administrative Manager Presentation: Approximately 25 minutes followed by discussion Nelson acknowledged that there were representatives from Parks and Recreation, the Police and Fire departments in the audience, and noted that many other departments also work special events. He began by providing a brief overview of Chapter 95, Parks and Recreation ordinances for all services and facilities, and Chapter 96, Special Events ordinances. Proposed updates for Chapter 95 would be: updating to reflect applicable fees; and, establishing Levitt Shell facility use fees for non-Levitt organized events. Chapter 96 proposed updates would: allow for commercial activities to apply for special event permits; sets parameters for City resource cost recovery; and, adds a First Amendment Activity to ordinance. Jackie Nelson spoke about the rise of special events in the City. They have increased from 88 in 2017, to 111 in 2019. As part of the process, the groups have to go through a Special Events Committee to obtain approval for their event. Captain Jeff Garten spoke about the police department's role with the various events. He explained how the events are staffed, the number of hours worked by officers, and what factors they have to consider for the various events. Division Chief Jay Titus explained that they currently do not charge for medical or fire suppression standbys at events and that they only charge for personnel costs, not for equipment or vehicles.  TJ Nelson spoke about the cities that Sioux Falls was compared against that have a Cost-Recovery for Police. He said it's time to discuss who should be paying for police protection at the events- the public or the organizers of the event? The Cost Recovery for police and fire is about $70 per hour and covers the following costs: overtime, pension, Medicare, and Social Security. Nelson said that's in line with what a majority of other cities do for their cost recovery models. He spoke about a clause in the draft ordinance that grandfathers events that have been held annually for three years or more and would not charge for two officers, the first two hours of the event. He spoke about 14 Legacy Events and that they involved 1,792.5 hours of coverage time at a cost of $125,815.58 to taxpayers. Jackie Nelson spoke about park fees in Chapter 95. The update would reflect fees that are no longer applicable, as well as fees currently not in ordinance. It would also add Levitt Shell Facility Use Fees for non-Levitt Concert events. She said the Levitt Shell is a $5M investment to the City of Sioux Falls; and we have to be careful with the rental. Nancy Halverson, with Levitt at the Falls, spoke about the Inaugural season of the facility, which included: 30 free concerts with an average of 1,774 attendees per concert. Jackie Nelson spoke about the proposed rental fees, which is based on attendance size and a base rate. There may be additional fees as well. Nelson ended her presentation with a timeline for the ordinance. Discussion followed regarding: what the special events ordinance covers, first amendment activity, what determines staffing levels for the events; the use of scheduled vs. none scheduled officers; payment of overtime; Legacy events; use of hired security; the potential for large expenses for special events; the need for a tiered-use chart for costs; the need to see the ordinance; Paramedics Plus; projected revenue generated from the ordinance changes; how long events are grandfathered for; waiving of fees; Gov. Kristi Noem's fundraiser; reimbursing the entities for the cost recovery fees for the money they generate for the City; paying overtime and keeping events free; soccer tournament; circumventing the fee; importance of police presence; Sioux Falls People for Youth and a softball tournament; the importance of the Informational meeting; Festival of Cultures and community resource officers; rental cost of the McKennan Park and Terrace Park band shells; special duty rate; what is the threshold that a police officer has to work vs hired security. 4. Public Comment Thor Bardon, representing Prairie Patriots, expressed his concerns about the fees, the possibility of training volunteers to help assist the first responders, and the possibility of forming a citizen committee to look into helping. John Fiksdal spoke about people in Sioux Falls coming together to get stuff done, the creation of Sioux Falls Jazz & Blues Society and JazzFest, the impact of arts in Sioux Falls, and pay the police for their worth. 5. Executive Session  A. Consulting with legal counsel or reviewing communications from legal counsel about proposed or pending litigation or contractual matters pursuant to SDCL 1-25- 2(3) The Executive Session was cancelled. 6. Adjournment Council Chair Marshall Selberg adjourned the meeting at 6:17 p.m. Denise D. Tucker, MMC, Assistant City Clerk