Council sets $15 million spending plan for city

• Members debate Swiftel budget

BROOKINGS – The Brookings City Council this week OK’d a nearly $15 million city budget, passing it forward for a public hearing and final adoption Sept. 25.

However, Tuesday’s work session on the budget – the fourth in a months-long review and debate of city spending and revenues – didn’t end without several of the councilors taking a parting shot at a familiar target, the Swiftel Center.

In the past, councilors John Kubal and Mike McClemans have made no secret of their feelings about the city-owned event center: they both dislike having to approve a $300,000 annual subsidy for the 11-year-old facility, and both have expressed their belief that it’s become a money pit for the city.

This time out, however, the two encountered a strenuous defense of the Swiftel Center and its operations by the mayor, the city manager, other councilors and even the director of the facility, Tom Richter.

The discussion began modestly enough when McClemans said he wanted to “chirp off” about the roughly $3.5 million of Swiftel Center expenditures listed in the five-year capital improvement plan (CIP) approved with the overall budget.

The councilor suggested that if the council planned on spending that much money on Swiftel projects, the group might want to consider bonding or borrowing rather than using cash to pay for the improvements.

“In my business, I wouldn’t want to spend money that keeps me tight financially,” he said.

But then, with Kubal’s participation, the discussion broadened to “what’s the city’s policy with regard to the Swiftel Center?”

“This is $3.5 million over five years,” McClemans said. “After that, is there an end? We have to ask ourselves, ‘is this a good expenditure?’ But we are given no policy, no goals.”

McClemans said he wants to see a consensus from the council on the direction it wants to see the Swiftel Center moving.

Kubal, too, said he “(doesn’t) feel the city has much oversight at all over the Swiftel Center,” and he wants “a little more transparency in the operations.” He suggested that perhaps a council member should once again serve as an ex officio member of the Swiftel board.

“If there is a policy, I’m not exactly sure what it is,” Kubal said. He noted that he wants “some way of measuring the dollars that go in against what comes out in the way of economic development.”



Council sets policy

City Manager Jeff Weldon noted that the council sets policy for the Swiftel Center every time it approves the budget or includes an item on the long-term capital improvement plan.

And Mayor Tim Reed pointed out that Swiftel Center operations are no mystery: the city-owned facility is managed by Weldon exactly the same way he manages any other city department. Even though Richter is not a city employee (he serves under VenuWorks’ management contract), he operates the same way as any other city department head.

Weldon, frustrated by the discussion, commented: “With regard to policy, you need to tell me what you want. Is it operations, the type of events we’re getting? Do you want female mud wrestling as opposed to country western music? Tell me what you mean by policy – you have to give me more specifics if this is going to be a fruitful discussion.”

Richter, in his own defense, noted that “each year we present a business plan to the city, a budget, a budget narrative, the CIP budget and an annual report. I just don’t want anyone watching this (televised meeting) thinking we’re running loose and just doing whatever we want to do out there.

“This business, in the past 11 years, has grown from an income of a half-million dollars to just over $1.8 million in 2011. And the subsidy, which we haven’t even talked about yet, the allotment … to pay for any shortfall we might have, hasn’t changed – as our business has grown three times. That’s true. We can’t make those numbers up.”

It was Councilor Ope Niemeyer, however, who capped the Swiftel discussion, scolding his fellow council members for continuing to resurrect issues that have been argued and settled.

“We set policy when we vote for things,” he said. “We have a lot of departments that don’t create income. We have a police department that does their job. We have parks and rec guys that take care of the facilities we have here. We don’t expect them to make money. (The Swiftel Center) is a facility that is here for the public. It just blows my mind that we argue over this facility every year. Even before I got on this council. And it just drives me nuts!”

That effectively ended the Swiftel discussion, but McClemans persevered in asking for different financing options for Swiftel Center projects. His motion was defeated on a 3-4 vote.



Subsidy restored

Two other budget issues received some attention from the council Tuesday. A $20,000 subsidy for Downtown Brookings Inc. was restored with the proviso that the organization work with the Chamber of Commerce to develop a plan and structure that will strengthen the downtown area. That plan, per the mayor’s motion, will still have to pass muster with the city manager and the council.

Another organization, the Brookings Growth Partnership, also got the council’s reconsideration of its budget request. The city had been scheduled to provide a $125,000 subsidy for the Partnership’s Innovation Campus, but Weldon had asked that be trimmed by $25,000 to begin a phase-out of the city’s contribution to the research park.

“We’ve given $1.1 million over eight years, and last year a $35,000 operating loan,” Weldon said. “We need an exit strategy. What we’ve done in the past is not sustainable long-term.”

But Mayor Reed asked that the Growth Partnership’s full $125,000 request be reinstated on a one-time basis. The changeover to a new executive director and a renewed emphasis on recruitment of tenants for the park warrant additional temporary support, Reed said, and the council agreed.

It remains the current council plan to reduce the amount the Growth Partnership receives by $25,000 a year.

The 2013 city budget is balanced at approximately $14,985,000 – revenues and expenses will be equal. It’s about $2 million less than the current budget, which includes costs for the new city-county government center.

In earlier budget sessions, Weldon referred to the spending plan as a “no frills budget.” While there aren’t many extras included, it is still an ambitious program, with almost as many city projects as there were under the current year’s budget.

Reed led a general discussion of the city’s financial outlook, noting increasing labor and operating costs but lowered property valuations – possibly leading to lower revenues – for the city.

“We’ve got a pretty good budget in place,” he said, “but we’ve got some future issues unless property taxes and sales taxes really take off. We could see some times where we’re going to have a little tougher time budgeting.”

The first and second readings of the budget adoption ordinance will be held during the Sept. 11 and Sept. 25 coouncil meetings.

The proposed 2013 City of Brookings Budget and Five-Year Capltal Improvement Plan are available through a link on the first page of the city’s website: www.cityofbrookings.org.



Contact Ken Curley at kcurley@brookingsregister.com.