New London’s Finance and Personnel Committee moved discussion of the Grand Theatre to the forefront of the agenda at their Dec. 8 meeting.
In October, Rogers Cinema CEO Scott Koran asked the city to consider taking ownership of the historic building and the building adjoining it. He attended the Dec. 8 meeting to check on the progress of the offer.
Other citizens included Ben Bruette, manager of the Grand Theatre, Margie Brown and Bonnie Weidert of Friends of the Grand from 1998, Chamber Director Laurie Shaw, downtown business owners Beth Hutchison, Gordy Schirpke, Bob Leahy and Cheryl Hosmer.
Kent Hager gave a brief history of what has transpired since Sept. 1 when Koran informed the city that Rogers Cinema was consolidating and therefore New London would be losing a theatre.
Hager reminded the committee that 12 years ago the citizens voted 924-669 in a referendum to save the Grand Theatre building. A mil levy covered the $250,000 in restoration costs needed to bring the grand old lady back to life.
The building is now being offered as a donation to the city from Rogers Cinema. Copies of the Rogers financial statements were evaluated by Judy Radke, the city’s finance director. Hager found two other theaters owned by cities in the state of Wisconsin. Another was located in Michigan. All were on lease agreements. Hager had suggested in October to lease the theatre to the manager, Ben Bruette to keep in operation, versus having another empty building in town and jeopardizing the Grand’s historic building.
Radke said after seeing the profit and loss statements for the theatre that it had always been combined with Waupaca’s theatre, and had to be separated. The focus of this effort, she said, was ‘If we take the theatre could someone make a profit from it?’ Radke said looking at the statements, adding lease money in and arranging for things like snow removal, etc., she felt the theatre could make a profit.
Tom O’Connell asked if the statements were audited, and Radke explained that they don’t need to be, due to the small amount of debt on the theater.
Romberg then said, “There are all kinds of reasons for us to do this. It keeps people here in town and brings others to our town, they shop here too. There are kids working there too. But, is this the reason for us to take this on as a city?
“I am concerned about a lot of things and we should discuss this win/win situation we’ve been offered here,” Romberg said. “Mr. Rogers as a knowledgeable businessman will get tax breaks from gifting this property to us. Did Mr. Rogers also look at the fact that the assessment came to $700,000? Did he not want to move on this until after the first of the year? With his tax rate of 35 percent he would realize $250,000 to 270,000 of tax credits. Somebody should ask why he doesn’t sell it to Ben for that amount. Revolving loan funds are available and the city would not have to take ownership of this big building.”
Another concern of Romberg’s was, ‘Could the theatres be separated?’ “I’m concerned that Ben doesn’t have enough skin in the game. If he leaves, what do we do then? What happens if the HVAC systems break down? I’d like to know things like this. Who would be responsible?”
Dave Morack expressed his goal was to keep the theatre at all costs. Secondly, he would prefer having a private owner do it. “We are facing stressful times in the coming years as a city. We have enough to worry about without a big theatre.” In the same breath he agreed that the economic impact of having the theatre should be remembered and that he doesn’t want to have to drive to the valley or to Waupaca to see a movie on a big screen.
“I attend two movies a month on average,” illustrated Morack. “If I drive to the valley or Waupaca that is a cost of $5 a trip for gas. In one year I am spending $150 just to drive to the movies I want to see. There is a Woodman’s next door, so I might as well do some grocery shopping, and while I’m at it I could stop other places. It takes the dollars out of our community. We can’t afford to do that.”
Romberg wanted to hear the facts about how much an HVAC system would be to replace, to which Mayor Henke and Judy Radke said would not be huge numbers. “If one HVAC unit went out we’re talking much less than the original price without installing ductwork and everything. “It’s just like your home. You don’t know when these things will go out,” said Henke. “It may be tomorrow, but it may be years from now.”
Romberg wanted to look at what a contract would say, what a lease options would say, and said, “Let’s make sure that we talk about all this and make a good decision and not cost us big bucks down the road. Let’s have citizen input and ask them if it costs $20,000 a year for upkeep, do they want to pay for that?” He said it may take a month or two to get responses from people.
