2016-535-Minutes for Meeting November 09,2016 Recorded 12/2/2016DESCH
TES COUNTY OFFICIAL
UBLANKENSHIPRECORDS , COUNTY CLERKvY 2V���5�5
NANCY
COMMISSIONERS' JOURNAL 12/02/2015 02:45:22 PM
ItIIf1IiIiIIuIIIIIuI,ini
DESCHUTES COUNTY FAIR BOARD
MEETING MINUTES
November 9, 2016
David Bishop called the meeting to order at 1:33 with the following present, County Fair Board Members Cheryl
Davidson, Mike Schiel, Steve Curly, and Bill Kuhn. Also present were Tony DeBone, County Commissioner,
Tammy Baney, County Commissioner, Tom Anderson County Administrator, Erik Kropp, Deputy County
Administrator, Wayne Lowry, Finance Director, David Givans, County Auditor, Lee Randall, Interim Property &
Facilities Director, James Lewis, Property Manager, Dan Despotopulos, Fair & Expo Director and Tracy Scott,
Assistant Director, Roxia Thornton Todoroff, Director or Sales & Marketing and Elyse West, Sales & Marketing
Assistant, and Maarten Leunen, Operations Manager.
Approval of Minutes
Cheryl Davidson moved to accept the minutes, and Mike Schiel seconded the motion. Motion carried.
Introductions.
Financials:
RV Park: Dan said last year was a good year. This year started with a bang, we're coming into our slow time of
year. Projected to have another good year.
Fair & Expo: Last year exceeded budget.
Food & Bev: We should do about the same as last year. Busy time ahead. November will be a great month,
Monster Trucks was great. Holiday shows and wrestling classic still to come for November. December is looking
better. March will be phenomenal, which we had two months of March. Just booked FFA for the next two years.
Storage: Budgeted $60,000, first time ever we are full in one month.
TRT Update: Dan wanted to share with group how and where we spent TRT money and the return. Dan went
over the handouts RV Park Marketing expenses vs Revenues; and the Fair Expenditures and ROI, including Media
value since we do a lot of trade for advertising. Roxia went over the Sales & Marketing overview. Dan said we
feel we are spending TRT money well.
Dan told the group that we met with the carnival and we are looking at expanding the carnival. We would basically
have two carnivals. We will do wristband day every day, again. Also thinking about Dock Dogs in the same area,
and have other all about dog spaces. We have also increased the cost for vendor space in that area.
Bill asked Roxia about meeting space, and do we have enough space to accommodate large meetings like the St.
Charles. Roxia indicated that we definitely need a larger meeting space that will also have larger break out rooms.
Roxia also indicated that lodging is a big issue; we don't meet meeting criteria for a lot of meetings/conferences
because we don't have on-site lodging. Also, lack of divisibility, currently our existing meeting spaces do not have
big enough break out rooms to accommodate the number of people the larger area holds. Tammy said we could
bring a different caliber of meetings/events by investing in improvements.
Roxia said she had 22 new sporting event proposals out as a result of attending the TEAMS Conference. Steve
asked what type of sporting events? Roxia said several including, drone racing, robotics, strongman competitions,
kick boxing, disc golf, corn hole, archery tag, and cross fit. Roxia said we are on the map. We are having editorials
written about us in publications.
Bill said we should get out to the citizens the economic impact that the facility has on the community. This is really
important information and it has a significant benefit to the community. Dan asked for suggestions of how to get
the info out. Some suggestions were, press release and or in partnership with other community partners. Tony
suggested having the Redmond Chamber contact small business' within the community to step up and share how
much their business has improved/increased because of the Fair & Expo Center.
Bill thought we should consider spending some money for an outside marketing firm. Dan shared that we just had
just talked about hiring an outside marketing firm to come in and help with branding us.
Elyse went over the Webpage Analytics (in handout). Our website is reaching worldwide! Facebook is the main
source. We have high ratings on our website.
Dan said going forward we want to utilize TRT dollars to better our business.
DSL Land James Lewis, talked to the group regarding the exchange agreement with the Department of State
Lands, to obtain 140 acres South of our property. The appraisals are now complete. Appraisal came out to $.46 per
sq. ft. which is $20,000 per acre for a total of 2.8 million for the 140 acres. Looked at how to expand the UGB,
plan amendments, and zone changes. We have to justify to State why we need UGB expanded. Currently the
application is being prepared by a consultant. Probably mid -summer before completed. The conceptual master plan
had to be completed, it is an important piece to why this needs to be done here, and is key to justifying the UGB
expansion. Cheryl asked if we are locked into conceptual master plan. James said no, if later we want something
else, we would go to the City. Part of the agreement with DSL is that they will extend 19th street with water and
sewer at their cost. Had conversations regarding OMD (Oregon Military Dept) and the location of the National
Guard Armory.
Tom shared that once annexed we will have fairgrounds zoning and may need to request a zone change in the
future to accommodate a hotel, if that's the direction taken.
Steve Curly asked about anticipated completion, James indicated six months from now, but he doesn't know the
timeline for extending 19th Street. Tammy said important to manage expectations, not sure we want the liability at
this time. This will be costly. Her goal is to have options to expand. Acquiring the land to maintain rights to have
the land in the future.
David Bishop said that a sports complex has been discussed. But do we want to go a different direction with this
property. David said the RV Park is a slam dunk to expand. Dan shared that the original intent was to create a
buffer zone, not to expand. The buffer zone was to protect ourselves for the future.
