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About this blog: I am a native of Alameda County, grew up in Pleasanton and currently live in the house I grew up in that is more than 100 years old. I spent 39 years in the daily newspaper business and wrote a column for more than 25 years in add...  (More)

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Big theater still looms in Livermore

Uploaded: Sep 25, 2012
Livermore residents as well as people throughout the valley probably took little notice of the actions in July by the successor agency to the city's redevelopment agency.
Back in 2009, the City Council had approved an agreement with the Livermore Valley Performing Arts Center to have the redevelopment agency invest in the 2,000-seat regional theater that the non-profit wants to build and operate in the now almost vacant block between Railroad Avenue and First Street, bounded by Livermore Avenue and L Street.
Those plans could have been knocked off target when the Legislature followed Gov. Brown's request and abolished redevelopment agencies as part of the budget balancing exercise in 2011. The governor was rightly concerned that redevelopment agencies had wandered far from the original intent of the law and were being used to build convention centers, stadiums, arenas and performing arts centers. One reason for Stockton's bankruptcy was the absurd expenditures in the downtown marina, arena and minor league baseball park.
The law, appropriately, required that existing obligations continue to be paid and set up oversight boards to allocate and monitor tax revenues to do so. Redevelopment plans have bonded against the increased property values driven by public improvements and then repaid the bonds using revenue from the higher property taxes. It was this diversion of funds that concerned the governor because the state had to make up revenues for education.
The Livermore oversight board consists of Supervisor Scott Haggerty (chair), City Councilman Stewart Gary (vice chair), school trustee Bill Dunlop, city housing expert Eric Uranga, Planning Commissioner Todd Storti, Isabel Dvorsky from the Chabot Las Positas Community College board and park district director Beth Wilson.
This group determined that the redevelopment agency had committed $205 million that needed to be repaid. Nearly three-quarters of that, $146 million, is for debt that has yet to be incurred for the regional theater. The agency has purchased the land—although it did so for a vastly different project than the regional theater. It has leveled the old Lucky shopping center causing the best downtown restaurant in Livermore (the Railroad Café) to relocate to the Nob Hill Shopping Center on Stanley Boulevard where its business continues to thrive—quality will do that.
No contract has been let for theater construction or related improvements beyond the razing of the existing buildings, yet this group of theater-backers has set up this questionable project to move forward should the majority of the City Council maintain its steadfast support for this project.
Mind you, the theater is designed to compete with the offerings at the Golden Gate and Orpheum theaters in San Francisco—we're not talking about batting heads with the downtown Walnut Creek theater. Wente's summer concert series, which has shrunk to a significantly more modest number of events due to the fierce competition from the Indian gaming casinos, operates in a tight niche. The regional theater is sized to compete head-to-head with the San Francisco theaters.
Downtown San Jose operations, despite the significant wealth in the Silicon Valley, certainly struggle to compete with San Francisco.
Yet, the Livermore visionaries along with the politicians who are the enablers are still willing to put the city's general fund—which ultimately stands behind the project—at risk if they move ahead with this plan. Remember, Livermore laid off police officers and closed a fire station (since re-opened) to bring its budget into balance when revenues cratered in 2008 and beyond.
History has demonstrated that the city, despite the substantial new revenues that are expected to flow from the Paragon upscale outlets at El Charro Road and Interstate 580, has far less margin in its revenue stream than some of its neighbors such as Pleasanton.
Livermore residents would be well advised to pay close attention—given the lack of coverage by the news media—they're going to have to follow the city's agenda and the oversight group's closely to know what their leaders—elected and not—are doing with their tax dollars.

Comments

 +  Like this comment
Posted by David, a resident of Livermore,
on Sep 25, 2012 at 2:39 pm

Thank you for highlighting this. It is difficult to get up to date information on the actions regarding the proposed theater project. This proposal is a terrible idea. The Bankhead theater can barely sell out even with a reduced calendar. How on earth did these theater advocates delude themselves that a new facility will be economically feasible? It sounds to me like the proponents have their own egos tied up in their dream of the big time theater.


 +  Like this comment
Posted by Rich Buckley, a resident of Livermore,
on Sep 25, 2012 at 3:30 pm

If I understand the Bankhead budget, the management appears to do a very good job of being creative in filling seats. While the average seat sales for the our size operation is about 60% nationally, I understand our Bankhead management team keeps ours over 70%. Roughly that's about $1-million a year in ticket sales (..and I could be wrong, I don't have source documents on those items). However, it does take another $1-million a year to maintain that creative high level of sales.

What we need to do is focus on raising about $1-million a year to operate the Bankhead utilizing all the creative marketing ideas the core employees and the large community volunteer staff provide.

If the Regional Theater project is dead, we still want very much to keep our Bankhead thriving, creatively marketing tickets and getting us that extra 10% to 20% margin. It's good for downtown local businesses.

I think we could work around many of our political city problems if we started quarterly placing our budgets in great detail, on line, perhaps somewhat like this:

Web Link

:-)


 +  Like this comment
Posted by Len Alexander, a resident of Livermore,
on Sep 25, 2012 at 3:40 pm

David,

Over the past five years, the Bankhead Theater has hosted/presented more than 900 performances/events; had 337,000 attendees including 75,000 students; grossed approximately $6MM in tickets sales; returned $4.8MM of those receipts to local non-profit arts groups; hosted 28 free outdoor Friday Nights Live! concerts; and, created an annual $3.5MM in economic stimulus for downtown Livermore. In the most recent season, LVPAC Presents attractions played to 82% of capacity and all events in the Bankhead played to 78% of capacity. In addition, LVPAC has more than 2,300 donors, members and sponsors and 975+ volunteers who believe that the Bankhead has made a significant contribution to our community.

