SedonaEye.com columnist Eddie Maddock requests taxpayer transparency from City Hall about its Sedona Chamber of Commerce Sedona Marathon partnership’s expenditures and receipts
Sedona AZ (February 3, 2014) – SedonaEye.com columnist Eddie Maddock takes a closer look at the Sedona Marathon and asks about the cents of it:
Following is a recent e-mail exchange with City Manager Tim Ernster:
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From: Eddie Maddock
Date: 2/1/2014 5:39 PM
To: Tim Ernster, City Manager
Cc: Rob Adams, Mayor
Hi Tim:
First off, it saddens me that I find it necessary for this communication. However, based on questionable changes which may have occurred relating to this event from last year, it becomes necessary. Much has already been written about other concerns; however, my purpose here extends over and above anything I am aware is being addressed.
At the bottom of this e-mail is a cut/paste entry fee schedule from the Sedona Marathon web site.
- Evaluating the lowest prices offered (except July 15 – Aug 31 which did not include 5K option)
Sept 1 – Nov 30: $30, $45, $75, $100 (eliminating the $25 for kids under 12)
- Evaluating the highest prices offered (except Friday 1/31 @ Expo and 2/1 Race Day)
Dec 1 – Jan 29: $35, $50, $80, $105 (also eliminating the $25 for kids under 12)
Based on projected attendance of 1,000 to 2,000, starting with the least amount ($30) and then the highest amount ($105), gross amount of ticket sales would range based on 1,000 participants from $30,000 to $105,000. Of course, double the amount (2,000 participants) places gate at $60,000 to $210,000. Obviously the true amount will be reflected someplace between these two figures.
Considering there is sponsoring participation and the same as the Film Festival various gratis accommodations have been offered besides volunteers, this leaves me with three basic questions:
- Is city sales tax collected on the price of the tickets? If not, why?
- Who receives the net proceeds from this event?
- Did the city provide additional funding? Last year didn’t the Chamber receive $10,000?
Thank you, Sir,
Eddie
Original Message——-
From: Tim Ernster
Date: 2/3/2014 9:53:26 AM
To: Eddie Maddock
Cc: Rob Adams
Subject: Re: MARATHON
Hi Eddie,
Here are my responses to your questions:
1. No sales taxes were paid on registrations, because the Chamber of Commerce is a non-profit organization;
2. All proceeds go to the Chamber of Commerce. Last year, it is my understanding that the Chamber broke even on the event.
3. The City awarded the Chamber of Commerce $9,000.00 cash and $5000.00 in-kind as part of the small grants program.
The value that Sedona received is the increased business it brings during a traditionally very slow time for the lodging and restaurant businesses as well as the other retail businesses in the City. This year there were runners registered from 44 different states and I believe eight other countries.
Also, I ran the 5K event not only to enjoy the day, but to see first hand what the impact was on the Kachina neighborhood. The impact was negligible and many of the Kachina residents were out in front of their homes cheering on the runners. In fact, many of the residents who were concerned about the event have sent in e-mails to the Chamber and the City complimenting the Chamber for the well-planned event.
Eddie, I hope this information is helpful.
Tim
——-Original Message——-
From: Eddie Maddock
Date: 2/3/2014 10:51:41 AM
To: Tim Ernster
Cc: Rob Adams
Subject: Re: MARATHON
Thank you, Tim, for your response. Without ever having an authorized audit of Chamber of Commerce finances it remains a doubt in my mind about the veracity that it is non-profit. This also applies to the contract for Destination Marketing and refusal by Chamber and city staff to demand a verified demographic accounting of the Chamber members and the extent of their marketing boundaries. How difficult is it to take the list of members and pin-point the physical location of a business with distinct knowledge of City Limits?
About the Marathon. Of course it’s a fabulous event and was even before the Chamber took it over. However, the last bullet under what “Community Plan is NOT” it states: “An infringement on private property rights.”
It appears that had the residents in Kachina Subdivision been notified well in advance, on a letterhead from the City of Sedona and not the Chamber of Commerce, all of the fuss might well have been avoided. The portrait has now been established that the Chamber of Commerce or perhaps any other alleged non-profit has the ability to assume ownership of any or all dedicated City roads. Day by day it appears more and more that the Chamber of Commerce is another department of Sedona City government. It is not. It is a member driven organization and by continuing to acknowledge their control over the city it becomes a threat to residents and businesses that we must all be members of the Chamber to even have a voice.
The above thoughts and statements reflect my own opinions. I do not speak for others.
Have a great day and thanks again for your prompt reply.
Eddie (Maddock)
For the best in Arizona news and views, read www.SedonaEye.com daily!
Eddie,
Another excellent article. Your estimates while conservative I think may be way low, according to http://www.sedonamarathon.com/ there were 2600 runners in 2014.
Even though the Sedona Chamber is a non profit, and the city manager claims “it is my understanding” that they broke even”, the city is giving away “$9,000.00 cash and $5000.00 in-kind as part of the small grants program.” Should not Mr Ernster KNOW what the situation is before granting more taxpayer money.
