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St. Michael-Albertville School District School District Uneasy About Long Term Financial Commitment to Ice Arena

Number released at a recent meeting of the STMA Hockey Board are potentially "unrealistic," and the school district isn't sure where it could come up with its portion of the cash needed for a second rink.

The lion’s share of last Monday evening’s school board meeting involved a discussion regarding funding for a second sheet of ice in St. Michael-Albertville, and how the school district can - and cannot - contribute to that effort.

School board member Jeffrey Lindquist, who is the board’s liaison to the hockey board, discussed the March 14 hockey board meeting with his fellow school board members. He said the meeting brought out the first tentative proposals on how costs for the approximately $3.5 million arena could be divided among the stakeholders, which include the two cities, the school district and the youth hockey association. The general consensus at the meeting was for the two cities to bear the majority of the financing, which they would likely bond for. However, these initial proposals also included plans for funding from the school district and the youth hockey association that left school board members feeling uneasy.

 The initial proposals suggested having the school district make a $15,000 annual contribution to the ice arena, a rate which would increase by $5,000 every five years for the duration of a 20-25 year financing term. Over the lifetime of the loan this would be a $500,000-$675,000 contribution from the district. This annual contribution would be in addition to the ice time the district pays for the high school hockey team’s ice time, which runs the district almost $45,000 per year.

District superintendent Dr. Marcia Ziegler noted that the district-meaning the STMA area taxpayers-have already given $500,000 toward the effort in the form of a land purchase given to the hockey board. Given the current state budget crisis and an upcoming local levy referendum this fall which taxpayers haven’t yet voted on, school board members said they simply can’t offer funding out of their general operating budget, which they say would take their already-tight funding out of the classroom and into an ice arena, which doesn’t fit the district’s main objective of increasing academic achievement in their schools.

Board members also expressed their discomfort at the idea of making such a large, long-term funding commitment and leaving future school board members and administrators to deal with the consequences.

 If the district were to bond for their portion of the ice arena funding, Lindquist said their financing rates would not be as favorable as the two cities could get because of the district’s current large debt load from a capital improvement loan for the recent construction of new school buildings. Ziegler said this wouldn’t make sense for St. Michael and Albertville taxpayers, as the funding ultimately comes from the same tax base and the impact on these taxpayers would be greater if the district took out the loan rather than the cities of St. Michael or Albertville.

“Our rate would be extremely uncompetitive because of that capital loan,” she said, saying she is waiting to hear back on specific numbers.

However, most board members were in agreement that the school ought to help with the effort financially on some level, though they didn’t pinpoint a specific dollar amount they would feel comfortable committing.

 In addition to their own situation, the board members also expressed their discomfort at placing such a large financial burden on the youth hockey association. As their part of this initial proposal idea, the association would be asked to raise $500,000 in up-front costs through fundraising. In addition, the association would be asked to contribute $40,000 annually, a figure which would increase by $5,000 every five years for the term of the loan. The majority of that annual contribution would be made through a surcharge on the 400 or so youth hockey players in the association. The school board thought this would be an undue burden placed on the families of hockey players and on the non-profit youth hockey organization, and they said they would prefer any funds raised by youth hockey to be used to defray operating costs rather than to actually fund construction.

“I think a half-million dollars in up-front fundraising is really optimistic, and I also think that looking at the youth hockey association to contribute $40,000-$70,000 a year is very optimistic, perhaps not realistic,” Lindquist said. “And, I don’t know how we could count on youth hockey to make that kind of contribution. What if they can’t make that contribution: who makes up the shortfall? I see just a multitude of problems with that model.”

 At this point in the discussions, it appears that all eyes are on the cities of St. Michael and Albertville as they discuss the feasibility of taking on such a project in the face of tight budgets and speculation of losing local government aid (LGA) dollars. One ray of hope lies in a recent meeting with State Sen. Amy Koch (R-Buffalo), where stakeholders in the ice arena would plead their case to state bonding dollars for the project.

“I think we have to keep working at it,” board chair Doug Birk said. “This doesn’t shut the door … we just need another piece to fall into place that we haven’t seen yet.”

 

Happy in St. Michael May 05, 2011 at 07:46 PM
No tax dollars for this! The school district should put their money into education, God knows our kids desperately need it!!! If people want to play hockey in a nicer arena, then they can fundraise for it. People are homeless, unemployed, and strethched thin! Trying to raise taxes (that's all a bonding bill is) is NOT the solution, and St. Michael says it will be increasing our taxes 5% soon! That's huge, and we already pay a lot (I actually am impressed with how St. Michael uses our tax dollars, so no complaints about that. Wright County, however...what a WASTE on multiple levels). Please say no to public funds for a new hockey arena. If people want it, they can privately fund it. How about asking businesses to sponsor on various levels?

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