Update on Sports Complex: Tom said currently there is a team working with consultants. He shared with the
group that we went ahead with the phase II analysis. We have a pretty detailed pro -forma, however, have not had a
chance to debrief and go through the feedback. Tom said the plan has options to go with one or two pieces vs the
entire complex. Tom said we intend to dive in as a team, to basically frame for discussion with Boards and teams,
and could go different directions. Dan said core group meeting is scheduled in a couple of weeks.
Dan said that we have talked about hiring a consultant to review our business plan. Where do we want to be in five
years and how do we get there? Dan said he reached out to CSL for RFP samples. SFA highly recommended CSL.
CSL pretty much hit all key points that we want to look at in the sample they sent. Dan asked for next
recommended step. Steve asked how much this would overlap with what we are currently looking at. Tom said yes
a bit, we would want to share with both consultants. Dan said we have identified the things within that we
need/want to do and we have in our current budget, but we want to know if this is what's best for us to do. Tom
asked what else we could attract. We need strategic options for enhancement to our existing facility and how we
would run it. Tammy said we need to shore up marketing plan. Group had discussions regarding additional
proposals or going out for RFP. Dan said he will put together a sample RFP and get to Board, BOCC and Tom for
review.
Discussion of County Wide Assessment Program: Erik shared that the Property & Facilities Dept (P&F)
maintains all County property and buildings except Fair & Expo and the Sheriff's Office. P&F is looking at
preventative maintenance and upcoming replacements and repairs to prioritize and create a 3-5 year plan. Lee said
the big picture is planning purposes for capital cost for large scale items (roofs, HVAC, parking lots,
interior/exterior of buildings). Looking at overall life span. P&F will also work with us and the Sheriff's Office to
include us in this plan/program. Dan said we certainly want to participate and be part of this program. Tom said
this will include `known' major expansions to keep us on track to meet capital adjustments.
Dan shared with the group the status of the surveillance system. Tomco is here today installing the conduit and
wiring. We are starting with the gates and event center. Hopefully this will be done by the end of this month.
Dan said that Jim Morrell has inquired about adding an emergency generator to our well. We did some research
and found we could add attachments approximately $40K. Maarten told all that well water currently is not potable.
We could drill new well going into new aquafer, and could tie into existing system. This would cost $300K to
$400K. Water usage increase took a toll on our well. Life expectancy on pump is 3-6 years. Tom thought there
could be possible grant money available for this. Dan said he would make a priority and follow up with Nathan
Garibay.
David adjourned the meeting at 3:34 pm.
Next Meeting will be Thursday, December 8th at 3:00 pm.
Respectfully submitted,
Tracy I Scott
DATED this day of
Raw
for the Deschutes County Board of Commissioners.
ATTEST: 51r..a -cam
(SfrMAAA-
0 Cc pLv1.�
Recording Secretary
ALAN UNGER, Chair
(fes 4
BANEY, V. Chair
2016
ANTHONY
ANTHONY DEBONE, Commissioner
JOINT MEETING
BOARD OF COUNTY COMMISSIONERS/COUNTY FAIR BOARD
WEDNESDAY NOVEMBER 9, 2016
1:30PM
FAIR/EXPO OFFICE CONFERENCE ROOM
Introductions
Approval of minutes (Fair Board/October 2016)
Financials — through October 31, 2016
TRT update — RV Park/Fair/Fair Expo
Master Plan/DLS land update — James Lewis
Sports Complex update — Tom Anderson/Dan Despotopulos
Discussion of Consultant to review current business plan and future
plans — See attached SAMPLE proposal from CSL (recommended as
one of the leaders in the industry)
Discussion of County -wide assessment of properties — Lee
Randall/Tom Anderson
Misc. items
Surveillance system
Emergency generator
Revenues
RV Park Fees < 31 Days
RV Park Fees > 30 Days
Washer / Dryer
Vending Machines
Room Tax Collection Fee
Cancellation Fees
Total Revenues
Expenditures
Materials & Services - Marketing
Interfund Contract - Personnel
Materials & Services - All Other
Total Expenditures
Net from Operations
Other Resources/Expenditures
Interest on Investments
Transfers In - Fund 130
TRT Grant
Debt Service
Net Other
Change in Fund Balance
Beginning Fund Balance
Ending Fund Balance
RV Park (Fund 601)
Statement of Financial Operating Data
July 1, 2016 thorugh October 31, 2016
FY 2016
Actual
$ 273,425
124,037
4,351
1,438
1,368
3,894
408,513
31,316
43,605
200,028
274,950
133,563
2,752
160,000
31,316
(219,582)
(25,514)
108,049
66,124
$ 174,173
FY 2017 - Year to
Date (33% of Year)
% of
Actual Budget ,
$ 197,809 76% a)
1,600 1% a)
2,179 109%
972 97%
N/A
1,987 397%
204,547 51%
27,804
10,000
58,642
96,445
108,102
998
27,804
28,802
136,904
174,173
$ 311,077
a) 5,933 RV spaces, 46% utilization.
