With the approval of a new $655,000 loan, the Vadnais Sports Center owes the city about $830,000.

David Brewster, Star Tribune

Opened in 2010, the Vadnais Sports Center was projected to pay its own way. However, in 2011, revenue fell $763,000 below projections.

Richard Sennott, Star Tribune

Vadnais Heights arena gets another loan

  • Article by: TIM HARLOW
  • Star Tribune
  • July 17, 2012 - 11:40 PM

The Vadnais Heights City Council has approved a $655,000 loan for the financially troubled Vadnais Sports Center, even though the arena has yet to pay back $174,000 in loans that were due by the end of June.

With the new loan, the complex at 1490 E. County Road E now owes Vadnais Heights about $830,000, and the city's finance director said there is a strong possibility the loan might never be repaid.

Most of the new money that was approved at the council's July 11 meeting will be used to make a $581,826 bond payment that is due Aug. 1. The loan also will cover items such as utilities, insurance and legal expenses.

In a memo to Mayor Marc Johannsen and City Council members, finance director Bob Sundberg said substantial revenue shortfalls and higher than budgeted expenses have precluded the Sports Center from repaying its loan to the city. The city's decision to financially guarantee shortfalls for 2012 makes the city legally obligated to pay the center's bills, the memo said.

The memo dated July 6 also said that the Sports Center had about $2,000 in its bank account.

In approving the latest loan, the City Council voted 4 to 1 to require the money to be repaid by Dec. 31. But previous deadlines have come and gone. In July 2011, the city gave the sports center a loan of $127,000 to make its August 2011 bond payment. That was to have been repaid in February 2012, but it was not. In March, the council extended the loan and increased the amount to $174,000. That was to have been paid back by June 30.

The City Council will have to decide by early September whether to continue funding the center in 2013.

Calls and e-mails to the city administrator and mayor seeking comment were not returned.

When the arena opened in November 2010, city officials said the facility, with two hockey rinks and a large domed field, would be able to pay its own way without taxpayer help. But records show that in 2011, the center's first full year, revenue was about $1.5 million, or $763,000 below projections, documents show.

In a bit of good news, the Maplewood Figure Skating Club has said it would like to bring the U.S. Figure Skating Championships in 2013 or 2014. The event would bring 500 to 600 participants to the center and would require 500 hotel rooms for five to six days.

Tim Harlow • 651-925-5039 Twitter: @timstrib

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