Carefree Truth
Issue #679, July 7, 2018
Issue #679, July 7, 2018
Centerpoint's Josh Friedman asked if the Council had any questions. Councilman Stephen Hatcher asked if there was an opportunity to to charge admission to the Pumpkin Festival. Mr. Friedman said they were looking at that possibility. Councilwoman Cheryl Kroyer said they decided not to do that this year, but the Festival does have a lot of value and they are looking at a way to do that in the future that won't turn people off.
Councilman Gene Orrico asked if the non profits are being charged to participate. Mr. Friedman said it depends on their activities. If they are using it as a fundraiser and they make enough money, the Town will recoup some. Mr. Orrico asked about participation by Carefree merchants. Mr. Friedman replied that they are encouraging them to participate, but there has not been interest expressed by most of the merchants in the past. He was not sure about a cost structure. It must first be determined if there is interest from the merchants.
Councilman Mike Farrar said that a $7,000 profit had been mentioned but that it excluded Ray's payment. Mr. Friedman again explained that his presentation was looking strictly at logistics and that Ray's contract was with the Town, not with Centerpoint. Mr. Farrar said there is no profit in the event. Mr. Friedman noted that you can't turn it around and make an overall profit in 1 year, but this is a huge step in the right direction. He believed that over the next few years, profits could be increased to cover Ray's cost as well. Mr. Farrar said that the revenue in 2017 was $40,000 and in 2018 the anticipated revenue is 77,000, an increase of 90%. Did Mr. Friedman think that was reasonable in 1 year? Mr. Friedman thought it would be more. Mr. Hatcher noted that approximately $20,000 of that would come from alcohol sales.
Councilman Gene Orrico asked if the non profits are being charged to participate. Mr. Friedman said it depends on their activities. If they are using it as a fundraiser and they make enough money, the Town will recoup some. Mr. Orrico asked about participation by Carefree merchants. Mr. Friedman replied that they are encouraging them to participate, but there has not been interest expressed by most of the merchants in the past. He was not sure about a cost structure. It must first be determined if there is interest from the merchants.
Councilman Mike Farrar said that a $7,000 profit had been mentioned but that it excluded Ray's payment. Mr. Friedman again explained that his presentation was looking strictly at logistics and that Ray's contract was with the Town, not with Centerpoint. Mr. Farrar said there is no profit in the event. Mr. Friedman noted that you can't turn it around and make an overall profit in 1 year, but this is a huge step in the right direction. He believed that over the next few years, profits could be increased to cover Ray's cost as well. Mr. Farrar said that the revenue in 2017 was $40,000 and in 2018 the anticipated revenue is 77,000, an increase of 90%. Did Mr. Friedman think that was reasonable in 1 year? Mr. Friedman thought it would be more. Mr. Hatcher noted that approximately $20,000 of that would come from alcohol sales.
Mr. Farrar asked if that included the $70,000. Mr. Friedman repeated that that was the entire logistical contract, which includes all the logistics for the event. Mr. Orrico said that, exclusive of Ray's contract, the Town's going to pay another $15,000 for digital media, so that's $125,000. Gary Neiss corrected Mr. Orrico, stating that Ray's contract is for $100.000, not $110,000. That was confirmed by Mayor Les Peterson.
Mr. Farrar continued, last year the pumpkin festival cost $161,974 and the revenue was $40,319, with a loss of $93,000. Ms. Kroyer pointed out that Ray's contract has never been added into the logistics costs. The Town is looking at giving all the logistics to Centerpoint. She felt confident that they could cover all the logistics costs and make some money on it. They are looking to make more revenue and also to cover Ray's contract in the future. Mr. Farrar insisted that Ray's contract should be included to compare apples to apples. Ms. Kroyer pointed out that that had been shown on a slide earlier in her presentation. Mr. Friedman said he was comparing apples to apples with the logistics presentation. Ray's cost has nothing to do with logistics. Gary repeated that Ray's cost had been included in Ms. Kroyer's presentation.
Mr. Farrar asked if this had gone out for a RFP. Councilman Mike Krahe reminded Mr. Farrar that it had gone out to 3 vendors, which had been stated in the presentation. Mr. Farrar claimed that a non profit ran the Christmas Festival in past years, and that 3rd party promoter Magic Bird had provided revenue back to the Town of approximately $18,000, bringing the cost down to $12,000. He asked why the Town didn't take the RFP to that private event promoter to do the same thing. They handled the logistics at no cost to the Town.