b) Transient Room Tax available for Promotion Expenditures
c) Personnel expenditures recorded in F&E which benefit RV Park
70% b)
33% c)
25%
32%
83%
0%
70%
0%
FY 2017
Budget 1 Projection 1 $ Variance
$ 260,000 395,000
140,000 5,000
2,000 5,000
1,000 1,500
1,500
500 4,000
403,500 412,000
40,000 40,000
30,000 30,000
232,357 232,357
302,357 302,357
135,000
(135,000)
3,000
500
1,500
3,500
8,500
101,143 109,643 8,500
1,200
160,000
b) 40,000
(230,367)
(29,167)
3,000 1,800
160,000
40,000
(222,736) 7,631
(19,736) 9,431
0% 71,976 89,907
95% 182,620 174,173
$ 254,596 $ 264,080 $
17,931
(8,447)
9,484
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Operating Revenues
Events Revenues $
Storage
Camping at F & E
Horse Stall Rental
Food=&13e'veragetActiiiities; net :`
Annual County Fair (net)
Interfund Contract
Miscellaneous
Total Operating Revenues
Operating Expenditures, net of TRT:
General F & E Activities
Personnel Services
TRT Grant
Materials and Services
TRT Grant
Capital Outlay
TRT Grant
Total Operating Exp, net of TRT
Other:
Park Acq/Dev (Fund 130)
Rights & Signage
Interest
Total Other
1 Results of Operations
Transfers In / Out
Transfer In -General Fund
Transfer In -Room Tax - (Fund 160)
Trans In(Out)-Fair & Expo Reserve
Total Transfers In
Non -Operating Rev & Exp
Debt Service
Total Non -Operating Expenditures
Change in Fund Balance
Beginning Fund Balance
Ending Fund Balance
FAIR AND EXPO CENTER
Statement of Financial Operating Data
July 1, 2016 through October 31, 2016
FY 2016
Actual
Year to Date (33% of the
year)
Actual I% of Budget
539,591 $
59,700
19,475
51,449
92;159::
283,000
43,605
7,384
1,096,384
899,882
(124,842)
714,323
(95,265)
109,067 20.0%
20,114 33.5%
100 0.5%
1,020 2.0%
(14 433» 6%' )
300,000 99.1% b)
10,000 33.3% c)
6,499 73.0%
432,367 38.4%
295,899
(53,315)
229,588
(50,616)
1,394,098 421,558
30,000 7,500
101,630 13,465
1,587 367
133,217 21,332
(164,516) 32,141
300,000
25,744
162,740)
263,004
83,332
8,580
(55.000)
36,912
29.7%
28.6%
28.7%
22.3%
0.0%
0.0%
30.5%
25.0%
12.2%
45.9%
15.2%
33,3%
33.3%
100.0%
16.7%
109,927 0.0%
109,927
(11,440)
58,723
5 47,253 5
0.0%
69,053
47,283 120.4%
1113,336
Budget 1
$ 545,000
60,000
22,000
52,000
4A01)0161
302,814
30,000
8,900
1,126,729
995,217
(186,672)
800,712
(226,594)
255,000
(255,000)
1,382,863
30,000
110,000
800
140,800
(115,134)
250,000
25,744
(55,000)
220,744
108,488
108,488
FY 2017
Projection 1 $ Variance
$ 562,578
88,114
22,000
50,000
1;09:2$1;
423,000
30,000
10,901
1,273,881
(2,878)
39,277
5 36,398 5
a) See "Food & Beverage Activities Schedule"
b) Revenues and Expenses for the annual County Fair are recorded in a separate fund and the available
net income is transferred to the Fair & Expo Center Fund
c) Reimbursement from RV Park for personnel expenditures recorded in F&E
$ 17,578
6,114
(2,000)
�: X273
120,186
2,001
147,152
984,827 10,390
(186,672)
783,995 16,717
(213,838) (12,756)
255,000
(255,000) -
1,368,313 14,350
30,000
117,465
895
148,360
53,928
250,000
25,744
555,000)
220,744
102,536
102,536
7,465
95
7,560
169,062 I
5,952
5,952
172,136 175,014
47,283 8,006
218,419 5 183,020
Page 14
Deschutes County
Fair and Expo Center
Food and Beverage Activity
July 1, 2016 through October 31, 2016
July I August ( September 1 October (Year to Date !
Revenues $ 8,956 $ 4,915 $ 16,506 $ 22,871 $ 53,247
Direct Costs
Beginning Inventory 24,921 25,417 27,773 26,515 24,921
Purchases 860 3,444 3,320 8,002 15,626
Ending Inventory (25,417) (27,773) (26,515) (25,580) (25,580)
Cost of Food & Beverage 363 1,088 4,579 8,937 14,967
Event Expenses 200 864 1,182 2,176 4,421
Labor 2,205 1,603 4,460 1,414 9,682
Total Direct Costs 2,768 3,556 10,220 12,526 29,070
Gross Profit 6,188 1,359 6,285 10,345 24,177
Gross Profit Percentage 69.1 % 27.7% 38.1 % 45.2% 45.4%
Other Revenues
Catering/3rd Party 691 350 1,738 1,849 4,629
Concessions/3rd Party 655 655
Rentals (Kitchen/Flatware)
Total Other Revenues 1,346 350 1,738 1,849 5,284
Expenses
Personnel 9,789 9,789 10,200 10,200 39,978
Other Materials & Services 1,152 1,909 678 176 3,915
Total Expenses 10,941 11,698 10,878 10,376 43,894
Income (Loss) F&13 Activity $ (3,408) $ (9,988) $ (2,855) $ 1,817 $ (14,433)
Page 15
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Deschutes County
Fair and Expo Center
Accounts Receivable -Past Events
Deposits - Future Events
At October 31, 2016
Accounts Receivable
September Events
Deschutes County Health Services 109.00
October Events
Oregon Angus Assn 3,000.00
Ridgeview Baseball Boosters 2,795.50
Tate & Tate (Consumer Cellular) 654.00
Tate & Tate (St. Charles Healthcare) 1,195.05
WEBCO 1,564.95
Total Accounts Receivable $ 9,318.50
Deposits for Future Events
FY 2017
November 15,182.50
December 3,500.00
January 2,460.00
February 620.00
March 11,750.00
April 1,460.00
May 8,000.00
June 8,760.00
FY 2018 and beyond 4,892.00
Total Deposits $ 56,624.50
October 24, 2016
Mr. Dan Despotopulos
Director
Deschutes County Fair & Expo Center
3800 SW Airport Way
Redmond, Oregon 97756
Dear Mr. Despotopulos:
It was a pleasure to speak with you recently concerning your potential interest in commissioning a
market & best practices analysis to assist in identifying and evaluating potential opportunities to
optimize operations and enhance market share, revenue generation, and economic impacts
associated with the Deschutes County Fair & Expo Center (DCFEC). The purpose of this letter is
to outline a potential scope of work associated with a study that we could undertake at your
request.
