City manager shares more details regarding Sierra Theatre, but the symphony plays a different tune

Publisher’s note: In March 2021, as the nation battled the COVID-19 pandemic, President Joe Biden and Congress enacted the American Rescue Plan, a $1.9 trillion act that provided $350 billion in funding for state and local governments to help offset the effects of the pandemic. The city received approximately $3.5 million in ARPA funds, and in November 2023 it asked the community to submit requests for the remaining $2.5 million in unused ARPA funds for potential public benefits projects. According to the Government Finance Officers Association, “The funding provided under ARPA provides a unique opportunity for state and local governments to make strategic investments in long-lived assets, rebuild reserves to enhance financial stability and cover temporary operating shortfalls until economic conditions and operations normalize.” The funding was intended as “revenue replacement for the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency, relative to revenues collected in the most recent fiscal year prior to the emergency; COVID-19 expenditures or negative economic impacts of COVID-19, including assistance to small businesses, households and hard-hit industries and economic recovery; premium pay for essential workers; investments in water, sewer and broadband infrastructure. The Susanville Symphony Society requested $1 million to purchase and refurbish the historic Sierra Theatre. During the process, the symphony’s funding request was reduced to about $450,000. The city then decided to use the ARPA funding intended for the theatre project for the purchase a new fire engine and planned to instead use general fund money for the theatre project.

Susanville City Manager Dan Newton had not seen the statement from the Susanville Symphony Society regarding the Sierra Theatre project when he spoke with Lassen News earlier this week. Now that he’s seen their statement, he offered our readers more information and his perspective on the project.

But despite Newton’s comments, the disparity between the city’s and the symphony’s version of events remain as wide and bitter as ever.

According to the statement from Kenneth Holmes, president of the Susanville Symphony Society, published by Lassen News earlier this week, “Our plans were based on receiving a grant from the city of Susanville to support this important endeavor. Unfortunately, the funding initially offered as a grant was proposed in a contract as a loan. This, coupled with the realization of actual operating expenses, made it impossible to move forward.”

Newton said some in the community feel the city changed the project’s direction by making the grant funding into a loan, “but that was never the city’s official position.”

And the city manager said the decision to abandon the project was made by the symphony. He said based on new information they discovered, the symphony decided the project would not work for them financially.

“I think they (the symphony society) should be commended for taking a hard look at the numbers and making a smart business decision, if that’s what they felt was necessary,” Newton said. “Based on new information about what it was going to cost,” the symphony society decided “not to move forward with the project.

“The original concept was the community needed access to the facility, so there were some concerns expressed by the public that it (Sierra Theatre) would need to available for Best of Broadway and other community events,” Newton said. “So, it was contemplated early on that there were going to be conditions in the agreement that would need to be met. Also if the project was initiated and it failed, the city would be reimbursed for its contribution, if the building was sold, in other words. There was a statement made by a representative of the symphony board that they would want to pay the city back if adequate revenues were generated. That statement kind of led to the crafting of the first draft of the agreement which was going to be explored as a loan-type concept. That’s where that came (from), but it was never presented as a ‘take-it-or-leave-it’ deal.”

Newton’s said the negotiations were still open and everything was still on the table when the symphony abandoned the project. Nothing had been finalized.

Ah, but that’s not the way Chris Gallagher, a Susanville Symphony Society member who met with the ad-hoc committee sees it.

Gallagher said during the many months the project has been on the table, the symphony and the ad-hoc committee had only two one-hour meetings, and at the conclusion of the second one-hour meeting it appeared the two sides had reached an agreement.

He said he had suggested that perhaps the symphony could give the city some of the profits — if enough were generated — to repay they city. But he said he made that suggestion in an effort to reduce the 20-year term of the agreement under consideration.

Gallagher’s bottom line
“What we talked about in the two meetings had no semblance to what I saw in that contract,” Gallagher said. “It was totally different. When Ken (Holmes) and I left (the second one-hour meeting), I thought we had figured out all the terms and all that kind of stuff, but it totally got turned around. They decided to totally change it after we had talked for two sessions … We thought the terms were set … I thought it was going to be simple for us to go in there and go, ‘Oh, yeah, that’s good. Perfect. Ready to go.’ And it was this whole different, unbelievably different, contract than what we had talked about … It went from being a grant to a loan, which was never discussed by our group … So, I have a little disagreement with them.”

“They could have come back to the ad-hoc and said this has never been part of the discussion, this is not what we want to do, and that could have been worked out, but they never did come back to the ad hoc,” Newton said. “They changed their mind during that process.”

Looking to the future, Newton said, “What would have happened is once there was an agreement in principle between the symphony society and the ad-hoc committee, it would have gone back to the city council for approval. The symphony changed their direction during that negotiation process. That’s my observation on the events that have transpired.”

Newton said he and the city attorney were involved in preparing the documents, but the city’s ad-hoc committee — city councilmembers Parrish and Dawn Miller — was steering the negotiations with the symphony.

Newton said he expects to dissolve the ad-hoc at the council’s July 2 meeting. He also said the council had passed a resolution that if the Sierra Theatre project fell through, the money would be used to pay off city debt.

“That’s currently the city’s official position,” Newton said.