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Does the Mayo Civic Center model need to change?

November 26, 2018

A new model for operating Mayo Civic Center is being pitched Wednesday.

The Rochester City Council will be asked to initiate a process to create a single nonprofit entity to oversee work currently done by city staff and Experience Rochester, which markets the facility and the city as a visitor destination.

“There really are a few ways this can go,” City Administrator Steve Rymer said. “It could go that they agree with the recommendation and then direct us to start down those steps necessary to achieve implementation of that.

“It could be that in concept they agree with it, but there are open questions they have, so they want us to come back.

“Or, it could be that this isn’t the direction we want to go.”

The recommendation follows months of work by consultant Dan Fenton, executive vice president of Jones Lang LaSalle Inc., who also oversaw a 2012 Civic Center operations and management study under Strategic Advisory Group.

The city entered a $94,500 contract with JLL for the latest study, which Fenton said included months of working with various local stakeholders — from community members and facility users to city officials — to determine the right path for the operations.

“One of our goals in this is we got as much feedback as we could,” Fenton said.

STREAMLINING EFFORTS

The latest study followed a forecast that points to increase reliance of lodging taxes for facility operations in future years. While the center has reduced its expected need for tax dollars this year, the latest estimates for 2023 indicate $2.5 million in tax dollars could be needed for facility operations.

That’s on top of approximately $2.5 million in lodging tax funds provided this year for Experience Rochester to market the city and attract conventions and events to the Civic Center.

The proposed change is being considered an attempt to streamline existing efforts.

In a report to the council, Rymer noted a stakeholder group focused on two options to increase accountability for facility management and set clear goals. Both concepts called for oversight of a single authority, either operated by the city or a private nonprofit entity.

In June, the city council indicated it wouldn’t support the city taking over the entire operation.

“I’m having a hard time looking at another division of the city,” said Rochester City Council Member Ed Hruska, who is also executive director of Rochester Sports, a division of Experience Rochester, formerly known at the Rochester Convention and Visitors Bureau.

The result is the proposed creation of a new nonprofit authority, which would have its own director and be overseen by a volunteer board of community members with a specific set of guidelines and expectations for running the city-owned facility.

Following a presentation and comments during a uniquely timed public hearing, starting at 4 p.m. Wednesday, the city council will be asked to determine whether the proposal is the right path for Civic Center operations.

While public comments will be taken Wednesday afternoon, the proposal has already raised questions.

On Monday, Randy Blake, the center’s operations supervisor, urged the council to slow down. He said change is needed to improve efficiency, but suggested existing staff could make those changes if clear goals are established.

He said privatization would likely add complications and could hamper the facility’s reputation if current standards are not maintained.

“They need to table this for a little while and get some new insight on this,” he said.

While Blake noted he’ll be eligible for retirement before the transition is complete, he worries about new staff members who he recruited to work for the city. He said they could lose union investments if their jobs are privatized.

Rymer has indicated the city will work to help employees.

“We will have an expectation with the new entity that everyone who is working today in their different roles, or similar-type roles, have the opportunity to be with that entity if they so choose,” he said. “It’s not the thought that we would require it, but everyone has to have that opportunity.”

Part of Wednesday’s request from the council is to authorize efforts to protect employees.

On the Experience Rochester side, Interim Director Mary Gastner said her team is working in the same direction to prepare for a potential change.

CONSULTANT’S EXPERIENCE

Another question that has been raised in the weeks since Rymer announced plans to recommend a change is whether the proposal mirrors operations in San Jose, Calif., where Fenton ran convention facilities as CEO of Team San Jose until 2011.

The nonprofit oversees city-owned venues and conducts marketing for the city with the guidance of an appointed board of directors, representing business sectors similar to those referenced in connection to the local proposal.

During Fenton’s time at the helm of Team San Jose, the organization faced scrutiny for reportedly failing to meet expected outcomes and two grand jury reports cited concerns about the operation.

Rymer said this week he was aware of the past concerns but didn’t see a conflict, noting he would not have suggested the contract with JLL if he had.

Fenton said the Team San Jose experience is behind him and the current recommendation only offers surface comparisons to that model. He said his recent years as a consultant have increased his knowledge of a variety of operational models, which have informed the Rochester proposal.

More importantly, he said, community members have helped create the proposal.

“Part of it has to do with the destination itself,” he said.

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