PROPOSED SCOPE OF WORK
The proposed scope of services presented herein has been structured to assist the DCFEC identify
and evaluate potential opportunities to optimize operations and enhance market share, revenue
generation, and economic impacts. The following study tasks comprise a methodology for a study
consistent with those we have completed very successfully in communities of all sizes throughout
North America. The proposed tasks are as follows:
Task 1. Market Analysis
Task 2. Strategic Recommendations
Task 3. Cost/Benefit Analysis
Task 4. Funding and Implementation Strategy
A description of our scope of services and methods to be applied to each study task is provided
below and on the following pages. Upon your review, we would be happy to refine the scope of
services to best meet your needs.
Task 1. Market Analysis
The purpose of this task is to analyze the DCFEC's physical/operational characteristics and historical
performance, industry best practices and comparable facility benchmarking data, and unmet
market opportunities in Deschutes County and for the DCFEC. This analysis will help for the basis
for evaluation of future incremental demand that an improved and/or enhanced DCFEC could
accommodate. Specific steps to be undertaken are presented on the following pages.
Conventions, Sports & Leisure Intemational
520 Nicollet Mall • Suite 440 • Minneapolis, MN 55402 • Telephone 612.294.2000 • Facsimile 612.294.2045
Mr. Dan Despotopulos
Page 2 of 14
Step 1. Study Kickoff and Initial Project Planning
As an initial step in the engagement, we will work with the DCFEC and other key stakeholders
to establish the specific project goals and timeframe. An initial planning meeting will take place
to collect pertinent project data and to identify the local organizations, officials and others that
we will need to meet with at the study's outset. This is a critical first -step, and we will spend
several days in the community conducting local interviews, reviewing existing data and visiting
existing convention and visitor industry amenities.
We will conduct initial in-person, one-on-one interviews in Deschutes County with key project
stakeholders to obtain background information related to the project. In addition to DCFEC
leaders these interviews could include individuals such as elected and appointed
county/city/state officials, key hotel owners and managers, Redmond Chamber of Commerce
and CVB leaders, leadership among local academic institutions, tourism industry
representatives, restaurateurs, business leaders and other civic and visitor industry
representatives or project stakeholders. These meetings will focus on analyzing conditions
with regard to local market characteristics, facility needs and the opportunities that future
investment in the public assembly facility and hospitality sector may represent.
Specifically, through this process, we will:
• establish a working group that will include representatives of local project leaders;
• assemble important project related data;
• gain initial insight and perspective into local conditions that will impact the research
process;
• establish the format and content of our deliverable products; and
• modify the work plan, if necessary, to reflect any appropriate changes arising from
the information obtained in the steps noted above.
Step 2. Existing Deschutes County Fair & Expo Center Analysis
We will analyze the existing/historical physical and operational characteristics of the
DCFEC. This analysis will help form the basis for analysis of competitive positioning, future
demand levels and estimates of the incremental level/mix of business that an improved
and/or enhanced DCFEC could potentially generate. This analysis will also include one or
more site visits and detailed interviews with Center management and staff, along with
Deschutes County and other involved stakeholders.
As the information is available, the collection and review of data will include, but will not
be limited to:
• Information provided by the DCFEC, Deschutes County and other project leaders.
• DCFEC physical components, configuration, functionality, amenities and related
issues.
• Event characteristics:
o Number of events by type
o Utilization days (move -in, event, move -out)
o Space used, by area
Mr. Dan Despotopulos
Page 3 of 14
o Attendance
o Origin of attendees
o Length of stay
o Historical growth characteristics
o Square footage and daily occupancy by type of space
o Event seasonality
• Booking reports (tentative, definite, licensed events by year).
• Lost business lists/reports.
• Rental and service rates.
• Operational policy, procedure and reporting structures.
• Operating revenues.
• Operating expenses.
• Capital improvements and Tong -term facility planning data.
The results of this task will provide an assessment of the capacity, performance and
limitations of the existing DCFEC and, importantly, benchmark data for subsequent tasks.
We will review the existing DCFEC's program and preliminarily identify programmatic and
functional deficiencies relative to state -of -the -industry fairgrounds/exposition complexes.
