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Talks get heated over arena’s ongoing cost [UPDATED]
Published 11:24am Wednesday, January 18, 2012 Updated 11:55am Wednesday, January 18, 2012The mood was tense at Monday night’s city council meeting as council members discussed the use agreements for the community ice arena. A particular sticking point was whether every entity using the ice is paying its fair share.
The conversation started when Finance Director Bill Sonmor presented the city with use contracts with the Fergus Falls School District, the Fergus Falls Hockey Association and the Fergus Falls Skating Club for the 2011-2012 skating season.
The council eventually decided to approve the contracts pending final modifications discussed with the organizations, but not before a heated debate over what the city’s role is in paying for the arena’s operating cost.
Alderman Scott Rachels said the city’s financial stake in the operating budget will be seen as akin to “subsidizing” the arena and said the hockey association should be paying more of the operating costs.
“The school stepped up, but the hockey association, they aren’t stepping up,” said Rachels.
Using previous budget numbers, Sonmor came up with a rough estimate of $305,568 for the arena’s 2011-2012 season operating budget. That will be tweaked in the coming years as real costs come in.
“Two or three years from now we will have a better idea of what this building will really cost,” said City Attorney Rolf Nycklemoe.
Of that estimated budget, the contracts stipulate that the school district pays 33 percent of the cost (roughly $101,000), the hockey association pays 38 percent ($116,000), and the skating club pays 11.5 percent ($35,000). The city picks up the remaining 17.5 percent ($53,500).
Under that arrangement, said Sonmor, the groups were charged based on usage time and on who gets time in “prime hours.” The city then covers open skate and open hockey costs, and it would also fund the men’s leagues (with fees from the players).
“I don’t think taxpayers were looking forward to paying the operating part of it,” said Rachels, pointing out that the operating expenses of the arena were covered by the other entities using the facility when the city leased the Fairgrounds Ice Arena.
The city did pay a lease of more than $20,000 for the former arena, Alderman Eric Shelstad quickly pointed out, stating that the city has always had an ongoing stake in an arena.
“Why should we get it free?” Alderman Jim Fish chimed in. “We need to be billed for that time also.”
However, Rachels encouraged them to put themselves in taxpayers’ shoes.
“That’s what the average Joe is going to think: we’re subsidizing it,” he said.
He singled out the hockey association as one group that could contribute more to the operating budget, saying that the school district is paying $17,000 more for the new arena while the hockey arena apparently didn’t adjust its budget, even though the city had told the group that the new arena might cost more. He also pointed out that the hockey association will be using more of the arena’s ice time (about 43 percent overall) than the 38 percent of the budget it’s paying for.
Some aldermen were unhappy with that line of reasoning, particularly JoEllen Thacker.
“That really irritates me, because if we didn’t follow this procedure here we’d be asking the hockey association to pay for the open ice time, and to say that they haven’t stepped up to the plate when they’ve raised almost $4 million — I just think that had to be said,” she said.
Rachels responded that the community raised that $4 million, not just the hockey association.
One reason the school is paying more for the arena is because the school is also using more ice time than it has in the past (for physical education), while the hockey association is using the same amount. Sonmor added that it’s hard to know for sure how much the hockey association was paying in the past because the association also paid the city for the men’s leagues and the skating club after those groups paid the association (that arrangement is not allowed anymore under the requirements of the bonds used to fund the arena).
“We were trying to come up for a fair mix for everyone,” he said.
City staff pointed out to the council that the contracts are approved each year, and the council can change them in the years to come. Still, Rachels voted against the contract with the hockey association.
The Fergus Falls Hockey Association issued a prepared statement: “We respect the city council and greatly appreciate its decision to enter into a user agreement with our organization. We feel the user agreement is appropriate and fair in all aspects including cost to all users. We are thrilled to be a part of the new Community Arena and thank all those involved with the process. With regard to any comments made by Councilman Rachels that may have been construed as negative to our organization or its efforts, we have no comment.”
Tags: ice arena
Well, color me “surprised”!
