Documents: Hawaiian Falls financial woes preceded layoffs, buyout

The Pflugerville Community Development Corporation ultimately took out a $25 million loan for construction of the park

PFLUGERVILLE, Texas (KXAN) — Hawaiian Falls Pflugerville had a net income loss of over three-quarters of a million dollars in 2014, its first year of operation in the city, according to documents obtained by KXAN.

A Pflugerville “profit and loss” statement from Harvest Family Entertainment, which has been Hawaiian Falls’ parent company, shows the business was in the red $784,414.27 from January through December of 2014.

KXAN obtained the financial documents through the Texas Public Information Act.

The Pflugerville Community Development Corporation, which collects a half-cent sales tax and seeks approval from City Council for major projects, helped bring the water park to town. The PCDC ultimately took out a $25 million loan for construction of the park. PCDC backs the loan, but Hawaiian Falls pays the principal and interest on it, a PCDC official said.

Hawaiian Falls experienced a tough 2014 season. The company laid off employees last December. This May, a private equity firm bought the water park, according to city records.

Amy Stansbury, a Hawaiian Falls spokeswoman, confirmed the financial statements are accurate, but said the company is doing well now. She said the 2014 losses were due, in part, to the investment involved in opening two parks that year—one in Pflugerville and one in White Settlement near Fort Worth.

“The sales were going well, and there was a hit that was taken up front when you build two parks,” Stansbury said.

Stansbury said prolonged rainy weather this summer contributed to the company operating in the red again in 2015. However, she said the company expects to be profitable next year and season tickets sales have increased about 30 percent year over year.

Amy Madison, PCDC Interim Executive Director, would not comment on Hawaiian Fall’s financial documents, but she said Hawaiian Falls is current on all the payments it is required to make.

“This year, they are absolutely current and have been since I have been in this chair,” said Madison, who took over as interim PDCD executive director following the departure of Floyd Akers on Aug. 1.

Madison said she is currently “happy with the performance of the park. It continues to grow.”

Pflugerville City Manager Brandon Wade echoed Madison’s sentiment.

“They are totally caught up on their finances, and they have brought a few hundred thousand people to this community over the last couple of seasons. From that perspective, we are pretty happy,” Wade said.

Pflugerville City Attorney George Hyde told KXAN the water park company has not missed any payments. “There has never been a financial breach in the city’s agreement,” Hyde said.

Two seasons down

In 2014, Hawaiian Falls opened late due to construction delays and inclement weather. Park construction costs also exceeded initial expectations, and the city of Pflugerville approved a loan increase for the park to $25 million, up from $23.5 million last November, according to media reports.

Then in December 2014, Hawaiian Falls announced layoffs and employee furloughs.

In May 2015, private equity firm Source Capital LLC bought the majority share of Hawaiian Falls’ parent company Harvest Family Entertainment days before the Pflugerville park opened for the summer.

Stansbury said Hawaiian Falls’ leadership has also changed. Former Hawaiian Falls president David Busch retired, and former company vice president Clint Hill has taken the helm of the company.

Source Capital is actively involved in Hawaiian Falls management and helping the company grow, Stansbury added.

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