Step 2. Existing Market Conditions Analysis
The purpose of this step is to define and evaluate the local market characteristics of the
Deschutes County and Redmond area as well as the existing event facility infrastructure
(Le., exhibition, arena, convention, conference, meeting, fairgrounds, equine/livestock,
civic and spectator and other multipurpose event facilities).
Initially, the analysis will focus on demographic/socioeconomic attributes and will be
instrumental in understanding how the Deschutes County and Redmond area is presently
positioned in the fairgrounds, exposition, equine/livestock, meeting, spectator, civic and
local event industries (i.e., events with attendance bases that are primarily locally -based).
Additionally, the primary components of a successful facility destination/event package will
be evaluated in order to assess the area's ability to support added/improved exposition,
sports/recreation, convention, meeting, equine/livestock and other event activity. This
aspect of the analysis is critical in understanding the community's visitor industry resources
and infrastructure. The analysis will include a review of the Deschutes County and
Redmond area market data, both current and projected, to assess the area's ability to
accommodate added event activity (i.e., typically economic impact generating events that
have a significant portion of out-of-town attendance).
Mr. Dan Despotopulos
Page 4 of 14
Characteristics to be evaluated as part of this analysis step include the following:
• committable, quality hotel properties and guest rooms;
• existing/planned local exposition, conference, sport/recreation, event and hotel
facilities;
• hotel cost structures;
• key demographic and socioeconomic characteristics and trends, such as
population, disposable income, retail sales, entertainment spending, corporate
base and other such indicators;
proximity issues to major metropolitan markets;
air, rail, ground transportation and shuttle access;
• entertainment offerings and attractions;
• key community resources; and
• other such characteristics.
Further, as the information is available, we will collect and review data associated with
existing local exposition, sports/recreation, conference, civic, spectator and multipurpose
event facilities.
Information collected and analyzed will include, but will not be limited to the following:
• existing exposition, sports/recreation, multipurpose, exhibition, civic, conference,
meeting, and event facility physical components, configuration and related
issues;
• event characteristics (type, number, length of stay, origination of
attendees/participants/spectators);
• square footage and occupancy/utilization by type of space;
• event seasonality;
• lost business information;
• rental and service rates;
• operating revenues and expenses; and,
• capital improvements and long-term facility planning data.
The results of this step will be used in combination with data prepared throughout the
study to assess the Redmond area's competitive position within the regional and national
marketplace and its ability to accommodate additional event demand. By understanding
the type of business currently accommodated within the community, we can focus our
recommendations on facility development that could add to the overall level of events,
attendees and economic impact.
Mr. Dan Despotopulos
Page 5 of 14
Step 3. Comparable and Competitive Facility Benchmarking Analysis
In evaluating the market positioning and demand for the DCFEC, it is important to gain an
understanding of the competitive and comparable facility environment. Within this step,
we will assemble and review the operational and physical characteristics of existing and
planned facilities in the region that could compete with the proposed project. Projects
around the country that may offer some element of comparable insight will also be
evaluated. The type of data that will be assembled for comparable and competitive
projects indudes the following:
• facility type and marketing focus;
• fairgrounds, equine, livestock and exposition physical elements and capabilities;
• exhibit, meeting/conference and multipurpose space and capacities;
• sport and recreation space and capabilities;
• fixed and temporary seating components;
• future expansion plans;
• layout, staging and design features;
• event characteristics (levels, attendance, utilization, future bookings, etc.);
• ancillary services and amenities;
• operating revenues and expenses;
• rental terms;
• available parking;
• area demographics;
• hotel availability, quality and proximity to the facility;
• visitor industry tax rates (i.e., hotel/motel tax);
• convention and visitor bureau marketing resources;
• location characteristics and transportation access; and
• other such characteristics.
In addition, as a part of this analysis, a number of case studies will be developed
concerning comparable facilities in communities similar to Redmond addressing the
respective facilities' level of use, rates, financing, source of public subsidies, size and
operating expense, as well as other key facility/market information.
Further, we will conduct a detailed benchmarking and best practices analysis of similar
fairgrounds, exposition and multipurpose event centers throughout the country. The data
collected will be carefully analyzed and presented in a consistent format to allow for
comparisons and analysis to the operating structure and performance of the DCFEC. We
will conduct detailed interviews of facility management for each facility to develop a
detailed set of physical facility, operational, policy and procedure, and other pieces of data
for comparison.
Mr. Dan Despotopulos
Page 6 of 14
This data will be used to develop recommended procedures and policies to optimize the
operation and marketability of the DCFEC. This task includes a complete review of
customer services, building operating functions and marketing/positioning issues that are
provided or present at comparable facilities within the public assembly facility industry.
These functions may include but are not limited to:
• maintenance and operations;
• booking and event services;
• food service and catering;
• telecommunications and audiovisual;
• decorating, drayage and event set-up/teardown;
• security;
• advertising;
• contract and part-time event labor;
• electrical; and,
• other such functions and issues.
The review of such functions and issues will be developed based on our extensive project
experience and primary research conducted as part of this engagement. Facilities will be
selected based on a combination of physical, operational and market characteristics. As
part of this review, we will carefully describe the service in terms of customer base,
prevalent means of providing the service in the industry, general financial characteristics
of the function, how the service impacts the customer base and other important
characteristics.
