Waconia's $6 million hockey arena on thin ice
- Article by: HERÓN MÁRQUEZ ESTRADAwest today
- Star Tribune
- February 10, 2010 - 9:24 PM
Waconia has brought in a management company to help revive the fortunes of the city's relatively new skating arena, which is facing heated competition for ice time from neighboring communities.
The facility was opened in 2008 but almost from the start the Waconia Hockey Association (WHA) has struggled to meet its financial obligations to the city, which co-owns the $6 million arena.
The association and the city will meet Thursday night with the management company to address the situation.
"We knew within a year of it opening that it was going to be tough," said John Bruellman, a former association president.
The WHA pledged $1 million toward the construction cost. It also contracted to pay the city for 1,650 hours of ice time at $220 per hour, or $363,000 a year.
Although it is current on payments -- and has already paid $600,000 of the $1 million obligation -- there are concerns about whether it can keep meeting those obligations.
WHA officials acknowledge that they are fielding questions and squelching rumors about the future of the association and its deal with the city.
"Our original agreement with the city has been putting us under an increasing amount of financial pressure," WHA President Brian Tasson wrote in a posting this week on the group's website.
That's especially true because the group can use only about two-thirds of the ice time it is obligated to pay for, WHA officials said recently. The group pays the city for the remaining 500 to 600 hours, more than $100,000, regardless of whether the arena is used.
"We haven't defaulted on anything, [but] it's been a struggle," said Dale Laumann, the WHA's vice president. "The issue is the 500 hours we need to sell in the off season."
The main reason for the shortfall, Laumann and others say, is that nearby communities such as Eden Prairie and Victoria have added ice sheets in recent years, siphoning business from Waconia.
Also, the arena's financial obligations have forced the WHA to charge higher fees to play hockey or rent the ice. Most nearby cities charged about $175 to $180 per ice hour.
"They've lived up to their obligations, but forward looking they say they can survive about 10 more months and then they won't exist," Waconia Mayor Roger Lehrke said.
The city seems unwilling to make up the shortfall given budget constraints, the bad economy and the fact that an increase in the city's arena obligations would probably mean an increase in taxes, he said.
"We offered a few suggestions. They've offered a few suggestions," Lehrke said this week. "But we can't seem to find that middle ground."
As a result, the city hired Rink Management Services Corp., the largest operator of ice skating arenas in the country, to serve as a mediator.
Two days of talks will be held before a report is submitted to the city, said City Administrator Susan Arntz.
Although the biggest issue is the selling of ice time, the arena itself remains a source of community controversy. Some residents thought it was approved without enough scrutiny and intended to benefit only a few families.
Lehrke says some of those hard feelings persist, exacerbated by a perception that the city might have to bail out the association or impose more financial burdens on non-hockey people in Waconia.
Arena supporters note that when it was built, Waconia was the biggest city in Minnesota without its own ice arena.
"I'm sure there was and is a segment of the population that was not in favor of it when it went in," Bruellman said. "But I'm not sure that support for it is eroding."
Heron Marquez Estrada • 612-673-4280
© 2014 Star Tribune