The people who should really be mad are those who have kids that go to other schools in this district. We pay taxes that have to go to the hockey arena, but yet our smaller schools don’t have hockey teams…and I wonder if they would even be able to utilze the arena if they did want to have a hockey team? My taxes are paying for it too, so I don’t see why they couldn’t…
Melissa, I hope that the reason your in Fergus Falls is because of employment, otherwise it would seem silly to pay higher taxes. Assuming that is the reason you are in Fergus, why don’t you send your kids to the schools here and support your local district?
Furthermore, I believe even children that don’t go to school here can be in hockey, the FFHA is separate from the school until JV and Varsity, sign em up!
I think it would be interesting to talk to the Hotel Managers and retuarant owners to see if they have increased business this winter because of the tournaments. I would think that they have. I also would imagine that it more than offsets what they are now paying in taxes. ( I don’t think this arena keeps businesses from comming in, I think it has more to do with people choosing to send their money out of town)
Support local.
I have a young family and like to see this town adding and updating, someday we might be able to get our schools to grow instead of decline.
My children attend a school in this county, which is authorized because of where we live. Everyone who lives in or near Fergus doesn’t have to go to Fergus schools. We choose to send them to a smaller school that offers more opprotunites than they would be afforded had they had to try out for every activity.
No, I am not here due to employment; if that were the case, I would be living on the east coast or in Colorado. Family is the reason I am here.
I didn’t say that the arena is keeping businesses out of this town. I feel the higer taxes are keeping new businesses out of town. I grew up here and remember when the mall was booming. Now it is a ghost town. Oh, wait, it is probably a tax write-off for the owner to have it that way…Also, if the rent wasn’t so high, there would be more shops in order for people to shop local.
Yes, I wish the hotel managers and restaurant owners would share this information. But what are you saying, that the arena will only bring that type of money here during the winter? I would hope they have the capability to keep it open all year round; they do it in southern states where it doesn’t get near as cold as it does around here. That would be a shame if it were only a money producer a few months out of the year.
The ice arena should never have been built in the first place. Groups using the arena should pay their fair share and not expect the taxpayers to subsidize their ice time. The ice arena and new high school location have caused significant traffic flow increases on side streets in the immediate area. When will the traffic issues be addressed? It seems to me the City of Fergus Falls has a lot of work to do.
Ms. Hale, if you don’t like it……well, move.
Who said the Taxpayers would not have to step in?
Like the Golf Course, their Booze Stores that fail, and now the Ice Arena, the City needs to get out of ‘OWNING’ businesses. Who fails, who does not step up, high costs that expected, its always the Taxpayer who gets it in the hind end.
Sooooo….when this thing needs upgrades or repairs in the future…..who do you call?….Alderman Eric Shelstad —so he can put the TAX HIT on MORE Fergus Falls Taxpayers!
And they wonder why more businesses don’t want to come here…
Don’t get so excited Dave. We all know that when the government gets its hands on any sort of money making venture that it turns to gold. In the end, the taxpayers will be rolling in dough from the profits of the hockey arena and it will also be self-sufficient. Just take a look at Amtrak or the USPS.
Well well. Why does this NOT surprize me!? The taxpayers have to dish out more money. And this is for something we didn’t even get to vote for…I’m rural Fergus Falls but I still have to pay the extra taxes. I don’t even have a kid interested in hockey. And when does the school use the arena for physical education? My child has gone there ONE time! I still say the arena should never have been built! The other one could have been updated far cheaper than what has been spent. The new school got got rejected twice, cost less than half that budget to update Kennedy…..that’s why the taxpayers didn’t get to vote…the same thing surely would have happend to the arena…
Leann :
There was a vote to increase the City’s Sale Tax to help pay for the new digs. Nothing about upkeep, monthly expenses, or future repairs were mentioned in that referendum that I am aware of.
The vote to increase that tax did pass – due to so much NOT BEING EXPLAINED to the taxpayers. You must remember our city council at that time. Democratic – left winger- progressive- we are going to spend the money anyway we can figure out how to do it.