The analysis will yield the identification of effective industry practices, and will assist in
making recommendations as to future courses of action in Deschutes County that could
serve to improve the marketability and operating efficiency of the DCFEC, including cost
containment and revenue enhancement.
Utilizing the benchmarking comparison, we will provide analysis on such ratios as per
square foot, per total expenses and other such metrics (including adjustments for varying
costs of living and other issues). We will prepare a careful review of DCFEC performance
levels with the benchmarked facility set, highlighting areas of material difference and
commenting on potential opportunities to enhance future performance.
Step 4. Market Characteristics and Opportunities Analysis
The fairgrounds, exposition, spectator, convention, civic, tradeshow, sports/recreation,
meeting and entertainment industries have undergone significant change over the past
two decades. Issues impacting the industry, including fluctuating demand for space and
facilities, amenities, hotel availability, service levels and other such characteristics, have
been joined by events such as a major economic recession, credit market crisis and
evolving industry demand. In addition, supply growth has impacted demand levels in
Mr. Dan Despotopulos
Page 7 of 14
individual markets. Many planners/promoters have also placed greater importance on the
issue of environment sustainability of a facility in terms of selection criteria.
The purpose of this step is to evaluate recent trends in the industry that may impact facility
expansion and/or improvement opportunities and event levels in Redmond. Throughout
this step, we will evaluate these and related trends, summarizing the potential impact on
the proposed new development/enhancement opportunities at the DCFEC. An evaluation
of these trends will be important in "framing" and placing overall market demand estimates
into the context of the industry, presently and into the foreseeable future.
Beyond the local interviews conducted as part of a previous step, we will interview via
telephone and/or online survey mechanisms a sample of past, current and potential new
users of the DCFEC both locally and from a state, regional and national basis. Such
interviews are an important component of our study approach, allowing us to go beyond
simply relying on competitive and comparable facility data. This market survey step of the
study will be critical in identifying the market opportunities that could be captured by the
potential DCFEC expansion/improvement scenarios. The analysis may include
organizations or individuals from the following event segments:
• Key DCFEC tenants and recurring users;
• expositions/exhibitions, including public/consumer shows, tradeshows,
conventions, and other such flat floor activity;
• equine/livestock/agricultural events/shows;
• amateur sports associations;
• various youth and adult recreational sports associations, clubs and organizations;
• other national, regional, and local tournament organizers;
• local municipal parks and recreation departments;
• local school districts, colleges and universities
• concerts, cultural events and festivals;
• corporate and trade events;
• educational uses and activities;
• community banquets, meetings, festivals and related events;
• local civic, service club, and religious organizations; and
• other such events and activities.
Event organizer survey results will be analyzed to provide summaries of the following data
specific to added facilities:
• likelihood of utilizing an expanded/improved DCFEC;
• reasons for not choosing the Redmond area or the DCFEC;
• space/seating levels required to attract the event;
• overall hotel room requirements;
• other important community requirements to attract the event;
Mr. Dan Despotopulos
Page 8 of 14
• event seasonality;
• length of event data;
• attendance (exhibitor, attendee, participant, spectator) data;
• past facility use;
• requirement/preference for amenities;
• issues with respect to transportation and accessibility;
• perceptions of the Center and local area; and,
• other related event information and relevant opinions.
By combining the results of this step with the analysis results generated in previous steps,
we will be able to identify the event markets that represent the primary sources of demand
for an expanded/improved DCFEC, upon which future facility recommendations and event
estimates are made.
Task 2. Strategic Recommendations
The purpose of this task is to synthesize findings of the previous task to analyze and translate
market demand and opportunities into a market supportable facility program for the DCFEC. The
phase will also outline appropriate expansion/improvement options (if any), as well as other
DCFEC-oriented or visitor industry -oriented infrastructure, policy, and/or marketing initiatives that
would be expected to enhance the DCFEC's competitiveness and performance, as well as its ability
to positively impact the fairgrounds, exposition and multipurpose event facility industry in Redmond
and Deschutes County.
Step 1. DCFEC Supportable Program Analysis
We will prepare an analysis of the market supportable facility building program for the
DCFEC, based on market demand and related data developed as part of the previous
phase. The importance of matching the size of the facility will be balanced with
existing/anticipated future market conditions, financing/budgetary considerations, and
economic impact -generating and local needs ability of the potential expanded/improved
DCFEC. The analysis will focus on:
• square footage and configuration of various other DCFEC facilities (such as
exposition and multipurpose facilities, indoor/outdoor arenas, show rings, warm-
up areas, spectator seating areas, equine/livestock barns, stalls, show offices,
storage, etc.);
• fixed and temporary seating levels (in indoor and outdoor facilities);
• size of support space, staging areas and other functional areas;
• amount and type of other revenue-producing areas;
• space configuration, event and patron amenities and aesthetic features;
• parking and RV spaces;
• theme possibilities;
Mr. Dan Despotopulos
Page 9 of 14
• infrastructure needs; and,
• possibilities for future expansion.
We will identify any external factors that could significantly affect the ability of a potentially
expanded/improved DCFEC to maximize its potential. Factors to be identified include:
• availability of quality, committable hotel rooms;
• parking needs;
• transportation infrastructure/accessibility;
E. proximity to restaurants, retail, nightlife and other amenities/attractions;
• event attendee transportation within the area; and,
• other such characteristics.
If sufficient market demand does not exist for the proposed development project as
currently conceptualized, adjustments to the program and/or alternate project
opportunities will be discussed.
