The Augusta Convention Center Saga Continues

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The Augusta Convention Center Saga Continues

It seems like Paul Simon, president of Augusta Riverfront LLC, is determined
to bring commissioners good news about the Augusta Convention Center, even if it is
served with a side of a potential litigation.
This week, Simon went before the Augusta Commission’s public services committee
with the first annual report on the 38,000-square-foot convention center on Reynolds
Street.
The report was mostly sunshine and rainbows as far as Simon and Darryl Leech, the
general manager of the Augusta Marriott at the Convention Center, were concerned.
“In 2013, we had 36 events for the year with 37,000 plus attendees,” Leech told the
committee on April 28. “We had $10.1 million in economic impact in 2013.”
For this year, Leech explained that the $29.5 million convention center already has 27
events on the books with an economic impact estimated to be around $9.1 million.
“So the total economic impact of two years is $19.1 million for 2013 and 2014,” Leech
said.
Augusta Riverfront, who also shares management of the facility with Morris
Communications Co., owner of The Augusta Chronicle, is required under its agreement
with the city to provide the commission with quarterly and annual financial reports on
the new convention center because the downtown facility was financed with $20 million
in Special Purpose Local Option Sales Tax (SPLOST) funding.
However, Simon made sure to tell the commissioners that Augusta Riverfront is not
required to give an oral presentation on the economic status of the convention center.
“This is our first annual report since we have opened the center that we have given to
you,” Simon said. “We are not required to give it to you verbally. We are required to give
it to you in writing, which we have done through the administrator, but because it is our
first year, we want to make sure you understand the issues that we have there.”
Overall, Simon said that the convention center’s numbers were better than anticipated.
“At the end of the day, we budgeted to lose $850,000 in the convention center, but we
only lost $535,000,” Simon told commissioners. “Which means we improved the budget
by $315,000.”
As far as the Reynolds Street parking deck, Simon said the city had lost money. “You
are going to end up losing money on the Reynolds Street parking deck, but you are going
to make money on the hotel side,” Simon explained to commissioners. “We take a fee,
you get a lease payment and, overall, at the end of the day you earn $127,525 in parking
income. That was the city’s share.”
Therefore, if you take the convention center’s net loss of approximately $535,000 and
a profit from the two parking decks of $127,525, Simon said that the entire cost to the city of Augusta for the convention center and parking
deck was $407,797 in its first 10 months.
“In exchange for that, you got back an economic benefit of $10.19 million,” Simon said. In comparison, Leech said Savannah’s International Trade Center cost its city about $970,000 last year, while Athens’ Classic Center cost its city nearly $1.4
million.
“All of these places, I told you early on, they are not designed to make money,” Simon said. “They are designed to bring economic benefits to the city and we are trying to do that.”
But along with the good news, Simon also told commissioners he had some growing concerns about the city’s contractual agreements that were not being met.
“Our agreement provides that we will take over and operate the
center under certain terms and conditions,” Simon explained.
“One of those conditions is the building is complete. With a building of this complexity,
it is going to take some time to complete.”
However, Simon said it was time for the city to consider beginning construction on a
pedestrian bridge for the Reynolds Street parking deck.
“From the very beginning, we took a very active role in the planning and construction
phase of this project,” Simon said. “We did this because we knew as operators, the more
accurate and complete the facilities were, the more efficient the operations would be.”
Simon said he was not at the commission meeting to complain about the private
construction management firm Heery International or contractor R.W. Allen. Instead,
he said he just wanted to bring the commission up to date on some of Augusta Riverfront’s
concerns.
Specifically, Simon said there was a “punch list” of items that needed to be address
including the construction of the pedestrian bridge, a room-block agreement with the
Augusta Convention and Visitors Bureau and a right-of-first-refusal contract with the
city regarding the corner property on 10th and Reynolds streets.
“You can double the size of convention center on that piece of land,” Simon said. “But
if somebody comes along and wants to build an office building there, we have to come to
you and say, ‘They want to this, but do you want to buy the land at that price?’ You can
do that, but you need this agreement to do it.”
Commissioners seemed most concerned about whether or not the city had actually
committed to building the $990,000 pedestrian bridge over Reynolds Street.
Augusta’s General Counsel Andrew MacKenzie said he would have to review the record
to see whether or not the commission was bound by the former Augusta Commission’s
decision to have a crosswalk built.
“One thing to look at is we have a rule that says, once the commission has approved
something, it is whether or not there has been some positive action taken to accomplish
whatever has been approved,” MacKenzie said, adding that would determine if the
action could be rescinded.
Simon quickly objected to that possibility.
“Action has been taken,” Simon said. “We have been operating the convention center,
we shared the profits, we negotiated the reduction of our fee, we negotiated a shorter
term for the parking deck from 15 years to five years. We negotiated a lot of language in
the agreement, all of that was done in exchange for the commission agreeing to build a
crosswalk.”
He also pointed out that the funds are available to construct the pedestrian bridge and
therefore action should be taken.
“It is a dangerous situation over there,” Simon said. “There were 3,000 people there (at
the convention center) for Easter Sunday from Tabernacle Baptist Church. And you can
imagine 3,000 people trying to cross Reynolds Street to the parking deck. It’s a danger.
We have had three people killed in Richmond County this year crossing the street (across
the county), we don’t need another.”
Augusta Commissioner Marion Williams said he would not be pressured into a quick
decision about the pedestrian bridge.
“I don’t like the scare tactic thing,” Williams said. “I’m not going to be afraid.”
Commissioners agreed to postpone any decision on the matter until the city
administrator could hold a meeting with representatives from Augusta Riverfront,
Heery International and R.W. Allen.

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