By Bill MacKenzie*
It’s hard to tell a captivating, triumphant story about industrial agriculture in Eastern Oregon. But the Port of Morrow wanted to try.
Baker County already had the National Historic Oregon Trail Interpretive Center, Wallowa County had the Josephy Center for Arts and Culture and Umatilla County had the Tamástslikt Cultural Institute.
The Port decided to build a high profile state-subsidized Sustainable Agriculture and Energy (SAGE) Center along I84 in Boardman that would draw thousands of visitors and highlight the businesses that sustain the county. If you’ve driven I84 out that way, you’ve probably seen the Center.
But the dream hasn’t worked out as planned, offering lessons for others contemplating tourist attractions.
The idea for the SAGE Center emerged when Tillamook Cheese, stretched to the limit at its Tillamook facilities, opened a second cheese-making facility in Boardman in 2001. But it lacked the tourist attraction of a hoped for Tillamook Cheese Factory tour.
Port of Morrow Manager, Gary Neal, got to thinking about other industries in the county that had a hard time showing how they operate their facilities to make a wide variety of products.
“…maybe we could showcase the natural resource based economy we have at the Port of Morrow,” Neal thought. “Our technology in the plants as well in the fields growing crops is second to none in the world…The prudent use of our natural resources, multiple energy in the region, the Columbia River and the fact it is the lifeblood of what our region is about all needed a place for that message to be shared.”
The Port, a municipal corporation, hired Public Affairs Research Consultants to create a Business Plan for an Agricultural Learning Center that would “…offer visitors a unique opportunity to learn about modern food processing and where it intersects with transportation, food production and energy.”
A draft Business Plan prepared by the consultants said there were multiple reasons to be confident about the ability of a 28,000 sq. ft. center with exhibit space, offices, a gift shop, conferencing and class space, and a kitchen to attract 40,000 or more visitors annually and to be self-supporting, running a surplus from the first year.
The Plan projected the center would take in $187,880 annually. Most wouldn’t be from earned income, such as entrance and rental fees, but from other sources including payments from the Boardman Chamber of Commerce for space in the Center, payments by companies with displays, food service, a gift shop, visitor donations and grants.
The Plan projected surpluses at the Center starting the first year and continuing thereafter.
Encouraged by the optimistic projections, the Oregon Legislature stepped up with $4 million in lottery funds to help build the SAGE Center, which held its grand opening on June 1, 2013.
The 23,000 sq. ft. Center boasts a movie theater seating 204 people, two conference rooms and an ever-changing exhibit hall. The hall currently features videos of 3rd and 4th graders interviewing local workers, such as farmers and dairy operators, as well as a tractor-like device children can drive to plant corn using GPS technology.
There’s also an interactive tour of Morrow County in a simulated hot air balloon, hands-on displays illustrating the magnitude of Morrow County’s agricultural operations and a mock french fry-making machine.
The theater is used for movie showings, trainings for local businesses, large group presentations and local drama and music productions. A recent event featured a performance by acclaimed guitarist and songwriter Johnny A.
A job fair serving local industries is hosted at the Center annually as well as a Morrow County Harvest Festival, which is designed to showcase local artisans, produce growers and provide a free, family-friendly event.
Educational tours are also provided where students receive a comprehensive and interactive experience. Students see, touch, and sometimes smell how food and energy are produced in Morrow County and delivered to consumers.
It all sounds great.
But things haven’t exactly gone as planned.
The consultants said there were potential barriers to success, such as the need to raise public awareness of the center and the development of competing visitor attractions in the area, but they were still optimistic.
“Based on the strengths, weaknesses, opportunities and threats the proposed AIC is a reasonable risk and it is reasonable to conclude that it is a good investment,” the consultants said.
But the Center ended up costing much more than anticipated. The original estimate was about $6 million. The final cost was $8,305,845, requiring a $4.3 million investment by the Port on top of the $4 million state grant.
Then there were higher than expected operating costs.
The market feasibility study for the Center projected annual operating expenses of just $184,128.
To say the least, that was wildly off track.
The Center’s fiscal year ends on June 30. Actual fiscal year operating expenses have been: FY14: $497,940; FY15: $763,331; FY16: $913,014
The consultants projected annual replacement/maintenance/ground expenses would be $24,000. The reality? $115,210 in FY16.
The consultants projected the annual cost of a Director and hourly staff would be $105,241. The reality? With lower local volunteerism than expected and more responsibilities, such as staffing the Center’s gift store, full-time staff has grown to four and labor costs in FY16 totaled $300,091.
Similarly, the consultants projected the annual cost of marketing the Center would be $3000. The reality? Marketing costs in FY16 totaled $123,545.
Even the estimate for the minor item of supplies was way off. The consultants projected the annual cost of supplies would be $2,400. The reality? $19,205 in FY16.
The consultants projected an annual surplus starting with the first year. Instead, the SAGE Center is hemorrhaging money like a burst water main. It reported a deficit of $554,766 in its 1st year, $598,063 in its 2nd and $574,972 in its 3rd.