Len Alexander
Executive Director/LVPAC


 +  Like this comment
Posted by Rich Buckley, a resident of Livermore,
on Sep 26, 2012 at 10:09 am

Wow Len, that's really a high occupancy rate at 82%! I knew it was over 70 percent which in and of itself is significantly above average for other similar size facilities as a result of your marketing team.

The point I wanted to make is that without a creative (your creative) marketing team coming through with all these ticket sale concepts and diverse entertainment programs, our Bankhead will likely settle back downwards to a significantly lower tier operation in ticket sales and the downtown will feel this shift for quite some while in its wake. High ticket sales performance is a constantly changing environment.

Management critics may not realize the Bankhead has lost a very significant chuck of its revenue stream as a result of the State of California closing all redevelopment districts.

That lost revenue to the Bankhead's operations presents an immediate direct challenge to the community in the order-of-magnitude of nearly $1-million per year. If this perception is significantly incorrect, i.e., that we need to generate a replacement source for the $1-million a year Redevelopment Agency lost contribution, please correct me.


 +  Like this comment
Posted by Len Alexander, a resident of Livermore,
on Sep 26, 2012 at 12:36 pm

Rich,

Thanks for your kind words about attendence at the Bankhead.

With regard to the future impact of RDA related issues on LVPAC's operations, it's still too early to tell. We believe that our legal agreements with the City of Livermore's former RDA (and the City itself) will be upheld and that the Regional Theater will proceed as planned.

However, if the larger theater is delayed or abandoned, then there will indeed be a financial challenge to maintain the viability of both the Bankhead Theater and the Bothwell Arts Center, although not at the magnitude of $1MM per year.

We are hopeful that these issues will be resolved in the coming weeks so that a successful path forward can be determined. Thanks for your concern and support.

Len Alexander
Executive Director/LVPAC


 +  Like this comment
Posted by Carolyn Lord, a resident of Livermore,
on Sep 28, 2012 at 12:02 am

Tim,

I always enjoy reading your long-view summaries of valley politics and its players.

Considering this weeks topic on Livermore, I think you'll enjoy my painting of the empty lot where the Lucky's and Railroad Cafe used to stand, as well as the accompanying blog.

Web Link

I resonated with your admonition to remain vigilant. Most press coverage is scarce or disingenuous. The bi-monthly Oversight Board meetings are held during the day and are regularly cancelled.

The city staff and council defends the fiduciary commitment to LVPAC because it is an "enforceable obligation". An synonym of obligation is duty, which suggests a moral or ethical motivation.

Is it the City of Livermore's moral duty to pay for private business concerns? Is it ethical to commit the city's money without the consent of the governed?





 +  Like this comment
Posted by BH, a resident of Livermore,
on Sep 28, 2012 at 3:26 pm

Glad to see you're still writing, Tim. The Herald made a big mistake when they lost you!
On this topic, I vaguely remember that years ago, when the big theater was first mentioned,the City Council promised that they would not risk using the General Fund for the big theater. It was at a public meeting, a regular Council meeting as I recall, and they all agreed on that issue: the General Fund would remain safe, separate from any funds used for the theater. I remember that Marj Leider was on the Council at that time, so it was a while back.
So now they're ready to risk the General Fund, saying that they can't undo what a previous Council did in promising LVPAC that the funds for the theater would be there. If they can undo what a previous Council did in their promise to not risk General Funds, why can't they undo what a more recent Council did when they promised funds no matter what? It seems like they can undo or not, at their discretion.
Where am I wrong here?


 +  Like this comment
Posted by Rich Buckley, a resident of Livermore,
on Sep 28, 2012 at 7:44 pm

Agreed, it was a breach of a strong political promise and an unacceptable political act from my small perspective. On the other hand it's my understanding the General Fund was also used to back the much larger project of new "Paragon" commercial center development to the cheers and roar of the crowd, so for me, the "ethics" are so convoluted, they loose me.

The deeper issue is for me is, I want detailed finances posted on line quarterly like this: Web Link

.... so we voters can get on top of what is being done to us easily!


 +  Like this comment
Posted by I agree, a resident of Another Pleasanton neighborhood,
on Sep 29, 2012 at 12:42 am

Maybe it is indeed an ego thing, but why do city's continually want to risk taxpayers' money being siphoned off to support Performing Arts Center and Sports Arenas/Complexes? This is a big mistake be in the Concord Pavilion (or whatever it is called these days), the Sharks Ice Arena or the Livermore performing arts theater.

Also, given the large number of local venues such as the Dougherty Valley Performing Arts Theater, how can so many venues be self-sustaining financially?


 +  Like this comment
Posted by Rich Buckley, a resident of Livermore,
on Sep 29, 2012 at 6:13 am

I know nothing when it comes to the finances of the 2000 seat theater. Embarrassingly shameful as I admit that to be, is it "all" my fault that I am this ignorant on city finances? I'm on the City of Livermore website weekly and never find anything easy to read and understand on the viability of regional theaters. Yes-yes, I know, "They had hearings and where was I?" So how is the average voter who has far better things to do with their time, able to relate? They can't. Who's fault is that?

I believe we are rapidly emerging out of a cultural malaise aided in part by the thesis of "openness and transparency" we each so desperately desire in our government, but rarely find. City managers and their department heads feel stripped naked in public to have the insider's information spead around on the Internet. I submit the only trigger that will pry loose our inherent self interest to hide what we know and share community data with the community as a whole is to foster quarterly, ENTERTAINING on line, in depth reviews by community volunteers who my have to be backed up by a mandate from elected officials.....else city officials well read their jobs as "business as usual, 3-Card Monty game of perpetual deception" as seems to be the current status.

Web Link





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