The Relationship Between the YWCA Purchase and the Aquatic Center

A couple of weeks ago we had posted about a deal that may be brewing between T. Diane Bellamy-Small and Robbie Perkins regarding a possible purchase of the old downtown YWCA by the city of Greensboro.  The original Yes!Weekly post suggested Bellamy-Small may be seeking this project in exchange for her vote in favor of the aquatic center.

There may be reason to believe this proposal is attracting more support among council members who belong to the Melderec con Simkins faction headed by Perkins.

Purchasing the old  YWCA to convert it to a recreation center would be a horrible idea.  Yes, it has a swimming pool; but we need to remember that we just bought an enormously expensive swimming pool complex at the Coliseum.

This is a time of recession.  This is not a time we are likely to see tax revenues expanding prolifically.  We just heard from our police chief that there may be a need to add many new police officers and a new police district, with all the associated new capital and operational expense that would entail.  We still have not gotten a handle on what we really need to do to enhance crime control in our city; and this remains a top agenda item.  If it will require additional money, it has to come from somewhere. 

But there are many currently funded projects and programs, as well as new wish-list items like the YWCA, that compete for city tax dollars.  We cannot harbor the illusion that tax revenues are infinite.  They are not.

We cannot look at every proposal for new spending and say, "Wouldn't it be nice to have that?"  

The fact is that responsible households, businesses and governmental entities make discerning choices about the money they spend.  It is a matter of fiduciary responsibility.  We need to be concerned about the expenses we are passing along to those who do not have much, and indeed, to future generations.

Sure, in the eyes of some, the YWCA building would be "nice to have".  Among the members of this group, it always seems to be "more, more, more".

But is the YWCA purchase really necessary?

We need to consider the dimensions of the latest boondoggle the city bought.

The aquatic center is now estimated to cost close to $19 million dollars.  We do not know what future cost overruns might be.

Let us assume the debt is being repaid at 4% interest over a period of 20 years.  Let us further assume that the aquatic center requires $600,000 per year in operational expenses.

That means, in total, the aquatic center would cost us upwards of $41 million over a 20 year period.  But remember that lots of folks were willing to step up, and say how nice it would be to have the aquatic center.  The problem is that we have to pay for it during a period of economic contraction and intense competition for new jobs.

Sometimes I think that some council members would be very happy to increase our taxes by 30% or more to pay for all their spending schemes-- once all the fiscal realities become painfully clear.  But raising taxes to accommodate the spending frenzy will chase many of those new jobs away that we claim to be seeking.

Comments

[Duck]

Joe, you must have had a hard time with elementary math, not to mention economics in college.

[Bubba]

I see the Quacker is back.

[Abner Doon]

At least $41,000,000

[Abner Doon]

$600,000 in upkeep x 20 years = $12,000,000

+ 19,000,000 principle

+ $8,461,174 interest @ 4%

= $39,461,174, not including resurfacing etc...which will be at least $2 million over 20 years.

[Joe Guarino]

Duck, actually, math came pretty easily to me.

Abner, your numbers seem more precise than mine, which were an estimate. I appreciate your providing these numbers, presuming they are correct. (People can tend to underestimate or disregard the long-term costs associated with paying interest.) But what do you mean by "resurfacing"?

[hugh]

Joe, we can pay for this with the hotel tax. That is what clowncil tells us.

What is wrong with you people that you don't believe everything our most favored and beyond reproach leaders tell us?

[Don Moore]

DBS should have asked for more Bus Shelters instead for a Swimming Pool. As a result, her constituents are going to remain getting wet.

As for the losses in the Pool operations, I suspect that the coliseum will soon show a profit as its losses are pushed under water with the pool expenses.

[Duck]

$1M in operating revenues for 20 years equals $20M, $14.5M in annual economic impact equals $290M, and add the sales tax and hotel revenues, you get mega bucks!bubba loses 50lbs and gets to pay taxes for another 10 years, worth $1k. There is much to gain here besides the humor! quack, quack.

