Government

More News | | | Editor

Mayor warns of larger losses at Augusta Convention Center

  • Follow Business

If critics are concerned about the city losing money at the Augusta Convention Center, they should consider the long-term impact of having to cancel conventions, Mayor Deke Copenhaver said Friday.

“If we do not put in place a management agreement, we will start to lose bookings and we will stigmatize the facility, leading to major long-term losses for the city,” the mayor said.

The Augusta Convention and Visitors Bureau, which received $350,000 in city dollars to pre-market the facility, and Marriott officials already have booked 13 conventions at the 38,000 square-foot center, also known as the TEE Center, with the first event scheduled for late January.

Critics, including several commissioners, have taken issue with details included in proposed operating agreements between the city and Augusta Riverfront LLC.

The firm, which shares management with Morris Communications Co., owner of The Augusta Chronicle, runs the adjoining Marriott and was designated at the time the convention center project was approved to become its operator.

With critics speaking out against the agreements last week, a vote to approve the 15-year management agreements failed 5-2, with commissioners Wayne Guilfoyle and Corey Johnson against. The body will reconsider the documents at a meeting Monday at noon.

Guilfoyle, who offered an alternative motion last week for a shorter agreement with Augusta Riverfront, maintained that the documents up for approval Monday offer too few ways to control costs. Under the proposed agreements, the city pays Augusta Riverfront a flat rate to run the convention center and cater its events, but also shoulders all losses, which Augusta Riverfront President Paul Simon said could surpass $900,000 during 2013.

“The reason I made that motion is what it does is give us a snapshot of the 2013 budget to see how the next 14 years could be controlled,” Guilfoyle said, giving no signal Friday he’d become the sixth vote to pass the agreements as written. “I think another workshop needs to be done.”

Among critics’ concerns are that a new kitchen, to be shared between the Marriott and convention center, would be used to prepare food for the hotel, shifting that expense over to the city, or that Augusta Riverfront’s sale of the franchise would leave the city at the mercy of its new owners.

“It’s a lot easier to do any kind of changes now than later,” Guilfoyle said.

While Marriott staffers operated a nearby new parking garage on a month-to-month basis while commissioners similarly haggled over the operating agreement, Copenhaver said the hotel chain was unlikely to agree to the same for the convention center.

“I don’t think that gets any traction,” he said. “On the parking deck, that short-term option didn’t work out too well. What was supposed to be short term... drug on for a year.”

Copenhaver said he was reminded of the North Georgia Annual Conference of United Methodists’ 2002 decision to cancel a conference at James Brown Arena after experiencing poor service and conditions. While arena management has since been turned over to Global Spectrum, a subsidiary of Comcast, the Methodists continue to bring up the decade-old problems for the reason they won’t return.

“The domino effect is a scary proposition,” he said. “It’s basically like Congress on sequestration driving us toward the fiscal cliff. It’s the local equivalent of that.”

Commissioner Jerry Brigham, who supported approving the documents last week, said he expected them to keep coming back until approved.

“In the long run, we want to get into the tourism business,” Brigham said. “I think that’s one of the few things we can do to improve the economy around here, to increase our tourism business.”

Nov. 6 elections could replace four of the commission’s 10 members, so if the agreements aren’t approved by January, the newcomers will be tasked with examining the complex legal documents and making the decisions.

Copenhaver said he hoped the decision came sooner.

“The big picture is the long-term losses, and stigmatizing the facility out of the gates,” he said.

Comments (37) Add comment
ADVISORY: Users are solely responsible for opinions they post here and for following agreed-upon rules of civility. Posts and comments do not reflect the views of this site. Posts and comments are automatically checked for inappropriate language, but readers might find some comments offensive or inaccurate. If you believe a comment violates our rules, click the "Flag as offensive" link below the comment.
dichotomy
34491
Points
dichotomy 10/26/12 - 07:43 pm
6
1
“The big picture is the

“The big picture is the long-term losses"

Mr. Mayor...seems like we already have a huge long term loss and it's the contract to operate the thing.

