Spokane Journal of Business

A new approach to Riverfront Park

Board eyes enterprise fund, but proposal has its critics

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-—Kevin Blocker
The Looff Carrousel reconstruction project is one of the major renovations at Riverfront Park.

As some long-envisioned improvements to downtown Spokane’s Riverfront Park start to become reality, the city’s Parks and Recreations Department is grappling with a looming challenge: How does it create a financial sustainability plan for the city’s crown jewel?

The city’s Park Board is considering four alternatives to make the park, at a minimum, self-supporting. Board member Ted S. McGregor says he and fellow board members currently favor the idea of operating the park as an enterprise fund, in the same way it operates the city’s four golf courses.

By creating an enterprise fund, the board thinks Riverfront Park would be in a better position to be self-sufficient and not rely on the annual subsidy it receives from the city’s general fund.

“Before voters even approved the bond measure, the discussion, not just by city officials, but also among the community, was, ‘How do we operate the park differently from before?’” says McGregor, who also is publisher of the Pacific Northwest Inlander newspaper.

Speaking of future operations, he says, “Riverfront Park is a complicated piece of property, and we need to get it right.”

Leroy Eadie, Parks and Recreation director, says once fully finished in 2020, park officials have a goal of doubling the park revenue from its annual average of just over $3 million.

But two former members of the Park Board, both of whom have previously expressed their doubts publicly about the park’s ability to generate revenue, still believe the park will struggle to make money.

“Parks and Recreation does a phenomenal job in the area of maintenance and upkeep, but I question whether there’s the skillset present to create sustainability,” says Randy Cameron, a former three-time Parks Board president who served on the board from 2008 to 2015.

“It’s been 2 1/2 years now, and they’re still no closer to creating sustainability from programming,” he says. “You’re not going to cover a $1 million annual deficit selling key chains in the park.”

Three years ago, Spokane voters approved a $64.3 million bond measure to provide funding for an overhaul of the aging destination. Riverfront Park, which hadn’t undergone major improvements since it was constructed for Expo ’74, attracts between 2 million and 2.5 million visitors per year, Eadie says.

Andy Dunau, like Cameron, doesn’t favor the idea of making Riverfront Park an enterprise fund, an action that requires an approval vote from the city council.

Dunau, who is challenging Breean Beggs for the third district seat on the Spokane City Council, calls the idea “a scheme and a scam.”

Dunau served on the Park Board from 2011 to 2016 and headed the Riverfront Park oversight committee his last year on the board.

He points to the fact Riverfront Park’s longstanding executive team now has two City Council members sitting on it. Spokane City Council President Ben Stuckart and City Councilwoman Lori Kinnear now are among the executive team, which includes Rick Romero from Mayor David Condon’s office and Parks Board members McGregor, Greta Gilman, Avista Corp.’s Speed Fitzhugh, and Eadie.

“It’s a scheme because it’s a power grab by (city) council to get control of the park,” Dunau says. “I don’t support it all.”

Eadie denies that claim.

“The change to the executive team, since Andy’s time, is the inclusion of two City Council members to increase collaboration,” Eadie says.

Dunau says Riverfront Park typically operates with an annual $1 million deficit.

“As an enterprise fund, the park is no longer entitled to the general fund,” he says, while asking, “So where does the money come from … police, fire, and other local needs?”

Again, Eadie refuted Dunau’s claims.

“Parks and Recreation is defined by the city charter to receive 8 percent of the general fund each year,” he says. “Riverfront Park, as part of Parks and Recreation, cannot draw additional funds from the general fund, so there would be no impact to police, fire or any other department.”

With park improvements still three years away from being completed, the Park Board held a special meeting Sept. 29 regarding Riverfront Park’s operational future.

Jonathan Moog, Riverfront Park director, says, “We want to be able to put the park in a position where 40 to 50 years from now, we’re not going to have to come back to the public and ask for subsidies for the park. We want to leverage the park to be able to bring in additional dollars in a way that we haven’t done before.”

At the meeting, Eadie and Romero presented to the board and staff the four different funding alternatives to be considered for operating the park in the future.

Potential alternatives to establishing an enterprise fund include keeping operations the same, placing it into a conservancy, or creating a public development authority, Eadie says.

McGregor says it was his impression that Park Board members are leaning toward the creation of an enterprise fund.

“The enterprise fund idea is just simply easier to establish than a conservancy or a PDA,” McGregor says.

Moog says the goal of an enterprise fund would be to bring corporate shareholders into the funding mix as sponsors to assist with park support and programming.

Moog says he wants to see Spokane emulate the model the city of Houston used in creating an enterprise fund for its Discovery Green park.

“They developed partnerships and sponsorships with the business community,” Moog says. “In doing that, they’ve been able to operate a park that is free, or at low cost to the public for events.”

He adds, “And that’s something that we want to make very clear. We will continue to keep Riverfront Park accessible to the public.”

Eadie says development of an enterprise fund would be a phased approach.

“We’re not expecting it to be self-sustaining until it’s fully open and operational for a time. Even then, it may be a hybrid enterprise fund model,” he says.

For example, the Park Board might define the Riverfront Park enterprise model to exclude maintenance and grounds and cover those costs from the Parks and Recreation budget, Eadie says.

Riverfront Park hosted roughly 40 events per year before construction started last year. Eadie says park officials estimate that figure will have to at least triple as part of the effort to generate more revenue.

“That’s why it’s going to be crucial to have partnerships with organizations and businesses around town. We’re going to be reliant on them for programming,” he says.

Dunau says he struggles to believe Riverfront Park can generate up to $6 million in revenue on its own.

“Their numbers on the face are nonsense,” he says. “That’s a lot of figure skating.”

As for the other operating options available to the Park Board, both McGregor and Eadie say neither feels compatible with Riverfront Park.

“In establishing a conservancy, you’re turning that over to a concern, and there was the sentiment that we don’t need to do that,” Eadie says. “And then in establishing a PDA, now you have an entity that is much more revenue driven in its focus. Now the park becomes less free and open.”

Adds McGregor, “Creating an enterprise fund feels more evolutionary, where a conservancy and creating a PDA are more revolutionary, and we’re not advocating that.”

Next month, the first project funded through the bond measure, a new ice rink, will be unveiled at the southwest corner of the park. Construction of the ice rink, called an ice ribbon because of its design, started in January. An accompanying skating pond will be located south of the Skyride facility.

The ribbon will be 650 feet long and 16 feet wide with slight increases and decreases in elevation. The rink and accompanying ticket office project cost $9.4 million, says Fianna Dickson, Parks and Recreation communications manager.

City officials on Oct. 17 will announce the ice rink’s scheduled opening date for next month, Dickson says.

Construction also continues on the $10.2 million Looff Carrousel project. Spokane-based Walker Construction Inc. is the contractor on the project, which is expected to be finished early next year.

Prior to the project, the carrousel drew 500,000 riders per year. Until the new building is finished, the carousel rides are being refurbished and stored at another site, Dickson says.

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