Truth
On Tuesday, the Elkhart Parks and Recreation Board will begin the process of bonding to rejuvenate the Elco Theatre and turn the Sorg property into an event space to help support it.
The city is moving forward without a larger public discussion of the plan, with only the recommendation of the 400 Block Commission. While we laud the proposal and the work put into it by the dedicated group of business and community leaders who formulated the plan, we continue to maintain that a $13.5 million renovation project is something that must be aired fully before the public and OKed by the next city council and administration.
Last week's three-part series on the Elco by Truth reporters Jason McFarley, Bridget Levitz and Marcia Fulmer revealed much about what city taxpayers will face in the coming years if they enter into this journey.
Similar theaters in Anderson, Ind., and Waukegan, Ill., were beset with financial concerns. In Anderson, the Paramount Theatre is still trying to gain financial ground 10 years after its grand opening and must rely on volunteer help and funding from the city to make ends meet.
It's being touted as the model for the Elco restoration by the 400 Block group.
The pricetag of Waukegan's renovation rose $10 million just months into the project.
Both cities, just as Elkhart, are hoping their theaters will keep their downtowns thriving. Both show promise, but at a price -- taxpayers are clearly supporting the facilities in one way or another.
The proponents of the Elco plan say that taxes will not be raised to renovate the theatre. Currents bonds will be rolled over and the city's annual contribution from its budget will remain the same -- about $270,000.
That is, of course, if the conservative numbers in the business plan developed for the theatre and event space hold up once everything is operational. No one denies the theatre by itself will ever be self-sustaining. Construction of the event space is necessary for it to even come close to breaking even.
The business plan shows a projected loss in the first year of construction, with a net income in the next three years of construction ranging between $101,000 and $308,000. Income actually goes down as the theater and flex space open and a full staff is hired.
The business plan estimates 35 events in the flex space in the third year and 48 in the fourth year, almost one per week. That's the money-maker for the entire project, generating about $320,000 by that fourth year. That's as far as they've projected.
We think the numbers are overstated.
As The Truth's analysis showed, there is a lot of competition in northern Indiana and southwestern Michigan vying for similar and higher-caliber shows.
Sure, there's been a need for meeting space and a convention center has long been discussed, but has never come to fruition. This will not be a convention center.
We care about Elkhart's downtown. The Truth is part of the downtown neighborhood and we take pride in being here. We want to see it thrive as much as everyone else.
But we're concerned about the long-term financial viability of these facilities and the ongoing burden on the taxpayers. We're especially concerned that average residents in the city of Elkhart have not been -- and will not be -- heard on this issue. If they are willing to accept the cost, we'd like to hear them say it.
So, the question that the people of Elkhart must be allowed to answer, is "is the Elco Theatre worth saving, knowing there will be a cost to the taxpayers in perpetuity?"
People need time to answer.