By Jeff Keeling
Johnson City Commissioners got an unpleasant surprise regarding possible investment in East Tennessee State University’s performing arts center (FPAC) Monday night when they learned interest expenses would be added to any contribution they might make to enlarge the center.
No longer, Mayor Ralph Van Brocklin told his fellow commissioners, would an $8 million contribution truly get the city $8 million worth of extra construction on the $40.6 million project – thereby bringing the main theater from 750 seats to 1,200. Instead, commissioners learned, an $8 million commitment to the FPAC would only get $5 million of construction – enough for increasing the state-approved theater size to 1,000, not 1,200.
Van Brocklin said that at a meeting earlier Monday, university officials told him the disappointing news, after long having been asked whether ETSU could cover interest on an $8 million gift from the city paid over 30 years (estimated at $4 to $5 million).
“The answer that we got today, finally, was that they really can’t,” he said, adding that the Tennessee Board of Regents was cool to the idea.
“The $3 million gets us nothing except borrowing power,” Commissioner Jenny Brock said.
Further, the figures provided are for payments from the city to ETSU over 20 years, and not the 30 years that had been discussed. Van Brocklin said he learned both of those things at a meeting with ETSU representatives earlier Monday.
Now, Van Brocklin said, the commission needs to reconsider in light of the new information on payment duration and interest. “The commission is going to have to weigh those things very carefully,” he said.
Less than two weeks ago, commissioners met with architect Doug McCarty and ETSU’s Jeremy Ross and first learned 1,200 seats would cost an extra $8 million. At that meeting, they also discussed projected benefits of taking the main theater space from 750 to 1,200.
A 30-year commitment with no interest would have allowed the city to commit 1 percent of its hotel-motel tax, recently increased from 5 percent to 7 percent, and essentially pay off the $8 million over 30 years. To fund $8 million over 20 years would cost $400,000 annually. In essence, agreeing to an $8 million commitment at this point would get the city a smaller-than-envisioned FPAC, with higher-than-envisioned annual payments to get there.
Commissioners were openly unhappy, particularly as the news conflicted with what they’d heard for close to a year.
“That’s disappointing, because 30 years was not presented as problematic,” Commissioner David Tomita said.
“And that question was asked directly, multiple times,” City Manager Pete Peterson said. “Thirty years was the answer I got multiple times.”
If a silver lining emerged, it was McCarty and fellow consultants’ answers to commissioners’ questions about what opportunities would be lost in a 1,000-seat theater versus a 1,200-seat one. The answer? Not many.
Robert Long, a consultant working with ETSU on the project that’s slated to be built next to the Millennium Centre, said the difference would be negligible. Beyond giving a promoter more seats to sell, he said, “the difference between 1,000 and 1,200 seats does not necessarily get you more and better performers coming through.”
Long also said bumping up from 750 seats should bring a return. “I do support that there will be more talent opportunities to come through to 1000 than would come to 750.”
Those opportunities probably won’t include Broadway shows, nor musicians at the peak of their drawing power, Long allowed – nor would they at 1,200.
Production-wise, Long said, shows along the lines of Chinese acrobats would be more realistic.
Music-wise, he added later, such a venue would typically draw, “somebody who’s on their way up, or somebody who’s on their way out.”
That still left Vice Mayor Clayton Stout sounding perturbed at the latest wrinkle.
“The last eight months it’s been preached how important 1,200 seats is,” he said. “This commission has been asked to give a gift to get to 1,200 seats, and now you’re only going to get 1,000 seats – it gives me heartburn that we’re hearing this.”
“We’re a little grouchy here,” Tomita added, attempting to let the messengers know they weren’t the source of the angst.
McCarty, who delivered the cost estimates Aug. 6, did produce studies from that meeting showing that a 1,200-seat venue could be expected to bring in about 13 shows in a year, compared to six shows for a 750-seat one.
Regardless of the commission’s decision, though, a new FPAC will be completed in Johnson City within several years, provided ETSU gets the last $1 million-plus required to reach its $10 million community match.
“Even if it stays at 750 the university will be programing events that will be available to the community,” Brock noted.
A decision isn’t expected before the commission’s first September meeting at the earliest.