Monday, October 24, 2011

RiverPlex- Is it Working Out?

I re-run this article on the RiverPlex as the City Council gets ready to approve, I believe, the building of the new downtown Marriott that puts the property taxpayers at ONLY an approximately $35 million dollar risk.

I re-print this as a reminder that not ONE publicly financed project in Peoria County has met it's projections in the past 10 years.


This JS headline on August 21 about the RiverPlex is a clever play on words. Yes, how is it working out? Exactly as I said it would. Another missed projection similar to the "O'Brien" Field where attendance was down considerably this season (188,000) while minor league baseball attendance nationally, was up 1%. On 12/2/98, Rocky Vonachen was quoted in the JS that the ball park would pull in 300-400,000 people in a six month period. Rocky also said the ballpark couldn't exist alone and would need fill-in like concerts,etc. He was right. Another year of under 200,000 in attendance, many of them kids or courtesy tickets to advertisers and probably around $5 million left owing the banks, then what?

My accountant said no need to send him any more year end tax forms as I have no move value to right off. If I have none, then neither do any of the original investors, right?

Back to the RiverPlex. The article said the Riverplex is operating in the red, never in any year, able to meet the principal and interest on the money borrowed. Still owing $6.25 million plus interest on the original $10 million loan. Which means in 10years the PPD has only been able to retire $3.75 million of the original loan leaving $6.25 million debt plus interest, to be paid out over the next ten years.

Maybe, or it may be extended another 10 years. While public facilities are seldom expected to make a profit, PPD officials promised the RiverPlex would be making in excess of $500,000 a year!!

Back to the Chiefs. (I put "O'Brien" in quotes because allegedly, when their building naming rights ran out, they did not renew their contract and allegedly get their name on this stadium for free as Chief management has never been able to sell naming rights to anyone else).

Back to the RiverPlex. Here is what Park President Cassidy said to the JS in an article dated 3/21/99, "The financial analysis done by the Benefield Group, a consulting firm hired by the park, (Merle's recollection is a figure around $50,000) will be able to support its operations and support up to $6 million in public bonds). The PPD as noted borrowed $10 million and 10 years later still owes $6.5 million). Park Board President Cassidy continued, "Most, if not all, the bonded indebtedness will be paid through RecPlex operations".

Are consultants ever right or do they alter figures to fit the ambitions of those who pay their high prices? Hm.

All RiverPlex costs such as Social Security, retirement, FICA, insurance, etc., are charged to various park funds OTHER than the RiverPlex to make the whole RiverPlex deal look financially stable.

Cassidy was also quoted, "Contrary to media reports, there will be no required membership fee. Wrong. If you want to become a member, you pay $49 per month for an individual and $80 for a family, undercutting the privately owned, property tax paying clubs like the Clubs at RiverCity.

While St, Francis paid $4 million before construction started, they still pay $400,000 a year to use the RiverPlex. Abandoning, I believe, a much more accessible site they operated in Pioneer Park. (A high up St. Francis official told me by phone that St. Francis got the "short end of the stick" and were most unhappy with the deal).

While the PPD collects over $13 million a year in property taxes from those in the park's taxing district almost 50% of the RiverPlex users come from outside this district and do not support the deficits of the club.

Most of these figures are taken from the previously mentioned JS article by reporter Dave Haney on August 21, 2011.

Yesterday, I played tennis in a "cloud of dust" at the Glen Oak Park whose courts may still be threatened by the proposed basically unneeded parking lot for the zoo which has easily survived two seasons without additional parking.

In the meantime, unseen by the public, many acres of park owned property continue to erode and extend at least one major earth delta into the Illinois River while the cannons sink at the polluted Glen Oak Pond and playgrounds exist without toilets or running drinking water.

And user fees for other places or events keep rising. The park keeps counting on a rising EAV and so far they have been accommodated as note the rising evaluations of properties that are shrinking in value. My home is an example. Appraised at $218,000 but assessed at $254,000.

Park Super keeps bragging about the hundreds of thousands of people they accommodate yearly, but in reality, many of these are the same people. The RiverPlex hosts many events that could be hosted by tax payer paid facilities such as public schools and private tax paying other entities.

So you could say the facility is "working out" while occupying valuable riverfront swapped for some vacant and basically unusable city property at the equal rate of exchange at $5 per sq. ft. as appraised by local appraiser, James Klopfenstein and recommended by Tom Tincher.

What a deal! And the majority of the City Council approved it. Some of them, keep getting elected.

Governments in trouble. Look up history. I do.

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