Desperate Duluth convention center gets $1 million emergency city credit line
News that the Duluth Entertainment and Convention Center (DECC) faced a financial emergency shouldn’t have caught city councilors and officials by surprise. After all, earlier this month Mayor Emily Larson doled out $200,000 in left over federal pandemic funds to enable the city-owned facility to salvage dozens of hockey and other events in jeopardy of being moved to other venues, due to broken down ice equipment.
The recently appointed DECC executive director breathed a big sigh of relief in the News Tribune.
“The real group who has come out to save the day has been the City of Duluth,” [Dan] Hartman said at a press conference Wednesday afternoon at the DECC. “Mayor Larson has come out to help fix the gap financing so that we can put in a temporary ice facility hopefully in the coming months so that we can actually have seasons happen again.”
This week, it was deja vu all over again with even bigger stakes. Cash flow problems put Duluth City Council members in a serious bind to bail out the city’s biggest driver of tourism, according to the paper.
A somewhat reluctant City Council unanimously agreed Monday night to help its local convention center through a period of time when its bank balance is running perilously low.
The Duluth Entertainment Convention Center has reached a point where its leadership has grown uncertain it will be able to meet all its short-term financial commitments.
“I’m here tonight because the DECC needs your help,” said Dan Hartman, the organization’s executive director.
Apparently city council members caught wind of the convention center’s latest crisis just days prior to their meeting. Not to mention the $1 million emergency line of credit that was on the line in order to continue operations.
But 1st District Councilor Gary Anderson said he was somewhat taken aback by the sudden news of the DECC’s financial distress. He first heard of the potential crisis just four days prior to Monday’s vote to provide aid.
“It feels like we’re between a rock and a hard place,” Anderson said of the request. “The DECC absolutely can’t be allowed to fail,” in light of its importance to the local economy.
The lack of standard financial updates on the DECC’s operations also rubbed some city councilors the wrong way.
Hartman offered his word on that count. “From this point forward, expect financials every month for the prior month,” he said.
At large Councilor Noah Hobbs also asked for better financial transparency from the DECC and tighter financial controls, as it works to right its ship operationally. “This has to be figured out, and it has to be figured out sooner rather than later,” he said.
Any amount borrowed under the taxpayer-backed credit line must be repaid by October 2024. In the meantime, management pledges to revamp the DECC’s operations and finances which appear as shaky as the facility’s recently scrapped 1966-era ice machine.