Michael Brydon: Is it too late?

There are some in Penticton who believe that City Council and the Board of School District 67 are making a serious error by demolishing the former Pen-Hi gym and auditorium to make room for a parking lot. I formally joined a group opposed to the city and school board's plan relatively late (early 2007) but I am assured that opposition to the plan has existed since it was first proposed. Various dissenting groups have formed and recently, the dissenters have been re-energized by the support of some high profile, trusted members of the community. These newcomers have brought not only additional credibility and political clout, but also new knowledge, ideas, and fresh insights into why the former Pen-Hi gym and auditorium should not be destroyed.

Unfortunately, a common theme in the responses from those in power (and also in newspaper editorials) has been that the decision to destroy the buildings has already been made. Defenders of the decision ask where we were two or three or four years ago. Superficially, it seems like a reasonable question. However, this is precisely the same closed-mindedness we uncover when we examine recent history's most spectacular decision making failures. For example, dissent within John F. Kennedy's cabinet was suppressed in the weeks leading up to the Bay of Pigs invasion in April of 1961 even though there was much evidence that the invasion plan was inherently flawed and that conditions in Cuba were substantially different from those assumed during the initial planning stages. The Bay of Pigs invasion was an unqualified disaster and Kennedy realized that the root cause was a systemic flaw in the decision making process. The remainder of Kennedy's administration—which was characterized by some notable decision making successes, including a measured response to the Cuban Missile Crisis—was dedicated to rooting out false consensus and groupthink. JFK went as far as designating his brother, Robert, as an ongoing “devil's advocate” within cabinet. The Challenger Space Shuttle disaster provides another example in which last-minute dissent was suppressed by a “the decision has already been made” mentality. In this case the decision was to launch the shuttle even though several junior engineers expressed doubts about the impact of colder-than-normal launch conditions on critical O-rings. Subsequent inquiries identified systemic decision making flaws, not O-rings, as the root cause of the disaster.

Obviously, these examples are on a much larger and more tragic scale than the fate of a few buildings. But the Bay of Pigs and the Challenger disaster lessons have become an important part of the curriculum in many engineering and business schools. The stories are used to teach professional decision makers to value flexibility, to seek disconfirming information regardless of its source, and to delay committing to a course of action until absolutely necessary. Unfortunately, several prominent decision makers in Penticton either have not learned these lessons or have dismissed them as inconvenient. Private citizens of this community have taken the time to do some of the homework and due diligence that the city and school board seem unwilling to do (some of this is documented here). However, upon presenting new evidence to these decision makers, we are told that we are “willfully ignorant”, we are called “interlopers” and asked how we could have the “temerity” to question their judgment. In short, there is much name-calling, but little new evidence or rebuttal. This type of response is so at odds with contemporary decision making practice that I cannot help but think that we in Penticton are headed for our own decision making fiasco.

Oliver saving their school auditorium

The following appeared in the 12 Mar 08 edition of The Oliver Chronicle. The most interesting aspect of this story (apart from the fact that people in Oliver think their old auditorium is a valuable community and teaching asset) is that specific programs for federal and provincial funding are identified by name. This is surprising because Mayor Kimberley stated very clearly in the 22 Feb 08 press conference that no funding programs exist for such facilities. Hmmm. Very odd.

Referendum will be needed to save Venables Auditorium through Town

By Karen Knelsen

Frank Venables Auditorium will be getting several big improvements if a couple of large grants Town will be applying for come through.

The grants won’t cover the complete cost of a renovation and upgrade, but a referendum to borrow some money would give residents of Oliver and the rural area the chance to say if they are willing to pitch in with an increase in taxes – a total of about $31.38 per home, for the next 20 years, for an average single-family home (based on property value assessments averaging $285,000).

Previously, school auditoriums were funded by the province’s Ministry of Education, but several years ago, that provincial government money stopped flowing.

School District No. 53 has since been paying for basic operational costs of the building, along with fees charged to user groups. Soon, the district won’t be able to support the auditorium any more, and the money to keep the building up and running will have to come from somewhere else.

Tom Szalay, the town’s municipal manager explained the grants. The first of the two is from Towns for Tomorrow, a program run in conjunction with the province’s ActNow BC.

"The grant program allows a maximum grant of $400,000 and that grant has to be matched partly by local funding," Szalay said. Matching that amount isn’t as big a task as it may seem. "It only has to be matched by 20 per cent local."