They had their golfing buddy judge declare the original referendum petitions – void and not important. The ice arena supporters used the judicial system to suppress the rights of the voting public.
Lets talk about this Ice Arena for a moment. Now that it is on School Property, are our Property Taxes and any future levy increases for the School going to be used for this mess?
I sure hope that can’t and will not happen. There could be a revolt on that.
As I understand, the School gave them a lease on the land to build it. Not to pay for the upkeep. So, what has changed and when did it change?
As someone who worked in one of the motels in the past, I know that all of the motels in town were booked solid when ever there was a tournament There were teams from all over the state that attended the tournaments back 10 years ago. Motels were full, restaurants were busy, much more so than they are now, even on tournament weekends. Those who have worked in the industry know that all this hullabaloo is just another way that the school district gets a bit more than what the levy is for, and sticks it to the tax payers many times over….
Wow, all you people just whine about higher taxes. Your an idiot if you think it was a bad idea for this new arena!
Let me guess…you don’t pay taxes? The problem is not only the higher taxes, but how this all was mishandled in the first place. I would love to see how the arena is actually going to bring more money to the area, so they should start tallying up the out of town dollars being spent in Fergus because of it. And, when was the last time a professional hockey player actually came from Fergus? The arena was built for only a portion of the community…a small portion.
The Otters used to be a perennial powerhouse in MN when it comes to high school hockey. It used to be a big deal. However, this is besides the point.
For all those naysayers who say “I shouldn’t be paying taxes on this because my kid doesn’t want to use it”, you should really look at where stuff that you utilize comes from. Should we get rid of all the playgrounds in Fergus Falls? It is to my understanding that a very small percentage of our population uses these. How about all the parks in the city? I never use the parks, yet I don’t care if others do. I believe that almost all the projects done in the city target only a specific group of people, yet everyone pays into them. Odds are that city-funded things you like to utilize aren’t enjoyed by the majority. Maybe my generation should boycott social security because all the experts say that it will not be in existence when we need to utilize it, yet we pay into it.
Oh trust me, I remember how good the Otters were when I was in high school…even though it was quite a long time ago. And, let me clarify, my children are not “choosing” to not utilize the arena. They happen to go to a school that is smaller, where I feel the education is better because of the smaller class sizes. Also, for someone who doesn’t live here anymore and has stated they have no desire to ever live here again, you have pretty strong opinions on what happens in this fair city.
Ah, but do not assume I am no resident. I am gone for college, therefore, I am still legally a resident of Fergus Falls.
Also, your children are indeed choosing to not utilize the arena. You don’t have to be a resident or a specific school member to make use of it. It is a community arena and they do indeed have free skating periods.
Regardless, the whole “I’m not using it so I’m not paying for it” mentality seems like a great standpoint logically. However, if society were to abide by this, absolutely nothing “fun” for anyone would get done. Parents would have to pay for their own playgrounds (and we all know just how much money new parents tend to have), fishermen and boaters would have to pay for their own boat accesses, the river walk downtown (which very, very few people use on a regular basis)wouldn’t exist, yadda yadda yadda, and (insert recreational public work here) would not exist. Just because they do not appease to you directly, does not mean that the city shouldn’t finance it. Great cities have things for everyone.
One would wonder if the arena could have been built with state bonding money thereby spreading the cost throughout the state rather than on a local sales tax. Of course that would have meant local IR’s working with a D. govenor but it might have been a more cost effective solution. (Notice there are other locations in the state that are willing)
Larry, I realize that you have to chastise we uncouth rural rubes from your digs in the cities, but if you lived here and were actively involved in the arena fiasco, you would know that this all came about, the illegal vote by the council to misuse the Port Authority statutes for financing the arena, about two years BEFORE Markey Dayton was elected, hence your snide crack about IRs having to deal with a DFL governor won’t fit: there was no DFL governor at the time, and seven of the eight council members (who all voted illegally for the arena) were (still are) tax and spend liberal “progressive DFLers. Also the mayor.
