Could Spokane Valley Outsource CenterPlace Operations? The city is trying to compensate for losses from the financially “bleeding” event center
Spokane Valley may outsource operations of CenterPlace Regional Event Center, the city’s regional events facility south of the river near Mirabeau Park.
On May 10, the Spokane Valley City Council discussed the possibility of hiring an outside contractor to operate CenterPlace after employees said the building was underutilized and wasting $400,000 annually.
Center Place opened in 2005. It was funded by a massive voter-approved loan from the Spokane Public Facilities District, which also paid for an expansion of the downtown Spokane convention center and improvements to the Spokane County Fairgrounds.
The building is 54,000 square feet and primarily hosts meetings, but tenants can also reserve space for community events, weddings, and other activities. The Spokane Valley Senior Center occupies a 15,000 square foot wing of CenterPlace.
Currently, Spokane Valley operates the events center with city employees. But that may not be the best arrangement, City Manager John Hohman said.
CenterPlace is rarely fully booked. The rented rooms are empty more than 70% of the time.
Given the low usage, it might make financial sense to hire a contractor to manage the place. A company with more management and marketing experience could potentially find more paying customers to use the facility, which could help reduce $400,000 in annual losses.
“If we could stop this kind of bleeding and have extra money for other uses, that would be great,” Councilor Laura Padden said.
But outsourcing operations could change how CenterPlace is used.
“Is it a community center? Is it a conference center?” Hohman asked the councilman. “What should it be?”
All City Council members said they are open to learning more about what outsourcing CenterPlace operations might look like. But no one has expressed an interest in converting the building into a full-fledged conference center yet.
Councilman Ben Wick said he believes CenterPlace should be a community center. These types of facilities shouldn’t be profitable, he said.
“I don’t want to turn it into a convention center where you’re trying to make money from it,” Wick said. “It’s supposed to be for the community.”
Councilor Brandi Peetz agreed, but noted that managing event centers is not the city’s competence.
“Is this really the business we want to be in?” she asked. “Not necessarily, in my opinion. Maybe a third party would do a better job.”
Several council members said they might be interested in a hybrid model where the city manages part of CenterPlace and a third party handles the rest.
“I wouldn’t want to see it complete, just managed by someone else,” Councilman Tim Hattenburg said. “I think we could do both.”
Mayor Pam Haley said she also likes the hybrid idea. The city isn’t able to market the place properly, and the $400,000 annual loss is a bit extreme, she said.
“It would be great if it was cost neutral, but it would still be great if we could just cut our losses,” Haley said.
Hattenburg said he thinks CenterPlace is a convenience for the citizens of the Spokane Valley and agreed with Wick that it shouldn’t become a convention center only. He said he would like the facility to lose less money but called the $400,000 figure misleading. The convention center generates economic activity in the city, which offsets some of the losses and cannot be properly quantified, he said.
Councilman Arne Woodard emphasized that Spokane Valley is a treaty city and it would not be unusual to outsource operations.
The city administration has relatively few employees and deliberately outsources various tasks that most municipalities carry out with their own staff. Spokane Valley’s contract with the Spokane County Sheriff’s Office for Law Enforcement is the most obvious example.
Councilor Rod Higgins said councilors need to ask themselves how much they are willing to lose to keep CenterPlace more community-centric.
“How much pain are we willing to endure financially to keep it this way?” Higgins asked. “Sooner or later, CenterPlace may not be the community center we need. We may need something different to bring life to our businesses here.”