Borough Council Special Meeting Votes, August 4th, 2011: $7,000 approved in 4-3 vote
Aug 04
Borough Council met for another special meeting on August 4th, 2011 at 7:30 PM to discuss two matters. All members were present, except Monica Simpson who attended the meeting via telephone.
Mass Gathering Permits
The first item was a mass gathering permit for Iron Hill, which was discussed briefly, and approved unanimously by all members of borough council. They had asked to use two borough parking spaces during their “Outdoor Barbecue” on August 13th, 2011.
Jim Cunningham then introduced an item not on the agenda regarding a change to a mass gathering permit already issued to Gibbons Car Show, changing the permit from State Street to the Media Borough parking garage. The change was approved unanimously.
State Street Showcase becomes divisive
The second item regarded the request from Dawn Roe for a $7,000 grant to a subcommittee of the Media Economic Development committee, which was formed last year after Council President Pete Alyanakian was voted into power in July.
The Economic Development committee has a subcommittee, chaired by Dawn Roe, which is putting together events for the theatre in late November.
Briefly, last year Media Borough gave $16,000 to the Media Theatre to pay Bob Linn Architects for designs to get a grant for up to $200,000 to improve the physical structure of the building. Based on requests from Peter Williamson and Monica Simpson, the borough requested the money to be paid back as cash or “in-kind” services from the Media Theatre. Negotiating with Monika Rehoric, the Media Theatre paid $4,000 in cash, and gave the borough four nights (at $3,000 per night) in 2011 to use the theater as it saw fit.
The issue and discussion was about whether the money would be a loan to be paid back or a grant for the committee to spend as they saw fit.
Ms. Roe’s committee is in charge of putting together a set of events from November 8th (Election Day) through November 11th. Other dates had been negotiated in the spring and the summer time, however, due to the time required to produce and promote the events, they were not feasible.
The agenda item, unfortunately, is somewhat misleading in that it states the money is to “RENT SPACE” at the Media Theatre, when, in fact, it is to pay for the band to fill the space. The space has already been rented for $12,000 for the four nights.
At the time of the meeting, Ms. Roe had negotiated a non-profit rate of $3,800 to headline the group “BlackThorn” for the evening of the 11th. She had also budgeted money to pay for the band’s dinner that evening.
Pete Alyanakian neglected to take public comment at the start of the meeting, so immediately after the motion was made and seconded, he requested public comment.
Jim Cunningham interjected and confirmed that the money was not budgeted, and would come from the contingency fund which is money set aside by the borough annually for special circumstances.
Several residents came to support making the money available as a grant:
- Marcus Hoffmann, from the Fair Trade Committee
- Judy Fowler, Executive Director of the Media Arts Council
- Lisa Johnson, a member of the committee
- Several other committee members were present in support of the money being given away as a grant
Dr. Eric Stein, Monica Simpson, and Peter Williamson all expressed reservations about spending the money in the form of a grant.
The discussion escalated quickly as Dr. Eric Stein requested making the $7,000 in the form of a loan per the recommendation of the Finance Committee.
While re-iterating his support for non-profits, Dr. Stein simply asked for accountability regarding where the funds were to be spent, as only $4,000 had been budgeted:
“I’m a little concerned giving taxpayer money for an event. I’m a little uncomfortable paying $4,000 for a band, not matter how good. I’d rather see 10 local musicians benefit from that $4,000.”
He stated that he would like to see a plan on a daily basis for each event with expenses and expected revenues and understanding which non-profits were participating on a daily basis.
I’m really uncomfortable about this … procedurally, it concerns me, just giving money away without proper documentation. But to give it away, in these economic times, I’m a little uncomfortable about that.”
He also pointed out that in her budget projections, the net profits from the event were $12,000 to $15,000 in profit. He iterated many times that he was in favor of helping the non-profits out, but that he would prefer to make it as a loan to protect the borough.
The Finance Committee’s recommendation would be to make the funds available as an interest-free loan to the subcommittee, with MBA oversight, and providing audited expenses of how the money was spent. In addition, all revenues would be shared equally among the non-profits. Finally, Borough Council would be allowed to forgive the loan, if it felt it necessary, down the road.
Peter Williamson: Another thing that I think is important to note is that, we have four dates. And what you guys are talking about with the non-profit sharing is … one.
Roe: One with a strong possibility of a second.
Williamson: … with a second which will have additional costs but also additional revenue. So the finance committee thought on this was … as an incentive for the non-profits and also some protection of the borough that a loan would be a good approach, with the idea that if we did two or … three nights, $12,000 would be, in an ideal world, tripled, $36,000 in which case our small investment of $7,000 would be small start up capital, it wouldn’t be so hard to pay that back.
Another thing that is important for everyone to recognize is that the economic development committee as an entity started this year, and this is the third cash request that’s been made.
The first was for …
Alyanakian: The sign.
Williamson: No, that was the second. The first was for the brochure which was $2,500, the second was for the sign which was $3 …
Alyanakian: No, $1,800.
Williamson: … So … there’s a pattern … and everything happened post budget. So, no matter what happens tonight … I request that that committee as a group come up with a budget for next year so this doesn’t happen, again. So it’s not, you know, drip drip drip. Because that’s part of my concern here that it’s an off-budget dip.
