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Crookston Times - Crookston, MN
  • Crookston Sports Center deficit concerns some more than others

  • Positive impact on community far outweighs red ink on bottom line, Stassen says.
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  •     Back when the City of Crookston was still investing money in maintenance and other necessary items at the Crookston Civic Arena and Winter Sports Arena, it wasn't uncommon for the connected facilities to produce an annual loss that topped $250,000, which the city compensated for each year with dollars from the general.
        When it became more and more clear to city and Parks & Recreation leaders that the two rinks weren't part of the city's long-term plans – they were in line to be demolished to make way for a new flood control levee – the city greatly cut back on the money it injected into the facilities, spending the absolute bare minimum needed to keep them open and operational. As a result, the annual losses shrunk, eventually falling below $200,000. But, even then, the annual deficits were in the $150,000 range.
        Even with its increased energy efficiency, the fact that the city's new facility, Crookston Sports Center, had three rinks and was significantly larger than the two old arenas, early budget projections for the CSC had the new facility losing well over $200,000 a year, and even more than $250,000 a year.
        That's why, when the CHEDA Board of Directors got a glimpse of the Crookston Arena LLC budget last week, most seated around the Valley Technology Park conference room table didn't raise any red flags when the bottom line showed the CSC projected to lose $233,000 in 2012. But, for some people who haven't been involved for years with the city or CHEDA and, therefore, weren't privy to the CSC's initial projections, or weren't aware of the fact that city officials pretty much figure that their arena facilities aren't going to be in the black, there was some concern.
        "I hate to see a budget that just assumes we're going to lose money," CHEDA board member Kurt Heldstab said, mentioning the Alerus Center in Grand Forks that lost money for years and led to much stress among city leaders 25 miles to the west, "before all of a sudden making money and making everyone happy."
        No matter what city officials assume, Heldstab continued, if the average Crookston citizen chatting with a city official on a park bench was told that the CSC lost $233,000 in 2012 but that it was no big deal, that citizen might disagree. "They'd say, 'What?!'" he said.
        CHEDA board member Ross Matlack agreed, saying that budgeting for a loss makes him a "little squeamish." He said he doesn't necessarily need to see every last budget detail that led to the loss, but would instead prefer to see details of a "plan to not have a loss."
        Matlack said he'd also appreciate some "talking points" that would better educate him on the CSC's finances and mission so that when others ask him about the CSC, as a CHEDA board member he'll be armed with accurate information. "I could say, 'Yes, we lost $230,000 but it's bigger and better than the old facility, and the old facility lost around this much money, too,'" Matlack said.
    Page 2 of 2 -     While the CSC's specific budget might show a loss on the bottom line, CHEDA board member Craig Morgan wondered if that necessarily equated to a loss throughout the community, which is home to more sporting and recreational events since the CSC opened its doors almost three years ago.
        "If you focus on the value of the arena to the community, (its deficit) seems more acceptable if it brings other things to town and makes people money," Morgan said. "We're losing about the same as we were before, at an out-dated, non-functional facility."
        Board chair and city council member Keith Mykleseth added that the city added a third sheet of ice and, yet, the budget deficit is actually smaller at the CSC than what was previously projected.
        Chamber of Commerce President/CEO Shannon Stassen noted the record amount of lodging tax revenue taken in over the past year, which he said it coincides with increased events at the CSC. "I think if you put it all together, the pluses would far outweigh a $200,000 loss," he said.

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