Arena private fundraising on track [UPDATED]Published 10:51am Monday, November 21, 2011 Updated 12:59pm Monday, November 21, 2011
When the movers and shakers behind the new Fergus Falls community ice arena lined up at the arena’s ribbon-cutting ceremony Sunday afternoon, they were celebrating a job completed. However, while most of the construction on the building is done, the arena fundraisers’ work continues.
“I’d have to say I think the fundraisers have done an awesome job,” said Fergus Falls Finance Director Bill Sonmor. The committee has raised over $3.9 million in fundraising pledges, $1 million more than its original level of commitment and the same amount of money committed to the project from the city. That number doesn’t count in-kind donations from local businesses.
While some arena opponents have expressed doubt that all of the donors’ pledges will amount to real dollars, early signs point to most of the money coming in – and earlier than expected, no less.
The fundraising committee has until 2021 to collect all of the money for the arena, but most if it is committed to come in by 2016, the last year of Fergus Falls’ bonding for the arena project. The city, which receives a check of newly collected funds every month from the committee, has already received $806,701 in cash, more than Sonmor expected when he spoke with the fundraisers about incoming donations.
“I think we’ll collect more of it sooner,” he said.
The city bonded $6.98 million for the project, which will be paid off by a combination of fundraiser donations and a half-cent local sales tax. The city has the ability to raise up to $6.6 million with the tax if some of the donations fall through and to fund interest payments on its original commitment.
The city has committed to only spending $4 million plus interest on the arena, and any gap between how much money is on hand and how much more is owed when the bond period ends will be financed internally and not with tax dollars. When the fundraisers finish collecting all of the donations, the city will use those donations to pay back the funds it used to cover the difference.
“We’re not going to collect taxes in place of donations,” said Sonmor.
As the arena was built over the summer, the fundraising committee came back to the city with more requests for improvements.
“Whenever we wanted things to be added, like an expanded heating area, seatbacks, and a concrete floor in the practice rink, we had to return to the city and guarantee that we would raise that money,” said fundraising committee member Gary Spies. As a result, the committee is now responsible for paying for about $3.5 million (with interest) of the arena cost, instead of the original $3 million.
While the $4 million it’s raised will cover those improvements, said Spies, there will likely still be a few hundred thousand dollars left over. For now, that doesn’t matter.
“The money, until the city’s bonds are paid off, has to go to the city,” Spies said.
After that, however, the committee expects to have remaining funds.
“Because we’ll have that money, we want to use it for something that’s going to benefit our community,” Spies said.
Once the committee knew it was raising funds above and beyond what it needed to complete the arena, fundraisers began telling donors that any leftover money will go toward youth athletics in the city.
“We need to use it for the purpose that the people donated it for,” Spies remarked.
With that in mind, one idea popular with many fundraisers is setting up a community scholarship fund that would help purchase sports equipment for students who couldn’t afford to participate in a sport otherwise – any sport, not just hockey.
“If there’s a young man who can’t afford to play tennis because his family can’t buy tennis shoes, he could fill out and application and we could get him tennis shoes,” said Spies by way of example.
Other ideas (including using the money solely for hockey) have been brought up, but Spies said the all-sport scholarship plan has gained a lot of support. However, at this early stage in the proceedings, nothing has been set up to administer such a scholarship, and precautions against conning the system will need to be put in place.Tags: ice arena