VENUWORKS MAKES PRESENTATION ABOUT THE THUNDERBOLTS BEFORE CITY COUNCIL

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VENUWORKS MAKES PRESENTATION ABOUT THE THUNDERBOLTS BEFORE CITY COUNCIL

Schoenike stated that “purpose of the Thunderbolts was not to lose or make money, but to break even”

by Steve Ary

In Monday evening’s Council Meeting, the Evansville City Council was met with The Ford Center’s Scott Schoenike, Executive Director of VenuWorks, which is the organization in charge of managing operations and has legal control of the Southern Professional Hockey League Franchise, the Evansville Thunderbolts.

The Thunderbolts replaced the Evansville IceMen in 2016. The former owner, of the Evansville IceMen Ron Geary, wanted to speak at last nights Council meeting.  Last week his attorney was told by Council President Missy Mosby that he would be allowed to speak for only 3 minutes.  Mr. Geary’s attorney declined to accept Mosby’s offer.  Channel 25 News also reported that Council President Missy Mosby informed them that a representative of Mr. Geary that he would not be added to the agenda, but that he would be able to speak for 3 minutes during the “public comment” portion at the end of the meeting. We have been informed by Mr. Geary’s attorney that he plans to formally request that Mr. Geary be put on the next Council agenda to speak about his experiences at the Ford Center.

For clarity, in the “public comment” portion of any Council meeting, individuals are given only 3 minutes to speak, and may address the Council or ask questions, but there is no requirement for the Council to respond or even answer those questions. Most of the time the Council hears the passionate pleas of their constituents, but only responds with a “Thank you” before they move on to adjournment, as if to say, “Your voice doesn’t matter.”

Scott Schoenike, on the other hand was given  as much time as he needed.  Schoenike provided information to the Council touting accomplishments of the Thunderbolts hockey team, and mentioning that the organization aims to “break even.”  He went on to say, “We survive off sweets, beverages, sponsorships, and ticketing fees.” But what doesn’t look good is the revenue profit per event.

He stated that his purpose was not to lose or make money, but to break even, and to bring economic development to downtown Evansville. Schoenike stated, “If we can break even as a hockey team, the Ford Center is still doing well. But to break even is not what you are in business for, and that is not what most people understand. We are set up to break even in order to bring that economic development.”

Schoenike’s less-than-convincing presentation in light of the city’s massive financial struggles and budgeting difficulties during the Winnecke administration caused Council Vice President,  Justin Elpers to interrupt. Elpers asked what specific changes were being made to the hockey team, and what were the details therein. “I just want to have a meaningful discussion about these numbers and about the future,” said Elpers.

After several nervously repeated statements and a general description of a game plan which centered around bringing awareness of the hockey team to the people of Evansville.  Councilman Dr. Dan Adams asked another pointed question about VenuWorks’ financial losses; “Can you tell us how much money was lost?”  Schoenike skated around the answer, stating that the financials are Mike Hall’s personal business. Mike Hall owns 10% of the Evansville Thunderbolts. Adams asked Schoenike how much the city gets hit with the losses in revenue, to which Schoenike assured the Council that none of the losses hit the city, but rather hit Hall entirely.

One person watching Mr. Schoenike’s presentation commented, “How are we supposed to believe that one man who owns 10% is responsible for 100% of the financial losses?”   It shows in the Agreement between the City and VenuWorks For Professional Management Services and License For Usage of the Evansville Arena, that “all operating expenses of the Franchise shall be deemed an expense of the Facility”… What does this mean?  …it mean that the “Facility” is the City of Evansville.  It looks like the Evansville taxpayers shall be responsible for all the operating expenses and losses incurred in the 2016/2017 hockey season. It looks like Mr. Schoenike  must have mis-spoken or didn’t tell the truth in answering this question.

Next, Dr. Adams asked Schoenike what the hockey team’s record was. Schoenike was too embarrassed to answer, but the Evansville Thunderbolts had a losing season with only 13 wins and a whopping 43 losses. Schoenike said, “I try not to think about the last record. It’s about the experience.”

