A $200,000 promotion fund wouldn’t be a “silver bullet” for Intrust Bank Arena, but it could make the difference between a tour stopping in Wichita or not, Sedgwick County and arena officials say.
County commissioners are scheduled to vote Wednesday on whether to create an annual fund to entice more acts to Wichita. Commissioners delayed a vote on the fund – and other changes to the county’s contract with SMG, the company that manages the downtown venue – late last month.
The proposed amendment to SMG’s original contract would extend SMG’s management through Dec. 31, 2020.
The county’s initial agreement with SMG provided an automatic renewal if the county received at least $1.7 million during the arena’s first full five years, which ends Dec. 31, 2015, County Assistant Manager Ron Holt said. SMG was $75,000 short of that goal by the end of last year, and Holt said Tuesday he expects the company to meet that threshold by the deadline.
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The county’s contract with SMG is unique in that SMG agrees to swallow any losses. Under the current agreement, SMG keeps the first $450,000 of profit in any given year; the next $450,000 goes to the county. After the $900,000 mark, 60 percent of profits go to the county and 40 percent to SMG.
The proposed amendment calls for SMG to keep the first $400,000. Any profit in excess of that would be divided evenly between the county and SMG.
Another change under the proposed amendment lowers the threshold for automatic renewal. If the county receives more than $850,000 between Jan. 1, 2015, and Dec. 31, 2019, the contract would renew for another five years.
A.J. Boleski, arena manager, said the promotional fund could be used for one to three shows a year. Boleski told The Eagle earlier that arenas elsewhere in the country have used promotion funds to help attract big acts by lowering promoters’ upfront risk.