The application hasn’t gone forward yet – it has to be approved by council first, and Szalay would look for that approval on Monday, March 10 at the regular open council meeting.

"Staff has put together more details on the application, we’ve got a formal resolution going to the council meeting on Monday night asking for them to say ‘yes,’ they authorize staff to make this application on their behalf."

The other available grant does come from the federal government, said Szalay.

"(It’s) called Cultural Spaces Canada. We have not applied for that yet, we intend to. That one will pay for up to one-third of building renovations and up to 40 per cent of specialty equipment – things like lighting, or sound systems – maybe even theatre seats."

Szalay said if all the funding comes through on time, Oliver could see a referendum on borrowing the remaining amount of money required for upgrades on the November election ballots.

"We figure that on the basis of the $4 million project, we can apply for about $1.4 million from that grant program. If we’re successful on that, and if we’re successful on the provincial one, that would leave about $1.7 million short. The only place we can identify where that would come from is from the local community."

The school board has identified an amount of $500,000 that could be redirected in the SOSS renovation and rebuild toward the auditorium, which previously had no place in the budget allowed to them by the Ministry of Education. That $500,000 has been included in the amount the Town has applied for.

A report done by Bevanda Architecture in October 2007, after consultations with user groups and theatre technicians, features three groups of items the facility needs based on priority levels high, medium and low. Only the high priority items have been included in a $4 million budget for improvements to the auditorium.

Items on the list include new theatre seats at an estimated cost of $249,326, new floor finishes, new wall and ceiling paint, and a new balcony railing, along with other improvements to the balcony, totaling $133,039, and upgrades to code requirements, totaling $241,3198, and including new washroom facilities.

Alison Podmorow, a drama teacher at Southern Okanagan Secondary School (SOSS) uses the auditorium, which is attached to the school, frequently to teach her classes. She can’t imagine a better place to hold her classes, or school gatherings. "To replace it would be ridiculous. We wouldn’t be able to."

She knows the facility isn’t perfect and it needs a lot of work to bring it up to community theatre par – alongside communities like Winfield and Summerland, which both have similar fine arts outlets.

"They’re both attached to the high school. The high school uses them but the community also funds part of it, and they’re amazing facilities," she said.

The Venables auditorium may not currently be on the cutting edge regarding lighting, sound, and furniture, but Podmorow said there is one feature belonging to the building that makes it unique among other structures in Oliver.

"It’s a great size," she said. "The strongest point of it is the size. We use it for our full school assemblies. We would never be able to have the whole school together in a different kind of facility."

The referendum would be put to both town and area C residents.

Michael Brydon: A message to Mayor Kimberley

The following message was sent to Mayor Kimberley, members of Penticton city council, members of the board of SD67, and the secretary of the Penticton and District Performing Arts Facility Society on 13 March 08. So far, I have received no substantive responses. We will have to wait and see.

Dear Mayor Kimberley:

Thank you for taking the time to respond and for including the larger group in this discussion. Information on this issue seems not to be flowing very well so I think this was a good decision.

Although I do not pay property taxes in the City of Penticton (and, like Mr. Siddon et al., have nothing to lose if your administration commits tax dollars to the SOPAC), many of us in this community are troubled by an arrangement in which the City of Penticton has abdicated all responsibility for planning and analysis for the SOPAC to Mr. Amos’ group and (according to Dr. Karr’s letter in this morning’s Herald and Western) Mr. Amos’ group has abdicated all responsibility for planning and analysis to Proscenium Architects and Interiors—a firm with no local knowledge and a clear conflict of interest in that it is in the business of selling performing arts facilities. This sequence of abdications has created a situation in which the city is backing a plan about which it knows very little. To cite just one example, you appeared surprised in Tuesday’s meeting to learn that the Proscenium plan (the plan on which Mr. Amos’ group is drawing so heavily) includes a downtown parkade (please see page 16 of the 20 Feb 08 SOPAC presentation).

As a professional researcher with some experience with complex, uncertain decision problems, I have decided to do some of my own due diligence. It is clear to me from even a cursory analysis that the SOPAC has no possibility of going forward without significant investment by the City of Penticton or a regional government. Please allow me to share what I have discovered and perhaps you will understand the source of my skepticism.

