Please note: This is a very long post which details my observations made at a meeting pertaining to the BPAC. If you’re not interested in all of the gory details, please click here: to jump to the most important information found near the end of this post.
Yesterday I attended the Economic Development Association of Minnesota‘s Third Thursday Event which took place at the Burnsville Performing Arts Center. The purpose of the event was to provide Burnsville the opportunity to showcase exactly how the BPAC is utilized to draw in more business to Burnsville and how it has a positive effect on the local economy.
From the event page:
Richard Florida, author of the Rise of the Creative Class, defines successful economic development as the attraction of skilled workers because companies in the 21st century will go where the work force exists. To accomplish this attraction, cities need to provide the amenities that a skilled worker desires, one of which is an attractive performing arts culture.
Learn how the Burnsville Performing Arts Center has become an integral part of Burnsville’s plan by anchoring a 54 acre redevelopment project, providing opportunities for the local arts groups, the school district, attracting visitors, and giving Burnsville a magnet for a highly educated and skilled work force.
In the past two years, Burnsville has attracted over 90 new companies, and boast of a regional shopping center that has rising sales and an occupancy rate of 97% during that time.
In an article entitled, “Beautiful Cities,” in Alternatives Journal, Winnipeg went through a time where they concentrated on erecting buildings which were functional and easy to build but found the city, “lost the sense that anything they had that was unique or authentic had any importance or value.” The article claimed that the city later realized that by quantifying, “investments in culture and built environment in terms of dollars and cents,” it forced a situation in which the city, “fails to account for the revenues, the new jobs, the export, the investment, the property value, and the cost-effectiveness of not having to building new things because they have invested in existing neighbourhoods.” We all know that Burnsville has been trying to years to justify the extensive public tax burden of the BPAC by explaining it in similar terms such as the huge impact the facility has had on Subway’s business on one particular day.
The presentation began with Tom Hansen (Deputy City Administrator of Burnsville) welcoming everyone instead of Mayor Kautz who was on very important business for the US Conference of Mayors in Las Vegas providing background on the BPAC including its expected economic impact from studies done more than 5 years ago and the politically charged atmosphere which he assured everyone had died down. His main points included:
1. The Mediterranean Cruise Cafe would not be located next door and would not be catering the luncheon if it weren’t for the BPAC. Some may argue that it was the park next door and the need for a filtration system for its water features, never intended to be used for swimming, in addition to Eagan’s controversial eminent domain seizures which were the true reasons for the move.
2. If a hotel had been built, as was originally proposed but never came to fruition being that the city is usually only at about 50% hotel capacity at any given time, it would have generated an additional $227,000 in tax revenues.
3. $1.25 million is the estimated economic impact of the arts center as defined by 50% BPAC occupancy for 104 weekend days (~52,000 people) spending an average of $25/day.
—-
Jon Elbaum (BPAC Executive Director) presented next and provided a variety of bullet points about the BPAC and how it operates including:
1. Providing world class entertainment and a special experience for corporate clients by breaking the mold of the traditional empty square rough shell of box seen in usual convention center spaces and offering a well designed space which flows to utilize instead.
2. Mr. Elbaum noted he conducted a small economic impact study through the Americans for the Arts and it was determined that the BPAC provided $2.7 million in overall economic activity and a total of 76 FTEs in the community something Mr. Elbaum believes is pretty impressive.
3. The demands on the calendar are such that Mr. Elbaum notes they are beginning to turning away business showing the growth the center is now experiencing.
—
Amie Burrill (Executive Director at Burnsville Convention & Visitors Bureau) was the final presenter and gave a couple of supporting points to the bullets mentioned by Mr. Hansen and Mr. Elbaum above including:
1. Dance competitions and comedians show an uptick in hotel stays and packaged events (tickets + hotel + food).
2. Grande Market Square has seen a recent increase in the number of inquiries for the vacant restaurant space there.
3. While they have been discussed, no actual impact studies have been done by the CVB on the BPAC’s addition to the city.
After the meeting was over I had questions for both Mr. Elbaum and Mr. Hansen so I contacted them both via e-mail. Both were kind enough to provide responses and/or put me in touch with those who would be be able to answer my questions.
