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| (L-R): Audience at the DPAC, Mayor Bill Bell, Councilman Don Moffitt | Photos: Google Images/City of Durham |
The Herald-Sun reported in an article that the current agreement has theater operators, PFM/Nederlander, and the city of Durham splitting the theater's net operating income 60/40, with the city getting the lesser share.
The new proposal, a rather confusing one at that, would be laid out as the following according to The Herald-Sun:
- Each year, the city and PFM/Nederlander would still split the first $2 million in net income 60/40, with the city receiving the lesser share.
- The operator would get to keep the next $300,000 then the two sides would resume the 60/40 split until income hits $3 million.
- Once past $3 million, PFM/Nederlander would keep 70 cents on every $1 the theater nets.
But Mayor Bill Bell and City Councilman Don Moffitt don't buy it.
Both Bell and Moffitt noted in the article that the proposed agreement would short change the city. And the numbers don't lie.
According to The Herald-Sun, administrators explained if the DPAC earned $4 million in a year the city, under the proposed split, would receive about $1.4 million. The straight 60/40 split in the present lease would yield it $1.6 million.
Moffitt said a straight 60/40 split "would seem to give the operator plenty of motivation."
I'm no business or economics guru but I'm intelligent enough to see that this is short changing the city which has invested quite a bit into this theater. $200,000 adds up fast and the city would be losing that each fiscal year.
I guess I can understand a new profit-sharing system if the operators were struggling to get high-quality shows into the DPAC but, from the look of the venue's lineup, it doesn't appear that way.
I guess I can understand a new profit-sharing system if the operators were struggling to get high-quality shows into the DPAC but, from the look of the venue's lineup, it doesn't appear that way.
Why not make it simple and keep it the way it is?
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