Bemidji considers in-house management of Sanford Center

BEMIDJI — After nearly 20 years of substantial deficits and controversy surrounding the Sanford Event Center on the south shore of Lake Bemidji, the Bemidji City Council is considering bringing management of the center in-house.

The contract between the city and ASM Global, now Legends Global, expires in March 2027. The management contract with the New York-based firm has been in place since 2022. ASM pursued a contract for the Sanford Center after the city terminated its contract with VenuWorks, which had run the center since its opening in October 2010.

During a Monday, July 27, work session, the Council discussed three potential options: renewing the contract with Legends Global, a hybrid management option where some aspects of running the center would be contracted out, or completely taking on management in-house.

Leadership at the Sanford Center has been marked by high turnover, with executive directors being fired, resigning and even charged with theft.

"In the 20 years the Sanford Center has existed, how many executive directors have we had? Does anybody know? It's a lot. How many finance directors have we had in 20 years? A lot," Mayor Jorge Prine said during the work session. "We don't have that same type of turnover within the city."

Prince advised councilmembers to review the state auditor's report of the theft.

"It wasn't a good auditor's report when that investigation was completed, not just on the management company, but on the city as well," Prince said. "When you farm out your finance, that's what you potentially open yourself up to."

The Sanford Center's construction was financed by a $44 million bond, with the city still owing around $36 million, plus $10 million in interest.

In his comments, Prince noted that the city's overall investment into the Sanford Center — from covering operating losses, annual bond payments, management fees and capital improvement needs — represents $120 million.

The annual operating deficit runs city taxpayers around $450,000 a year. Capital improvement and maintenance needs at the center are nearing $400,000 a year, but the city has only been budgeting up to $210,000 in recent years.

"I'm looking at it from an alignment and sustainability point of view. Center has been here 20 years. There's been a lot of bumps and bruises and all kinds of things that have happened in 20 years," Prince said. "How do we position the center to be successful in the next 20 years? Because I don't think anybody wants a repeat of the previous 20 years."

Bemidji City Manager Rich Spiczka said a contract with a private for-profit company does not always mesh well with the goals of the city.

"We have to eliminate the silo that's not part of our normal operation, 'cause [the Sanford Center's] ours. It's always going to be ours," he said. "If we're going to accept the performance that we currently have on how the center operates with dollars — with whatever metric you want to use — how are we going to afford it going forward?"

Despite frequent use as a convention center, Spiczka noted only three concerts took place at the Sanford Center last year. For contrast, Mankato's city-run event center put on 18.

Prince and Spiczka say that there have not yet been any direct conversations between the city and Legends Global about the expiring contract, which would be the next step before any formal vote.