Corn Palace Financial Performance

The Corn Palace serves two distinct purposes: as Mitchell’s premier tourist attraction drawing summer visitors, and as the city’s primary event center hosting basketball games, concerts, and community gatherings (except during tourist season). This dual-purpose approach—maintaining a historic tourist destination while operating a modern event facility—creates unique economic challenges.

The fundamental question facing Mitchell taxpayers: Is it economically viable to combine these two very different functions in one aging, historic building? The financial data over the past decade provides important insights.

Financial Performance (2014-2024)

Financial Summary

Click here to download Corn Palace Financial Report 2014-2024 (PDF)

The $118 Million Tourism Claim

It’s important to understand that community event centers like the Corn Palace are rarely expected to turn a profit. These facilities serve as public infrastructure, similar to parks, libraries, or recreation centers. Their value isn’t measured solely in direct revenue but in their broader economic impact.

The Mitchell Chamber of Commerce and city officials emphasize that while the Corn Palace operates at a loss, it functions as an economic engine for the community. In recent statements to KELOLAND News, Johanna Allen of the Mitchell Convention and Visitors Bureau claimed that visitors spent $118.4 million in Davison County in 2024, and that most of that spending can be attributed to the Corn Palace. This number comes from Travel South Dakota, part of the South Dakota Department of Tourism. They define a visitor as anyone who lives at least 50 miles from Mitchell.

These are significant claims. If we interpret “most” conservatively as 70%, tourism officials are suggesting that the Corn Palace drives approximately $83 million in annual visitor spending. This would represent a remarkable return on the facility’s -$870,836 annual operating subsidy.

If accurate, the Corn Palace’s annual operating loss of -$870,836 would indeed be a worthwhile investment for generating substantial local economic activity. Let’s examine Mitchell’s actual revenue patterns to better understand the relationship between tourism and our local economy.

Testing the $118 Million Tourism Claim

Understanding Mitchell’s Monthly Revenue Patterns

If the Corn Palace truly drives Mitchell’s economy through summer tourism, we should see clear evidence in the city’s overall revenue patterns. Tourist destinations typically experience dramatic spikes during their peak seasons—beach towns boom in summer, ski resorts in winter. So when does Mitchell’s economy peak?

Let’s examine Mitchell’s total taxable sales revenue throughout the year with data provided by the South Dakota Department of Revenue—this captures every dollar spent in the city, from groceries to gas to hotel stays:

The $118 Million Question

The chart reveals an important pattern: Mitchell’s taxable sales revenue remains remarkably stable throughout the year. Peak tourist season shows only a modest increase, despite this being when the Corn Palace sees its highest visitor numbers.

This modest summer increase stands in stark contrast to the $118 million tourism narrative. The Chamber claims the Corn Palace drives “most” of this spending—if we interpret “most” conservatively as 70%, they’re essentially claiming we have an $83 million Corn Palace. If this $83 million claim were true, we would expect to see dramatic seasonal spikes in our revenue data—yet the chart shows nothing of the sort.

What If the Chamber’s Claims Were True?

The Chamber of Commerce claims the Corn Palace drives “most” of the $118.4 million in tourist spending. Let’s conduct a thought experiment: If we accept their claim that 70% of all tourist spending comes from the Corn Palace, what would Mitchell’s economy look like without our famous attraction?

This chart presents a hypothetical scenario to test the Chamber’s claims:

• Blue line: Mitchell’s actual taxable sales revenue (what we really observe)
• Green line: Hypothetical Mitchell Without $83M Corn Palace—showing what would happen if we removed the attraction AND the Chamber’s claims about its $83 million economic impact were true

To be clear: the green line is NOT reality. It’s a hypothetical scenario that asks, “What if the Chamber is right about their $83 million Corn Palace, AND we didn’t have it?” If their claims were accurate, removing our supposedly $83 million attraction would cause Mitchell to lose approximately 32% of its sales revenue during peak tourist season.

This scenario would mean Mitchell’s summer revenue dropping below its winter levels. The city would theoretically lose roughly $83 million in annual sales revenue. Such a pattern would differ dramatically from other South Dakota cities.

