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ASM Global will take over Sanford Center management on Monday

In a unanimous vote, the Bemidji City Council approved a contract with ASM Global for the management of the Sanford Center.

Sanford Center

BEMIDJI — Beginning on Monday, March 7, the Sanford Center will be under the new management of ASM Global, following a unanimous vote by the Bemidji City Council to approve the company’s contract.

The decision marks the end of a months-long search for a new management company after the city terminated its previous management contract with VenuWorks last September.

While under management by VenuWorks, the Sanford Center saw frequent leadership turnover and accrued losses that averaged to $300,000 a year, which then fell upon the city to cover.

In the contract with ASM Global, which runs through 2027, the company estimates that the losses will be reduced dramatically in just its first years of management, projecting a loss of $190,000 the first year, $6,000 in the second year, and a profit anticipated in the third.

“I give a lot of credit to ASM for being willing to stand behind their numbers,” Mayor Jorge Prince said, explaining that there is a clause in the contract that allows the city to terminate its relationship with ASM Global if they do not meet those expectations.

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On top of the annual $120,000 fee paid to ASM Global for managing the event center, the contract also includes a calculated incentive fee for the company if it performs above a predetermined benchmark net operating loss.

The benchmark is placed at a net operating loss of $420,000, and if ASM Global decreases losses to less than that, the incentive fee is an additional 30%. If the company has zero losses or earns a profit, the incentive increases to 40%.

“They’re incentivized to bring the deficit down,” said Ward 3 Councilor Ron Johnson, who was on the Sanford Center Transition Committee. “The most important thing is getting that deficit off the backs of the taxpayers.”

Also included in the contract is a fund of $200,000 provided by ASM Global for capital improvements to the venue, and a replenishing $100,000 fund for marketing events.

“They hope to use (the fund) to bring an event in, and if they make money, use it to replenish it and have $100,000 for the next event,” Johnson said.

With the contract approved, there will be regular meetings to evaluate ASM Global’s management of the Sanford Center and its overall performance, as well as discussions about what events to bring into the city.

“How do we tie in community engagement, the community’s feedback?” City Manager Nate Mathews asked as an example of questions the city’s team will begin addressing. “What’s the right type of event? How many? That sort of thing.”

Among the areas of focus moving forward will be how to ensure the event center is accessible to community members and a resource they are able to enjoy and use.

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“We would like this to be more affordable and resourceful to the community,” Councilor At-Large Daniel Jourdain said.

Following the unanimous decision to approve the city’s contract with ASM Global, Prince took a moment to address the significance of the move and he and other council members expressed their thanks to the city’s staff who worked diligently throughout the transition period.

“This is a really significant thing to just happen,” Prince said. “I hope that this is a symbol to our community that we all really do need to pull together and do everything we can to make this center successful for every citizen in Bemidji.”

Related Topics: BEMIDJI CITY COUNCIL
Nicole Ronchetti is a reporter at the Bemidji Pioneer, focusing on local government and community health.
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