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The Forest Lake School District is better equipped to handle the center’s financial operations, school officials said.

David Joles • djoles@startribune.com,

Minnesota Department of Education approves Forest Lake ice arena financing plan

  • Article by: Libor Jany
  • Star Tribune
  • November 2, 2013 - 2:00 PM

The Forest Lake Sports Center, which for months has been operating under a cloud of financial uncertainty, is getting a new owner.

Last week, the state Department of Education signed off on the Forest Lake Area Schools’ $3.3 million financing plan to buy and operate the sports arena, after previously rejecting the district’s plan to issue abatement bonds to come up with the money.

Representatives from the Forest Lake Area Athletic Association (FLAAA) first approached the district about taking over ownership of the sports arena in late 2012. The feeling was that FLAAA lacked sufficient manpower to run the facility, which it built in 2008 to replace the former Maroon and Gold Sports Center.

District officials said the deal makes sense for both sides.

“FLAAA in this area has a tremendous history of running athletic programs for kids. But my understanding is that they came to the realization in this process that they’re not well suited for the business side of running a facility,” said school district spokesman Ross Bennett. He said the district is better positioned than FLAAA because it has the financial muscle to run the arena.

“We’re equipped to do that, probably better than they are,” Bennett said.

FLAAA President Al Hauge declined to comment on the pending deal when reached by phone Wednesday.

To finance the acquisition, the district initially voted to raise $3.3 million through the issuance of abatement bonds. The Department of Education twice rejected the school board’s move on the grounds that the financing plan would require voter approval because the facility “would be used primarily and regularly for school-managed activities,” Commissioner Brenda Cassellius wrote in a July 30 letter to Schools Superintendent Linda Madsen.

An appeal of the decision was denied for the same reasons, Cassellius wrote in a subsequent letter dated Sept. 24.

The school board voted 6 to 1 in October to approve a lease-purchase agreement for the five-year-old arena. No details of the deal were made available.

District officials said after the previous attempts they were confident that this time the Education Department would rule in their favor.

“We believe that if we went with that type of financing, you take the loan and you bond to help pay it off so that using that type of financing we would have had more money coming into our general fund than the type of loan that we are currently going for,” said school board President Rob Rapheal.

Bennett estimated the arena will pull in $119,000 a year by renting out ice time and meeting space, money that will flow into the district’s general fund to pay for new teachers and school supplies.

But not everyone was on board with the board’s decision.

“I’ve made my feelings on this issue known. Personally, I do not support the purchase of the ice arena as a matter of principle, and I am not convinced this is in the best interest of the district,” school board member Kathy Bystrom, the lone dissenter in the Oct. 3 vote, said in a prepared statement.

Raphael said he supports the move. “It’s a good thing for our community,” he said. “I think in the long run the arena’s going to be in a lot more stable footing. It’s going to mean a lot more ice time.”

Libor Jany • 651-925-5033 Twitter:@StribJany

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