To put this in perspective, cities like Brandon, Hartford, and Huron—none of which have major tourist attractions—all maintain steady or growing revenue throughout summer. They don’t experience the dramatic collapse shown in our hypothetical green line. If losing the Corn Palace would truly cause such a catastrophic drop, it would mean Mitchell has built an economy more tourism-dependent than beach towns or ski resorts—places where the entire economy revolves around seasonal visitors.

Let’s visualize this hypothetical scenario by comparing what Mitchell would theoretically look like without the Corn Palace (if the Chamber’s claims were accurate) to actual cities that don’t have major tourist attractions:

Actual Mitchell dataHypothetical scenario

Showing how Mitchell actually compares to other cities

This normalized comparison raises important questions about the scale of the tourism impact claims. Notice how this hypothetical Mitchell has an economic pattern completely unlike any real South Dakota city. While Brandon, Hartford, and Huron all show normal summer increases, our imaginary “Mitchell without its $83 million attraction” would experience a catastrophic summer collapse.

This dramatic summer collapse in our hypothetical scenario reveals the impossibility of the Chamber’s claims. Cities without major tourist attractions like Brandon, Hartford, and Huron all maintain steady or growing summer revenue. If Mitchell truly depended on $83 million in Corn Palace tourism, losing it would create an economic pattern completely inconsistent with normal seasonal business cycles.

Cities with More Pronounced Seasonal Patterns

How does Mitchell compare to other South Dakota cities that experience seasonal variation? Let’s look at cities with more noticeable summer increases:

The data shows that while Mitchell maintains consistent revenue throughout the year (with only a 5.5% summer increase), some other South Dakota cities experience more noticeable seasonal patterns. Cities like Spearfish and Chamberlain see moderate summer increases (18-24%), while Murdo experiences larger seasonal variation (47%).

For the most dramatic contrast, consider Keystone—home to Mount Rushmore’s gateway. Keystone’s economy is almost entirely tourism-driven, providing the perfect example of what real tourism dependence looks like:

The contrast is striking. While Mitchell maintains consistent revenue throughout the year, Keystone experiences massive seasonal swings—exactly what you’d expect from a tourism-dependent economy. This is what tourism impact actually looks like in the data.

This thought experiment illustrates an important point: if the Corn Palace truly generated $83 million in economic impact, its absence would create an unprecedented economic pattern—one that no comparable city exhibits. The fact that Mitchell’s actual revenue remains stable year-round suggests that the Corn Palace’s economic contribution, while valuable, may be more modest than the largest estimates indicate. This understanding can help guide more informed decisions about future investments.

Mitchell’s Real Economic Strength

The data reveals Mitchell’s true advantage: a stable, year-round economy driven by residents and regional shoppers, not tourists. Unlike communities dependent on seasonal visitors, Mitchell maintains consistent revenue throughout the year—a sign of economic resilience and sustainability.

In 2012, Dr. Ralph J. Brown—Professor Emeritus of Economics at USD and member of the Governor’s Council of Economic Advisors—presented to Mitchell’s City Council and economic development boards with a clear message: to grow the economy, focus on growing export-based industries rather than tourist attractions. His decades of studying South Dakota’s economy revealed that export industries (manufacturing, call centers, credit card processing, etc.) bring new money into communities, while population-based businesses (retail, restaurants, services) merely recirculate existing dollars. Each dollar generated by export industries creates additional growth in the local service economy. Tourism, despite the attention it receives, doesn’t drive the kind of sustainable economic growth Mitchell needs.

What actually grows export industries? Dr. Brown identified key factors: an educated and trained workforce, solid infrastructure, and most importantly, good quality of life for employees. Mitchell already has strong foundations in these areas: our great K-12 program prepares students for the future; Mitchell Technical College and Dakota Wesleyan University provide specialized workforce training; and our infrastructure is well-equipped to support business operations. These are the assets that attract sustainable, year-round employers, not seasonal tourist attractions.

