Calling special meeting of River District membership, and a board statement

Editor’s note: As a co-founder of the River District and as a River District member, I am calling an EMERGENCY MEETING OF THE MEMBERSHIP OF THE RIVER DISTRICT to discuss the termination of our Executive Director Kim Wheeler-Johnsen and our Assistant Diane Lyons. The meeting will be held this Thursday, Sept. 9 at the Brewery Building, 200 Prairie St., at 5 p.m.

Items for Discussion: A. Status of Board of Directors B. Status of River District Financial Condition C. Status of Structure of River District. All board members and members are invited.

Please e-mail this out to any River District members you have on your e-mail list now.

This special meeting will be held this Thursday to garner the 10 percent of the membership needed to call a full legal meeting and address the status of the issues before us and the agenda of that meeting. Please urge every member you know to attend. Check the River District website and click on “Membership” and “Entertainment.” We need every member we have there to make a good and fair decision, after we fully discuss matters at hand.

In the interest of fairness and the right of reply, the following e-mail was sent out by what must be the board of directors of the River District. It was unsigned, Sept. 7.—F.S.

Dear River District Members,

The following letter was sent to the editors of local newspapers.

On August 31, the River District Association (RDA) made the difficult decision to lay off its staff and cancel its scheduled events. Some community members have questioned how this could have happened, and they deserve an explanation.

The RDA’s expense structure was established years ago when it could count on consistent public funding.  The current reality is quite different, and the organization must adapt.

As a result of the recession, RDA ended 2008 approximately $25,000 in debt as community members and businesses reduced their levels of support to control their own expenses.  In 2009, the RDA eliminated this debt while holding all scheduled events and working to accomplish the organization’s goals, all in a terrible economy. Unfortunately, these efforts left the organization with no reserves going into 2010.

The RDA’s tenuous financial position at the end of 2009 was exacerbated in 2010, when it received a 50 percent cut in its funding from the city.  The RDA earns a substantial part of its income under a contract with the city to provide downtown revitalization services.  In April of this year, when it became clear that city funding was in jeopardy, the RDA called on its membership to come to its aid to help convince the city council that funding the RDA was a good investment. A handful of members responded to the call for help, and only four non-board members addressed city council in open meetings.  Ultimately, the council awarded only half the amount it awarded in the past, and city staff encouraged the RDA to pursue a state grant to make up the difference. The state repeatedly delayed processing the application and attached conditions the RDA could almost certainly not meet.  By the time the organization learned receipt of the grant was extremely unlikely, it was too late.

Some have said the organization should have pursued other income sources, even appealed to members to replace the $20,000 it did not receive from the city.  It did not do so because it and city staffers believed the state grant would be awarded. By the time the Board of Directors learned otherwise, it was forced to act quickly to avoid incurring liabilities the organization could not meet. The RDA certainly could not ask its employees to continue working if it could not pay them.

More importantly, even if the RDA could have raised enough money in the short term to meet its financial obligations, it had no reasonable expectation that funds would be available in the long term to support an expense structure predicated on consistent public funding. Certain aldermen stated during the funding debate this spring, and have made it clear more recently, that organizations like RDA should not expect to receive ANY city funds next year.  Coupled with falling revenues from other sources, and recognizing the toll the constant struggle to raise funds equal to expenses was taking on the organization’s ability to focus on its mission, it became clear the RDA must adopt a new business model.

The Board of Directors was saddened to cancel scheduled events and lose the dedicated support of RDA’s staff.  It did not make these decisions lightly.  RDA staff members were well aware of the organization’s financial situation and, to their credit, were extremely professional and gracious on their last day.  The Board is working to determine how the organization can work to support downtown initiatives and is seeking strategic partnerships with organizations that share the RDA’s vision of a revitalized downtown.

The RDA continues to have an active membership, and the Board of Directors welcomes any support the community can offer, especially now that the organization will rise or fall based on the dedication of those who believe in the revitalization of our downtown.

From the Sept. 8-14, 2010 issue

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