Mayor Peterson said that was not accurate. He said Mr. Farrar was going back and trying to redo an already approved marketing plan. Mr. Farrar responded that he hadn't approved it. The Mayor said Mr. Farrar might not have but this Council did. They were looking at the executional elements, not at Ray's contract, which was approved and signed. They were looking at the best way to control the content and execution. There are not enough volunteers, staff and Council members to do this. This is a vetted vendor. 2 others were also considered, and Centerpoint was determined to be the best. He told Mr. Farrar that at some point he needed to stop arguing the same thing at every Council meeting.
Mr. Farrar said this was the first time he had seen this proposal. He felt it should be tabled for review and that it was unfair to ask him to make a decision at this meeting. He still didn't understand why the Town tried to be an event promoter. They were looking at a loss of $93,000, and he didn't know why they needed to do that. He said that Carefree had wonderful festivals done by the private sector. Mayor Peterson disagreed, saying he wouldn't describe them as "wonderful". Mr. Farrar said the Indian and Chocolate festivals were wonderful, and Jo Gemmill's Christmas Festival was outstanding. Carefree is not an event promoter.
Ms. Kroyer pointed out that this is the 4th year of the Pumpkin Festival. It has gotten an incredible amount of interest and has put Carefree on the map. They have spent a lot of time, done a lot of research, interviewed a number of companies and have come up with the best solution, in the opinion of the marketing committee. Mr. Farrar said that was not his opinion. Mayor Peterson pointed out that Mr. Farrar was not part of the marketing committee. Mr. Farrar said the Pumpkin Festival is wonderful for Carefree but the financial model does not work. The losses can't be sustained going forward. Bring in a private sector promoter and the Town can contribute a very small amount. He repeated that this decision should be tabled.
Mr. Hatcher pointed out that the long term strategy has been for the Town to move away from Town orchestrated events. This will be the first time for that transition to a private party. The transition can be made to this gentleman for all of these events. Previously, they were orchestrated by Gina Kaegi. She has moved on to a new job, so that cost is no longer in the budget.
Mayor Peterson noted that they tried what Mr. Farrar was suggesting with Magic Bird and it was a disaster. "They were tag sales or garage sales, and that's not what this town is. That's what you want to go back to. You want to bring back Magic Bird." Mr. Farrar claimed the businesses like that kind of event. He said that Carefree is trying to be Paradise Valley North, when that's not who our customers are, according to what Don at Pizzafarros told him. The Town kicked out Vermillion and Magic Bird. They didn't work with them to try to make it better. The Mayor said they did try to do that. The Town delineated their goals, and those promoters said that's not what they do.
Dr. Krahe noted that they were going down that rabbit hole again, talking about all these other things, when they were here to talk about the contract with Centerpoint. He said he didn't need any more time to understand what's very simple. He saw that they were going to make some money. "It's not rocket science." It's a great proposal, moving to reduce costs and ultimately make money off these events. "It's pretty simple." They don't have to talk about the businesses or Gina or anybody else. They are here to look at this proposal and make a decision. Some may have missed it, but he saw RFPs in the presentation. Dr. Krahe made a motion to accept it and move forward, get it going and get it done.
Vice Mayor Crane noted that last year produced a $21,000 loss on logistics and this year there should be a profit of $7,000. He asked if Mr. Friedman was confident the vendors could be charged more, and he asked how much more. Mr. Friedman said he didn't have the numbers the vendors would be charged with him that night but he could get back to the Council with those numbers. It depended on each vendor's level of involvement and the time spent at the Festival. He had talked to the vendors and they had agreed on fair market value prices. In past years, some had been charged as little as $50-100 to participate, while making $12,000-15,000 at the event. Fees charged will now be comparable to other events of this caliber.
Vice Mayor Crane asked if the Town would be part of the vetting process with the increased number of vendors. Mr. Friedman said that Town has chosen the vendors. The vendors have always participated by invitation, and this year would be no different. 45 vendors got invitations and they are expecting to have 25-30 vendors participate. Some vendors who participated in the past called to express interest even before the invitations were sent. Last year, 12-15 vendors participated. There will be an increase in both the fees and in the number of vendors this year.
The Vice Mayor asked if the number of vendors doubles, can the standards be maintained? Ms. Kroyer assured him that Vicki Zimmerman and Mr. Friedman will make the decisions together, and that standards will be maintained. She said they are not looking for flea market kinds of vendors. They want a nice Harvest Market. They can expand it and keep the quality. Mr. Hatcher asked if the Council, as a group, got to see oversee the vendor choices. Ms. Kroyer replied that there are people with experience who would vet the vendors.