Check the newspaper’s archives. You will find Dayton had a request for an almost open ended bonding bill, asking for city and county suggestions for building projects, the same week Bud Nornes was asking for taxing authority for the arena. I think the passions of should we/shouldn’t we build, we have/you don’t have the authority, raise taxes/no new taxes clouded someone’s vision and created a less then best outcome.
Look at the most recent bonding proposal and notice the local projects that are included. There is no guarentee the bonding bill will pass, but that is the way other units of government, those with clearer vision, often do things. Learn from history–control passions.
Get real Larry: $101,000 paid out by the Fergus Falls School dist.
Yeah….like they wanted more higher property taxes a little while ago cause they needed the money, so…they added a $101,000 dollar ADDITIONAL DEBT to their financial fabric.
What a bright idea?
And our super smart City Fathers decided they could afford an ADDITIONAL DEBT of $53,000.
What a bright idea?
The Senior High has a varsity hockey team – the school district should pay their share of the maintenance. The City sponsors open skating and other activities at the arena, and should also pay their share of the maintenance.
Dave, somehow we’re not communicating. Dayton just announced a bonding bill with the bonds to be paid with
money collected from the entire state. There is a request for funds for a stadium to replace the stadium used by the St. Paul Saints, among others. If that bill is passed you and I and every other tax payer will be paying off those bonds, even if we never use that stadium. If the forces behind the arena in Fergus Falls could have been clear headed enough to find a way to include its construction in a state bonding bill, I and every other metro resident would have helped to pay for it, even though I/we would likely never use it. Now you can argue no bonding bills should ever pass but that is not reality for they DO pass. Some cities get their stuff built for them and some do not. I don’t deny a hunter has a right to shoot himself in the foot but one who shoots a deer eats better.
And Dave – how is it ADDITIONAL DEBT??? The School District, Hockey Assn and City of FF have been splitting the maintenance costs of the rink at the Fairgrounds for the past 30 years. In fact, maintenance costs on the new facility will likely be less than they would have been at the old arena. You really don’t know what you are talking about.
“Learn from history-control passions” (Larry Erickson).
Spoken like a true supporter of socialist dictatorship. You are telling us, “If you don’t like what government officials do to us, don’t like their heavy handed RULE over objecting citizens, we should just shut up, stop complaining, let the elite ruling class decide what is best for the peasantry”.
Why are you wasting your retirement years working part time in a publicly funded job? There is definitely a place for you in the 0bama campaign, or in Marky Dayton’s administration. Hang out with the real elites, don’t waste your life quelling rebellions among the naifs and people with dirt under their fingernails.
No, if you object to something, you should indeed speak out and voice your opinion… reasonably. I’m going to go out on a limb and guess that you did not attend a meeting and you did not voice your objective opinion.
Fact of the matter is that this arena is already built. People need to accept that. There is nothing more that can be done about the construction costs and the likes. If you do not like how the city council went about this, then do not vote for the members in your district that caused this. If the same member ran for reelection and was reelected, I assume that a majority of the city is okay with their decisions. Just because some people are okay with this does not mean they are socialists. So, instead of complaining on a stupid internet comment board, why don’t you become proactive about stuff. Gives you a much better feeling of gratification than sitting there calling anyone who disagrees with you socialists and the community will have a much better view about you.
Blame it on Bush.
I think Mr. Rachels is right on the money. Literally!
After 41 years in Ottertail county, 20+ in Fergus Falls, I made the decision to move and I won’t miss the BS! The good of the few is all that is important in that community..
I think the people of the Fergus Falls area should be glad we are spending tax dollars on a good investment like our children. I don’t have any kids that are old enough yet either. It’s the same old story why should I have to pay when my kid is not in that activity. Well your kid may be in baseball or football and you don’t mind hocky parents paying for your baseball and football fields. It’s like saying I don’t drive down cascade so I don’t want my tax dollars going to snow removal and sanding of that street it just don’t make any sense.