And the deficits were actually worse. That’s because the Port of Morrow injected $70,000 in the 2nd year and $180,000 in the 3rd year from its general fund to help keep things going. Without those infusions, the deficits would have been $668,063 the 2nd year and $754,972 the 3rd.
Port officials insist they’re not fazed by the ballooning costs and deficits. Joe Taylor, President of the Port of Morrow Commission and a local farmer, said changes to the Center’s design from original plans explain some of the cost increases, as did the Port’s desire for “…a first class venue to tell the story of our area’s agriculture and energy communities.” In any case, he said, the Port had sufficient funds in its budget to handle the expenses.
The number of visitors has not met expectations either, despite the consultant saying there were “many reasons to be confident” about the ability of the SAGE Center to attract them.
The Market Feasibility study projected 40,000 visitors a year, emphasizing that this was a “relatively conservative” estimate.
But it has proven hard to tell a rich and entertaining story about agriculture. There are high visitor days, such as during the Harvest Festival, which attracted about 1000 people in 2016, but on many days the expansive parking lot is largely desolate.
As a result, the Center has averaged just 22,000 visitors a year, with no year-to-year increases, according to Kalie Davis, the SAGE Center’s Manager.
About 14,500 of the SAGE Center’s 22,000 annual visitors are U.S. and international tourists. Another 4000 are groups of schoolchildren, most from Eastern and Central Oregon. “Not a lot from the Portland area, “ Davis said. “That’s an area we’re working on.” Events, such as job fairs and movies (the center’s theater is the only one in Morrow County), bring in the rest of the visitors.
In comparison, the Oregon Trail Interpretive Center in Baker City attracted 36,871 visitors in 2015 and the Columbia Gorge Discovery Center & Museum hosted 38,130.
Davis minimized the difference between projected and actual visitor counts. The 40,000 SAGE Center visitor projection by the consultants was simply unrealistic from the beginning for a rural facility far from major population centers when most tour operators focus on the I5 corridor and the Oregon coast, Davis said. ‘It’s not as easy as if you build it they will come,” she observed.
The Port would clearly like to see an increase in the visitor numbers, “…but we are not concerned about what we have seen this far,” Taylor said. “The SAGE Center is located in a county of 12,000 people and along a very straight stretch of freeway. Trying to get those folks to pull off and come in is a big challenge and we are learning and getting better at it all the time.”
The hope, Davis said, is that media coverage, such as being featured on KGW-TV’s “Grant’s Getaways”, growing interest in the farm-to-table movement and enthusiasm for tracking where food comes from will draw more visitors to the Center. She sees 30,000 visitors annually as a reasonable goal.
Embracing optimism, Davis expects it will take a little while to raise public awareness of the relatively new Center and build visitor count, but it will happen. “Nobody knew what OMSI was, I’m sure, when they started off,” she said.
As for the construction cost overrun and operating deficits, officials with the Port and the SAGE Center dismiss suggestions that these have been a shock or are reason for concern.
Davis said the substantial increase in the construction cost of the Center is because the original design in the early stage of planning was essentially a box, with no custom elements. The design changed later when a community committee argued a more appealing design was necessary to attract visitors. “The cost did go up quite a bit, but the Port knew that going into it,” said Davis.
Taylor added that the Port is aware of the substantial difference between projected and actual operating expenses, but “…is not overly concerned.”
Taylor and Davis said the failure of the Center to generate surpluses isn’t a problem either.
“The Port knew that the SAGE Center would not be a money maker right away,” Taylor said. “This is a long term program to educate people on where their food and energy comes from.”
Furthermore, Taylor said, the Center represents just 5% of the Port’s operating budget and less than .008% of its overall annual budget. “Over time the benefit the SAGE Center brings to our region will pay off bigger than the deficits we see now,” he said.
Neal reinforced Taylor’s observations. “This is not about generating revenues to offset the expenses,” Neal said. “This is about sharing with as many people we can (information) about the use of natural resources and that our food doesn’t just come from the grocery store, our electricity doesn’t just come from a light switch, and so on.”
“The only reason this facility even charges admission is to show value in the experience,” Davis added.
The Center, she said, was built more as a marketing tool for the Port and an educational and community facility for Boardman. In addition, it was intended as a catalyst for local growth, a magnet for new residents and workers in an economically healthy area struggling to attract a qualified workforce.
In many respects, the SAGE Center seems to have a precarious future, given its ballooning costs and grim deficits. Its survival, however, may depend more on the Port’s willingness and ability to continue bearing the financial burden than on whether the escalating costs can be reined in.
Neal said the Port has no intention of throttling back in its support of the Center. “We have the resources to support this facility and the mission for the long term,” he said. “This is a long term investment.”
*Bill MacKenzie has worked as the Communications Manager of a major technology company in Oregon, a newspaper reporter on business and politics and as a staff member on a committee of the U.S. House of Representatives. He writes on public policy issues at: thinkingoregon.org
The SAGE Center At A Glance
Location: Visible from Interstate 84; at 101 Olson Road, Boardman, Ore., 97818 (A small map showing the location might be helpful)
Directions: Take Exit 164, turn north toward the river, then turn right on Front Street. Follow it 1/2-mile to the SAGE Center.
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