I have attached five documents:

1. A copy of a recent income statement from the North Okanagan Regional District that clearly shows payments made by the NORD on behalf of the Vernon and District Performing Arts Centre. This information has already been widely circulated within the community and the press. I include it only for completeness. The significance of the Vernon case, even though costs have escalated dramatically since its construction, is that Vernon received no federal or provincial funding and raised only $30K within the community. Given the similarities between Penticton and Vernon, I think it would be unwise to discount the Vernon precedent.
2. A preliminary sample of recent news stories and press releases from the Lexis/Nexis database. I searched on the terms “performing arts”, “facility”, and “funding” in Canadian news sources and included any story that seemed relevant. It is clear from the experiences of other communities across Canada who have built or are building performing arts facilities that significant municipal/regional investment is the norm. It is also clear that funding from senior levels of government (provincial and federal), when it does materialize, is relatively modest.
3. A copy of the Framework Agreement between the federal Building Canada program and the Government of BC. The relevant passage states “For projects involving a local or regional government, the Parties expect that level of government to provide funding for a minimum of one-third (1/3) of the Eligible Costs of an Approved Project.”
4. My slides from our recent press conference. I include these so you know what has been said to the press recently.
5. A formal decision analysis of the Pen-Hi, SOPAC, and referendum problem. I hope to recoup my investment in time in this project by publishing a paper (the coin of the realm in academia) on the structure of this decision problem. This analysis is missing some of the most recent evidence. Even so, it will be blindingly obvious to any decision theorist that the rational course of action in this case is to sequence a borrowing referendum ($30K or no $30K) prior to making irreversible decisions worth tens of millions of dollars.

So with regards to the referendum question, here is a less-formal chain of reasoning. Please tell me if and where you disagree:

1. It is a matter of public policy (at least under the federal program used in other communities to fund performing arts facilities) that municipal/regional governments must commit to 1/3 of the total cost of the facility. As Mr. Siddon and other experienced politicians have already pointed out, there is no free lunch.
2. It is an empirically verifiable fact that actual municipal/regional commitments have been significantly higher than one-third. Local governments are picking up between 57%-100% of the total cost of these facilities. Moreover it appears that the municipalities/regions are responsible for all cost overruns.
3. Although the SOPAC committee has so far declined to provide the public with the estimated cost of the SOPAC, the cost of a slightly smaller facility in Burlington, ON, is currently estimated at $33M-$36M (no parkade). Thus, in the most optimistic scenario, the City of Penticton is obliged to fund $11M of the cost of the SOPAC if the facility hopes to qualify for federal funding.
4. The borrowing costs alone for an $11M investment over 20 years are just over $1M annually. I am guessing that this corresponds to a tax increase of roughly 5% (please correct this if it is wrong—I do not have access to the information required to calculate this).
5. Bottom line: If the SOPAC goes forward at any point, the City of Penticton will have to get voter assent for at least $11M of borrowing and a dramatic tax increase. There is no question of if a referendum is required (at whatever cost); there is only a question of when.

To reiterate a point made by Mr. Siddon on Tuesday, it is very important at this point that you either acknowledge the inevitability of the city’s participation in the SOPAC or publically refuse any further involvement. Either the city is “in” (in which case it might want to conduct some of its own due diligence) or it is “out” (in which case the SOPAC is clearly dead). This is something we will be focusing on leading up to the referendum so you may wish to prepare a clear answer.

Of course, you are free to use the arguments below to justify your unwillingness to get voter assent before you make decisions [Mayor Kimberley claimed a referendum would be too expensive in the 2008 budget year in previous correspondence]. You are free to put all your faith in a “feasibility analysis” produced by salesmen. But it seems a bit inconsistent to commit the City of Penticton to 20 years of million-dollar debt payments without first paying $30K to ask voters if this is something they want. Moreover, it would be politically reckless to willfully destroy an affordable and viable alternative to a $33M-$36M luxury (which, let’s face it, will only benefit a well-connected cultural elite) before giving voters any say in the matter. Based on what we are hearing at our table in Cherry Lane mall, Penticton voters are smart enough to see where this is going.

You have made the case in the past that council and the school board has had to choose between an old, inadequate building and a new state of the art facility. However, let’s not ignore the evidence. The real choice for a cash-strapped little town that has already had a tremendous feast at the public trough is between the Pen-Hi buildings (even if it costs $6M to upgrade them) and nothing. On this point, Dr. Karr is correct—we are a special interest group: Our special interest is to keep the current leadership of Penticton from blindly running our little town into the ground.

