Sarasota Performing Arts Center Foundation wins extension for completion of ‘implementation agreement’ for new venue on The Bay

Contract for architectural firm to design structure expected to come before City Commission in July

Editor’s note: This article was updated early in the afternoon of April 7 to provide more details about the professional background of a resident who addressed the funding issue for the new performing arts venue. The update also includes a clarification of the plans to review the status of the tax-increment financing district for The Bay Park at the 15-year mark.

On a 4-1 vote this week, the Sarasota City Commission agreed that the Sarasota Performing Arts Center (SPAC) Foundation could have until November 2024 to present the city the planned “implementation agreement” pertaining to the new venue that has been proposed for the city’s Bay Park in downtown Sarasota.

Formally, the document will contain details about the actual cost of the SPAC — which Foundation members last year estimated between $300 million and $350 million — and its operating expenses.

An agreement that the commissioners approved on a final vote in April 2022 laid out responsibilities for both the city and the Foundation in the effort to construct and operate the SPAC. That document called for the implementation agreement to be provided to the commission this month.

Commissioner Jen Ahearn-Koch cast the “No” vote during the April 3 regular meeting of the commission, stressing that she still had too many unanswered questions to agree to the delay.

Commissioner Erik Arroyo — who voted against the agreement in 2022 — made the April 3 motion calling for approval of the extension. Vice Mayor Liz Alpert seconded it.

Arroyo likened the action to a judge’s ruling in favor of an attorney’s request for a continuance in a trial. (As he noted, Arroyo himself is an attorney.)

Moreover, Arroyo pointed out that the commissioners approved the initial document with the attitude that they would negotiate with the Foundation “in good faith.”

In fact, early on during the discussion this week, Jim Travers, chair and interim CEO of the Foundation, pointed out that the nonprofit was able to secure a $10-million pledge on the basis of that agreement’s winning commission approval a year ago.

Travers and the Foundation’s new chief operating officer (COO), Laura Hennessey, both explained to the commissioners that they needed to request the extension for preparation of the implementation agreement for two primary reasons: The Foundation has had to work under the requirements of the state’s Sunshine Laws in selecting an architectural firm, including local government regulations regarding procurement; and, as Travers put it, “We had a lot more architects respond than we thought” to the Request for Proposals that the city’s Procurement Department issued last year on the Foundation’s behalf.

As work proceeds on that implementation agreement, Travers also committed this week to having the Foundation’s attorney, Dan Bailey of the Williams Parker firm in Sarasota, work with City Attorney Robert Fournier on modification of what commissioners referred to as the “non-compete clause” regarding the future of the Van Wezel Performing Arts Hall.

Before the commissioners voted 3-2 on April 4, 2022 to approve the initial agreement, Cheryl Mendelson, then the Foundation’s CEO, talked about the fact that, if the Van Wezel remained in use, it would not be able to present the types of shows that the SPAC would provide to the community. She suggested, for example, that arts and cultural organizations in Sarasota that produce their own performances could schedule those at the Van Wezel.

“I believe we can work something out that makes sense,” Travers told Commissioner Ahearn-Koch during the April 3 discussion, referring to that clause.

The clause says the following: “City shall continue to operate the [Van Wezel] Hall (to include ensuring adequate parking spaces) until such time as the new PAC becomes ready for occupancy and operations; whereupon the Hall shall cease operation as a performing arts facility with respect to booking any program or activity that would compete directly with the PAC. The City shall work cooperatively with SPAC [the Foundation] prior to the anticipated opening of the new PAC, to collaborate and complement park programming.”

This week, Commissioner Debbie Trice, who was just elected in November 2022, pointed out to the Foundation representatives, “Recognize that we also own the Van Wezel Hall.” Therefore, she said, the commissioners need to ensure that if it remains in use, it will produce sufficient revenue to be viable.

She stressed that she could not agree to the extension of the timeline “without a change in the non-compete clause today.”

During the discussion, Travers further committed to providing the commissioners more frequent updates on the SPAC’s work. “I believe we should have done a more efficient job … of communicating,” to both the commissioners and the public, he said.

He wanted to give them his word, he told the commissioners, that he plans to appear before them “a lot more often,” to brief them on updates.

Travers also told the commissioners that the Foundation expects an economic impact study on the SPAC to be completed later this month; he said he would talk with them about its findings, which will be made public.

“There’ll be some very compelling information,” Travers added, in regard to the financial boost the SPAC is expected to give the community.

Selecting the architect

In regard to another issue, Cortez Crosby, project manager with the Paratus Group in New York City — who is serving as a consultant to the Foundation — pointed out this week that the contract with the architectural firm ultimately chosen to design the Sarasota Performing Arts Center will include phases. That way, he assured the commissioners, if they decide at some point that the city cannot afford its 50% share of the SPAC’s expense, the firm would not be allowed to proceed with its work.

He estimated that the cost for the architectural firm to arrive at an estimate for the SPAC would be $4.4 million, in the first phase of work.

The city would pay for half of that, Crosby added.

