City raises concerns on Ruth Eckerd Hall agreement

Clearwater council members are tussling over the language and lack of information to enter a binding contract with Ruth Eckerd Hall for control of the new waterfront amphitheater. 

During a Monday city council work session, the council members reviewed a venue license agreement between the city and REH to provide venue management services, ticketing, and food and beverage services at the new amphitheater, which will open in 2023. 

REH was selected earlier this year to become the operator of the new venue, which will anchor the 22-acre Imagine Clearwater development, transforming Coachman Park. 

“It has been difficult to negotiate some of the parameters, but I will say REH has been amenable to the requests the city has made. The city maintains all rights – to sell the naming rights to the venue and fixed assets inside the venue,” City Manager Jon Jennings said.

“Ruth Eckerd will have the responsibility of sponsorships as it relates to events, and concerts and will be able to bring in vendors as they see fit, but in terms of the hard, physical assets in the facility, that will be up to the city to recoup [funding for the $30 million bond].” 

Councilwoman Lina Teixeria voiced that after months of negotiations with REH, the council received the proposed licensing agreement on Friday evening, not providing sufficient time for the reviewing process. 

“My discomfort stems from the fact that I’m acutely aware that any further delays in this process will negatively impact Ruth Eckerd Hall and their ability to successfully launch this amphitheater; I feel this pressure to rubber-stamp [this],” she said, stating she acknowledges the value REH brings to the community. 

Councilwoman Kathleen Beckman echoed similar concerns, also adding the lack of information from REH. 

“If the goal is to have a license to recoup $2 million a year and that REH will make it a success, I am on board with that. [But] we’ve got no information – no performa, no numbers, no financials about how we are going to ensure we are receiving $2 million a year so we are at least breaking even,” she said. “I want things in a contract that are black-and-white about financials.” 

She recommended that if the agreement moves forward, REH and the city should meet at least twice a year to review the financials to ensure all parties are in good standing. 

Jay Ravins, financial director for the city, stated there was an early analysis done, which showed the city would be at a financial loss if it ran the amphitheater rather than a different entity. 

“We have an operator taking all of the risk,” he said, referring to REH, stating the revenue from ticket sales would help the city offset its bond debt. 

Others listed challenges and highlighted information under the agreement: 

• There was concern that it took seven months to craft a 15-page agreement, and there was a lack of public input. 
• Under the drafted agreement, REH, the licensee, would develop the schedule of events at the venue with a minimum of 35 events per year, beginning in 2024. Jennings said Ruth Eckerd Hall would likely surpass the 35 events minimum requirement.
• The operator would also be tasked with communicating with groups to host community events, such as high school graduations, and would work with the city for its 10 events, including the Clearwater Jazz Holiday. However, the venue is limited to 4,000 covered seats and 5,000 un-covered for a total of 9,000 seats, which may not be adequate to handle the capacity of the jazz event, councilmember David Albritton said.  Jennings explained while the 9,000 seats would serve the niche of events the city wants to attract, the operator will have to find a solution for larger events. 
• REH would have control of the venue name, logo, promotion and media campaign, all of which would be mutually agreed upon by the city and licensee. Susan Crockett, CEO of REH, said they have engaged with a professional branding company, which would work with REH on stylizing the name, creating the logo, and developing a teaser campaign for it and its institutional marketing. 
• REH would negotiate and administer all program sponsorships and be responsible for all expenses associated with the sponsorships, which include individual gifts, foundation grants, public grants, or other program-related and event-related donations for events including but not limited to individual events, presentations, educational programs, community events (provided that they do not constitute as city events) and event series.
• Questions surfaced on concerns about fencing, which would be installed around the venue’s footprint, but not the entire area – as it’s open to the public. The fencing would be intact during events. There are concerns regarding when exactly the fencing would be placed, and liability issues on public safety. 
• Concerns also emerged on the agreement specifically reading, “any closure of Drew Street’s westbound lanes shall be accomplished in a way that maintains current levels of ingress to and egress from the Sandcastle Religious Retreat and The Osceola at Sandcastle.” Councilmembers stated it was “highly inappropriate” to include the Sandcastle in the agreement. 
• Beckman said there should be environmental protections for the venue. 

Clearwater Mayor Frank Hibbard said he anticipates that the agreement may go through reiterations, similar to the agreement for the Capitol Theatre. 

A vote on the agreement was not casted, as it was a work session meeting.

“I concur with the city’s director of finance that the proposal before council is a win-win partnership.  My takeaway from the workshop is that while there were questions, we share the same priorities and values,” Crockett said in a statement to the St. Pete Catalyst. “Some answers can only unfold as we move forward, such as striking the right balance of activity and generating revenue for the debt service. We will always be accountable to the council and our stakeholders and those conversations will not end with the grand opening. We will continue to be community-committed in our focus, an efficient operator, an award-winning organization and a trusted partner.”