BY ART CULLEN
That the City of Storm Lake finds that it must pursue an abrupt divorce with Kinseth Hospitality over the management of King’s Pointe Resort is a sad ending to what was and could have been a prosperous partnership. The lack of clearly understood goals was fed by a lack of communication that owes to both sides in any marriage. As a result, the separation proceedings will be expensive.
Kinseth and the city had a good working relationship for several years as the North Liberty-based firm started pulling the resort out of the red. The resort was launched at the height of the Great Recession. Kinseth took over after a rocky start and built revenue along with profits. The resort was floating its own boat.
But there were complaints about service and facilities upkeep. Kinseth was driving for profits and cutting expenses. There was a lot of turnover from good people. Somewhere along the line, the city and Kinseth failed to appreciate what the common goals are: to attract visitors to The City Beautiful, to transform the image of the community, and to do it sustainably — that is, to cover the debt payments and upkeep through resort sales revenues.
Profits took priority over service and maintenance, it appears.
That is the city’s fault. It is also the fault of Kinseth executives who failed to smell the pot boiling over.
Which is a shame. This is one of Iowa’s leading tourist attractions. This is an Iowa company run by All Americans.
How did model fall apart?
A failure to communicate.
City Manager Jim Patrick concluded that the city cannot bear dealing with Kinseth until its contract expires in June.
It leads one to ask why the city did not have a new vendor in its back pocket ready to go when the divorce papers were served. A lame duck is running the pond.
And, a lame duck is advising the council to bolt. Patrick will be gone in May but the residue of his decisions will rest with us, to the weight of up to $100,000 in cost from the city treasury this fiscal year.
Perhaps the relationship has eroded to the point where real damage is being done to the franchise, and there is no rescuing it for the sake of the children. But we should at least pause to consider the costs. And we should know that the administration indeed has a vendor signed on. The council spoke with some firms with excellent credentials, just like Kinseth. It would be good to know how this proceeds forward.
Communication with the public has not been a strength of the administration. That will change soon, we are sure, as Patrick retires. We can see how the lack of it messed up what was a good thing.
Extend sales tax
Storm Lake may breathe a sigh of relief in the welcome news that the Iowa Legislature is moving ahead with a 20-year extension of the school sales tax as it stands, with no amendments or diversions. This will be absolutely crucial to the success of an effort to build a new early childhood education complex that can alleviate severe space shortages in our growing school district.
It has been feared that budget hawks in the legislature would oppose the extension, or that someone might raid the fund to improve water quality. Neither happened. Instead, the GOP controlling the statehouse understands that the one-percent sales tax is popular in rural and urban Iowa. According to a study by Iowa State University researchers, the sales tax generated nearly $2.8 billion in school infrastructure and technology spending from 2009 to 2015. That’s an economic development boost, an education boost and a community boost. Part of that spending was well-used by Storm Lake to build an elementary school and expand the high school while decreasing property taxes.
We feared that the sales tax would sunset and that the Storm Lake School Board would be forced to ask for a general obligation bond to be paid off by property taxes. Such a measure would require 60% voter support. We don’t believe a $20 million bond issue, or more, would be welcomed by property owners who vote.
But those voters will enthusiastically endorse sales taxes being used for such purposes, as the high school referendum testified.
It’s popular. It is helping rural schools rebuild. It is helping starved districts acquire new and expensive computer technology. It is keeping sharing school partners together. And it is helping to hold down property taxes, which must be a Republican legislative priority.
We trust our area legislators will put their shoulders behind progress for Storm Lake and all rural schools. Extend the sales tax. Build Iowa’s future.