Dr. Brown’s framework becomes especially relevant when examining Mitchell’s actual visitor patterns. The state’s 50-mile visitor definition conflates two distinct groups: genuine tourists (out-of-state, infrequent visitors) and regional visitors (frequent customers from surrounding counties who shop Mitchell’s stores regularly). Mitchell’s retail pull factor of 2.14—more than double the state average—confirms we excel at attracting regional shoppers, not tourists. These aren’t people drawn by the Corn Palace; they’re customers from Huron, Parkston, and Chamberlain who come for our retail offerings, medical services, and restaurants. As Dr. Brown emphasized, both tourists and regional visitors can contribute export dollars, but they require different strategies. The data clearly shows Mitchell’s visitors are overwhelmingly regional shoppers making frequent trips, not tourists exploring attractions—a reality that undermines claims about massive tourism impacts from the Corn Palace.

This understanding should guide our investment priorities. Dr. Brown’s prescription aligns perfectly with what makes communities thrive: invest in quality of life amenities that serve residents daily—parks, recreation facilities, activities for children, and cultural opportunities. These aren’t just nice-to-haves; they’re exactly what Dr. Brown identified as essential for attracting and retaining the workforce that export industries need. When we make Mitchell an exceptional place to live, we create the conditions for sustainable economic growth. The Corn Palace expansion does the opposite—it diverts millions from these proven strategies to chase tourist dollars that our own data shows barely exist.

City’s Expansion Plans Despite Economic Reality

While the data shows minimal tourism impact and average annual operating losses of -$870,836, the Mitchell City Council continues to pursue expansion plans for the Corn Palace. The economic patterns we’ve documented—stable year-round revenue without significant summer spikes—suggest these investments may not generate the returns officials anticipate. Here’s how these proposals have evolved over the past decade:

A History of Expansion Proposals

The city has considered various expansion proposals over the past decade:

• 2012: A $35.4 million vision was unveiled featuring a “Corn Tower” rooftop observation deck, expanded seating from 2,989 to 3,950, and converting City Hall to exhibit space. Visitation was already dropping at that time.

• 2013: The City Council unanimously approved a $7.175 million renovation plan in two phases. Phase One ($4.2 million) included LED domes that could change color, larger murals, and a walk-out balcony. Phase Two ($3.08 million) would convert City Hall to tourist space.

• 2021: After spending $120,000 on a renovation study, architects determined the building footprint must expand to reach the desired 5,000 seats.

• 2022: Plans ballooned to a $40 million expansion, but faced funding challenges with no major donors stepping forward.

• 2025: Pursuing a $12-15 million expansion, scaled back but still ambitious.

• Now: The latest presentation reveals the budget has ballooned to $20+ million—$18.83 million for construction plus $1.31 million in design fees—a 33% increase from the promised $15 million ceiling. The expansion would add 35,000 square feet across three floors at $600 per square foot (per Mayor Hanson). As Council member Bathke calculated, that’s $5,760 per seat. Despite these high per-unit costs, the city presses forward with no explanation of how this investment will address the facility’s $870,000 annual operating losses.

The 2013-2016 Reality Check: Promised Growth, Actual Results

Looking back at previous expansion efforts provides valuable context for today’s discussions. The 2013 renovation offers an instructive case study in how projected benefits can differ from actual outcomes.

In 2013, the city approved a $7.175 million renovation with optimistic projections. City leaders expressed confidence that this investment would enhance tourism and generate increased visitor spending. Three years later, after implementation, officials remained positive about the results. In a 2016 Mitchell Republic article, Corn Palace Director Scott Schmidt declared he was “happy with it” and that the facility was “pretty darn busy every single day.”

The article highlighted encouraging metrics:

• 126,079 visitors had already passed through that tourist season
• The new Education Center averaged 775 people per day
• Concession sales were up
• New billboards along Interstate 90 were credited with attracting visitors

However, the financial data tells a more complete story:

Despite the optimistic projections in 2013 and the positive assessments in 2016, the inflation-adjusted revenue data reveals a different picture:

When adjusted for inflation to 2024 dollars, the revenue chart reveals that the $7.175 million investment approved in 2013 generated no meaningful revenue increase. Despite the LED domes, larger murals, and expanded learning space—all features intended to enhance the visitor experience and strengthen Mitchell’s tourism appeal—revenue remained essentially flat. The 2016 reports of being “pretty darn busy” were not reflected in sustained financial improvement.