Go with Commissioner Guilfoyle's recommendation or get another firm to run it while you bid it out for a 5 year contract.

Insider Information
4009
Points
Insider Information 10/26/12 - 07:51 pm
8
0
I will NEVER ever ever stay

I will NEVER ever ever stay at another Marriott.

They have absolutely no involvement in this deal, so who cares what they think?

The Marriott is like the dirty old man creeping into the locker room. Ain't got no business being there.

Riverman1
87034
Points
Riverman1 10/26/12 - 11:01 pm
8
1
Great Idea

By golly, our hapless Mayor has finally come up with a great idea even if he doesn't know it. "While arena management has since been turned over to Global Spectrum..."

Global Spectrum is ready and willing to take over management of the TEE Center.

Bless his heart, Deke thinks a balance sheet is something you lay on the beach sand and put your surfboard on to practice.

Riverman1
87034
Points
Riverman1 10/26/12 - 09:04 pm
7
1
Heartbreak Hotel Chain

"While Marriott staffers operated a nearby new parking garage on a month-to-month basis while commissioners similarly haggled over the operating agreement, Copenhaver said the hotel chain was unlikely to agree to the same for the convention center."

Oh, so it's a hotel chain with little regard for our concerns? Sounds like the No Tell Motel. Just sign, pay and no one asks any questions.

F4therTime
4656
Points
F4therTime 10/26/12 - 09:30 pm
6
0
Ok I have
Unpublished

No problem with a management agreement but not just to have one. It cannot be a one sided deal. So far, this whole TEE center crap is a one sided deal for everyone except Augusta.

Insider Information
4009
Points
Insider Information 10/26/12 - 10:26 pm
8
0
If the Marriott wants to

If the Marriott wants to insert its nose where it doesn't belong, how about we respond with a protest in front of its hotel?

If the Marriott is claiming to have a right to the TEE Center, then the TEE Center (AKA the public) has a right to the Marriott.

Who is in for an old-fashioned protest?

I'm sure their guests would love it.

Riverman1
87034
Points
Riverman1 10/26/12 - 10:44 pm
4
1
Jan. 27th

Insider, great idea. I suggest it be on Jan. 27 or 28 when the first convention is there. Wouldn't that be something. An effective way to tell all concerned how we feel.

By the way, the 12 (not 13) events scheduled run through 2015. The occupancy rate is abysmal even though we will keep paying all these maintenance, utilities, management and promotion fees.

Riverman1
87034
Points
Riverman1 10/26/12 - 11:27 pm
4
1
Future Owners of Marriott

What happens when the Marriott is sold? All these agreements go with it. All these promises of local people not doing anything that will cost the city more money will mean absolutely nothing.

The owners of the LLC will one day leave this to their offspring at the least if they don't sell far before that. You know how inheritances are divided and sold off. Later owners will simply demand adherence to the written contracts.

I mean to tell you this whole TEE Center deal has been like having backstage passes in Charleston for Hurricane Hugo. A disaster of monumental proportions.

Conservative Man
5577
Points
Conservative Man 10/27/12 - 12:53 am
5
0
Bottom line.....

.....who negotiated the deal on behalf of the city?....

.Jim Plunkett and Fred Russell..

Jim Plunkett can't be "fired" ..per se. But he can be denied future business....Fine...

But Fred Russell CAN be fired. Or at least asked to submit his resignation.....

I'd prefer the former...but I'd accept the latter .......

KSL
134725
Points
KSL 10/27/12 - 02:42 am
3
1
Is it just me?

The headline made me laugh out loud when I saw it on the list.

KSL
134725
Points
KSL 10/27/12 - 02:50 am
3
1
Has it gotten too cold to be

Has it gotten too cold to be at the beach?

Tullie
2930
Points
Tullie 10/27/12 - 04:30 am
2
0
Riverman said: By golly, our

Riverman said: By golly, our hapless Mayor has finally come up with a great idea even if he doesn't know it. "While arena management has since been turned over to Global Spectrum..."

