Rhino's Ramblings: Where Are the Concerts?
It’s one of the biggest questions asked around the city and, in many ways, one of the least understood issues. Where have all of the shows gone to at Mosaic Place? And how do we bring them back?
It’s also a story which has two sides to it. One where in the past where it seemed every concert coming through southern Saskatchewan ended up at Mosaic Place; and another of budget overruns, no strategic planning and limited long term sustainability for the facilities.
It all came crashing down just over two years ago with the release of the Myers Norris and Penney (MNP) report. It was an injection of over $400,000 that kept the doors open on the Downtown Facility and Field House (DFFH - Mosaic Place) and the Yara Centre.
It is no lie to state that without that cash injection the facilities would have had to close their doors and the upcoming Dolly Parton concert and the Moose Jaw Warriors hockey schedule would have been cancelled.
That’s how grim it truly was despite how the biggest supporters of the DFFH might try to paint the situation.
What the MNP Report found was really the tale of two facilities.
One facility where it all seemed all was well and thriving, with top name concerts on a monthly to basis; and a second version where the reality was a little different. The facility was bleeding red ink to the tune of $1 million annually with budgets ignored and information withheld or selectively provided to the DFFH board and little oversight by the DFFH Board and City Council.
Initial successes had led a DFFH Board to place too much faith in CEO Scott Clark, who tightly controlled information MNP concluded.
MNP would extensively question Clark on multiple occasions, who would, on the eve of the MNP Report’s release, literally ride off into the sunset to manage a similar facility in Grande Prairie, Alberta. But of course the new job offer had nothing to do with the imminent release of the MNP Report.
As someone once told me “Mr. Clark landed on his feet.”
Whether that is true or not is debatable but what also can be said is that the former DFFH CEO was no longer at the helm when the MNP Report was released and he declined comment when the local media contacted him to hear his side of the story.
Here is what the MNP Report concluded about former CEO Scott Clark:
“The CEO appears to have been controlling
data and limiting the flow of information to the
Board; this limited the Board’s ability to fulfill
The CEO managed the DFFH as a private enterprise
rather than appreciating its public
ownership and accountability to City Hall
• Financial management does not appear to be
a strength of the CEO
• The CEO did not have in place a
comprehensive set of policies including in HR
• Staff do not trust the independence and
objectivity of the HR system
• Confidence in the CEO has been eroding
amongst the staff”
MNP Report Page 12 Point 7
The great economic boom we were promised with the construction of Mosaic Place died along with the slide of commodity prices as weakening demand ate into the value of the Canadian dollar. Shows or bowl events, which were bought in US funds, seemingly became more expensive within a matter of months.
The economics of SaskaBoom, which existed in 2011–2014 fuelled the high Canadian dollar (the Petroleum Buck) but extra cash for concert goers started to disappear and in 2015 the DFFH started to feel the effects. But instead of adjusting the model to reflect the new economic realities the show literally went on until the wheels fell off, financially, and former Councillor Candis Kirkpatrick resigned from the DFFH board as she could not support its upcoming budget and the presiding Council of that time ordered the MNP Report.
Taxpayers were undoubtedly subsidizing some of the biggest names in the entertainment industry. It’s no word of a lie that seniors who could not afford to replace the hot water heater in their homes if it failed were now subsidizing some very big names in show business.
Although the MNP never stated it, in my opinion there were undoubtedly concerts in 2015-2016 which lost money. When you had concerts by US bands like Megad:eth barely half sold out, its obvious there were some bad financial returns.
The financial successes we were told about during this period were, in my opinion, an illusion that David Copperfield would be envious of.
If you don’t believe me it’s right there in the MNP Report: “when the Canadian dollar dropped throughout 2014, financial challenges emerged with a drop in revenues from promoter based shows decreased sharply in 2015.”
Although the report is now over two years old, many of the underlying economic conditions persist, especially when it comes to the US dollar.
