On Monday’s regular City Council Meeting, administration will provide an annual update on the Relationship Framework Agreement (RFA) between The City of Red Deer and Westerner Exposition Association (WEA), as well as an update on WEA’s journey to financial stability. The RFA works to promote an effective and collaborative relationship between the two organizations, while supporting the ongoing success and stability of WEA.
“The Westerner is a key piece of our community and regional fabric. They experienced hard times over the past four years, but in 2022, their revenues showed evident signs of recovery,” said Tara Lodewyk, City Manager. “While they are managing to maintain a steady revenue stream since the world opened from the pandemic, their cashflow health is still recovering. Our community and region needs to continue to show their support and confidence by attending the many great events and by booking their facilities.”
The annual administrative review of Westerner operations and financial situation has led to four recommendations for Council to consider:
- In 2023, begin the development of a Master Plan for the Westerner, which is expected to cost $100,000. The recommendation is that this cost be equally split between The City and WEA. The Master Plan, recommended in the RFA, is a 15-year vision that will include land use, access and multi-modal transportation, building design principles and site servicing.
- Support short-term cash flow for the Westerner by providing a $1 million line of credit for WEA to cover expenses prior to realizing event revenue. This contingency loan is seen as emergency funds, with an expectation for it to be paid back once revenue is realized and only used after their current line of credit.
- Amend the repayment formula for the $19 million Exhibition Hall loan agreement for five years to allow time for WEA to retain sufficient cash to meet current obligations and improve cash flow. If approved, administration projects that while WEA would not make a loan payment until the fifth year, there is no impact to The City’s budget or to the 30-year loan payment deadline.
- Amend the current RFA to have the City Manager approve all expenditures from WEA’s Major Maintenance Reserve.
“Administration is recommending these steps to provide a balance of providing the Westerner with the best chance to regain their financial footing and build reserves, while also protecting and building on The City’s investment,” said Lodewyk.
**with information provided by The City of Red Deer