Vice Mayor Crane said a package with a lot of new revenue streams had been presented, and he asked if everything had been mapped out to make sure it all fits. The $7,000 profit is based on it all fitting. Mr. Friedman said they'd had countless meetings and he's walked the space. There are ways to maximize space that were not utilized in the past. The general footprint will remain the same. The majority of the increase in revenue identified so far is what was done before but the Town didn't get money from it. The 2 biggest sources will be the vendors, and the sales of food and alcohol. Previously, the 3rd party logistics companies took 75% and gave 25% to the non profits. The Town got nothing. The non profits will still get 25% but the other 75% will now go to the Town. Centerpoint will be enhancing what was there as well as increasing the number of vendors booths and kids' activities. The Town will be getting what it should have been getting since Day 1.
Mr. Hatcher asked that Centerpoint extend a hand to any local businesses who want to work with them, giving them the opportunity to participate. Mr. Friedman said it is on his agenda to meet with both the businesses and the non profits. Very few businesses have shown an interest in participating in the past. He would like to find out why and to see if there is anything that can be done to mitigate concerns they have had.
Mr. Farrar asked if, given the increase in vendors and activities, will street closures be required on Easy Street? Mr. Friedman said no more street closures should be required than there were in the past, although depending on where the hay ride and the haunted house end up, they might require slightly more, or a crosswalk monitored by police.
The Council voted 5-2 to approve the contract with Centerpoint, with the Council members being able to look over the contract and make minor changes if they felt any were needed. Mr. Farrar and Mr. Orrico were opposed. Mr. Farrar said the Town has been doing this for 2 years. He still wanted it done entirely by a 3rd party private promoter, saying the Town doesn't have the experience to do it. Mayor Peterson said the Town is moving in the direction of increasing cost recovery while maintaining control over the quality, which he felt was the logical next step. He was not in favor of going back to what he thought was a failed approach.
https://vimeo.com/278768546
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list.
Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.
Mr. Farrar continued, last year the pumpkin festival cost $161,974 and the revenue was $40,319, with a loss of $93,000. Ms. Kroyer pointed out that Ray's contract has never been added into the logistics costs. The Town is looking at giving all the logistics to Centerpoint. She felt confident that they could cover all the logistics costs and make some money on it. They are looking to make more revenue and also to cover Ray's contract in the future. Mr. Farrar insisted that Ray's contract should be included to compare apples to apples. Ms. Kroyer pointed out that that had been shown on a slide earlier in her presentation. Mr. Friedman said he was comparing apples to apples with the logistics presentation. Ray's cost has nothing to do with logistics. Gary repeated that Ray's cost had been included in Ms. Kroyer's presentation.
Mr. Farrar asked if this had gone out for a RFP. Councilman Mike Krahe reminded Mr. Farrar that it had gone out to 3 vendors, which had been stated in the presentation. Mr. Farrar claimed that a non profit ran the Christmas Festival in past years, and that 3rd party promoter Magic Bird had provided revenue back to the Town of approximately $18,000, bringing the cost down to $12,000. He asked why the Town didn't take the RFP to that private event promoter to do the same thing. They handled the logistics at no cost to the Town.
Mayor Peterson said that was not accurate. He said Mr. Farrar was going back and trying to redo an already approved marketing plan. Mr. Farrar responded that he hadn't approved it. The Mayor said Mr. Farrar might not have but this Council did. They were looking at the executional elements, not at Ray's contract, which was approved and signed. They were looking at the best way to control the content and execution. There are not enough volunteers, staff and Council members to do this. This is a vetted vendor. 2 others were also considered, and Centerpoint was determined to be the best. He told Mr. Farrar that at some point he needed to stop arguing the same thing at every Council meeting.
Mr. Farrar said this was the first time he had seen this proposal. He felt it should be tabled for review and that it was unfair to ask him to make a decision at this meeting. He still didn't understand why the Town tried to be an event promoter. They were looking at a loss of $93,000, and he didn't know why they needed to do that. He said that Carefree had wonderful festivals done by the private sector. Mayor Peterson disagreed, saying he wouldn't describe them as "wonderful". Mr. Farrar said the Indian and Chocolate festivals were wonderful, and Jo Gemmill's Christmas Festival was outstanding. Carefree is not an event promoter.
Ms. Kroyer pointed out that this is the 4th year of the Pumpkin Festival. It has gotten an incredible amount of interest and has put Carefree on the map. They have spent a lot of time, done a lot of research, interviewed a number of companies and have come up with the best solution, in the opinion of the marketing committee. Mr. Farrar said that was not his opinion. Mayor Peterson pointed out that Mr. Farrar was not part of the marketing committee. Mr. Farrar said the Pumpkin Festival is wonderful for Carefree but the financial model does not work. The losses can't be sustained going forward. Bring in a private sector promoter and the Town can contribute a very small amount. He repeated that this decision should be tabled.
