Rochester City Council Update – November 28, 2018
In lieu of a Council Update video on Facebook I am just going to write a post as there was only 1 public hearing at our meeting on the 28. I also stayed after until past 11 to watch a Planning & Zoning meeting as there were a couple items of personal interest. Here is a synopsis of my comments and thoughts.
I began my comments by basically saying the City of Rochester was unwilling to make needed changes for 40+ years and now we do have to take action on some issues. You are seeing this in the Community Development Department, national searches for the best staff, increased oversight and transparency, and changes at the Mayo Civic Center & Experience Rochester. I believe that staff is largely doing a good job and will still have a role in a future organization if they so choose. Our job it to keep them engaged and alleviate fears. That said the Brad Jones / Stevan Kvenvold era is over and it will never return.
Ed Hruska rightfully recused himself from all discussion as he has a substantial conflict of interest. Kudos to him for doing the right thing.
The city council took 5 actions on Wednesday.
- Direct the City Administrator to initiate the process to transition the governance and operations of the Mayo Civic Center and Experience Rochester to a singular entity governed by a new board of directors.
- Direct the City Administrator to work closely with the existing employees from both organizations with the primary goal they remain employed with the new entity or the City in another capacity.
- Authorize the City Administrator and Human Resources Director Direct staff to negotiate employee programs to ensure continuity of service through the transition and provide financial assistance for employees not employed by the City or new entity after the transition as outlined below:
- Employee program to incentivize them to remain with the MCC during the transition.
- Employee separation program for those not employed with the entity or City following the transition (if any)
- Direct the City Administrator to return on December 10, 2018, with information to include, but not be limited to:
- Full time line for execution
- Composition of board seats based on industry best practices
- Return with a timeline to make the necessary changes to the Rochester Amateur Sports Commission (RASC) Contract
Note that I added the 5th one by amendment. I am not expecting major changes with that organization, however they are currently funded through Experience Rochester and will need to either be part of the new organization OR have a separate contract. My issue was not to change anything, but rather to produce a timeline to get to the answer before changes are in place in 2020. I expect we will have an annual performance based contract with RASC, since their performance tends to be very good, I don’t think much will change.
In general both myself & Nick Campion tried to force the issue around some of our core values. We had different approaches but really the decision was delayed until later. Here is what I personally was after:
- Transparency – The new oversight organization must have to comply with the Minnesota Government Data Practices Act. This was not the case under Brad Jones & Stevan Kvenvold.
- Strong Conflict of Interest Policy – The organization & members can not direct public resources or data to their private or competing organizations. This was not the case under Brad Jones & Stevan Kvenvold.
- The members of the board overseeing the public tax dollars, convention bureau, Mayo Civic Center, and must be appointed by the Mayor & Council. This was not the case under Brad Jones & Stevan Kvenvold.
Nick Campion tried to accomplish this by ensuring the this oversight board was public, which I was fine with. Randy Staver and Mark Hickey strongly opposed this. I tried to introduce an amendment to add this direction to staff but created confusion because we probably can’t appoint to a corporate non-profit. While public boards are by definition non-profit, the use of the “non-profit” just created confusion. By consensus we proceeded with these 3 principles as understandings, but I think they will face strong opposition from Mark Hickey & Randy. Until, of course, Mark is gone…
Ultimately any plan that does not address these 3 items is destined to be a repeat of the mistakes of the past.
My reason for going down this path is that I am looking to achieve 3 things from the Mayo Civic Center in the future.
- Avoid the massive increases in projected losses.
- Keep the venue accessible for local events.
- Remove the financial risk from the city budget.
The hardest part about #1 is there are many ways to cut expenses, but if it only makes the venue less usable that is not a solution. If the only goal is to make money we lose the value of a civic center. Finally there may be some ways that we can reduce the operating subsidy using internal resources. The issue is that we still accept all the risk in an area that is not our core competency.
It is well understood that civic centers are money losers in all but the most extreme cases. While the oversight and tax dollar allocation must be public the actual operations could be public or private. While the actions take don’t specify either, I would expect that the eventual outcome will include a privatization on at least some of center sales & operations. The reality is that only a private contractor can achieve #3.
Additionally a group with private connections to programing can get past some of the limitations on entertainment options that currently exist. Typically this includes 75 mile rules. What this means is that if there is a performance in the Twin Cities, nearby Casinos, or the 2 neighboring college towns, the acts can’t come here. Many private operators are able to bring in their own events.
I think one person who certainly didn’t help was some folks wanted us to avoid changes because it might impact current jobs and employees. Because I don’t want to mislead anyone I made clear that this can not be the consideration. We are not a jobs program. I strongly believe in helping employees who have done a great job for us. When RPU ended coal burning at Silver Lake Plant we were able to make sure that every single employee landed on their feet, many still with RPU. My goal will be to achieve the same here. That said we can’t promise that.
40+ years is a long time to go with out making meaningful changes in a community as it grows. I saw how poor the long term city budget looked this year. This is one of many steps the newer administration is taking to right the ship. The rats that got us here have jumped ship and that is really unfair to some people doing good work.