Financial status of the Maplewood Community Center (updated)

[updates at end]

During the February 11th council meeting mention was made of an email from Mr. Ahl to the city council and Ms. Guilfoile which raised questions about the financial status of the Maplewood Community Center. Maplewood Voices has obtained that email via a data practices request.

The email is in response to an initial question from Ms. Longrie about the Taste of Maplewood, which led to Mr. Hjelle questioning Chief Lukin's involvement in such events in the context of Fire Department budget cuts, which elicited Mr. Ahl's summary of the budget situation and accounting practices that he inherited.

Mr. Ahl makes these assertions:

• The City has not reconciled our bank statements in the past 13 months.
• We have not tracked our fixed assets for a majority of 2007.
• Budget transfers were not processed for a majority of 2007.
• Revenue tracking has been significantly delayed during 2007.
• Journal entries were not checked and authorized.

He goes on to say:

The Community Center budget has been stated that it was 'in the black'. It appears that Karen's report to the Council in October 2007 was based on budget assumptions rather than actual expenses, because the actual numbers were not available. Karen was given information for her report that appears was not accurate at the time. We discovered this week that the Community Center Enterprise fund is significantly in the red. Besides the approved tax subsidy of $380,000 [which is budgeted to be reduced to $230,000 in 2008] it appears that Community Center revenue will have a shortfall from the budget of nearly $260,000. Operating expenses appear to be very close to budget; however, the building maintenance expenses are already $40,000 over budget and there is over $70,000 in expenses yet to be incurred that should be counted toward the 2007 budget. That means the Community Center is going to require nearly $750,000 [$380,000 (planned) + $260,000 + $40,000 + $70,000] of tax dollars in 2007.

[Update 1: 2/13 10:00AM]

Mr. Ahl mentions Ms. Guilfoile's budget report. Here is the relevant slide from that October 29, 2007 report , obtained via a data practices request, which lists the Community Center as just $16,000 in the red after three quarters of 2007 operations.

The Copeland Council had long made the financial management of the Community Center a focus of their attention. Here, for example, is part of a Lillie Newspapers article from January 10, 2007

...
According to City Manger Greg Copeland, the positions were terminated in an effort to make the Community Center, located at 2100 White Bear Ave., more profitable.

"This is a facility that is not making money right now. What we're doing is we've proposed that because the arrangement is not acceptable; this facility needs to carry its own weight," he said.

Copeland said the eliminated positions will be replaced by two new positions more focused on marketing and sales. He said he'd like to see the center sell at least 500 additional membership packages, and increase banquet bookings by 25 percent.

Maplewood Mayor Diana Longrie said that the efforts to make the Community Center more profitable were hastened because of pressure from the Minnesota State Auditor's office.

"The city of Maplewood received two letters from the state auditor's department saying that the community center, as an enterprise fund, was not in compliance with the rules required for an enterprise fund. It has to at least break even as an enterprise fund," she said. "The Council was under a mandate from the state auditor's office to put together a plan for the center to break even."
...

The Center's operations were also the subject of campaign statements. Here is a short mp3 excerpt from candidate Rebecca Cave's opening statement at the October 30, 2007 League of Women Voters Candidate Forum, held at the Community Center, wherein she makes the 'in the black' claim.

[update 2/13 2:30 PM, minor wording edit]