Justin Elpers asked another question, “Does VenuWorks have any prior management experience of a sports team.” Schoenike’s answer was, “No, but it’s really not about the bottom line. It’s really about helping The Ford Center. The hockey team does not help the bottom line. We are here to break even.  ”Elpers – “Scott, what is your plan to get more butts in the seats?”  Schoenike – “We’re going to have to promote more.”

Councilman Jonathan Weaver,  said snidely, “So all of the rumors of gloom and doom are false.”  Adams said, “What rumors? I haven’t heard any rumors.  ”Weaver continued, “It’s a good product and we need to go out and support the hockey team.” Weaver who has a voting history of backing every one of Winnecke’s agendas and “accomplishments” seemed to be “all in” despite the city’s shortfalls, debts, horrendous budget issues such as  unpaid city employees health insurance, and a $129 million municipal revenue bond borrowed to build the Ford Center.

In an interview after the meeting, Councilman Justin Elpers commented that it is “very concerning” that VenuWorks has “no prior management of a sports team” and that some on the Council are in full support of this hockey debacle without even considering the financials of VenuWorks and the Thunderbolts at The Ford Center.

It looks like Mayor Lloyd Winnecke and the Evansville City Council promises that Evansville Thunderbolts hockey team will be generating much needed capital to support the operations costs of the Ford Center have clearly fallen flat. The lack of funds generated by the hockey team and the millions spent on a hope and a dream have revealed that the hockey team itself is nothing short of a “money pit” for the City of Evansville and its taxpayers, and is not the revenue generator that was promised.

 

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16 COMMENTS

  1. It should be patently obvious to the taxpayers of Evansville that apparently, only Adams and Elpers have their vested interest. And, of course, there is Weaver and Mosby, you know, the one’s that rely upon the resources of our mayor’s wife ..the bread and butter of realty ..those listings ..if the new chairman of the dems, namely Scott Danks idly stand by like Faulkner, the former chairman the democrats might as well close shop!

    • Seem to recall that possibility of a special meeting may have been raised by the Demo 8th district or State Chairman where they could vote on removing a party officer or office holder from the party for disloyalty back when the Owen/Jarvis led Central Committee openly opposed their primary winner Rick Davis and supported his Repub opponent. Don’t recall it ever went past discussion of a possible special meeting for removal from the party. Does anyone else recall something like this?

  2. We hear from Adams and Elpers but where in the hell is our CPA, namely Anna Hargis. Elpers, apparently an educator and to most of our knowledge, especially mine lacks the financial tools at least professionally is asking the hard money questions. With her Highness, old Yeller and her lap dog Weaver the Weasel in charge of the Clowncil, the taxpayers of Evansville will never know the financial calamity that currently exist but like a house of cards the day of reckoning will be at hand.

  3. Looks like Councilman Elpers has a backbone and a brain. As for Councilman Weaver, it is surprising he is allowed to run as a Democrat.

  4. Historically, Evansville only supports winner.s Remember when U of E was national champs and getting a seat in Robert’s Stadium was nearly impossible and now there are more attendance at high school basketball games than attendance at U E games. Winners in Evansville will be supported and at best a semi pro Hockey team with only 13 wins will be losing proposition. And with Winnecke at the helm, you can double down on that bet!

  5. “Justin Elpers asked another question, “Does VenuWorks have any prior management experience of a sports team.” Schoenike’s answer was, “No, but it’s really not about the bottom line. It’s really about helping The Ford Center. The hockey team does not help the bottom line. We are here to break even.” (CCO)

    * * * * * * * * * * * * *

    So in reality, what we have is a city subsidized jobs program, the team, which they hope will help the arena to at least “break even” every year, but which has not happened in spite of very generous conditions offered to the team by the city. Someone needs to pull the plug on this nonsense.

  6. Does VenuWorks have shareholders? For a senior executive of a for profit business to stand up in a public meeting and state that there is no profit motive may constitute a breach of fiduciary responsibility. Is VenuWorks a for profit company or an alter ego of the City of Evansville like several local non-profits that depend on city money to keep,the doors open.

    Did Mr. Hall get snookered into buying ownership in an alter ego shell? For profit businesses by IRS rule report profits and losses to shareholders on for K-1 in proportion to their ownership percentage. It sounds like the City of Evansville may have absorbed the VenuWorks losses through the ERC and hung Mr. Hall out to dry. That is SNEAGAL at best and straight up illegal at worst.