Mr. Hatcher pointed out that the long term strategy has been for the Town to move away from Town orchestrated events. This will be the first time for that transition to a private party. The transition can be made to this gentleman for all of these events. Previously, they were orchestrated by Gina Kaegi. She has moved on to a new job, so that cost is no longer in the budget.
Mayor Peterson noted that they tried what Mr. Farrar was suggesting with Magic Bird and it was a disaster. "They were tag sales or garage sales, and that's not what this town is. That's what you want to go back to. You want to bring back Magic Bird." Mr. Farrar claimed the businesses like that kind of event. He said that Carefree is trying to be Paradise Valley North, when that's not who our customers are, according to what Don at Pizzafarros told him. The Town kicked out Vermillion and Magic Bird. They didn't work with them to try to make it better. The Mayor said they did try to do that. The Town delineated their goals, and those promoters said that's not what they do.
Dr. Krahe noted that they were going down that rabbit hole again, talking about all these other things, when they were here to talk about the contract with Centerpoint. He said he didn't need any more time to understand what's very simple. He saw that they were going to make some money. "It's not rocket science." It's a great proposal, moving to reduce costs and ultimately make money off these events. "It's pretty simple." They don't have to talk about the businesses or Gina or anybody else. They are here to look at this proposal and make a decision. Some may have missed it, but he saw RFPs in the presentation. Dr. Krahe made a motion to accept it and move forward, get it going and get it done.
Vice Mayor Crane noted that last year produced a $21,000 loss on logistics and this year there should be a profit of $7,000. He asked if Mr. Friedman was confident the vendors could be charged more, and he asked how much more. Mr. Friedman said he didn't have the numbers the vendors would be charged with him that night but he could get back to the Council with those numbers. It depended on each vendor's level of involvement and the time spent at the Festival. He had talked to the vendors and they had agreed on fair market value prices. In past years, some had been charged as little as $50-100 to participate, while making $12,000-15,000 at the event. Fees charged will now be comparable to other events of this caliber.
Vice Mayor Crane asked if the Town would be part of the vetting process with the increased number of vendors. Mr. Friedman said that Town has chosen the vendors. The vendors have always participated by invitation, and this year would be no different. 45 vendors got invitations and they are expecting to have 25-30 vendors participate. Some vendors who participated in the past called to express interest even before the invitations were sent. Last year, 12-15 vendors participated. There will be an increase in both the fees and in the number of vendors this year.
The Vice Mayor asked if the number of vendors doubles, can the standards be maintained? Ms. Kroyer assured him that Vicki Zimmerman and Mr. Friedman will make the decisions together, and that standards will be maintained. She said they are not looking for flea market kinds of vendors. They want a nice Harvest Market. They can expand it and keep the quality. Mr. Hatcher asked if the Council, as a group, got to see oversee the vendor choices. Ms. Kroyer replied that there are people with experience who would vet the vendors.
Vice Mayor Crane said a package with a lot of new revenue streams had been presented, and he asked if everything had been mapped out to make sure it all fits. The $7,000 profit is based on it all fitting. Mr. Friedman said they'd had countless meetings and he's walked the space. There are ways to maximize space that were not utilized in the past. The general footprint will remain the same. The majority of the increase in revenue identified so far is what was done before but the Town didn't get money from it. The 2 biggest sources will be the vendors, and the sales of food and alcohol. Previously, the 3rd party logistics companies took 75% and gave 25% to the non profits. The Town got nothing. The non profits will still get 25% but the other 75% will now go to the Town. Centerpoint will be enhancing what was there as well as increasing the number of vendors booths and kids' activities. The Town will be getting what it should have been getting since Day 1.
Mr. Hatcher asked that Centerpoint extend a hand to any local businesses who want to work with them, giving them the opportunity to participate. Mr. Friedman said it is on his agenda to meet with both the businesses and the non profits. Very few businesses have shown an interest in participating in the past. He would like to find out why and to see if there is anything that can be done to mitigate concerns they have had.
Mr. Farrar asked if, given the increase in vendors and activities, will street closures be required on Easy Street? Mr. Friedman said no more street closures should be required than there were in the past, although depending on where the hay ride and the haunted house end up, they might require slightly more, or a crosswalk monitored by police.
The Council voted 5-2 to approve the contract with Centerpoint, with the Council members being able to look over the contract and make minor changes if they felt any were needed. Mr. Farrar and Mr. Orrico were opposed. Mr. Farrar said the Town has been doing this for 2 years. He still wanted it done entirely by a 3rd party private promoter, saying the Town doesn't have the experience to do it. Mayor Peterson said the Town is moving in the direction of increasing cost recovery while maintaining control over the quality, which he felt was the logical next step. He was not in favor of going back to what he thought was a failed approach.
https://vimeo.com/278768546
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list.
Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.