Time to Centrecise?

The Centre, Elgin's $41M recreation center, reported record losses of $855K, putting it on track to hit a million dollar deficit in 2006. They've fired several managers already since the place opened. Now it seems the approach is to talk it down and reduce expectations. We're now told that the Centre was never meant to make a profit or break even. Other city programs lose money, we're told. Why should we expect differently? Of course, this is not what they were saying several years ago when they were campaiging for a $20M recreational center, which--through the magic of people spending other people's money--eventually ballooned to $41M.

Recap: Thomas Sandor (who was not on the council at the time) fought against it, but could not convince the city to hold a referendum. Marie Yearman voted against it, because the poor would have no access to it--they still don't. Later Ruth Munson joined her in voting against it when it was clear that there was no feature conjured by the architects--like a $600K walkway--the council could refuse.

My feelings at the time were that such a large project--the largest in Elgin's history, deserved a referendum even if the city were not legally obligated to hold one. I've been ambivalent about it ever since. On the one hand, it's a nice amenity, improves Elgin's image, and provides an incentive for people to live downtown. On the other hand, it's undemocratic--open only to those who can afford the steep fees, extremely expensive to build, inefficient to operate, and represents the sort of boondoggle and state-owned enterprise that we as Americans have learned to fear.

If I remember correctly, the Centre--said to be the largest publicly-owned recreation facility in America--drove the YMCA and one or two fitness centers out of business. But the Centre itself, no matter how poorly run and economically deficient, can never go out of business, because its deficit will always be covered by the City of Elgin. Governments around the world are privatizing state-owned enterprises, and we're building them.

In matters like this, I think the city's role should be as catalyst, not operator. Whatever the private sector--whether for profit or not for profit--can do better, let it do. I don't think the city's role is to provide dance classes or karate classes or ceramics classes or any of the things that a city bureacracy by itself is not uniquely positioned to provide.

We should support private organizations that provide these services, not compete with them. If we had $41M to spare, we could have spent it recruiting dance studios and karate studios and ceramic studios to Elgin. We could have helped them find spaces in our historic buildings. We could have helped them rehabilitate and restore those buildings. I think you'll find that $41M would have gone a lot further this way, while also bringing a lot of small business owners, artists and so on into the community.

In truth such a strategy would never have cost $41M, perhaps not even $4M. The cost would have been low, the risks negligible, and the returns comparable to a $41M boondoggle.

History has shown--America has shown--that the private sector can operate businesses more efficiently than the government. The lesson we've drawn for governments has been, "Don't compete and don't get in the way."

Yet because altogether the city's businesses employ some 900 people, whose union, the SEIU is the most important contributor to the campaigns of our councilmen, it's unlikely that the city will ever divest itself of any business. If anything, the opposite is likely to occur. Head count will hit a thousand, city hands will be in every pie, etc.

To me, it's sort of disturbing, because the city has harmed private businesses not just by competing with them, but also by its "Schock and awe" campaign of demolishing landmarks and historic buildings, scaring away the people and businesses that otherwise would have brought them back to life. Good sense requires us to ask ourselves, could Planner's Blight be responsible for the large number of vacancies in the downtown?

Could it be possible that the city government is involved in too many things and doing too much?