    • Joe

      Thanks for your accurate and pointed post. It look like it might be time for a Joe Wallace pro business in your face “Letter to the Editor” taking on the ERC, Mayor and his 7 political puppets on Council to task for letting this type of situation to happen.

      Thanks for your support

      Editor

  7. They’re not running the place for a profit? Considering the lame schedule of concerts they have been bringing, that has been apparent since day one.

    The removal of the IceMen and the replacement with the Blunderbolts was just another stupid misstep by Venuworks.

    BTW, how many corporate Suites will be empty this year?

  8. The storm clouds are forming over the Thunderbolts.

    It seems like Scott Schoenike is telling a lie–re: a 10% investor absorbing 100% of the losses. If that’s the case, show us the hockey bills paid by Mr. Hall. Did Mr. Hall write checks to Venuworks for the Ford Center rentals for the hockey games ? Did Mr. Hall reimburse Venuworks or the City for the operating losses of the hockey team ?

    The truth of the matter is–Hall paid nothing, and I even question whether he invested any cash for his 10% share of the team. Since the City apparently paid $ 200K of the $ 225K for the franchise license with the Southern Hockey League, Mr. Hall may have purely been a ‘straw man’. He was just part of the fabricated story, they need some individual (not Venuworks) to go out and “fight to keep hockey in Evansville”.

    Get John Friend to explain the at-risk rules re: investments, and you’ll see that there is no way Mr. Hall got all of the losses while only being a 10% owner.

    • Mr. Lime,

      Under the IRC 701 provisions, partners in this case, Mr. Hall could receive all the loss allocations, but only to the extent Mr. Hall had hard money therein or on the hook for the entity’s debt. For example, it Hall had invested hard many of $100,000 and VenuWorks invested $200,000, and the agreement stated that Hall receives the losses, and the first year of operations generated a $200,000 loss, Hall would receive only $100,000 of the loss and the next $100,000 would go to VenuWorks. This is referred to as the AT-RISK rules. If during the next year, the entity’s loss was $200,000, VenuWorks would receive another $100,000 of the loss, which would wipe out their total hard money input, the next $100,000 in the second year would be allocated based on debt, generally, if Hall was the only one on the loan, he would then receive the next $100,000 because he has at-risk on collection from the bank. Hope this explains the mechanisms of partnership tax law.

  9. I am just a grandma who loves hockey. I don’t understand all of the legal talk and technical talk of running the Ford Center. I can give some good reasons why attendance dropped of thoug. The food and drink is way too expensive for families. Interaction between the public and the team was severely lacking. Downtown has been ripped apart all around the Ford Center all year and downtown is so crowded with buildings that parking is a couple blocks away. There was almost no coverage on tv and many people had heard the Icemen had left but had no idea there was still hockey at the Ford Center. I’m sure if you compare the Thunderbolts record with other teams in their debut seasons they will be close to the same. Give them more of a chance. Also take into account the fact that the Thunderbolts are SPHL and the Icemen were ECHL. Those of us who attended love the game and the team was a great bunch of young men who played with their whole heart. I also don’t understand Mike Hall’s whole involvement in the team, and I hope they didn’t make him a scapegoat, but I do know he and his sons have a real love of the game.

  10. Is it True the Thunderbolts only sold 10 of the 17 available suites for the past season. At a cost of $35,000 each this resulted in a loss of revenue of $245,000 which would have gone directly into the city coffers. Could this possibly be because of the quality of product offered.

    Is It True that the poor performance of the Thunderbolts as compared to the quality of the Icemen also be a direct cause of food and beverage sales to be down some 80-90%.

    Is It True that because of the poor support of the Thunderbolts, the $2.00 per ticket facility charge was also down 80-90% as compared to revenue that was generated by the Icemen.

    IT IS VERY TRUE: 1) that this has been a tremendous financial impact to the City of Evansville. 2) I sure am glad that I’m not on the Evansville tax role.

  11. What does James Brinkmeyer do during council meetings? I never have read any reports of him asking a single question during a meeting. He votes right along with Messy & Beaver every time though. I think B.J. Watts tells Brinkmeyer how to think and how to vote.

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