QUESTIONS AND CONCERNS
REGARDING
THE ROCKINGHAM COUNTY COMMUNITY CENTER
Questions and concerns have been raised regarding the Rockingham County Community Center underway at the County’s Park at the Crossroads. Responses to the more frequent questions and concerns are presented in this posting. Please contact the County Administrator with any questions or concerns not addressed below.
1. Funding:
It has been said that the Rockingham County Community Center (the Center) will be funded from “taxpayer dollars”.
From the beginning, the Center was proposed only because the County would not need to use general fund, or “taxpayer”, dollars for the project. Transient Occupancy Tax (TOT) revenues will be used.
TOT is collected by the proprietors of short-term lodging, such as motels and hotels. It is similar to the food and beverage tax and the sales tax in that the TOT is paid by the customer, not the proprietor. The customer often is from outside the area.
Rockingham County has set its TOT tax rate at 5%. Forty percent of that rate, or 2 of the 5%, can be used by the County for any purpose it chooses. It goes into the general fund.
The remaining 60%, or 3 of the 5% rate, must be used for “tourism and travel, marketing of tourism or initiatives that, as determined after consultation with the local tourism industry organizations, including representatives of lodging properties located in the county, attract travelers to the locality, increase occupancy at lodging properties, and generate tourism revenues in the locality”. Va. Code Section 58.1-3819.
Proprietors in the tourism and hospitality industries, the constituency assigned by the State Code as the stakeholders in the 3% TOT rate, have been consulted and are very excited about using TOT funds for the Center because they believe it will attract travelers from out of the area who will stay in their facilities. For example, the largest tourism property owner in the County has delivered to the County a letter expressing its strongest possible support for the project, and has informed the County that, if the County builds and operates the Center as proposed, the proprietor will build a 150-unit hotel, rather than the currently planned 120-unit project.
However, because the Center will also be used for activities and events other than those related to travel and tourism, portions of the funding must come from sources other than the 3% rate. Funds from the 2% rate of the TOT may be used because funds from that portion of the TOT revenues go to the general fund.
Projections show that all the costs of building the Center can be provided for from the 5% TOT rate and there will be money leftover to conduct other tourism and travel related projects.
2. The County should not go into more debt for the Center.
As proposed, the County will not go into debt for the Center. Initially, money will be “borrowed” from savings accounts and paid back over time from TOT revenues. The “loan” will be made at an interest rate more favorable to the “lender” than interest rates the County can obtain on savings accounts, while also being more favorable to the “borrower” than rates the County could get if it borrowed from outside sources.
3. The Center will lose money and will not be a net revenue generator. There must be a “feasibility” study.
The Center has never been intended as a positive revenue generator. County staff have evaluated the expected needs and associated costs and, because the activities are largely those already being conducted by the County, is able to reasonably predict the cash flow. Income from the Center will not, and was never intended to, cover all costs and expenses. Costs and expenses not covered by fees can be covered by TOT revenues and, therefore, need not be a drain on the general fund. The Center is not a business and does not compete with free market businesses.
4. The Center will put a local free market enterprise out of business. The County should buy out Horizons Edge.
The Center will not compete with Horizons Edge. Currently there is some overlap between programs run by the County and activities offered at Horizons Edge because Horizons Edge chose to run some programs that are similar to programs that were being run by the County before Horizons Edge was built. That small amount of overlap will continue. The County has always attempted to work with Horizons Edge on various activities and will continue to do so in the future.
Whatever business difficulties Horizons Edge may be experiencing currently are not caused by anything the County is doing now. Those difficulties will not be exacerbated by the Center because the anticipated programs at the Center will not compete with the activities Horizons Edge has been hosting. If anything, Horizons Edge could be helped by cooperating with the Center on larger tournaments.
Investors in Horizons Edge have asked the County to buy them out rather than build the Center. Horizons Edge facilitates do not suit the needs of the County. There are numerous elements to Horizons Edge, elements that are expensive to maintain and operate, that the County does not need or want. Furthermore, Horizons Edge lacks an indoor track, a feature the County’s high schools very much want, if not need. Moreover, the location of Horizons Edge has been evaluated as unattractive for County purposes.
The location of the County’s Park at the Crossroads is remarkably centrally located when measured from the County’s four high schools. According to Google maps,
Broadway High School is 18 miles away,
Turner Ashby High School is 11 miles away,
East Rockingham High School is 10.5 miles away, and
Spotswood High School is 4 miles away.