1. I was interested in knowing how the City of Burnsville arrived at the number 90 for new businesses added to Burnsville in the last two years. The statements provided in the pre-meeting documentation seemed to lead people to believe these new businesses were directly attributable to the BPAC and related redevelopment efforts in the HOC. I was particularly interested in any data the city may have had on the number of businesses which left the city during the same time to be used for comparative purposes. I contacted Mr. Hansen who put me in touch with Skip Nienhaus, Burnsville’s Economic Development Coordinator. Mr. Nienhaus stated, “our information on how many come each year are derived from permits pulled for construction or build out, information from our building owners, information from our chamber, and general observation. We do not track how many businesses leave on a yearly basis.” In other words the “90″ number provided is a rough estimate and being that no comparative data is available no one, not even the city, has any real idea if 90 new business is good or bad or even what the reasons were that they opened their doors in Burnsville.
2. Out of all of the points raised during the three talks, Mr. Elbaum’s statement that he had conducted, “a little economic impact study of the BPAC done by Americans for the Arts,” interested me the most. While many other statements about the impact of the BPAC were based solely on guesses, some not even educated, Mr. Elbaum was presenting what he claimed was data derived from an actual study. I went to the Americans for the Arts website and found that the nonprofit had in fact conducted a nationwide economic impact study in 2005 and even provided extensive documentation to back it up. Excited I dug further looking for what Mr. Elbaum had done for the Burnsville Performing Arts Center. What I found out was shocking.
Following an e-mail conversation with Mr. Elbaum, I learned his “little economic impact study done by Americans for the Arts” consisted of nothing more than entering three numbers (population range (50,000 – 99,000), optional total expenses ($1,100,000 was used), and total attendance (a number which Mr. Elbaum estimated and arrived at 70,000)) on the Americans for the Arts website, hitting submit, and coming up with a variety of misleading talking points based on national averages from 2005 (prior to the economic downturn) to give an estimate of the economic impact of an arts facility on the town in which it resides. To be blunt: no study was conducted for the BPAC and for a man who proudly announces to others that almost all of what is said on this website is inaccurate, I have to admit I am embarrassed for Mr. Elbaum as purposefully misrepresenting 15 seconds of data entry and clicking “submit” as a “study” and piggy backing on the hard work that Americans for the Arts did to provide valid information to the public about what value the arts have on their communities is something which is wholly inaccurate.
What do you think of the points raised during yesterday’s meeting? Do you believe that the BPAC is making a positive economic impact on Burnsville? Are you in agreement with those presenting and in attendance that assumptions are an excellent way to provide information about the economic impact of a taxpayer funded facility? Whatever you have to say about the BPAC and its economic impact go ahead and comment on as I’d love to hear what you have to say.
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February 18th, 2011 at 7:18 am
Anytime you hear a government official justify something by citing Richard Florida, watch out. Florida’s idea is plausible on the surface, but it neglects a key fact of logic: “correlation does not prove causation.”
Here’s one very short critique of Florida’s thesis. You can find others: http://www.manhattan-institute.org/html/_calgherald-a_flawed_analysis.htm.
February 18th, 2011 at 7:53 am
I was recently watching a city council rerun where certain members of the city council (Sherry, Keeley and Kautz) went on and on about how they aren’t getting any complaints (I think they were talking about no complaints about the shows, being able to get tickets etc.). Chrighton was quick to remind the council and the viewing audience that there are still complaints about the facility not making any money. In fact, the city CFO indicated they are in constant contact with Mr Elbaum and his staff about how things could be done better etc.
The council, city staff memebers and the advisory commission need to stop falling all over themselves to be “nice” to Mr. Elbaum and say how great things are. While some things like bookings may be up, this place has a long way to go to start turning a profit. I don’t know of any citizens of Burnsville that are happy about this place. Perhaps we would be better off terminating the contract of Venueworks and having city staff run it.
February 18th, 2011 at 8:00 am
dsw,
When questioned by the group about if/how bookings are controlled for questionable acts, Mr. Hansen pointed out that they have VenuWorks (or any management company) to act as a buffer between themselves and any controversy over that sort of action. VenuWorks has a fairly open booking policy, Mr. Elbaum noted. As long as they meet their criteria (financial, etc, etc, etc) they can get on stage.