According to Forex, on December 31, 2014 the value of the Canadian dollar was 0.90592 versus the US dollar. On December 31, 2015 it was 0.78299 and as of September 15, 2018 the value is 0.77705.
What that means is if the main problem with the viability of concerts is the difference between US and Canadian funds, and no other factors have changed, we are actually in a worse position than 2015 when it comes to expected revenues if Mosaic Place were to buy a show under the same terms as in the 2011–2014 period.
From what I was told by the former DFFH General Manager Graham Edge is that there are many ways to structure deals to buy the right show and get around some of the impediments and financial risk involved. I did ask him, more than once, how but he declined to tell me. I spent a couple of relaxed afternoons with Edge at the facility but it was his guarded secret and he never did tell me exactly how to do it.
He did say they were prepared to go after the right show if it materialized.
The only way around it, it seems, would be to change the DFFH's operating structure - become more efficient, choose shows where you can expect a good crowd and the performers who will deal in Canadian funds only, split the risk with outside promoters, base the overall cost on ticket sales and seek outside sponsorship of shows from local businesses. The thing is, unless you want to subsidize even more than the present rental model does, it seems getting shows here is not going to be easy.
The near financial collapse of the DFFH also has more than a few blaming the City for the demolition of the 0 block of River Street West and empty lots where once thriving and historic hotels and watering holes once stood.
The sad FACT of the matter is that the City had NOTHING TO DO with the abandonment of the new hotel, overhead walkway and gathering place once envisioned there.
It was a private endeavour and the purchase and demolition of a good portion of the 0 block of River Street West was not done by the City of Moose Jaw. The closest the City got to any of it was selling the far west portion of the River Street roadway to the developers. The City did it's best up to and including selling a part of a roadway to get the project built. Fault-wise, against the City? I just don't see it.
Exactly why the project was abandoned is, in some ways, tied to the economics of the DFFH but I also have the opinion it was also the tale of two business groups which all ended up in a bankruptcy and legal action filed at Queen's Bench Court in Regina.
If you ever want to have a good non-fictional read of some of what happened on River Street's redevelopment drop by the Victoria Avenue Court of Queen's Bench; it’s actually great reading and it sheds some light on the entire issue.
In my opinion though the real winner of the River Street redevelopment, it seems, was Eddie, the former owner of the Royal Hotel, who reportedly sold the property for a cool million dollars, ditched his young mistress and then packed up his wife and kids and returned to Lebanon. Not only did he make some extra cash by under-sizing his liquor shots (something he was fined for) but the old hotel’s demise allowed him to return to his homeland.
But what about concerts? How do we get Mosaic Place back into the game?
Well I can tell you for a fact there has been plenty of skulduggery going on and the business community is starting to ask questions. There’s a push, it seems, to prime the economic pump Mosaic Place was promised to be..
It’s very true that there were some businesses – especially restaurants and hotels - who did quite well when the concerts and events were in town. The initial successes, such as the week long Scotties Tournament of Hearts brought in lots of out of town cash.
Going after this event a second time, is in my opinion, almost a must. If the stars and economics line up, the Scotties repeating here would be a great event and it would help out a lot of local businesses.
Businesses, along with a lot of concert-goers, are starting to put pressure on the City to bring the concerts and the good times back.
Economically there is undoubtedly a downturn, locally, as illustrated in the record amounts of outstanding property taxes. More than a few people are openly asking online if anyone is hiring. These are people who just last year were working and amongst those major concert attendees.
With a byelection on the future of the DFFH should be something discussed.
Perhaps the big questions which needs to be asked when it comes to Mosaic Place, from potential new councillors is what they envision for Mosaic Place’s future? What sort of structure do they see to help the facilities to live up to their economic promise? And to get there, how are they going to ensure history doesn’t repeat itself? How do they balance out the DFFH when it comes to infrastructure priorities and the borrowing we are doing to finance it? How are they going to finance the concerts people are asking for?
It’s a debate worth having.