Civic Center announces furlough plan for all employees
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Civic Center announces furlough plan for all employees

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Facing a shortfall of $1 million, the Rushmore Plaza Civic Center put a plan in place Thursday to furlough all of its employees for 15 to 66 days.

Civic Center Executive Director Craig Baltzer said this plan only makes up about a third of the shortfall. The facility has already cut all 450 of its part-time employees and this move will affect 41 full-time employees. There are four positions that are still held open due to a hiring freeze.

Director of Finance Tracy Heitsch said the facility projected revenue of $10,865,000 for 2020 and even with a recovery in the fourth quarter they will lose half that. 

The $1 million shortfall is what remains after all of the expense cuts that have been made so far. The shortfall amount is based on a reasonable worst-case scenario and even with a furlough program that Baltzer called "robust," only about a third of the extra shortfall will be erased.

"As you can imagine, this has been difficult but necessary," Baltzer said. "All of our employees are valuable, but we have to be responsible."

The civic center generates about two-thirds of its revenue and the other third comes from BBB taxes and fees. 

Baltzer said hotels, bars and restaurants have been hit hard during the coronavirus crisis and that will have an impact on the BBB revenue the civic center receives. However, the coronavirus has already taken an even bigger toll on the civic center.

"For us, the effect was immediate and it was 100 percent," Baltzer said. The civic center closed on March 23 and won't have any events until at least July 1. 

"July and August are our slowest months every year, so getting them back won't help a lot with budget shortfalls," he said. 

Some employees will be furloughed for as many as 66 days while others will take 15, 20 or 30 day furloughs depending on job responsibilities. All furloughs are considered temporary so employees can retain their benefits until they return. 

Baltzer said that salaries and benefits, utility payments, bond payments on the ice arena and interdepartmental charges are the only budget items left that they have any control over at all. The only expense they have direct control over is salaries and benefits, which led to Thursday's board action.

Board member Charity Doyle challenged the other board members to begin working with the city government to help postpone or suspend some of the interdepartmental charges. The civic center staff is also looking into options on how to suspend or postpone the annual interest payment on the ice arena that comes due in December. The annual payment is from a 2008 bond that funded the construction of the ice arena. It is a 20-year repayment program.

"With the residents' support and recent vote on this facility, I think the city should do what it can to support the civic center," Doyle said.

Board member Tim Johnson said he expected the area's BBB taxes to rebound more quickly because of advantages the Black Hills offer. It is a less populous and more cost-friendly vacation than many other options for travelers.

"Many people think we do better when the economy is great," Johnson said. "But in reality, we do better in slower economies because people can't afford the big ticket trips to Europe, Hawaii and the Caribbean. This year, we are also a safer option."

Human resources representatives began meeting with employees Thursday and the furloughs will begin June 1.

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