Wednesday, June 20, 2007

CPAC...a cruel J-O-K-E

The Miami Herald which has, in the past, been a big cheerleader for the Carnival Center for the Performing arts here in Miami has published an article today that sheds light on the incompetence of local government and publicy funded projects.

A Miami-Dade County assessment of the Carnival Center for the Performing Arts found that the independent trust that manages the county-owned facility committed expensive errors in budget planning and failed to institute cost controls that could have stemmed an estimated $4.1 million deficit.

Burgess' memo, dated May 30, comes as county commissioners consider approving a $4.1 million infusion to keep the Carnival Center open through September. Commissioners are scheduled to hold a full public hearing on the request Tuesday; the Carnival Center is set to run out of money in July.

The money would come from $3.1 million in savings from the Carnival Center's construction budget and $1 million borrowed from future county funding, which is derived from hotel bed taxes.
Huh? Savings from the construction budget? You mean the budget that was originally set at $255 million but ended up at $473 Million?

By the way the CPAC's CEO, Michael Hardy, makes a cool $225,00 a year and has a contract through 2009. It's good work if you can get it.

Why are is the CPAC losing money:

Among the preopening errors attributed to Hardy and his staff are budget miscalculations that failed to account for significant start-up costs and steep increases in utility rates.

Though the cost of electricity increased 30 percent from 2005 to 2006, the memo states, the jump was not reflected in the Carnival Center's budgeting.

Burgess's memo criticized Hardy's occupancy projections as ''poorly crafted,'' as they were based on a mean average of costs at major performing arts centers across the country and failed to account for the Carnival Center's two large halls. Most performing arts centers have one large hall.

What's more, the Trust's occupancy cost projections were based on a building area of 476,000 square feet. The Carnival Center's actual building area is 525,000 square feet.

''Consequently,'' Burgess wrote, ``the PACT's baseline budget per square foot was not realistic for the premises.''

The result of the combined miscalculations was that Hardy and his staff budgeted occupancy costs at $306,250 per month. They actually came in at $647,844 a month.


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