You moved?

KSL said: Is it just me? The headline made me laugh out loud when I saw it on the list.

I didn't LOL..but I did smile. I had to read this posting first to see what horrible thing has popped up now.

If we do not put in place a management agreement, we will start to lose bookings and we will stigmatize the facility, leading to major long-term losses for the city,” the mayor said.

The management agreement should have been put in place a long time ago. They are trying to rush it through at the last minute hoping everyone is too stupid to notice that everything is to their advantage.

“It’s a lot easier to do any kind of changes now than later,” Guilfoyle said.

Mr. Guilfoyle, you have earned my respect. Thank you for trying to look out for Richmond County. I agree with those words. Changes would be impossible to be made after the fact. Anything agreed to will be pointed at constantly. Everything needs to be looked at with a fine-tooth comb.

rebellious
21297
Points
rebellious 10/27/12 - 05:24 am
3
0
Absurd

,“If we do not put in place a management agreement, we will start to lose bookings and we will stigmatize the facility, leading to major long-term losses for the city,” the mayor said.

So $900,000 annual losses is what......chicken feed? Yes let's sign this agreement today so we limit our losses to 900k a year. If we delay, shucks we could end up losing more, like maybe a million a year. It is hard to believe he would say that!

It would be interesting, just for comparison sake, to find out what the debt repay and service would be if we mothballed the thing. Then we could see the projected losses in true light.

Keep holding out for a better, shorter term agreement Commissioner Guilfoyle. The vote was 5-2. Where are the absent 3 Commishes on this? Might wanna be lobbying to be sure they ain't gonna roll over on you.

This urgency Deke et al have reminds me of the way car salesmen (apologies to them for the comparison) try to rush you into signing the papers without explaining the details. Does this agreement have a Carfax we could see?

omnomnom
3964
Points
omnomnom 10/27/12 - 05:41 am
5
0
"In the long run, we want to

"In the long run, we want to get into the tourism business”

hehe, i thought we were privatizing everything to get out of business and leave business to business.

Nightmare on Reynolds Street.

Tullie
2930
Points
Tullie 10/27/12 - 07:10 am
4
0
Sums it up

omnomnom said: Nightmare on Reynolds Street.

seenitB4
90980
Points
seenitB4 10/27/12 - 07:45 am
4
1
When the mayor says this...

“If we do not put in place a management agreement, we will start to lose bookings

Haven't we heard those words B4....like in Obama care....pass it before we can read it....Nightmare is right!

nocnoc
45088
Points
nocnoc 10/27/12 - 08:16 am
4
0
SURPRISE !We already have in

SURPRISE !
We already have in place, a group that handles conventions, sporting events, entertainment venues and more, for VERY large crowds. Something called the Augusta-Richmond County Coliseum Authority which oversees such locations as the James Brown Arena.

QUESTION
Anyone have the current names of the 14 people on the Augusta-Richmond County Coliseum Authority Board? The A-RC website for some reason does not list the names. http://www.augustaga.gov/index.aspx?NID=559.

soapy_725
43772
Points
soapy_725 10/27/12 - 08:13 am
0
0
What's with all of these five syllable words.....
Unpublished

the Deekster is beginning to sound like Jesse Jackson. Stigmatize, sequestrate, underutilized....

