The City of Rapid City and the Rushmore Plaza Civic Center are making concessions to help the city’s lone professional sports franchise, the Rapid City Rush pro hockey team, improve its financial standing over the next three years.
At a Thursday news conference, Mayor Steve Allender, joined by Rush Principal Owner Scott Mueller, Civic Center Executive Director Craig Baltzer and Civic Center Board Chairwoman Donna Winkler, said the combination of $2.15 million in debt initially incurred by the Rush to help the civic center ice arena open for the team’s inaugural season in 2008-2009, and declining game attendance over the past several seasons, has put the franchise in a financial bind and led to talks between the civic center and the team on how to keep the ECHL franchise going in Rapid City.
The Rush, which signed a 10-year lease agreement with the civic center prior to the 2017-2018 ECHL season, received a $108,000 reduction in rent, amounting in $3,000 for each of the team's 36-game home schedule last year.
After talks began late in 2017, Allender said the Rush agreed to give Baltzer more influence in the business management of the team.
The new agreement also means the civic center could share in any financial losses the team incurs over the next three years of up to $350,000 annually, well within the profit margin of this team over the time they have been at the civic center, Allender said.
“We’re not using general fund tax dollars. This is not a bailout,” Allender said. “This is what sports teams and arenas do to get through challenging times.”
Allender said construction of the ice arena in 2008 cost more than $25 million, but still did not include furnishings, such as seats, dasher boards, suites, sound system, video boards, televisions and Zambonis.
The civic center, he said, chipped in more than $2 million from its capital improvement fund — putting the fund in the red — to furnish the arena and secured bonds for another $1.5 million for the east parking lots, while the Rush were forced to obtained a $2.15 million loan to buy electronics for the ice arena in order to be able to open for the team’s first home game in November 2008.
"This investment into the facility, which is unheard of in other places, created a massive debt for the Rush and has made it difficult for the organization to remain financially whole," Allender said.
The Rush averaged 4,146 spectators in their inaugural season in 2008-2009 and continued to post growing attendance in their Central Hockey League championship year (4,811), peaking in 2010-11 at 4,923.
But attendance has seen a steady decline since then. In 2014-15, the team’s first season in the ECHL, average attendance slipped to 3,856.
This previous season, only five ECHL teams, Brampton, Ontario (a suburb of Toronto), Kalamazoo, Mich., Manchester, Mass., Norfolk, Va., and Wheeling, W.Va., averaged fewer spectators than the average of 3,053 attending games in Rapid City, according to figures tallied by hockeydb.com.
Mueller said a combination of the newness of the team wearing off and the team's performance on the ice, failing to make the ECHL playoffs the past three seasons, has contributed to the slide in attendance.
"The win-loss factor is the big thing," Mueller said. "Everybody likes winners."
Allender said the new agreement means the team will remain in Rapid City for at least three more seasons, with a chance to restore the city's enthusiasm for hockey.
“The plan is to restore the team to a position of financial strength and stability, and Rush fans are a big part of that equation moving ahead,” he said.