That is taxpayer money that MUST be accounted for. Taxpayers are not responsible for supporting the chamber of commerce. Per your estimate if they made $210,000 or MORE, why are the citizens giving them an additional $14,000? Also, did the marathon pay for the police and city workers and equipment, or was this another grant?
It is an OUTRAGE, and another point for disincorporation.
Thank you for your always excellent articles Eddie.
Regards
Richard
Thank you Richard Saunders for your input.
FYI my communication with Tim Ernster occurred prior to the event itself. So, you are correct. My estimates were, indeed, conservative.
City transparency with Chamber of Commerce is sorely lacking. Otherwise we would not be required to ask these questions.
TO WHOM IT MAY CONCERN:
From the above article, this is what especially jumps out at me. . . the last bullet under what “Community Plan is NOT” it states: “An infringement on private property rights.”
It not just the marathon that gets taxpayers money from the City of Sedona. Please check into it. There are many groups getting money from them.
I would love to see a list and the amounts.
City Council meeting is 2-11-14, at 3:00 & 4:30
AB 1733 Presentation/discussion/possible direction regarding the development of the Fiscal Year 2015 contract for services between the City of Sedona and the Chamber of Commerce Tourism Bureau for visitor services, destination marketing and tourism product development.
Maybe we would like to attend, or start sending emails to city manager, mayor, and council members NOW.
An additional $711,000 in new taxpayer funding is planned for the blood-sucking Chamber of Commerce next fiscal year. And although it operates regionally, starting July 1, 2014, the Chamber will receive 55% of Sedona’s bed tax collections–or approximately $1.2 million annually–for visitor services and destination marketing. City staff is incestuously tied up in this outrageous waste of money.
Due diligence, competitive bidding and Requests for Proposals don’t appear to be a City Council priority.
Writing or attending meeting won’t help. This is a done-deal. Jennifer and her chamber will be honored for their good work at marathon. will be given kudos for invading private subdivision. Do away with city government only hope. They disgrace the very people who provided them with jobs, voters who approved incorporation to begin with. Very bad idea.
sad extremely disappointed. The worst City council by far. Chamber a farce.
From: jeanjenks
To: mayoradams@sedonaaz.gov; mdinunzio@sedonaaz.gov; mward@sedonaaz.gov; dmcilroy@sedonaaz.gov; jmartinez@sedonaaz.gov
Subject: FY 2015 Service Contract with the Chamber of Commerce
Date: Mon, 10 Feb 2014 06:34:47 -0700
Hello Mayor Adams and Councilors,
I believe the City Council still needs to perform due diligence is this matter. Inquiring minds want to know: What is the estimated increase in tourism spending within the City limits of Sedona IF 55% of bed tax collections are allocated to the Chamber of Commerce? Likewise, what is the estimated increase in tourism spending in areas outside the Sedona city limits if the City Council goes with the Chamber and this percentage?
It seems the Council has yet to identify and define the tourism area and specify boundaries. The City must restrict the DMO’s spending of the FY 2015 bed tax allocation it receives from the City to marketing Sedona proper and establishments within Sedona’s city limits only. This means the Enchantment Resort, the Hilton, and the establishments in Oak Creek Canyon, the Village of Oak Creek, etc., that are not within the city limits and don’t pay Sedona bed and/or sales taxes–that already have a financial advantage–would be completely out of the picture.
In that the Chamber is a special interest, member-driven organization that operates regionally, it is unsound economics for the City to allocate 55% of City of Sedona bed tax collections to the Chamber for destination marketing, product development and the Visitor Center. This represents an estimated $711,000 more and greater than a 50% increase for FY 2015 to an organization that would have conflicting marketing goals and purposes.
The Council must authorize RFPs and allow competitive bidding. Unlike the Chamber of Commerce, there are many competent, professionally qualified marketing sources that would not go regional, but would restrict their marketing activities to Sedona proper, having no need to promote, advertise, and favor members.
Better qualified, more experienced marketing sources also would be more knowledgeable and charge less than the estimated $1,200,000 annually the Chamber speciously claims is it’s entitlement.
Please look around you. Sedona’s tourism has engendered very bad traffic congestion, and the City’s livability is on the decline. Not only is the town overbuilt, but it’s on its way to becoming an over-priced tourist trap. The cost of food, housing and entertainment are too high. No surprise that Sperling’s BEST PLACES TO LIVE states “Compared to the rest of the country, Sedona’s cost of living is 26.30% higher than the U.S. average.” Nor that according to Frommer’s world-famous travel guide series’ INTRODUTION TO SEDONA “….if you lower your eyes from the red rocks, you’ll see the flip side of Sedona–a sprawl of housing developments lined with unattractive strip malls, and highways lined with bumper-to-bumper traffic.”