Who is writing this stuff for him, Paul or Billy?

soapy_725
43772
Points
soapy_725 10/27/12 - 08:16 am
0
0
Save the T rallies
Unpublished

Get Governor Raw Deal to head up the movement. The power of the court of public opinion. Take it to the streets. Invite HLN and CNN. Tell them it is crime against the poor and non whites.

gildea09
57
Points
gildea09 10/27/12 - 08:18 am
2
0
possible 1st loss

Georgia Chiefs of Police have already sent notice to the CVB, that if no contract is in place by COB next tuesday they intend to cancel and start looking for a new venue somewhere else. They are supposed to be the first event in the TEE Center.

soapy_725
43772
Points
soapy_725 10/27/12 - 08:19 am
0
0
Poor citizens repeated raped by local
Unpublished

power brokers and their lackey politicians. Birth rates and hospital visits rise resulting in windfalls profits for hospitals. Coincidence?

soapy_725
43772
Points
soapy_725 10/27/12 - 08:22 am
0
0
Turn the TEE
Unpublished

into a gambling casino. Now that would bring some tourism. Or maybe not. The locals skimming of the top would undoubtedly bring bankruptcy. The skim everything else.

...point to ponder
760
Points
...point to ponder 10/27/12 - 08:24 am
3
0
... The city(us citizens) had

... The city(us citizens) had the worst possible legal representation / negotiating team during this entire ordeal.
The Mayor's recent warnings about losses needed airing a few years back...not at the last minute.
*the convention center is a great asset to our city but the folks who have overseen the different agreements on OUR behalf have fallen short in their fiduicisry duties protecting the interest of the taxpayer.
*this one sided agreement never really disturbed the Mayor or the Administrator....they seem to not care what the agreements cost the taxpayers ....
I've said before that this last minute dealing with the details (*details that went unnoticed for quite some time) are the things that kill deals....sad commentary in a city that has so much talent but I guess greed will always trump the taxpayer/citizens. Very sad Mr. Mayor.... You should have been on top of this earlier.

Insider Information
4009
Points
Insider Information 10/27/12 - 09:10 am
3
0
Deke's blame game...

When the TEE Center fails (and it will), Deke blames criticism of the operating agreement, not that the TEE Center itself is failure.

When construction costs skyrocketed for the Marble Palace, Deke blames a lawsuit criticizing the bidding process, not that the winning bidder conveniently forgot about ADA standards.

When Deke fails, he blames his critics, rather than himself.

Riverman1
87034
Points
Riverman1 10/27/12 - 09:30 am
1
1
Tullie, what do I have to do,

Tullie, what do I have to do, rent a room downtown?

PghSteelersFan
140
Points
PghSteelersFan 10/27/12 - 09:37 am
2
0
In these comments, I have

In these comments, I have noticed a few things which need addressing.

One is 'Marriott'. While I prefer Hilton Hotels over Marriotts, the building is only 'branded' Marriott. The Marriott Corporation has given someone or company the right to use their name as a franchisee, Marriott Corporation doesn't get involved in 'local matters' unless the 'brand name' is being abused. In this case according to tax records, the building owners are Augusta Riverfront LLC.
Second, someone mentioned when the current owners of Augusta Riverfront LLC pass away there will be problems with inheritances. I believe that Billy Morris' children are already involved in Morris Communications. I would also think the LLC's majority owner is Morris Communications Inc (this can be checked with the Georgia Secretary of State's Offices). I don't think there will be any 'inheritance issues'.
As for the contract, I agree it seems as if there is a 'push' going on somewhere behind the scenes while the name(s) of the 'pusher(s) is not being revealed.
To try to pass a 'sweetheart' deal at this late date is not in the best interests of the City/County. This 'agreement' should have had 'public input', a public bidding process, and a final agreement signed with someone long before now. It is a failure of the City Manager not to have ordered public meetings or follow the bidding process. It seems this particular concession along with the operations of the parking deck were 'decided' by someone and the decision was final. The City/County Commission is expected to just 'rubber stamp' the whole thing. I would have to ask an attorney knowledgeable in public domain laws but perhaps someone violated the law by not having public hearings and a public bidding process for the entire project (Parking Operators, Food Service, etc) since taxpayer money is involved.
I also found it interesting the City proceeded to build a parking deck with public funds when they didn't even own the land the deck was sitting on. I did see this was corrected when it went public about the failure to own the land. At least something was corrected by public pressure.

