Forest Lake schools may run ice arena
- Article by: TIM HARLOW
- Star Tribune
- March 24, 2012 - 9:57 PM
The Forest Lake School District could once again be back in the business of running a hockey arena.
If things fall into place, the district could take over operations of the Lichtscheidl Arena ice rinks from the Forest Lake Area Athletic Association (FLAAA) as soon as this summer, said Larry Martini, business manager for the district that serves students in parts of eastern Anoka and northern Washington counties.
Results of a feasibility study conducted by a Roseville consulting firm are expected to be released during a meeting of the Forest Lake school board on Thursday.
"We feel very comfortable presenting this to our school board," Martini said. "We expect that our recommendation is that, yes, we should move forward on this."
The school board will have until May 3 to make a decision. The district would need approval from the Minnesota Department of Education before it could become the new owner, which could happen in July or August, Martini said.
Representatives from FLAAA floated the idea of transferring ownership of the ice arena to the school district in November, saying that operating the arena portion of the Forest Lake Sports Center was too much work for an all-volunteer organization.
Representatives from the athletic association, city and school district formed a task force to study the idea. To help guide the process, the task force enlisted the help Ehlers and Associates, a firm that offers financial consulting services to government agencies.
The sports center is not in debt and has positive cash flow, said FLAAA President Al Hauge. He said the reason the association wants the school district to take over the arena is because FLAAA does not have the money to hire people to take on duties such as administration, accounting and "running an operation of this magnitude."
"We've been doing this on a shoestring, and this is not something we are set up to do," Hauge said. "If we were to continue running this, we'd have to increase our fees for kids. Our mission is supporting kids in the Forest Lake School District. Our money is better spent on passing on the savings onto our sports for their registration fees."
Hauge said FLAAA would continue to sponsor its youth traveling teams in baseball, basketball, lacrosse, softball, hockey, soccer and volleyball as well as in-house softball leagues for youth and adults.
'Efficiencies and synergies'
Hauge said FLAAA suggested the district take over the sports center because it has operated a similar facility in the past and already manages 14 school buildings. The district also has the manpower to take on the arena, Hauge said.
"There are definitely some efficiencies and synergies here," Martini said. "We think this is a good thing to do."
While the exact cost to the district will be released with the study, Martini said it is believed the arena has a fair market value of $5.1 million and liabilities of $4.6 million, including economic development bonds totalling $4.2 million.
Martini said the school district is interested in taking over operations because it believes it can get cheaper financing than FLAAA. The interest rate on the bonds is currently 4.15 percent. Martini said he believes the district could get bonds at 3 to 3.5 percent.
He also said he believes the district could generate revenue by renting the ice rink and adjoining dome facility for activities such as soccer, baseball and softball training, and other dry land activities. The district could use any money left over after arena expenses are paid to fund school programs, including paying for teachers and textbooks. The district could not use money from its general fund to cover any shortfalls, Martini said.
FLAAA built the sports center in 2008 to replace the former Maroon and Gold Sports Center, which was owned by the school district. Martini said the facility was "operating past its lifetime" and was too costly to maintain. The district converted it into a maintenance and storage facility
With the prospect of having no home arena for the high school's girls and boys hockey teams, FLAAA stepped in and built the $4.5 million arena at 5530 N. 206th St. Hauge said neither the school district nor the city had money in their budgets for a new facility at the time, so the association took the lead.
Hauge said FLAAA would continue to have offices in the building. He also said that if negotiations fall apart that his group will continue to own the building.
"We will continue to operate it," he said. "After all, where would the teams go?"
Tim Harlow 651-925-5039 Twitter: @timstrib
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