Step 2. DCFEC Business Plan Analysis
Based on industry best practices, we will discuss pertinent issues as they relate to the
existing DCFEC and a potential expanded/improved product, including, but not limited to,
physical characteristics and amenities, market positioning, marketing opportunities and
challenges, fit within the greater destination/marketplace, management options,
operational issues, marketing and operational synergy among other site/property
elements, and other such items.
We will conduct benchmarking and best practices analysis of similar fairgrounds, exposition
and multipurpose event facilities throughout the country, focusing on facilities of
comparable size and/or in similar destinations. Results will be summarized allowing for
comparisons with existing and potential conditions in Redmond. The benchmarking
comparison data wilt include, but not be limited to, the following:
• event coordination policies;
• operating and maintenance policies;
• types of services provided in-house versus contracted versus open -vendor;
• terms of the agreements for contracted services;
• reporting structure for contracted services;
• overall organizational structure with staffing levels, including required skills and
functions;
• marketing structures for the facility, public sector, CVB (destination marketing
organization), and other stakeholders, highlighting the formal and informal
relationships between each;
• marketing budgets and focus;
Mr. Dan Despotopulos
Page 10 of 14
• event and attendance levels by type of event;
• recent year financial performance of the facility;
• size and type of sellable space; and,
• other such characteristics or special features.
We will outline the core parameters of a management and operating plan that is deemed
most appropriate for the DCFEC, based on industry best practices and the assessment of
the unique attributes of the project. Consideration will be made pursuant to the market
supportable program previously indicated and recommendations that are designed to
improve the marketability, visitor/economic impact generating capability/effectiveness,
and operating efficiency of the DCFEC, including cost containment and revenue
enhancement.
We will outline a set of strategic opportunities designed to enhance the operating structure
and resultant performance of the DCFEC to best protect City and other stakeholder
priorities and integrate efficiencies that may be available. We will also analyze the
strengths, weaknesses, opportunities and challenges of identified strategic enhancement
options as they relate to the DCFEC. Recommendations for any indicated core adjustments
will consider:
• governance/oversight,
• day-to-day operations,
• staffing,
• strategic marketing/promotion partnerships,
• method of provision of services (in-house, exclusive vendor, preferred vendors,
open vendor policy, etc.),
• general FF&E needs,
• booking and discounting policies, and,
• other such items.
Step 3. Strategic Recommendations
We will develop a preliminary, prioritized set of strategic opportunities/initiatives related to
the DCFEC (physical product and business plan/operations) and visitor industry -oriented
infrastructure, policy, and/or marketing initiatives that would be expected to enhance the
DCFEC's competitiveness and performance, as well as its ability to positively impact the
fairgrounds, exposition and multipurpose event facility industries in Redmond and
Deschutes County. These could include new hotel products and other visitor industry
infrastructure (under public/private partnership funding models or other incentivized or
coordinated process via the City, County or other public sector entity).
Working in coordination with the DCFEC, County and other project stakeholders, we will
develop specific development/initiative scenarios for further analysis in subsequent study
phases.
Mr. Dan Despotopulos
Page 11 of 14
Task 3. Cost/Benefit Analysis
The purpose of this task is to estimate the key costs and benefits (upfront, ongoing and cumulative)
associated with agreed upon scenarios generated under the previous tasks of the study.
Step 1. Event/Use Levels Analysis
For each of the strategic scenarios, we will estimate the level and characteristics of events
and activities that could be attracted to and retained at the DCFEC during a stabilized year
of operations. Measures of event demand will include:
• event and activity levels by event/use segment;
• potential attendance (including visitor) levels by activity or use;
• origin of attendees/exhibitors/participants (i.e., local vs. non -local) and
associated traffic levels;
• length of event and use data;
• facility space and functionality requirements (exhibit, meeting, banquet, seating,
staging, dirt/equine/livestock, fair, technology, etc.) by event type;
• hotel requirements;
• parking requirements; and,
• seasonality data.
Step 2. Preliminary Development Costs Evaluation
Working with project representatives and building on past construction cost estimates, we
will generate (or update) preliminary, order -of -magnitude construction cost estimates for
each of the identified strategic scenarios (if they include an expanded/improved DCFEC).
The cost estimates will focus on per-unit data adjusted for conditions in the Redmond area
and cost data of comparable facilities modified for time and locations. Working with the
DCFEC, County, City and/or other key stakeholders, we will develop preliminary, agreed
upon development/investment/implementation cost estimates associated with other non-
DCFEC strategic initiatives within each scenario.
Step 3. Financial Operations Analysis
We will prepare a financial operating analysis for the DCFEC under each of the identified
scenarios. Specifically, we will develop a computer-based model incorporating comparable
facility data, historical DCFEC operations, and the estimated levels of event utilization and
attendance derived from the market analysis in order to develop estimates with regard to
facility operating revenues and expenses.
We will estimate line item revenues, including rental, food service, event service, parking,
advertising and sponsorship revenues, and other such sources. We will estimate line items
Mr. Dan Despotopulo
Page 12 of 14
expenses, including salaries (permanent and event driven staff costs), utilities,
maintenance, supplies, insurance, contract service costs and others.
We will work with the City and project leaders to develop other
revenue/expense assumptions associated with each of the scenarios, in order to provide
initial estimations of the financial retn/,iskytruduresassodatedwiLhthepnojec±under
each scenario.