Riverman1
87034
Points
Riverman1 10/27/12 - 09:40 am
1
1
Deja vu

This hurry up, bum’s rush, by Deke saying conventions won’t come if we don’t approve the agreement is eerily similar to the hurry up and approve the building of the TEE Center or the hotel won’t be built. That’s the hotel that was never built if you are wondering which one.

Riverman1
87034
Points
Riverman1 10/27/12 - 09:46 am
1
1
"I would also think the LLC's

"I would also think the LLC's majority owner is Morris Communications Inc (this can be checked with the Georgia Secretary of State's Offices). I don't think there will be any 'inheritance issues'."

I doubt Morris Com. would be involved in this LLC. An LLC protects assets. Morris Com has debt issues and they want to keep their problems separate from this LLC. If Morris Com were majority owner and their debts were called in, then the the LLC would definitely be under a yankee owner in Philadelphia or somewhere.

Insider Information
4009
Points
Insider Information 10/27/12 - 09:57 am
2
0
@ PghSteelersFan

Actually, the Marriott Corporation has been involved and has been making demands from throughout this debacle.

Case in point?

It wasn't Riverfront LLC demanding the city install Marriott-approved toilets at the TEE. It was Marriott.

Marriott demanded all fixtures meet its approval.
Marriott demanded the HVAC system meet its approval.
Marriott demanded the fire system meet its approval.

And who is in Marriott in this contract? Nobody.

dichotomy
34491
Points
dichotomy 10/27/12 - 11:04 am
3
0
Bad and they knew.

This "contract" is SO bad they were afraid to make it public in time for discussion and review. They HAD to wait to the last minute so that it would be a "crisis" that they had to rush to get in place. Why? Because the contract is SO BAD and SO ONE SIDED that they knew any blithering idiot could see through it and any 6th grader could have negotiated a better deal.......unless they had been paid off or promised something in the future, after approval, when the dust settles.

"Copenhaver said the hotel chain was unlikely to agree to the same for the convention center." Did ANY OF YOU TAXPAYERS see the word Marriott on the SPLOST ballot that approved the first $20 million (of the $40+ million we actually spent) for this boondoogle? I personally don't give a flying flip what the Mariott thinks about this deal. They have invested NOTHING in this deal and will REAP ALL OF THE PROFITS. Who cares what the Marriott wants?

I don't care if they have to cancel ALL of the events next year in order to get a rational, fair deal for the taxpayers. What they are proposing is NEITHER. And signing a 15 year agreement with ANYBODY in this day and age is absolutely the DUMBEST thing I have ever heard. Not to mention the fact that the contract apparently has NO provisions for an "out" based on quality of service, sale of the Marriott, escalating losses, etc. Would YOU sign a 15 year "NO FAULT" contract for ANY service that you were buying? Would you sign a contract where the service provider invests NOTHING and YOU GUARANTEE to PAY FOR EVERYTHING....NO MATTER WHAT IT IS as long as the contractor can claim it is an operating expense. And there is apparently still the minor issue that we DO NOT OWN ALL OF THE LAND the thing is built on.

There was a day when any politician or public servant who got their constituents involved in a deal like this would have been tarred and feathered and run out of town.....or worse. When did we lose our backbone? Don't you wonder why the majority of our politicians are not listening to the outcry to reject this deal? Don't you wonder why they don't seem to be worried about being re-elected? Maybe they have been offered a better deal....later on.....after the dust has settled.

And where are the other 3 spineless commissioners who keep avoiding a vote on this issue? Are the hiding? Or are the STILL NEGOTIATING their PAYOFF for their vote.....as usual. If this deal passes, just watch which side of the fence they fall on and what they get in return a year of two down the road. Jobs? Property? Political and fianancial support for a run at the mayor's job? Another "redevelopment" project in their district?

My position is that NO DEAL is BETTER THAN A 15 YEAR BAD DEAL. And believe me, this is a VERY BAD DEAL. Paul Simon & "associates", and the Marriott, can stick it in their ear as far as I am concerned.

Back to Top

Search Augusta jobs