[Joe Guarino]

Duck, I sure hope those projections were not based on wishful thinking, because they sure were not based on sound market research based on what I have seen on this issue.

Hugh, we cannot reflexively trust what we are being told-- because trust has been breached repeatedly in the past.

Don, thanks for sharing those observations.

[Mick]

"We" are not paying 6 million of that 19.

Where do we get $600,000/year in operating expenses and where do we get 2 mill in resurfacing? These numbers may be correct but I would like to know the source(s).

Since we are counting operating expenses in the total costs should we not include income? I know that sales and hotel taxes are not attributed to the bottom line of the facility but is it not at least worth a mention.

To me it appears you are just going for shock value and not real analysis. But it is your site after all.

[Joe Guarino]

Mick, I think the point needs to be understood that it should be possible to estimate expenses in a fairly reliable way; but estimates of revenues are unreliable, because that would depend on solid, objective market research-- which has not yet happened.

I believe the $600,000/year was a city estimate of annual expense, if I remember correctly. The resurfacing figure was raised by another commenter.

[Mick]

Understood. It just looks to me you are simply angling to put this in as bad a light as possible at every turn. The CVB money is 6 million. I am not sure that is difficult to estimate yet you left that out. Just because the income is unklnown doesnt mean it will be non-existant. It is worthy of mention as is the tax income to the city. I'll stick with my original theory of "shock value". Thanks.

[Abner Doon]

Resurfacing

The swim center is basically two Olympic size swimming pools.

At about 13,000 square feet times two, times twice in 20 years, at about $10 per square foot, $130,000 x 2 x 2 = $510,000

Plus, as we know, chemicals and large bodies of artificially created, heavily chemically concentrated bodies of water closely separated make everything underneath them stress. That’s always where the hit comes, and you have to fix it.

Entropy, the 2nd law of thermodynamics.

Plus the dive tower will have to be redone for insurance reasons.

And new pumps all around.

And to remain competitive and professional, the floor tiles, showers, bathrooms and locker rooms will have to be redone.

All that humidity inside disintegrates everything.

[Abner Doon]

Mick, do you own a pool?

[Joe Guarino]

Mick, let's not forget that the CVB money is a source of funds that would have been available to the Coliseum for other purposes; and there is a good chance it will need to be replaced by other sources. We can't believe anything the Coliseum folks represent on this issue because they have proved they are not trustworthy.

Thanks for the explanation, Abner. I do not know what the expected lifetime of these surfaces should be.

[Arch Stanton]

"Mick, do you own a pool?"

Him and the rest of us tax payers will own one soon, maybe 2 if the YWCA purchase goes through.

[Mick]

Looks good but you didnt really answer the question. Where do you get your figures? Job or personal experience? Internet? Where do you get $10. Why twice in 20 years? Is it accurate to extrapolate backyard pool figures with this facility? Have you experience with commercial pool operations? You do seem to know what you are typing about.

Is proper maintenance and/or resurfacing already included in the estimated operating expenses (I doubt that though)

[Vivi]

If the YWCA venture were to pass City Council it would be another bad chapter in Greensboro's history. I think it would send a clear message of promoting segregation. Meanwhile our new Council is preparing to throw away our money on a luxury item that will be enjoyed by few but paid for by many. By time its paid for I could very well be a great grandmother. Wow

[Joe Guarino]

Vivi, the YWCA purchase would be another case of back room deals and machinations driving the agenda-- just as in the case of the aquatic center. The city already has a very extensive Parks and Rec infrastructure-- probably much more than other cities our size-- and the case has not even been remotely been made that this facility is critically needed.

I also wonder about the downtown location for a rec center. Downtown is an area where few young people actually live. Are we proposing to make this purchase primarily because the building is available? Are we proposing to do it because it is just another feather in the cap of big local government?