The Town of Penhold will be looking for a new group or individual to take over the operation of the Fitness Centre in the Penhold Regional Multiplex.
After the previous owner, Calgary businessman Paul Gabbay, defaulted on the lease early in March the town temporarily took over the operation of the centre until they could discuss a new resolution.
Council passed a motion to send out a request for proposals for the operation of the Fitness Centre in their council meeting on Monday, March 28 after reviewing two different options for the facility.
“We will have a call out for about two to three weeks and hopefully we will find a successful person and go from there,” said Dennis Cooper, Penhold mayor.
The town owns the equipment located in the fitness centre as it was purchased through the previous owner when they opened the facility.
Town council considered two options for the facility, the first being to find a new owner and the second being to take it over themselves.
Multiplex facility Manager Derek Crichton made a presentation to council specifying the costs and implications of both options.
The cost of re-tendering the fitness centre would be only that of the operating costs while the town looks for a new owner. However Crichton said the downside to an independent party running the fitness centre is that it complicates the purchase of passes for customers. With separate owners the ability to sell passes that allow access to the entire Multiplex becomes a complicated and much less seamless process then if the town owned the facility, said Crichton.
The other downside to re-tendering the facility is that the town would no longer have influence over the staffing, maintenance of the equipment, or marketing of the facility, sates the report presented to council.
The option to take over the fitness centre would have come with a much higher price tag but would have allowed for the town to control all aspects of the fitness including staffing and maintenance.
The estimated cost of running the fitness centre is just over $10,000 per month. This includes the staffing costs for one manager, one manager assistant, and two part time staff, as well as the insurance, computer program, debit and credit machine, satellite TV, janitorial supplies, and general operating costs.
In order to break even on those costs through memberships there would need to be 302 members who are paying $35 a month for the use of the fitness centre.
Councillors reached a unanimous agreement that they would not run the fitness centre as that is not what they had originally decided.
Councillor Danielle Klooster argued that the town should be giving small business the opportunity to start their business in Penhold and that the town should not be the ones to take over the facility.
Cooper said that the cost of operating the facility and taking on more staff to the payroll would be too great for the town.
The fitness centre will remain open while the town looks for a new owner and Cooper said that they would honour any passes or memberships that had been purchased from the previous owner. The town will also continue to employ the three staff working at the centre until they find an interested party to take it over.