I have to admit that even though I think that VenuWorks does a pretty awful job (and not even just in Burnsville) there are many other “can of worms” issues which are opened by having staff members run the facility outright.
February 18th, 2011 at 8:23 am
I think Richard Florida’s work has gotten better over time; he does a regular column for The Atlantic that is pretty interesting. I don’t always agree with him, but generally I think his ideas are being validated by current events. You only have to look around the Twin Cities to see that.
The Manhattan Institute piece doesn’t really offer a substantial critique, plus MI itself is certainly not an objective critic — that doesn’t make them automatically wrong, of course, it just means you have to scrutinize their arguments as well.
That is not to say that I think the BPAC was a good idea, of course, because I don’t.
February 18th, 2011 at 8:39 am
I think Mr. Elbaum should forward his statistics to that Mondale guy who is trying to get the Vikings stadium built.
In a matter of maybe five minutes, I should think that they could prove that building a Viking Stadium in Arden Hills will result in an economic impact that will forever rid Minnesotans from ever paying state or federal taxes again.
Total projected attendance (estimated, of course) 1 Million Bazillion!
Also, who paid for the Mediterranean Cruise lunch that was catered only because the BPAC exists to justify itself?
The TAXPAYERS? I guess yes.
February 18th, 2011 at 8:45 am
Well, in part the taxpayers paid for it being that the Med. Cruise was built on land given to them at dirt cheap rates so babies in dirty diapers could splash around in a faux-creek.
But EDAM members paid for the actual lunch served yesterday.
February 18th, 2011 at 8:51 am
Ah yes. But who gave them the money to buy lunch via their salary?
The TAXPAYERS?
>:)
February 18th, 2011 at 10:11 am
I wish Elbaum would comment here. For once I’d like to see him defend this in the open.
I think it’s time for an MSPD press release…
February 18th, 2011 at 4:46 pm
I thought it was interesting that with a citizen (a) attending a meeting and (b) performing a minimal amount of fact checking, the spinformation provided by the city on BPAC was so easily unwound to reveal the truth. Again.
When are those people going to learn?
February 18th, 2011 at 6:05 pm
Without getting to lengthy, because I am tired of writing about this place:
First, thank you Bill. This needs to be in the public eye. People will have a chance to voice their complaints at the voting booth soon.
Second, this type of work would get someone fired in a heartbeat in the “real world.” If someone made a statement like that about something a public company was doing, there would be all sorts of backlash and legal issues. If someone lied like that in a private business they would be looking for a job by the end of the day.
Outright fabrication and lieing is not helping anyone. Making statements about a lack of complaints, only because you dont actually want to address the complaints or deal with the root issue, does not make the problems go away.
As noted earlier in the week………Idiots abound.
February 18th, 2011 at 7:38 pm
As a Burnsville taxpayer this sounds like one of those BPAC Dog and Pony Justification Presentations. We have the Convention and Visitors Bureau speaking of the economic attributes of the BPAC towards its hotel/motel members from all those dance competitions. This glowing reported was given after the Convention and Visitors Bureau received such a sweet heart deal to move their office into the BPAC. Who negotiated this deal at taxpayer expense?……. Tom Hansen and the then city liaison council member Dan Gustafson. This is the first time in Burnsville history that the Convention and Visitors Bureau is receiving additional financial assistance from the Burnsville resident taxpayer. The Burnsville resident taxpayer is paying for ALL the utilities of this organization, We are paying their CAM which is equal to or more than their monthly lease. We are giving them a ridiculously low ” long distance” telephone rate. What fools are we to put up with these shenanigans. A note regarding the Burnsville Convention and Visitors Bureau. It is a private nonprofit organization. It will not divulge its members names or who their representatives are.
Regarding the presentation from VenuWorks. It’s the same type of info we received from the previous Director…….. nothing but fabricated/questionable data.
February 19th, 2011 at 9:52 am
This sort of creative number massaging happens all the time in the private sector too. It’s not right when it happens there either, of course, but it happens, and sometimes it even gets people promoted. All the more reason why people need to be able to spot it when it occurs.
February 19th, 2011 at 10:18 am
Lying about the source of your data is not “creative number massaging.”
