By Jensen, Randy on May 13, 2020.
The Enmax Centre is better off staying under existing City management and public ownership, while pivoting toward a more for-profit business approach, rather than being sold or privatized.
This is what representatives of the current management unit of the Enmax Centre told city councillors at Monday’s Community Issues Committee meeting.
Referencing last fall’s KPMG operational review report on the Enmax Centre, which had recommended the City consider divesting the asset or turning it over to private management or an arms-length board, the Enmax operational review team, headed by general manager Kim Gallucci, Drew Ginther and Jennifer Norsworthy, told councillors there were profound flaws in KPMG’s methodology when coming to its conclusions about the viability of privatizing the Enmax Centre.
Ginther noted when the review committee had tried to follow up with KPMG’s examples from other cities either those city management teams were non-responsive or were not directly comparable to the Enmax’s operating model. And those that were, like Medicine Hat’s Canalta Centre, which had pursued privatization had, in the past few years, reverted those facilities back under city control.
“Our conclusion is the way it is running today would probably be ideal,” said Gallucci. “Most communities base it on what their needs are; so some do private management because they can’t attract the right people to operate. Some do it because it is easier for them; they want it arms-length away. Here, we’re looking at it as we are part of the community and we are a community builder. We look at it as something we do to help draw in talent and attract high-calibre shows. We’re more community-minded that way; so that’s why we call it a Lethbridge-made solution. It’s to try to meet the demands of a for-profit model, but still be that community builder.”
The Enmax operational review team went to their bench and brought out the big guns on Monday to convince council the City should retain direct control: prominent local concert and events promoter Ron Sakamoto and Lethbridge Hurricanes general manager and WHL executive of the year Peter Anholt.
Both Sakamoto and Anholt endorsed the Enmax Centre’s current management team, and championed the position the Enmax should remain under direct City control and pivot toward a more for-profit model. Both endorsed the idea of paid parking at the Enmax Centre, pegged at about $5 per vehicle, as a way of generating income. Sakamoto said people may “whine about it” but it was standard at almost every other event centre where he hosts concerts.
Altogether, Gallucci stated, by taking a more for-profit-focused approach he expected the Enmax Centre could reduce its dependence on direct taxpayer subsidies by $1.5 million per year as of 2023. He said while his operational review committee found KPMG’s recommendations flawed, the Enmax Centre appreciated the perspective the report brought to its management team. They had already been working on new models on how to generate more revenue prior to the report coming out, Gallucci said.
“The KPMG review gave us a chance to really focus on them,” he stated, “and where we can improve, and what we can do (to generate more revenue). We have spent the last four years trying to figure out what works and what doesn’t. We’re in a great place to know what can be successful, and what can’t be successful, and really increase events in the right place and right location.”
Pivoting toward a more for-profit model will mean hard choices in the future, said Gallucci, like the aforementioned paid parking decision, but he acknowledged it was the direction the Enmax Centre must go.
“What that means is we would take a for-profit model approach, which is really assessing everything based on if it is profitable or not,” Gallucci summarized. “Sometimes we have done things that were good for the community, but in this case we would now say: ‘Is it good for the community? And also is it profitable?'”
City council will discuss what it plans to do about the Enmax Centre’s future at its June 1 public meeting.
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