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WORLAND — Although there is a degree of disagreement between Washakie County Commissioners, Worland City Councilors and Washakie County School Dist. No. 1 Board members, there is solid agreement on one thing: The Worland Aquatic Center is struggling to stay afloat.
Beginning Monday evening at the WSCD No. 1 meeting, school district business manager Jack Stott told school board members that there is a cash flow problem at the aquatic center.
Worland City Councilor Mandy Horath serves on the Worland Aquatic Center Joint Powers Board. During the Washakie County Commission meeting Tuesday, she said, “With the joint powers board, and our director, David Villa, we’ve cut everything we possibly can to make the cash flow a little better, and it’s just not working.”
Stott said that the center operates on about $270,000 per year.
“We’re operating that pool as lean as you can operate a pool. Even at $400,000, I could look every one of you in the eye and say, ‘We’re not being extravagant at all,’” Stott said Tuesday.
In a letter to school board members, Stott wrote, “As several communities around the state have called requesting information about our facility, I have indicated that a $400,000 budget would be adequate, while still not being extravagant.”
When school administrators realized that the district would play an “integral” role in constructing the aquatic center, they immediately asked what they could do to avoid being in the same boat they found themselves in when officials began planning to construct the aquatic center in 2010, Stott wrote.
“That boat being a facility in need of major repairs and insufficient funding to accomplish those repairs,” Stott added.
During the 2010 election, Washakie County voters approved a special 1 percent sales tax to raise $5 million for an endowment of which the principle would be invested in “any type of security which school districts are authorized to invest.”
The 1 percent sales tax raised $600,000 more than was anticipated. Now, officials are debating whether to use some of that money to get through the difficult times.
Considering options
In 2014, Stott told the Northern Wyoming Daily News that the district expected to collect interest at a rate of 4 percent on the endowment. However, the endowment is only collecting between .15 and .35 percent.
As a result, instead of collecting the originally projected $80,000 per year from the endowment, the district is only collecting $5,000 to $6,000 annually. Those involved with the aquatic center agree that in order to stay afloat, something must be done.
But there’s disagreement on what.
In his letter to the school board Monday, Stott proposed dipping into the endowment.
“It is also an age old temptation/problem that those affiliated with an endowment will seek means to access the principle in order to alleviate stresses. For that specific reason, endowment agreements are written so as to make it very difficult — even impossible to access the corpus (funds). Our agreement is not any different,” Stott wrote.
However, times are tough, Stott said, and there is a number of ways the aquatic center can use funds from the endowment — and do it responsibly.
One option, Stott said, was to “carve” out $300,000 from the endowment. The question with that option is, how long until funds are exhausted?
“And after they are exhausted, how do you maintain that level of funding,” Stott asked in his letter.
The next option would be for the school district to loan funds from the endowment at no interest to the aquatic center.
“I would propose that under the loan option, the WAC JPB be authorized to borrow, interest free, from the endowment at up to $25,000 each year for two years. Further, that interest revenue distributions be capped at $40,000 until the loan is paid back.”
School board members did not specifically authorize Stott’s proposal. Instead, voting 6-1, they authorized moving forward and discussing their options with other entities.
Susan Scheuerman cast the only no-vote.
Tuesday meetings
Members from WSCD No. 1 and the aquatic center joint powers board met with county commissioners at the Washakie County Courthouse Tuesday.
While there was agreement that there is a serious funding problem at the aquatic center, officials did not reach a solution, but agreed to address the matter.
At the meeting Stott said that if interest rates increased by as little as “1 or 2 percent,” the aquatic center would greatly benefit.
Commissioner Terry Wolf said, “This is something we need to sit down and talk about. I’d love to be optimistic that interest rates are going to go up,” adding that no one can be certain that interest rates will increase.
Stott said that for every 1 percent increase in interest rates, the district receives an additional $20,000 from the endowment fund.
Horath said that even if the aquatic center doesn’t earn a profit, it still provides an incentive for people to move to Worland.
School board and joint powers board member Anna Venable agreed: “We want to recruit people to live here.”
At the Worland City Council meeting Tuesday, Horath said that the aquatic center is bleeding and “we can’t stop gushing.”
Worland City Attorney Kent Richins called the district’s proposal “creative financing.”
“It’s kind of a sign of the times,” Richins said, noting that the Worland landfill is also facing economic difficulty along with the golf course. He added, “We’re on hard times.”
Horath said that the right course of action is, “What’s right for the pool and our community. We have to give the community what they voted for.”
Richins said that he believes the purpose for the excess $600,000 is for rainy days.
Horath replied, “And it’s pouring.”
In their upcoming meetings next month, city councilors and county commissioners will discuss which action to take next. If they approve the loans, they will inform the school district, which has already approved the action.