February 19th, 2011 at 2:56 pm
Can not say that this surprises me. Elbaum and Venuworks should be fired due to the lack of transparency in the operations of the BPAC. Again, where are the event specific revenues that occur every month that were once reported? With each and every report or presentation that comes out and Bill looks into the validity of the numbers, it continues to show that these exercises are based on bogus numbers and can not be supported or defended. Again, until you can accurately measure something with valid data Elbaum and the City of Burnsville should refrain from publishing rubbish reports and making claims about Economic Development that can be tied to the BPAC.
February 19th, 2011 at 4:24 pm
Tim, you work for much different companies than I do then. I have worked for three different fortune 500 companies, and in any one of them, standing up in front of internal or external customers and delivering this type of work would get you an express trip out the door.
This is not creative use of numbers. Its an outright lie to justify a $20,000,000 building.
People in the real world get fired for things far more minor than this.
February 19th, 2011 at 7:54 pm
Sure they do, and they should for things like this too. But it doesn’t always work out that way. I think you are misinterpreting what I’m saying here.
February 20th, 2011 at 8:38 pm
I work for a Fortune 500 as well and have 90% of the Fortune 500 Companies as Customers. If I presented something like this to a client it would only happen one time and I would either be demoted or fired after I was shredded by the client and my leadership. If you can not identify sources of your data and if they are not audited or credible, you do not present them.
February 23rd, 2011 at 10:14 am
Attendance numbers are an irrelevant measurement if artist fee’s and expenses outpace ticket sales. The business model of this facility is out of wack but EASY to fix. Since the facility does not want to “Promote” shows with taxpayer $$ and take the financial risk, BPAC needs to become a more conducive facility for outside promoters. If a promoter’s breakeven is so high on every show because the rental fee and other venue costs are so high, they will just take the show elsewhere.
The answers are so easy:
1) Get rid of VenueWorks $120k a year contract.
2) Unfortunately staff needs to be cut. There should be no more than 2-3 full time employees running a facility of this size. Cut that budget from $395k per year to 175k. All other staff (IE Production mgmt – should be line item event costs paid back by renter/promoter)
Wow… budget solved without even talking about the million different ways to increase revenue.
February 27th, 2011 at 5:04 pm
Shocked I tell you, Shocked. So I was working on a craigs list add as my son caught up on some tv shows from last week. Watching Outsourced, there was a reference to the song Smooth Operator. I asked my son if he was familiar with the song referenced and he said no. So I zipped on over to Youtube to find Sade’s song and play it for him, so he could know a little more pop culture from my day.
Low and behold, as the video played I noticed an add placed below the video frame. It was an add for the PAC, and a Sade concert coming up. Clicking on the add brought me to a link with the songkick.com domain.
February 27th, 2011 at 5:21 pm
Mikeh,
Songkick has nothing to do w/the BPAC. It’s not like VenuWorks did anything to create that. Songkick allows musicians to create a list of their gigs (past and future) and YouTube then pulls that information into the videos. With Google knowing your approximate location it then provides you with targeted advertising.
That is all Google and Songkick and not VenuWorks.
February 28th, 2011 at 9:25 am
“It was an add for the PAC, and a Sade concert coming up.”
Lest anyone get excited and think that Sade is coming to BPAC, it hate to burst the bubble. This event is Marat/Sade, a play put on by the resident local theatre group, not a concert by the Sade of Smooth Operator fame.
February 28th, 2011 at 9:30 am
I once saw Marquis De Sade at The Guthrie. Dude got naked on stage. Not what I signed up for.
Oh, and the BPAC is a waste. Back on topic.
February 28th, 2011 at 9:41 am
Whit, that’s fucking hilarious.
February 28th, 2011 at 10:06 am
Anything referring to “smooth operator” at the BPAC would be tremendously ironic.
March 16th, 2011 at 7:01 am
[...] in February when I attended the EDAM meeting where Burnsville and the BPAC Executive Director, Jon Elbaum, misrepresented faulty…, I decided to do my part to bolster local businesses prior to a BPAC-hosted event by eating at [...]
March 26th, 2011 at 12:53 pm
Apparently I should have given my money to LS Pizza Shack instead of Taqueria Hidalgo: http://twitter.com/lspizzashack/status/51500868691959809
Maybe I could have saved another business located in the thriving Heart of the City retail district from closure.