As is known, the Sedona of today has yet to recover from the Great Recession, and commercial vacancies still abound. Many non-Chamber small businesses that do not benefit from the tourist trade are struggling to make ends meet and stay afloat. Only last fall the Sedona Art Supply closed its doors after approximately 30 years doing business in our City “animated by the arts.” Although Amazon now charges taxes on purchase orders, small internet outfits with extensive supplies and materials, such as Jerry’s Artarama and Blick’s Art Supplies in the case of the Sedona Art Supply, do not. And internet buying and competitiveness are on the increase. Meanwhile seniors, the elderly and retirees living on fixed incomes are watching the purchasing power of their money decline and their savings deteriorate. Why does not the City Council do right and represent all groups in this town?
At its October 8, 2013 Regular City Council Meeting the Council voted to increase the allocation of its total FY 2015 bed tax collections to a DMO for destination marketing, product development and operation of the Visitor’s Center from 50% to 55%. This percentage needs to be reduced down to that of the present fiscal year–approximately 37%. More funds for tourism are not the answer to City Hall’s overspending.
Sincerely,
Jean Jenks
Sedona Resident
How about we just get clean financial reports from the City that include a P&L on two city – opps!… Chambered sponsored “events” that receive a ton of money or in kind from the city – 1) the Holiday extravanzzzza and then the “Mare on the run” (aka Marathon)
At some point of time (hope it is within my life time) we will be privileged enough to get full disclosure on the above……..and I’m thinking we are deserving full disclosure on many more issues…but at this point I’d be happy with the above……as well as getting Jeans questions answered.
P.S. Let’s not be fooled by the City’s financial awards.
According to the City of Sedona COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) for the Fiscal Year Ended June 30, 2013, the “Excess of Revenues Over Expenditures” is in the red at ($1,470,182).
Also on the taxpayer’s backs: The Arizona Department of Revenue’s FY 2013 BONDING REPORT reveals the City of Sedona has a bonded indebtedness of $5,096.68 per capita. This is the 7th highest of AZ’s 91 cities.
So city saves money by only one public notice (RRNews 2/7) Tentative Agenda council meeting 2/11, 4:30 PM, since instead of running two separate ads about the 3:00 pre-meeting they included it in the bold lettered paragraph at the top or the ad. However, is anyone else noticing that 3:00 pre-meeting is very conspicuous by absence of appearing on Ch. 4 at said time? SO MUCH FOR TRANSPARENCY, INDEED.
If anyone feels they are not getting clear financial records from the City of Sedona they should get in touch and file a complaint with http://www.azleg.gov/ombudsman. This a citizens aid dept of the Az. State Legislature.
The City is bound by law to provide everything you as an Arizona Citizen in regards to Public records. First document everyone should have is the contract between the City of Sedona and the Chamber of Commerce.
For the record here, at the Sedona City Council meeting (2/11/14) Steve Segner who heads up the Lodging Council (a Chamber of Commerce affinity group) appealed to the City Council to purchase the ADOT property at the “Y” because “that is what the Lodging Council and Chamber of Commerce is hoping to have happen.” Ah ha! Transparency in action.
A million dollars (at least) from the City is on the table for Destination Marketing (over and above the additional funding for Holiday Central, the Marathon, and blah, blah, blah who knows what else). And they are now seeking control of property not yet even purchased by the City of Sedona? Or is this just another done deal with secretive Sweetheart Valentine messages being sent to special recipients including but not limited to the Lodging Council and OAK CREEK (aka REGIONAL) Chamber of Commerce?
Oh yes, allegedly another offer has been made on that “Y” (good question) property. My, my . . . takes me back to the day when the City frantically decided to purchase City Hall because of another supposed pending offer . . . on a property specifically designed for a police department, holding cells, council chambers, municipal court, and other facilities to accommodate specific governmental functions? Right!
Sedona Registered Voters: PAY ATTENTION.
Councilman Mike Ward copied me with the following e-mail he sent to City Council, City Manager, and Asst. City Manager. My reason for sharing it publicly is to acknowledge my appreciation not only for transparency in stating his position but also to let people know that at least one member presently seated on the Sedona City Council has (IMO) maintained touch with reality.
Thank you, Sir.
For the record, the referenced item on the agenda for the meeting on 2/25 states:
“AB 1747 Discussion/possible action regarding the purchase of real property located at 250 Brewer Road by the City”
This comment submitted to Sedona Eye on 02/21/14 by:
Eddie S. Maddock
——-Original Message——-
From: Mike Ward
Date: 2/20/2014 12:23:04 PM
To: City Council City Council; Karen Daines; Tim Ernster
Cc: Eddie Maddock
Subject: Brewer Rd discussion
If there is to be a vote regarding the Brewer Rd property on 2/25, my preference is against the purchase. Given that sellers, including ADOT, perceive that the city has deep pockets allowing them to name any inflated price and that the city has not identified funding sources for developing the property, it makes little sense to continue pursuing the property.
I do not believe that the “vision” for the future argument is valid considering my logic for not buying the property.
Mike Ward
Sent from my iPad