Archive for March 14th, 2010

Decent idea, we are losing between $6 and $7 million per year. When money dries up it’s time to start looking at outside of the box ideas to save tax payers dollars.

Let’s take a look at the City Mangers Office direct responses regarding the pluses and minuses of outsourcing:

1. Let’s Let A Private Management Firm Bid On The Contract: Currently there is little opportunity for private management to run these facilities (TCC, Music Hall, Fox Theater, Leo Rich Theater, Tucson Arena) and show even modest financial improvement. Private management succeeds to the extent that existing public management provides opportunities for improvement. Here are the traditional major opportunities and quick assessment of each:

2. Corruption – None. Typical examples include employees on payrolls that do not work, embezzlement, and services in exchange for personal favors. None of this exist today in Tucson.

3. Bloated Operational Budgets – Not a problem. Significant savings can be realized when facility management budgets are unnecessarily large. Extravagant spending and too many employees can be fixed by private management. Even before recent budget cuts our buildings were running on very slim budgets. With current cuts of 60%, or more there is little opportunity for private management to find significant savings.

4. Political Decisions Rather Than Business Decisions – Very little opportunity. Compared to many public management environments, Tucson rarely operates based upon politics rather than business principals. This has improved over the years. As an example, rates are now set by the staff based upon market driven decisions. Only once or twice a year does this happen today.

5. Dysfunctional Human Resources or Purchasing Policies: Very little opportunity. Over recent years these functions have improved greatly. The availability of pCards is an example of significant improvement.

6. Opportunities to bring more Events – Very little opportunity. Sometimes private companies can book more events in the same facilities. Here is a look at our buildings:

      Tucson Music Hall – Very little room for growth as the calendar in full during the performing arts season.

      Leo Rich Theater – This facility is too small to attract more concerts or other performances. It’s real potential lies with presentations at conventions. This growth ca best be realized by the creation of a headquarters hotel. The hotel staff is the ideal private sector booking partner with national booking strength.

      Tucson Arena – This facility is too small, too old, too run down and the ceiling is too low. Additionally half the current use dates are for exhibit events and not arena style events. All of this means that no significant new use can be added.

      Tucson Convention Center – Like the Leo Rich Theater, this space will be increased use with the addition of a headquarters hotel. If a hotel is not added, no one can bring more business.

      Fox Theater – There is room for event growth here. Due to their similar size, significant growth would best be realized by competing with the Rialto for concerts. This could be done but not without damage to the Rialto calendar.

7. Quality Management Staff: Very little opportunity. At times, private companies can bring quality management personnel to facilities for the first time. We have quality professionals staffing the TCC and Fox Theaters today. Over the last few years, at least 2 of these key staffers have been invited to go to work for private management companies and have declined. Additionally two of our staffers are board members are two prestigious venue management schools.

embedded by Embedded Video

YouTube Direkt

Reminder not to violate the publics trust.