THUNDER BAY – The Thunder Bay Community Auditorium will be expected to take on more administrative and capital costs under a new operating agreement with the City of Thunder Bay.
City council approved a resolution Monday to “fully implement an arms-length relationship” with the TBCA.
It’s already a separate entity with its own board and employees, but has relied on the municipal government for significant support in operating the city-owned facility.
Leaders with the TBCA and the city downplayed the impact of the new agreement, which is under negotiation and expected to go into effect on Jan. 1, 2023, saying it will largely cement the status quo.
“It looks like it’s something new, but it really isn’t,” said TBCA general manager Bob Halvorsen.
The city has committed to continued funding support, he said, which he described as the TBCA’s biggest concern in the negotiations. Other details of the new agreement are largely “mechanics,” he said.
The city’s $741,000 contribution in 2021 made up only about 14 per cent of the TBCA’s operating budget, Halvorsen said, falling from as high as 36 per cent in the 1990s.
The operational funding provided by the city through its Community, Youth & Cultural Funding Program will increase slightly to $758,082 in 2022, after remaining steady for several years.
The city has historically covered major capital expenses at the auditorium, like a new roof and resurfacing the parking lot, but that could change under the new agreement, said city treasurer Linda Evans.
The new arrangement will include a formalized funding agreement and a new lease, she said. The previous operating agreement for the 1,500-seat centre dated to 2003.
The TBCA will be expected to take on more of the capital costs to maintain the facility, as well as responsibility for “back office” operations like payroll administration, accounting, and banking.
“The expectation is that the Thunder Bay Community Auditorium will seek funding for capital through programs like the City of Thunder Bay community partnership fund, as well as other levels of government,” Evans said.
Halvorsen said the staffing implications of taking over administrative duties were still unclear.
“Some additional funding will be provided to the TBCA through the Community Youth & Culture Funding Program to allow TBCA to get back office processes set up,” Evans said.
The city considered other models before moving to formalize the “arms-length” arrangement, said Evans. That included considering a “local board” structure and bringing the auditorium under a city department.
“The information we gathered supported our initial recommendation to move to an arms-length [model],” she said. “Really what [influenced the decision] was the fact that it’s the most cost-effective in the long term. It will increase funding opportunities for the auditorium, and this was supported through benchmarking of similar facilities in Ontario and British Columbia.”
Given that negotiations are ongoing, the information reviewed by city council that informed the decision will remain confidential, she said.
While the TBCA will take on new costs, Evans was confident the new structure will also “open up new funding opportunities,” saying government programs and other funders are more eager to support independent organizations.
The arms-length arrangement offers fundraising benefits, Halvorsen agreed, as well as allowing the auditorium flexibility in setting its own purchasing policies.
Evans and Halvorsen agreed the changes will have little to no impact on front-facing operations.
“It will be business as usual for concertgoers, for those who attend the auditorium,” Evans said. “This is really just making it consistent with other similar entities.”
