|Is Rapid City Ready For Prime Time?|
(photo from gotmine.com)
For example did you buy your house for $100 thousand? I guarantee you'll pay three or more times that much over the life of the mortgage, which is what long-term financing is all about. But the compelling question is, will you get fair value for the out-of-pocket monthly mortgage payments you'll be making for the better part of your adult lifetime? That's really the question that we have to ask ourselves about the Expansion Project. Is it worth the $300-$400 million (depending on the interest rate of the bonds we issue--and remember, we're committed to half of that already thanks to ADA) we'll be shelling out for it over the next 3 decades? Apparently, we've got the cash flow to support something on the order of $12-$15 million a year to pay the thing off, but what we really want to know is if the new facility will give the economy enough of a boost to make it worth the expense. I think it will. Civic center-based events produce significant amounts of money for the Rapid City economy. Consider this: the Lakota Nation Invitational (LNI) just came and went, bringing thousands of people into town for its 3-4 days of activities. It's economic impact? Around $4 million. Then there's the stock show and its hundreds of thousands of attendees--we're talking seriously serious bucks here.
Now remember, we already HAVE to spend $90 million or so for ADA-compliance purposes, so our calculations should be based on the return we'll get from the extra $100 million or so that a brand new and much larger facility will cost. I think this is just too good an opportunity to pass up. Sources (sorry, no names, no genders) tell me that the Chamber of Commerce Convention and Visitors Bureau have been saying for years that Rapid City needs space to handle large conventions that want to come here but can't because they want to do everything under one roof. My sources and my common sense tell me that the sales tax dollars gained from these confabs will be huge. My hope is that as the discussion progresses before the public vote on this thing takes place next Spring that some hard economic projections will surface--and if they come anywhere close to what I think they'll be, the return on Rapid City's investment will be impressive indeed.
|Let's Hope The Vox Of The Populi Is Informed|
(photo from KEVN news)
Beyond that, there's a point about marketing the area in general. South Dakota's chronic shortage of skilled and well-educated workers has long been bemoaned by state officials in Pierre, who've been thrashing around for years trying to find ways of getting outstanding people to stay and migrate here. What better way to raise the public's consciousness about our first class entertainment and recreational activities than to have Rapid City highlighted in news and marketing journals because of the activities and events taking place here? This is anecdotal, I know, but a winter doesn't go by that I don't hear from people I know scattered around the country about LNI or the Stock Show. You can't buy this kind of publicity and exposure.
The proposed civic center has the potential of being one of the crown jewels of the northern Plains, nestled as it is in one of the great natural and historic centers in the United States. For the few million a year it will cost us on top of what we already have to spend to upgrade the existing facility anyway, it's a risk that we'd be smart to take. In 2012 we had a $163 million budget. Stripping away the annual cost of the ADA-imposed alterations that we have to complete, expansion or no expansion, we have 30 years to finance $100 million, which is manageable and well worth the risk.
Note added on 12/26 @9:14 p.m.: Commenter Rick K. below references a study that leads him to conclude that the expansion is a bad idea. Here's the AECOM study. Note the following conclusion at the bottom of page 5 of this study: "A number of comparable facilities have shown that both new arenas that replace obsolete facilities as well as larger, multipurpose indoor venues can successfully attract levels of usage that support facility operations."