This historical perspective is important for today’s expansion debate: Past projections about tourism impact and revenue growth have not materialized as expected. The 2013 renovation was promoted with considerable enthusiasm and specific economic benefits. The 2016 assessments remained positive despite flat revenue. Today, as the city considers another significant investment with claims about $118 million in tourism spending, it’s worth examining whether the underlying assumptions have changed or if we’re relying on similar projections that haven’t proven accurate in the past.

Critical Context: This Expansion Targets Events, Not Tourism

It’s crucial to understand that this expansion will not attract more summer tourists. The improvements—additional basketball courts, expanded event space, and increased seating—are explicitly aimed at hosting more events throughout the year.

Consider your own Corn Palace experiences: How full was the venue at the last event you attended? When friends or family visit for events, do they struggle to find seats, or do they comment on the plenty of available space? If finding seats is rarely a problem at current events, what changes in Mitchell’s event landscape would suddenly require 1,500 additional seats?

These aren’t rhetorical questions—they’re the due diligence our community deserves before a $20+ million commitment. Yet the city’s expansion proposal contains zero attendance data. Not a single figure showing how many people actually use the current capacity.

This omission speaks volumes. We’re being asked to fund a 43% capacity increase at $5,760 per seat without the most basic usage information. If the data supported expansion, wouldn’t it be front and center in every presentation? Mitchell taxpayers deserve evidence, not assumptions.

Mitchell High School’s recent addition of three new gymnasiums with multiple basketball courts has significantly expanded the city’s event infrastructure. As Council member Mike Bathke pointed out when discussing another sports facility proposal, Mitchell already has 17 basketball gymnasiums in town. This raises an important question: with so much basketball capacity already available, does Mitchell really need even more courts at the Corn Palace?

The Rental Rate Reality Check

To justify a $20+ million expansion, the Corn Palace would need to dramatically increase rental revenues. The financial math:

• Current annual operating loss: $650,000+
• Additional debt service and maintenance on $20+ million expanded facility: $1.5 million annually (very conservative estimate)

This harsh reality translates to doubling or even tripling current rental rates. Event organizers already have choices—Mitchell High School’s new facilities, neighboring communities’ venues, or simply scaling back their events. When faced with rental rates that are 200-300% higher, will they choose the Corn Palace? Event organizers are budget-conscious and have repeatedly shown they’ll move to more affordable venues when costs rise.

A Different Vision: Investing in Mitchell’s Year-Round Future

The data reveals what many residents already know: Mitchell’s economic stability comes from the families who live here year-round, not from summer tourism. Our steady revenue throughout all twelve months reflects a community that works, shops, and lives here—regardless of the season.

Consider an alternative to the $20 million Corn Palace expansion. What if Mitchell invested in facilities that serve our residents 365 days a year?

Imagine $20 million creating:

• A modern community center with indoor play spaces for young children—somewhere families can gather when it’s 10 below
• Year-round youth activity centers with programs that give teenagers positive alternatives after school
• Indoor recreation facilities that keep families active through South Dakota’s long winters
• Multi-purpose spaces where seniors can exercise in the morning and kids can learn robotics in the afternoon

These aren’t luxuries—they’re the amenities that keep young families from moving to Sioux Falls or Brookings. They’re the facilities that make Mitchell competitive when recruiting professionals. They’re the difference between a community that retains its children and one that watches them leave.

The contrast is clear: expanded event seating used occasionally versus community facilities used daily. One serves visitors and event-goers a few dozen times per year. The other serves Mitchell families every single day, through every season.

The Corn Palace will continue requiring annual subsidies regardless of expansion. But facilities designed for daily use by Mitchell families? Those create value every single day—in healthier kids, stronger community connections, and a more attractive place to raise a family.

Mitchell has proven it doesn’t need tourist dollars to thrive. Perhaps it’s time to invest in what actually works: making Mitchell an exceptional place to live year-round.