Romberg then said there was another discussion to have. Whether the theatre group would want to use the stage in the grand and if so, how would the HVAC is moved to do so? It sits behind the stage at the Grand.
“I thought Ben would talk to someone in the theatre industry to see if the industry is dying, stable or growing. Ben should understand before he commits himself to this. If he leaves, will we get anyone else to lease the building? If we do, would they become a city employee?”
There was also talk about auctioning off the building and emptying the contents.
Tom O’Connell thought they should look at a block grant and asked if the theater would be able to buy movies for showing like they do now, or if just an independent theater, if they would loose the status of showing new releases. “We don’t want to bring this to another referendum do we?” asked O’Connell.
Mayor Henke said, “I don’t think it needs to go to referendum. I’ve met with Kent, Judy and Ben and my goal is to keep the movie theatres open. It is in the best interest of the community to keep it open. I think the city should take ownership and get rid of it as soon as possible. Ben doesn’t have the equity built up to buy it right now. He’s a young man. Think back to when you were 27 years old. Did you have much equity in anything? I think within the Economic Development committee we could use this as an incubator program. As far as value goes, we are not going to get a lot for the buildings. With the city owning it, we could liquidate the seats, right down to the popcorn makers if we had to. But I don’t want to do that.”
Considering the benefit this theatre provides our community, I think Roger’s offer is generous.”
Romberg said a bucket of bolts was still a bucket of bolts and nobody has come up with a ballpark of if this thing is marketable or the investment that needs to go into it.
“I would like to see SCORE or the small business administrations talk with Ben and I want to know if Mr. Rogers has thought of selling the building to Ben for the same price as the tax credits he will be getting.”
Romberg then spun his chair around to address the audience. “Nobody on the committee has a different objective; we’re all in agreement that we want the theatre here. We need to find out the best way to handle this in the interest of our citizens.”
He went on to say if anyone in the audience had anything to say about it, they wouldn’t be able to do so at the meeting. He said they didn’t have time with all the other items on their agenda, and another meeting following that one. He instructed them to contact their alderperson, and invited any other citizens to do this as well.
O’Connell said he would like to see the theatre stay in town. “
If we lose it we have another empty slot. Nobody wants that. If we don’t put a big financial strain on the city, I’m all for it,” O’Connell said.
“I can’t see it being a financial burden. You can write a lease and shift all responsibility of an HVAC system, anything you want, to the leaser, and away from the city,” Judy Radke said.
Alderperson Ron Steinhorst asked what the time frame was on this project, which was deferred back to Scott Koran of Rogers Cinema.
“If we can see progress towards acceptance of the offer we will be happy to make a deal soon. If it is going to take until February or April, probably not. We are consolidating and have already sold properties in Florida and Houghton, Mich., and could easily offer this same donation to a 501-3c non-profit and be done with it. It’s a fully operational theatre that you can empty and make money on if you want to. You can’t lose on this deal. The best case scenario would be for Ben to stay on as manager and pay you for the building as things operate. I will call Mr. Rogers and discuss it with him. If we aren’t making any progress soon, I don’t want to wait much longer,” Koran said.
Henke said, “We owe it to the taxpayers to try to keep it open and we need to find the best way to accomplish that.” He also encouraged citizens to call their alderpersons or the mayor or city administrator and voice their opinions in a constructive manner.
After the meeting advanced to other city matters, Ben Bruette and Scott Koran said to this reporter that they were frustrated that the members had not advanced any further than the talk they had in October. “The building is in great shape,” said Koran. “We’ve taken care of it. It’s pretty clear that this is a good situation for everyone if they want to keep the theatre open.”
Margie Brown and Bonnie Weidert, both members of the Friends of the Grand from 1998, agreed that if the taxpayers didn’t want the building they would have failed the referendum 12 years ago. There would be extensive costs in preparing the Grand for live theatre productions.
A special meeting has been called at city hall at 5 p.m. Thursday, Dec. 30, to come to an agreement on what to do with the Grand Theatre.