Step 4. Economic Impact Analysis
In this step, we will estimate the economic and flscal (tax) impacts associated each of the
identified scenarios, emphasizing the incremental impacts associated with
expansion/improvement of the DCFEC and other recommended strategic initiatives. The
operation of an expanded/improved fairgrounds, exposition and/or multipurpose event
facility typically attracts some level of out-of-town event attendees/exhibitors to the
community. Likewise, other targeted strategic initiatives will be designed to grow the
number of visitors to Redmond and Deschutes County. The nnn'|ooul attendees and
visitors brought into the community as a result of the facility and/or other initiatives
represent the basis for added Iocal economic and fiscal impacts.
As part of ths analysis, we will develop estimates of total incremental visitors to the
Redmond area generated as a result of new visitor -oriented facility and investment
strategies. We will then apply appropriate per -visitor spending estimates using industry
clata adjusted to the local area.
The multipliers, specific to Redmond and Deschutes County and provided by leading
inputjoutput multiplier models,will be used to estimate total economic output, earnings
and employment generated as a result of each of the supportable strategic options
identified. From these economic impact varlables, we will apply appropriate Iocal, regional
and statewide tax rates to estimate the added tax revenue generated as a result of the
initiatives.
The completion of the economic and fiscal impact analysis will allow for a comparison of
key costs and benefits associated with the development and operation of a new visitor-
oriented
ishnroriented event facility. If more than one program scheme nd/or project concept was
previously developed, costs and benefits will be comparatively evaluated to allow project
stakeholders and the community to assess issues related to return on investment.
Task 4. Funding and Implementation Strategy
The purpose of this task is to analyze funding altematives and to develop an implementation
strategy for one or more courses of action.
Step 1: Funding Analysis
We will identify and summarize typical funding sources used throughout the country and
the region for fairgrounds, exposition and multipurpose event facilities along with other
visitor industry initiatives comparable to the identifled scenarios. We wiH generate funding
Mr. Dan Despotopulos
Page 13 of 14
case studies of comparable and creative approaches utilized elsewhere that could merit
consideration in Redmond.
Further, we will investigate and coordinate with DCFEC. County, City, and other local
stakeholders various funding opportunities available locally. We will consider a variety of
traditional and nontraditional public/private partnership opportunities. We will focus on
both financing mechanisms and the project revenue sources that could be used to partially
fund facility development, initiative execution, and/or ongoing operations.
We will evaluate the current DCFEC, Deschutes County and Redmond destination
marketing funding structure and recommend whether specific adjustments/enhancements
are necessary and what the appropriate mechanisms/sources should be. Should a
public/private partnership be involved, recommend a potential structure/model and any
key agreement, development, marketing and operational issues that should be considered
to protect the needs of community and/or public sector partner.
Step 2. Implementation Plan
Based on entirety of the study effort, we will develop an implementation plan that
communicates and delineates:
• goals, objectives and rationale
• product/initiative elements
• phasing and milestones
• recommendations for next/additional planning steps
• responsibilities by stakeholder/partner
• funding sources and uses
• cost/benefit estimates
• measurement tools for ongoing return -on -investment
We will prepare a written draft report with this implementation plan and a detailed
summary of all study methods, research, analysis, findings and conclusions. We will
consider suggested revisions and deliver a final report. In addition to the written and
electronic report, we will deliver in-person oral presentations to the DCFEC, County and
other key stakeholder groups. The anticipated sequence/timing of these deliverables,
meetings and visits is outlining in the subsequently timing section of this letter.
Mr. Dan Despotopulos
Page 14 of 14
PROPOSED TIMING
We are prepared to commence this engagement upon receipt of notice to proceed. We would look
forward to further discussing the specific study preferences or alternatives you may have for the
study. We expect to be able to complete the scope of services outlined herein within 12 to 14
weeks, reflecting the extensive amount of primary market research and subsequent analysis
required to draw informed conclusions.
In addition, regular progress updates will be forwarded to you in-person or via conference call
during the study period. Furthermore, we anticipate completing the contracted elements in full,
performing all work as set forth in the final contract. In the event that a decision not to proceed
occurs within the time frame finally agreed upon for this engagement, we will cease our work, and
bill you for time incurred on the project at that point in time.
PROPOSED FEES
Total professional fees for any engagement will depend on the number of hours required to
complete the project and skill levels of the assigned personnel.
Professional fees associated with the proposed scope of work outlined herein will not exceed
$62,500. Out-of-pocket expenses, including travel costs, postage, telephone, report preparation
and reproduction will be billed separately at cost, and will not exceed $6,000 (unless expressly
authorized by you). These fee and expense figures assume three person -trips by CSL project
leaders to Redmond. Professional fees and out-of-pocket expenses will be billed and are payable
on a monthly basis.
Should additional work be required beyond the scope of services detailed herein, professional fees
will be billed on an hourly rate basis. Total professional fees for additional services will depend on
the number of hours required to complete the services and skill levels of the assigned personnel.
We would be happy to discuss with you potential adjustments to the scope of services to best meet
any requirements that you may have for this study.
Upon your review of this information, please do not hesitate to contact me at (612) 294-2003 or
bkrueger@cslintl.com. We would look forward to the opportunity to assist you with your planning
concerning this project and could put together an engagement letter (contract) at your request.
Sincerely,
Bill Krueger
Principal
CSL International