College Basketball Experience seeks loan relief after halting popular youth events

The operators of the College Basketball Experience heeded Mayor Sly James’ call several years ago to provide fun events for high school students, and they drew hundreds of teenagers to summer dance parties.

But after one participant was shot not far from the downtown facility early July 4, executive director Kevin Henderson curtailed the events. And that meant a big loss of money.

Given that, operators of the facility at 1401 Grand Blvd., next to the Sprint Center, are now asking the city to forgive the remaining $600,000 of a $1.1 million loan they received to complete construction in 2007.

“I can’t, as the leader of this organization, condone that type of behavior,” Henderson said of the shooting. “I don’t want to be any part of that.”

Police said two people were wounded about 12:15 a.m. July 4 near 13th Street and Grand Boulevard, as people were leaving the high school student event. Police said extra officers had been assigned to the area because of past disturbances after similar events.

Henderson said one of those wounded was a teen who had been at the party, but he emphasized the shooter, who was also wounded, came from outside and was not part of the event.

He said the College Basketball Experience had always complied with city rules for security at its events, and they had been successful and popular, attracting 500 to 800 teens from different high schools about twice a month in the summer and up to once a month in the winter.

While Henderson would not say how much money the high school socials generated, he said that loss was the reason the facility is now seeking relief from about $86,000 in annual loan payments due to the city through 2023.

The ordinance authorizing the loan forgiveness specifically states that the reason it’s needed is because the high school events ceased, costing the organization money it expected to use for improvements to the facility.

A city fact sheet attached to the loan forgiveness proposal states, “These events were a significant source of revenue...and their elimination will make it difficult to finance anticipated capital improvements to the College Basketball Experience while fully repaying an existing financial obligation to the city.”

There have been no further disturbances related to the College Basketball Experience since July 4, according to Mike Schumacher, public safety liaison from the city manager’s office.

Schumacher said he met several times with Henderson and others to discuss security needed for the events for high school youths. He said the city did not insist that the events be curtailed, but did want to ensure they were safe.

“It’s a wonderful facility,” Schumacher said. “But if we’re going to have large gatherings of kids, you need to have appropriate security.”

CBE officials pledge that if they get the loan relief, they will use that money for upgrades critical to keeping the building fresh and attractive for visitors and tourists.

But the City Council’s finance committee chairman says he’s skeptical, and hesitant to agree to that request. He needs to be assured it’s in the city’s best interest to forgive the loan.

“On the face of it, the request has some issues that need to be resolved,” said Finance Committee Chairman Scott Wagner, who held up consideration of the issue at the committee meeting Wednesday. It’s expected to come up again when the committee next meets Jan. 6.

The College Basketball Experience is owned and operated by the National Association of Basketball Coaches Foundation, the philanthropic arm of the National Association of Basketball Coaches.

They partnered with the city to build the $26 million fan-interactive attraction, connected to the Sprint Center. It was all part of the Sprint Center construction project, and both the arena and the CBE opened in October 2007.

Henderson said the city contributed about $10 million for the shell of the 41,500-square-foot CBE building, which the city owns. The foundation raised $15 million from coaches and other private donors for all the exhibits and other interior spaces, which they own and operate.

But there was a late cost overrun in building out the lobby that the foundation had not anticipated. So the city extended a loan with a principal amount of $1.17 million, with payments of about $86,000 due each year through 2023.

The foundation so far has paid more than $563,000, but still owes $606,635.

Henderson said the facility has been very successful, attracting about 100,000 people to about 100 events per year. It hosts high-energy sports and basketball activities for people of all ages as well as everything from birthday parties to corporate meetings and retreats.

It has never asked for city help with operating funds, unlike the American Jazz Museum in the 18th and Vine Jazz District and some other visitor attractions in Kansas City.

“We’re self-sustaining,” Henderson said.

But the facility also needs upgrades to maintain its vibrancy, and that’s where the loan relief would help, said Jim Haney, executive director of the National Association of Basketball Coaches.

“We are looking to stay on the cutting edge,” Haney said. “We think the changes are necessary to keep us attractive to people who come to the big basketball events and the conventions that come to Kansas City.”

The money saved would be used for building improvements, specifically technology. The CBE wants to improve video boards, including a video wall around the center court on the second floor.

The Big 12, NAIA and MIAA bring their tournaments to Kansas City regularly, and it’s also the home of the National Collegiate Basketball Hall of Fame inside the CBE and the CBE Classic, a basketball tournament played Thanksgiving week.

The facility’s first floor includes the National Collegiate Basketball Hall of Fame, a theater and several interactive exhibits.

A full court takes up one side of the second floor with more interactive stations.

“We’re not just a walk-through facility,” Haney said. “People come and stay for three, four hours. We’re interactive. You don’t just walk through like a museum.”

Wagner said he wants assurances that the upgrades will lead to more visitors, and Henderson said that information will be provided.

Wagner is also worried about setting a precedent, although that’s already happened.

In 2013, the City Council forgave $3 million of a $3.8 million loan to the Liberty Memorial Association. At the time, the association said it had tried its hardest to raise the funds needed to maintain the 86-year-old memorial, and it could not raise the additional money needed to pay back the loan.

If the council agrees to the College Basketball Experience request, the city would forgo all future payments to the Arena Debt Fund, which is intended to pay for preservation and major capital improvements at the Sprint Center.

Currently, downtown’s 8-year-old arena is still in good shape, and the fund is robust, with about $11 million. But Wagner said he wants to make sure that as the arena ages and needs major maintenance to stay vibrant, the money remains available to do that.

This story was originally published December 18, 2015 at 5:27 PM with the headline "College Basketball Experience seeks loan relief after halting popular youth events."