The promoter of Stillwater's ill-fated Lumberjack Days, already under criminal investigation, has filed bankruptcy to liquidate extensive personal debt.
David W. Eckberg and his wife, Stacy A. Einck, list about 150 creditors, according to documents filed Tuesday in U.S. Bankruptcy Court in Minneapolis.
Eckberg and Einck own St. Croix Events Inc., a festival promotions company that has coordinated Lumberjack Days since 1994. The regional festival drew tens of thousands of people each summer to Stillwater for headliner concerts, road races, lumberjack demonstrations, a parade and a fireworks show over the St. Croix River.
"This is a personal bankruptcy. It has nothing to do with Lumberjack Days," Eckberg said Wednesday. "It does not affect anybody's claim against Lumberjack Days or St. Croix Events."
However, the Chapter 7 filing shows more Lumberjack Days debt than Eckberg has publicly acknowledged. Many of the 135 business claims, totaling more than $1.4 million, appear related to the event. In other portions of the filing, money owed to secured creditors was valued at $888,000, most of it held in two mortgages on the house that Eckberg and Einck own in Baytown Township near Stillwater. In addition, Eckberg and Einck listed $45,565 in state and federal taxes owed.
Eckberg's attorney, John Hedback of Minneapolis, said it's common in personal bankruptcy filings for owners of small businesses to list all the possible financial claims against them. "He is personally liable for some of the business debts," Hedback said.
The filing also includes a claim of $250,000, "probably uncollectible," that Eckberg and Einck had loaned St. Croix Events. That money came from the sale of personal property, Hedback said.
"Stacy and I have fought a hell of a battle on behalf of the festival. There's nothing left," Eckberg said. "We followed our heart and brought in a lot of talent. We feel good about that."
Despite the festival becoming one of the metro area's favorite summer events, it's been dogged for years by reports of unpaid bills and drunken behavior. Fearing a stain on the city's reputation, the Stillwater City Council last fall canceled permits for Lumberjack Days and declared an indefinite moratorium on new proposals.
Eckberg came under investigation in October when several vendors and nonprofit groups told Stillwater police that he owed them money and in some cases, issued worthless checks. Those complaints led to a six-month investigation by the Washington County Sheriff's Office that was completed a few weeks ago.
Criminal charges, unrelated to the bankruptcy filing, could come as soon as next week, County Attorney Pete Orput said Wednesday.
Four years ago, the city of Stillwater contracted with the nonprofit Lumberjack Days Festival Association Inc. to allow permits for Lumberjack Days and require payments for public safety services and a separate event, the July 4 fireworks show. Eckberg signed the contract on behalf of the nonprofit board and subsequent city billings were sent to Eckberg and St. Croix Events.
Eckberg owes the city $43,250, according to the bankruptcy filing.
Listed among the "business debt" creditors is RES Specialty Pyrotechnics of Mankato, Minn., which Eckberg had hired for fireworks shows. That company, which said it's owed $114,000 from St. Croix Events, now has contracted directly with the city of Stillwater to produce this summer's July 4 show.
Other business creditors in the bankruptcy filing include the city's Board of Water Commissioners, First Student, the Minnesota State Patrol, Stillwater Public Schools, Washington County, school bands, banks, accountants, attorney firms, party rentals, telecommunications companies, youth groups, service clubs and a portable-toilet company. The bankruptcy filing indicates Eckberg and Einck, who is a manager at Andersen Windows in Bayport, dispute several of the debts. Some claims have gone to court.
Property that Eckberg and Einck declared as exempt from the bankruptcy filing includes their house, valued at $664,400, and two 2010 cars.
Kevin Giles • 651-925-5037 Twitter: @stribgiles