In 2007-07

Current assets

The U.S. National Whitewater Center strives to stay afloat on cash flow from its raging man-made river.
By Frank Maley

It’s easy to forget chronic concerns while fighting froth and fury at the U.S. National Whitewater Center, which opened last fall outside Charlotte. That’s because they’re drowned out by more-immediate worries — such as how to stay in the raft and avoid plunging into the soggy swirl. There’s no time to stew about shiftless subordinates, spendthrift spouses or ingrate kids. Whatever differences you might have with your crew vanish. You either work with it to beat the stream or you swim — and sometimes bleed — alone.

That coalescing aspect of whitewater rafting is a big building block of U.S. National Whitewater Center Inc.’s business plan. Executive Director Jeff Wise expects as much as 30% of the nonprofit’s revenue to come from businesses trying to build teamwork among employees or just looking to boost morale with some splash time. Group outings other than businesses will contribute more than 40% of the top line, which Wise hopes will exceed $7.5 million in the fiscal year that ends in October.

Whether the center, which employs about 50 full time and 200 during the summer, will break even is uncertain. Wise expects it to. It boasts “the world’s largest recirculating artificial whitewater river,” and it’s running ahead of projections. But roughly 70% of its revenue is expected to come between mid-May and mid-September. “The summer is going to tell us everything. We’re excited to see what the summer brings but nervous, too.”

Any spare change will go toward early debt retirement. If the whitewater center can’t cover its expenses during its first seven years — about $6.6 million in year one — a coalition of six local governments will help it make up as much as $1.7 million a year. That bothers some taxpayers who wonder why public money should be used to bail out a private entity. But Bobbie Shields, Mecklenburg County’s general manager of development and planning, says the county, the public body with the most to lose, is getting a good deal.

It had notions of converting land on its western edge into a park but hadn’t done much serious planning, Shields says. Wise and other organizers approached the county about five years ago and worked out a plan — including hiking and biking trails, a ropes course and a rock-climbing wall — for 307 county-owned acres. In exchange for pledging to cover as much as $1 million a year in losses, the county got a park with an unusual centerpiece. “The worst-case scenario would be that Mecklenburg County would have to pay $7 million — a million dollars per year — but we could not have built that park, or the park that we had visualized, at that site for that price.”

In fact, it cost the nonprofit considerably more than that, and a lot more than expected, to build the whitewater center. At first, organizers thought it might take about $15 million, but that was before a site was chosen. After some concepts and designs were drawn up, the total reached $25 million. It kept escalating after construction started in 2005. Part of the problem was a worldwide construction boom that drove up the cost of materials, Wise says, but part of it was the inefficiency of invention.

Organizers were inspired by an artificial river built for the 2000 Olympics in Australia, but theirs would have a differ- ent design and two main channels. Early estimates were revised as contractors looked more closely at the project. It add- ed up to $38 million, which the nonprofit borrowed from Bank of America, Wachovia and other lenders. “We’ve got it built; now we’ve got to pay for it,” Wise says. “That’s a big nut to have pay back over about a six-year-period.”

It didn’t help that the center’s opening was delayed until after last summer, which cost about $2.8 million in lost revenue. The nonprofit struggled to get the necessary county permits for the center and has had trouble getting state and city approval for the main access road — it hopes to have it built in early 2008 — so it extended a nearby dead end. Neighbors protested, even blocking access to the site briefly, but eventually settled with the nonprofit.

Once at the center, visitors can use the hiking and biking trails for free. Kayaking sessions start at $15 for 90 minutes and rafting starts at $33. The 6-foot-deep channels are essentially short ski runs of liquid snow, dropping 21 feet from start to finish and extending a combined 4,000 linear feet. Twelve million gallons of tap water, filtered daily and changed annual- ly, are pumped through them — as much as 536,000 gallons per minute. Computer-controlled gates allow employees to narrow the current, increasing its speed, or widen it. Large movable plastic pegs funnel the water as rocks would on natural whitewater. After each run, conveyor belts bring rafters and kayakers, boats and all, from bottom to top.

The nonprofit makes money from equipment rentals and sales, a restaurant, the ropes course and the rock-climbing wall, but peddling whitewater paddling is the main revenue stream. It already has attracted national attention. The U.S. Olympic canoe-and-kayak team trains there. The New York Times, USA Today, Esquire and Sports Illustrated have written about it.

Part of Wise’s job will be to keep the buzz going and draw more visitors. He’s a 43-year-old Charlotte native and lawyer who played a small role in starting Charlotte-based First Commerce Bank in 1996. Though he has no financial stake in the nonprofit, other than his salary, he’s motivated to make it successful. Its board is filled with Queen City power players, including Alan Dickson, former chairman of Ruddick, which owns the Harris Teeter grocery chain; Speedway Motorsports President Humpy Wheeler; and Pat Mumford, a senior vice president at Wachovia and a Charlotte councilman. “If this thing doesn’t do what it’s supposed to do, I’m going to have a lot of people upset with me,” Wise says. “I’m going to have a hard time getting another job in this town.”

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