East Grand Forks mulls funding for a proposed $24M ice arena plan

Consultants on Tuesday, Nov. 12, walked East Grand Forks leaders through a $24 million idea for two of the city’s aging ice rinks.

Their recommendation, in short, is to build a second ice rink at the East Grand Forks Civic Center, install a new, consolidated refrigeration system there that would service the new rink and the old one and turn the VFW Memorial Arena into an all-season fieldhouse.

It’s an ambitious plan that could draw more tournaments to the Civic Center, modernize both buildings and solve some of the city’s maintenance and upkeep worries.

But where would that $24 million come from?

As it stands, East Grand Forks has no funding plan in place, and, even if it acted immediately, the proposed renovations wouldn’t be complete for at least several years. City Administrator David Murphy stressed that discussions about the arena revamps were preliminary.

Aside from outlandish funding plans, such as hiking utility rates or service fees to exorbitant levels -- which no city staff member or official has proposed -- the three main options for public funding would be property tax revenue, bonding or sales tax revenue. City leaders also could dip into East Grand Forks’ fund balance -- think “savings account” -- which recently exceeded a city policy that calls for up to half of its budget to be kept in reserve. The city has about $6 million in its fund balance, currently.

The sales tax option is notable because East Grand Forks’ existing one is set to expire within a year. Voters approved in 2016 a 1 percent sales tax that city staff said brings in about $74,000 per month. The city uses that money to pay back the loan it took out from the East Grand Forks Water and Light Department to renovate a public pool at Sherlock Park.

City Council members agreed in August to wait for the consultants to return with ideas before considering a new sales tax. And, assuming they decide to institute another one, that revenue could go toward a host of other civic needs.

But there are funding options beyond public ones. East Grand Forks could sell naming rights or sponsorships, ask for volunteers to help with the less technical parts of the renovations, solicit private donations or accept “in-kind” work. The community at large or organizations within it also could raise money for the project.

“Historically, a lot of work’s been done on our arenas and other facilities that we have by utilizing some volunteers in terms of labor,” Mayor Steve Gander said on Tuesday. “And also a lot’s been done in fundraising with donations through some of the affiliated groups that will benefit from this.”

And that $24 million figure is only a preliminary estimate.

Michael McLean of JLG Architects, the firm to which the city paid $10,000 for the study that recommended the arena renovations, said the costs that comprise that figure are placeholders.

“Once this project gets into the details with actually getting into a design, all this will change,” he said of the project’s cost estimates.