Many families from the Broadway area, those living the farthest away, travel to the Park to participate in the many recreational and competitive activities currently offered. In fact, the Broadway area will send the most participants to the Park at the Crossroads during this year’s football and cheer season.
Broadway - 199
Turner Ashby - 197
East Rock - 186
Spotswood - 184
Athletic Directors (ADs) and coaches from all four high schools in Rockingham County, and ADs and coaches from neighboring counties, are excited about the Center and are already lining up to reserve time for practices, meets, games, and tournaments.
5. Comparing the Center to the Virginia Beach facility. WAVY and Virginian Pilot articles.
Reference has been made to the Virginia Beach Sports Center as support for the argument that sporting facilities lose money, and the County should not build one. WAVY news tells a more complete and balanced story.
Apparently, the Virginia Beach Sports Center was developed as type of public-private partnership, with the private partner wanting to make a profit. According to the WAVY article cited above, positive cash flow at the Sports Center has been difficult to develop in the initial years of operation. Part of that time the world was dealing with COVID-19 fallout.
In contrast, the Virginia Beach auditor is reported as saying:
Yet, when it comes to the overall goal of the Virginia Beach Sports Center, City Auditor Lyndon Remias said it’s likely meeting its goal.
“Yes, it’s been a rocky start financially,” Remias said. “I think in regard to bringing the events, the teams, filling the hotels, the restaurants. That side has been a plus.”
And, Funded by the city’s Tourism Investment Fund (TIP), which is made up of lodging, meals, and admissions taxes, it’s those exact funds the city believes will benefit the most. Multiple hotel owners have said the center has allowed rooms to be filled on traditionally slower weekends.
https://www.wavy.com/news/audit-shows-vb-sports-center-operating-at-loss-but-facility-providing-tourism-boost/
And an article in the Virginian Pilot concludes with this quote from the private partner:
“The Sports Center has been wonderfully successful in terms of its primary mission, attracting sports tourists to Virginia Beach,” Wack wrote in his text. “Opening in the pandemic, operating in a tight labor market, and meshing local programming with sports tourism events have all challenged the balancing of revenue with expenses.”
https://www.pilotonline.com/2023/08/05/virginia-beach-sports-center-is-falling-behind-on-bills-needs-over-1-million/
Rockingham County’s goals for the Center include providing facilities for Rockingham County residents of all ages and recreational and athletic interests first and foremost, as well as adding to travel, tourism, and hospitality activities in the area. The experience of Virginia Beach supports the idea that the Center will increase TOT, food and beverage, and sales tax revenues, by encouraging travel and tourism to the County.
6. An un-banked indoor track will not be used for competition.
A speaker at a Board meeting told the Supervisors, “If the County constructs a track without banked turns, most competitive track meets won’t use it.” BOS meeting of July 26, 2023.
The proposed track will meet and exceed the standards set by existing tracks used by high schools and small (D3 level) colleges. Roanoke College and Shenandoah University, members of the D3 ODAC, both have field houses with indoor tracks, unbanked, and both host multiple events each year. Bridgewater College competed in five meets at those facilities in 2023, three of which were two-day. Roanoke College’s unbanked, indoor track has been the site of the ODAC meet the past few years. St. Christophers in Richmond and Heritage High School in Lynchburg, also have indoor tracks, unbanked, and host many track meets. Bridgewater College and EMU have already expressed interest in utilizing the Center for practice and meets. JMU has even expressed an interest in utilizing the track.
7. What events and activities will be conducted at the Center.
The Center is an indoor community, recreational, and athletic facility that can and will be used for any of the activities currently sponsored by the County. The additional space will allow these indoor programs to increase in number, accommodate more people, grow in quality, and flourish just as the County’s outdoor programs have at the Park. (More than 700 youths are currently registered for football and cheer in the coming season.) In addition, the Center will be used by the four County high schools for indoor track and field practices and meets, spanning approximately 18 weeks. High school regional and state meets can be hosted at the Center, making it possible for Rockingham County families to participate in those events without driving more than two hours one-way. Discussions have already been initiated with the Old Dominion Athletic Conference (ODAC) to host their Track & Field Championships. The ability to host AAU/Travel/Club teams on non-softball/baseball weekends will create another revenue stream for tourism. The indoor travel tournament emphasis will be on volleyball because the initial basketball ventures will focus on Rockingham County AAU teams hosting tournaments as fund raisers for their programs. When not in use by track teams, the track will be used by many other people in the community, such as the numerous walkers who have nowhere to go in inclement weather. The Center will provide space the County does not currently have to accommodate summer day camp and activities for seniors.