Hennessey, the new COO, also talked about the work of the task force charged with selecting the architectural firm. Already, Hennessey noted, the group has winnowed the initial 43 applicants to a group of six. Following site visits — beginning this week — to projects those firms have built, she said, the task force will narrow its list to three or four finalists.

The six firms still competing in the selection process are “some of the most prominent architects” in the world today, Crosby of the Paratus Group emphasized to the commissioners.

A number of firms who responded to the Request for Proposals that the city’s Procurement Department issued are winners of the prestigious Pritzker Prize, he added. That architectural honor, he explained, is comparable to a Nobel Prize.

The finalists will be invited to send representatives to Sarasota, Hennessey added, and the public will be able to engage them in question-and-answer sessions.

“This is a public process,” Hennessey emphasized. “We welcome and encourage [public engagement].”

Then, in late May or June, she continued, the task force will make its selection.

Travers noted that the Foundation board will have to vote on that recommendation, and then the City Commission will be provided a draft agreement with the firm, for its review and approval.

That last step is expected in July, Hennessey added.

Foundation attorney Bailey noted that, essentially, the City Commission would have to agree to the choice of architect.

Ongoing financial questions and the future of the Van Wezel

Trice was the first commissioner this week to press the Foundation group for what she called “the back-of-the-envelope numbers,” explaining that if she had been on the board in the spring of 2022, she would have opposed the initial agreement for its lack of financial details.

Although she added that she is worried about the estimated expense of the new SPAC, “I’m more concerned about operational numbers.”
Travers explained that, in 2015, a firm called AMS Planning & Research created what he characterized as a “full operating model” for the SPAC. “Obviously,” he added, “we need to update that [report].”

(AMS has offices in Connecticut and Sacramento, its website says.)

Nonetheless, Travers pointed out that the SPAC plans call for two theaters, which should help ensure that it generates sufficient revenue.

Trice responded that she had not seen the AMS document.

Then she focused on the non-compete issue in regard to the Van Wezel. “The way that [current agreement is] written right now,” she said, “it’s seen by many people as a way to starve the Van Wezel Hall out of existence.”

City Manager Marlon Brown responded that he probably would need to ask Mary Bensel, the long-time executive director of the Van Wezel, to assist with rewriting the clause. He stressed that since both the Van Wezel and the SPAC would be city-owned structures, city staff has no desire to see one flourish to the detriment of the other.

Hennessey also emphasized the fact that, when the commissioners receive the implementation agreement, including details of the projected cost of the SPAC, “If you don’t like what is presented … you do not have to approve it.”

“These were big numbers that were thrown out,” Commissioner Ahearn-Koch told the Foundation representatives, referring to the SPAC construction figures that were discussed last year, “and our commitment is half, plus, plus.”

The city also is responsible for the infrastructure — including water and sewer lines and 1,000 parking spaces — to serve the facility, as well as off-site parking and shuttles.

City Manager Brown reminded Ahearn-Koch that City Attorney Fournier explained to her and her colleagues last year that if they were not comfortable that the city could shoulder its share of the expense, they did not have to approve the implementation agreement.

Moreover, Brown said, “If we don’t have the funding for it, I can’t recommend to move forward.”
The only certain source of money, he pointed out, is the revenue from the tax-increment financing (TIF) district that encompasses not only the 53 acres of The Bay Park but also property around it.

In early November 2020, the City Commission and the Sarasota County Commission approved an interlocal agreement that sets aside the proceeds from the district for expenses associated with development of the park. A board with representatives of both commissions must review proposals for construction in The Bay Park and then recommend to both local governments whether to fund them out of the TIF money.

Each year that property values rise in that TIF district, city and county financial staff members calculate how much revenue each would receive from those higher values. Then — as city Finance Director Kelly Strickland has explained — the lower of the two local governments’ millage rates is applied to that difference in property tax revenue from the previous year to the current year to generate money that is set aside in a trust fund for park improvements.

Although the TIF interlocal agreement covers 30 years, county commissioners ensured that the document included the stipulation that  a review of the funding mechanism be conducted at the 15-year mark. Then-County Commissioner Alan Maio talked last year of the potential that the boards might end the TIF agreement before the 30 years is up, if property values continue to climb sufficiently.

Altogether, the 2020 projection of the county’s Office of Financial Management was that the TIF district would generate just shy of $200 million over 30 years. In July 2022, the county’s Office of Financial Management revised its estimates to reflect a total of $308,033,001 from both local governments by the 2049 fiscal year.

Although City Manager Brown last year also talked of the potential of the city’s issuing bonds to help pay its share of the SPAC expense, he did not raise that issue this week. He said in 2022 that a surcharge on tickets for performances at the Van Wezel — and then, after its construction, the SPAC — could generate funds to help pay for the new performing arts center.

However, city resident Ron Kashden — who was among members of the public who addressed the board on April 3 in regard to the SPAC timeline extension request — undertook an analysis last year that showed the ticket prices likely would have to be doubled to raise enough money to pay off the bond debt. He reiterated that finding during his April 3 comments, noting that he is a CPA who for years was the auditor of one of the theaters on Broadway.

In fact, Kashden was the auditor of New York’s Shubert Theatre group, which owns and operates almost all of the Broadway venues, the News Leader has learned.