Michael Brydon: Presentation from 11 Mar 08 press conference

The following slides were presented during the 11 Mar 08 press conference.

Jack Ambler: Buildings in need of community support

The following appeared in the 02 Mar 08 edition of the Penticton Western News:

The debate concerning the Pen High auditorium and gym has been going on for some time now with numerous letters to the editor that speak of the continued usefulness of both buildings. Many of these letters have been written by well-respected members of our community and the views expressed are undoubtedly well thought out and mostly factual.

Dave Shunter’s recent letter was informative, with very compelling reasons to upgrade and keep the buildings for future use. Previously, many performers have written letters indicating that the auditorium is still an excellent venue in which to perform.

The Penticton Western News story of Feb. 22, entitled “Officials state case for school buildings demolition” was anything but informative and it really provided very little insight as to why the buildings must be demolished. It was the typical spin that politicians use to cloud an issue when simple common sense is being ignored.

School board chair Larry Little is quoted as saying “Given the proper information they’ll (I assume he means the taxpayers) be able to make an informed decision.” OK Mr. Little, give us the information. Tell us what the cost benefits will be to destroy two taxpayer-funded buildings that have been and still are a valuable asset to the community.

Don’t simply tell us that there are other facilities to take the place of these buildings, tell us in terms of dollars and cents how the taxpayer will benefit from hauling these buildings away to the landfill. Tell us why spending $30 million to construct a replacement theatre is more cost effective than spending $2 million to upgrade existing buildings which will provide a multipurpose facility.

Tell us why, not too many years ago, a very large sum of taxpayers’ money was spent to upgrade the gym while at the same time the school board was pursuing ministry approval for the construction of a new school and ultimately the destruction of a newly upgraded building. The half million or so of taxpayers’ dollars that you spent for the gym renovations is now going to be buried in the landfill.

“We haven’t done the greatest job, the city and the school board, in renting out our facilities.” How true. Both Mr. Kimberley and Mr. Little should tell the taxpayer why they are “not doing the greatest job” in all aspects of their civic duties. Were they not elected because they presented the best option at the time to manage the affairs of the city and the school board?

Maybe if they were doing their best to rent city and school board properties, the apparent problem of finding $200,000 per year for maintenance of the auditorium and gym would not be an issue. By my calculation, the $200,000 annual maintenance costs work out to approximately $5.72 per person in Penticton and much less if the cost were spread out throughout the regional district. This is not a large sum of money to pay each year for the privilege of keeping and using the auditorium and gym.

The local soccer club was very confident, and the city agreed, that they can cover the operating costs of their new facility and repay a rather large loan without the taxpayers’ help. Would proper management of the auditorium and gym not have the same result?

“… We’re looking at what’s in the best interests of our kids, and not so much the community …” Kids and schools are part of the community. The community includes everyone and everything within it and it is simply not reasonable to exclude the school board from decisions which have an impact on the entire community.

The school board says it is the city’s responsibility now and the city says it is the school board’s decision. It is time that Mr. Kimberley and Mr. Little quit passing the buck and work together on this project to make the community proud.

“We’re not eliminating anything, that’s another misconception.” I guess we’ll all see what kind of a misconception this is when we drive down Eckhardt Avenue this fall and see that two large buildings have been eliminated in favour of a parking lot.

Jack Ambler
Penticton

Michael Brydon: Analysis of the Pen-Hi Decision

I have taken some time to prepare a reasonably formal analysis of the Pen-Hi decision (see link to the right or click here). I will continue to update this document as new information becomes available.

The analysis contains new (as of late Feb 2008) information about the financing of the Vernon and District Performing Arts Centre and some preliminary funding results for proposed performing arts facilities in Burlington and London, Ontario. The basic conclusion of the analysis is what many of us have known intuitively since day one: The City's current course of action paints local taxpayers into a corner.

The experiences of other communities show us that a new performing arts facility in Penticton is going to require significant investment by local taxpayers. To this point, we have mostly been promised a "free" facility—a facility constructed using money from the provincial government, federal government, and volunteer contributions by individuals and organizations. Unfortunately, I can find no recent precedent for full external funding of a performing arts facility in Canada. Indeed, I have found several examples in which cities are on the hook for between 50% and 100% of the total cost of the facilities.

As a consequence of these findings, I have changed my mind on the South Okanagan Performing Arts Centre (SOPAC). Previously, I was in favor of moving forward with it—after all, who would not be in favor of a free performing arts facility? After looking at the numbers and considering the impact on local taxpayers (either increased taxes or decreased spending on other worthy projects), I have come to the conclusion that the SOPAC is little more than a dangerous distraction.

