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NDUS wants to keep Kennedy-Engelstad feud at the local level

The North Dakota University System opted Thursday to stay out of the fray between UND President Mark Kennedy and Engelstad Family Foundation trustee Kris Engelstad McGarry.

On Wednesday, McGarry, the daughter of late UND donor Ralph Engelstad, requested to meet with the Herald editorial board and discussed a fractured relationship between the Engelstad family and UND's administration.

The Herald reached out Thursday to NDUS Chancellor Mark Hagerott and State Board of Higher Education chair Don Morton.

The NDUS responded with an emailed statement.

"As you might imagine, this matter is being dealt with at the campus level and both Chair Morton and the chancellor are aware that there are ongoing conversations going on between the parties," NDUS spokesperson Billie Jo Lorius said. "They encourage the two parties to work together toward a resolution. They support all of the campus presidents as well as value and thank those who donate to our institutions. The Board encourages continued public-private partnerships to ensure a continued investment in higher education and our students."

Kennedy declined an interview with the Herald through a spokesperson but did release an emailed statement.

The sharing of ticket revenue in the contract between UND and RE Arena Inc., the entity that owns and manages the Ralph Engelstad Arena, is at the center of the public dispute between Kennedy and McGarry.

McGarry claimed Kennedy threatened litigation over the agreement between the school and the arena bearing her father's name.

She also claimed Kennedy told her the deal was written to benefit the donor, and the Engelstad family wasn't acting in the best interest of UND or the arena.

In defense, Kennedy said he has been negotiating terms of the deal but has denied much of McGarry's claims.

"We have been having conversations about the service agreement with representatives of the Engelstad family, but I believe our discussions have been in good faith and in a cordial manner," Kennedy said in the emailed statement. "As we've tried to articulate what's in the interest of the UND athletic department, we've merely relied on the foundational agreements that define the parties' roles and relationships."

An annual financial report by the NDUS dated June 30, 2017, details the relationship between RE Arena Inc. and UND.

According to the NDUS document, the agreement states "RE Arena Inc. collects all ticket revenue from ticketed UND athletic events (men's hockey, football, men's and women's basketball and volleyball). RE Arena Inc. retains 52 percent of such ticket revenue and remits 48 percent to UND.

"RE Arena Inc. collects all sponsorship sales revenue from the UND athletic events at the arena, RE Arena Inc. retains 64 percent of such sponsorship revenue, net of direct costs and remits 36 percent to the UND net of direct costs."

The NDUS report states that in fiscal year 2017, gross tickets sales were $4.6 million—meaning RE Arena Inc. took a $2.4 million share and UND was awarded $2.2 million.

In terms of advertising (also labeled sponsorship in the document), RE Arena Inc. made $769,000 and paid out $432,000 to UND.

Tom Miller

Miller has been with the Grand Forks Herald sports department since 2004. He's also a Grand Forks native and UND graduate. 

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