When it comes to the Lakeville Area Arts Center, the creative process is not confined to the activities on the stage.

During this time of shrinking city budgets, supporters of the city-owned facility are looking for new ways to financially support what they proudly proclaim is a valuable asset to the community.

Dennis Feller, who serves as treasurer for the nonprofit organization Friends of the Lakeville Area Arts Center, is in the beginning stages of exploring the possibility of creating an endowment. Feller, who also serves as Lakeville's finance director, said the goal is to find another financing source that benefits the Arts Center.

Lakeville's proposed budget for 2010 points out that for each of the past three years the Art Center's expenditures have exceeded its revenues by approximately $200,000. Taxes have made up the difference. A similar scenario is projected for 2010.

The Friends organization has raised approximately $750,000 for the Arts Center through donations and grants. An endowment would assure financial support on a year-to-year basis.

Endowments require the principal to remain intact and invested to create a source of income. Typically, 5 percent of the principal is spent to assure the fund's growth.

So, for example, if the Friends were looking to cut the annual $200,000 cost to the taxpayers in half, they would need an endowment of $2 million.

To date, the idea has been broached to the 11-person Friends board and the Lake-ville City Council. Council members did not voice any concerns about exploring the possibility further.

Feller said a lot of research has to be done to determine how to structure the endowment, what the money would be used for and how to market the endowment, as well as any legal limitations that may exist.

He hopes to have more information to present to the Friends board at a scheduled December meeting.

Feller points out that local arts centers in the state generally are not able to support themselves through user fees. At a time when most city governments are finding no other choice but to cut their budgets down to essential services, Lakeville officials have stood behind the Arts Center. The center is staffed by the equivalent of 3.7 full-time workers.

Feller pointed out that in the past few years it has been a year-by-year decision by the City Council on how it would subsidize the Arts Center. "It has never gotten to the point of if they would subsidize it,'' Feller said.

The Arts Center opened in October of 2001. The city paid $1.2 million for the former Catholic church and spent another $1.7 million to convert the building. The city will continue to spend $74,000 a year through 2014 to pay down the debt.

Dean Spiros • 952-882-9203