Of course, if the City puts a realistic referendum to the taxpayers of Penticton (of which I am not one; I live on the West Bench) and voters give council a mandate to invest in a performing arts facility, then what I think really does not matter. But I am pretty sure this council will not hold a referendum until they are forced to do so. By that point, the Pen-Hi buildings will be long gone and the choice will between an expensive new performing arts centre and no performing arts centre. Some choice.

Two schools of thought at odds over future of Pen High facilities

By Steve Kidd - Penticton Western News - February 29, 2008

There are two sides to every issue, and while School District 67 has solid arguments for proceeding with the demolition of the old auditorium at Penticton Secondary, another group is becoming increasingly vocal about their last-minute attempt to save the building.

Last week, city and school district representatives held a press conference to effectively announce that the time for any proposals to save the building was past. But the Penticton League of Electors said they aren’t finished yet, and suggest they may call a meeting of their own to rally public support.

And the newly formed league has some powerful, voices making the arguments for their position. Former Penticton mayor Dave Perry, former cabinet minister Tom Siddon and retired school district superintendent of facilities Ron Mason are all on the roster, and say the league is confident that given a stay of execution they can develop a proposal to save the buildings.

“I worked for the school district from 1973 until I retired in 1999, so I was very familiar with the buildings” said Mason. “We did quite a bit of work on establishing a plan to preserve them, because all the utilities are lost once the buildings (the rest of the school complex) are demolished.”

The school board did provide an opportunity for a group to come forward and save the buildings, but only the City of Penticton responded, and after consideration, declined. When their deadline — June 30, 2007 — passed, the school board went ahead developing their plans, making the site of the auditorium part of the parking lot.

The city did agree to take responsibility for redeveloping the Shatford Building, which will be developed into an arts centre with renovations beginning in 2009.

“If someone had come forward, you would see the auditorium on the plans today,” said Frank Regher, school district secretary-treasurer.

He said without an initiative from the community, the school board does not want to keep the buildings.

“They’re considered to have reached the end of their lives.”

There’s no dispute between the two sides that the demolition of the rest of the school buildings would require major changes to the gym and auditorium to make them into standalone units. Utilities, like a new heating plant and electrical services, would be required, as well as modifications to the fire sprinkler system. And along with the utilities, amenities like washrooms and a new entrance system would also be required.

All of these things, Mason said, have been figured into their plan, at an estimated cost of $1.2 million.

“There’s no contest on that, we know we can do it,” said Mason. “Our position is to preserve them as they are, until such time as there is funding in place to replace them.”

However, the City of Penticton, after studying the possibilities, decided not to take on the option of preserving the old buildings.

“With all the items done, it will still be an old structure with a limited life span,” said Mayor Jake Kimberly.

Instead the city went ahead with supporting the concept of developing a cultural corridor alongside Penticton Creek, with a new performing arts centre as the keystone.

But with the construction of the proposed performing arts centre years away, proponents of saving the buildings say they could continue to provide much-needed space, both for performances and indoor recreation activities.

“Does it make sense to wait for up to 10 years with nothing?” said Perry. “The cost of what they’re proposing for the performing arts centre is really prohibitive.”

However, both the city and the school district counter that no such pressing need exists, that the city and the schools have spaces that are under-utilized.

“Our resources are not used to the extent that they should be,” said Little, talking about school gym facilities. “When I consider that ... I don’t think there’s the great lack of gym space that has been made out.”

Kimberly also pointed out that when the Shatford Building is redeveloped as a community arts centre, Pen High’s original gym, inside that building, could be used as a small 250-seat performance space. Along with Cleland Theatre, he said, there should be sufficient performance space in the short term.

Parking is an issue of contention. The League of Electors argues that there is no need to convert the auditorium space into parking, suggesting that it would be more environmentally responsible to reduce parking as a way of encouraging more students to bus or walk to school.

The school district says good parking and access is necessary for the safety of the students and staff.

“The board is very concerned with traffic congestion and student safety,” said Little. “We do not want to see a repeat of the problem that exists at KVR (middle school) accessing the parking.”

Little said the board doesn’t disagree with the idea of being environmentally friendly, but questions the likelihood of getting students to walk to school.

“Parking is a reality,” he said. “Students will drive regardless.”