Rehoric: We knew that, but we also knew that the addendum with the Theatre was something that kind of .. just came up. It was not budgeted.
Williamson: The last point I’d like to make is that in Media, we have a professional … besides MAC [Media Arts Council] … yet another professional event organizer in the MBA [Media Business Authority] … they’ve done it for years and they’re very good at it. That’s why the finance committee wanted the money to go to them, we figured they would be the best ones to move it out into the community most efficiently, and also, if it were any form of a loan that went to the MBA and they had the ability to use those extra nights and turn a profit … and redistribute that to non-profits, maybe even keep some for themselves, that would be a great way for everybody to win. I don’t know why that’s not possible, it seems like a great approach to me.
Roe: The only reason I’m leery of that is I think that Friday night is going to be the main money-maker, and if we have the chance to sell out which I believe we absolutely will without a doubt. It’s going to be that night. If they do choose to do a Wednesday night event … I think it will be much lower-key, it will be something that we have to charge a lot … lower kind of seat fare for … I see it being profitable and worthwhile but it won’t be a huge money maker, but it will incur costs and it’s something the committee hasn’t decided it they’d like to do yet because of limited manpower … you know costs and things like that… it’s not something we’d sell out at $20 a pop for.
Eric Stein then interjected that at the previous MBA meeting that the MBA was interested and excited about managing the event, as well as funding it. Because Ms. Roe said that the intent had not been made to the committee, “It doesn’t exist to us,” stated Ms. Roe.
The vote concluded after a 42 minute meeting split along the “New Coalition” lines, with:
- Dawn Roe (I), Pete Alyanakian (R), Monika Rehoric (D), and Jim Cunningham (R) voting in favor of the grant, and
- Peter Williamson (D), Dr. Eric Stein (D), and Monica Simpson (D) voting against the grant.
State Street Showcase Proposed Budget
As a Media Borough tax payer who observed this meeting, I can only say…Wow, why bother having a so-called “Finance Committee?” Really! I was surprised how unrelenting the pressure was in the back and forth dialogue to usurp the authority of the Financial Committee’s savvy in these matters. It was somewhat concerning…even a little scary to see how disciplined financial principles so easily “went out the window” by one vote. I really appreciated Peter Williamson’s input on this…his wise observation of “dip dip dip” and how it could possibly be remedied in next year’s budget.
It’s distressing that partisan politics are interfering with rational thought in regard to the grants given to the Media theater. The purpose of budgets are to allocate money before the fact. Thanks to Mr. Stein and Mr. Williamson for pointing this out and representing the fiscal interests of Media residents and taxpayers.
What folks fail to realize is that the dates for use of the theater were finite…if no use was found, (and paid for) the borough would have been signing off on not recognizing a $12000 value. By allocating these funds, think of it as seed money, there is what amounts to a guarantee of revenue generation that will go directly to 12 non-profits which are incorporated in the borough of Media; including the Firehouse, MYA, the library, and others.
Personally, I would have been ok if it had been framed as a loan, but ultimately, it is the borough that will benefit from this.
I do understand the budgetary issue that this was not budgeted, but to the best my knowledge, this was not known about when the budget was approved. Council could absolutely have said no to this allocation, but that would have shut down a phenomenal opportunity. That would be the difference between being “right” and effective.
@Tom: Thanks for commenting. In general, I agree with most of your points. The question I have is why didn’t they take the MBA up on its offer to fund the event? (Which Eric Stein brought up at this meeting) No risk, all of the reward there.
I think the consensus was that if given the opportunity to help out the non-profits in town, we should do what we can do to help them. Another question, again, is how hosting and paying for the Friday Blackthorn concert actually benefits non-profits in any other way than sharing in the financial profits. Personally, I’d prefer to take the $19,000 spent on this event so far, and split that 12 ways instead of having the borough venture into the entertainment business. But that’s moot as the $12k has gone to benefit the Theatre renovation.
The grant money was given to the Theatre (actually, Bob Linn Architects) last year and the “in-kind” payback (suggested by Peter Williamson) was being negotiated by Ms. Rehoric, … so this could have been anticipated in this year’s budget.
The problem is that the “Economic Development” committee (Pete Alyanakian, Monika Rehoric and Dawn Roe) has a somewhat unclear mandate; does not have published meeting dates, and seems to overlap with part of the mission of the MBA. It is not mentioned anywhere on the Borough Website except in the Committee Assignments PDF.
I think that if the “grant” was voted down, then Borough Council would certainly have given the money as a loan in a follow-up vote. The loan terms as outlined by the Finance Committee would have allowed Borough Council to forgive the loan at its discretion. If the event produced no money, or a loss, my guess is that Borough Council would have simply forgiven it after the fact.
I think I would have preferred the loan model as it would give a greater incentive for the “Economic Development” committee to make the event a success. Risk and reward would be shared, instead of held solely by the Borough as it is now.
As a “grant”, the incentive is much less to make the event a success, as there’s no risk.
Finally, no one mentioned that Blackthorn just played a free concert in Rose Tree park on August 14th. So, I would say there’s no “guarantee” of success for this event in particular. It’s hard to compete with a free concert, although I hope it is successful for the non-profits’ sake.