Financial Disaster at the Alerus Center: Losses Over One Million Dollars!
OK readers. I’ve got a quiz for you.
Suppose you have a business of some kind that took from operations $3,893,000. Their direct expenses for the year were $4,987,000. In addition to that during the year the investors paid in $390,000 more to help out with operations and another $620,000 to fix up the place because your financials haven’t been providing for depreciation. It also turns out that your accountant that oversees
So what do you claim your year end results are. A loss of 1.1 million? A loss of 1.7 million. A profit of $15,000. Do they blame their year end results on the economy?
If you guesses the last two you’d be right. We are being SO lied to.
Alerus Center: Earnings, attendance up
That’s the headline for the Herald story. While attendance was up, even by their goofy accounting gimmicks their earnings (profits) were down. They CLAIMED a profit of $50,000 last year. (And their real loss was probably under $300,000). Only the apologists at the Grand Forks Herald would run a dishonest headline like that, implying that the profits were up.
So lets talk about the variances between the Alerus’s numbers and reality. First of all the Alerus gets a subsidy. That’s fine, the voters approved it. However it is absolutely wrong to count that as part of your operating revenue. How in the world can they claim that when I ate in a restaurant yesterday was part of the Alerus operations.
The really SHOCKING NEWS is that the concert fund isn’t just broke as I reported back in January. (I was the first to cover that even though the Herald had the story). The concert fund is $469,017.67 in the hole when they started with $250,000.
That’s a $719,000 loss that they are keeping off of the Alerus books. So where is that loss going to show up? I guess they must think they can bury it in the city budget. So your taxes are going to go up due to the mismanagement at the Alerus. It’d be nice if they could at least be honest with us.
The arrogant director of the failed Alerus said this about the concert fund.
Hyman said his staff booked Diamond months in advance and, by the time the concert took place in November, the economy had taken a sharp turn for the worse.
The fund started with $250,000 but ended with $469,017.67 in the hole. That’s $719,017.67 spent altogether. Michael W. Smith, Lifehouse, Disturbed and Neil Diamond all lost money.
Neil Diamond lost $252,000. [What that means is that Neil Diamond lost only 35% of the concert fund. That's only slightly above average. For the arrogant director of the Alerus to blame losses on the concert fund on the economy is bogus. If that were the case you'd expect that Neil Diamond would have lost far more than the other concerts. This is just one more example of how disingenuous the city leaders are.]
Consider this. The Alerus counts revenue from a concert in their revenue. They count some of the expenses. But they don’t count the expenses if they lose money on a concert. Then they claim they didn’t lose money on the big concerts?
When they report that the center made money to the public that makes that a fraud. Over on the chief Alerus apologist’s blog, Tu Uyen Tran disagreed with that. He said it was “framing.” I guess we know how committed to the truth the Herald is concerning the Alerus.
So last year the management company the city hired to misrun the Alerus made a deal. They’d only have to be paid IF they made money. They lost over a million dollars. Who wants to bet that they don’t get paid. Well they made money if you count a tax subsidy as revenue and don’t count a bunch of the expenses.
I suppose next they’ll try to claim that it’s no big deal that the center is losing money. They’ll claim that it’s normal for an events center to lose money. My response would be “why are you making a big deal about making money.” “Why are you cooking the books to show a profit.” “Why couldn’t you be honest about the expectations before.”
A couple other things came out related the Alerus as well.
The topic of the $787,000 that got transferred from the city accounts to the Alerus accounts came up. That’s one of the stories that I had to break because the people apparently didn’t have the right to know. Here’s what the chief apologist for the Alerus had to say.
Taxpayers are not liable for any of this because we have already paid for it.
So we’re not liable for it, because it was already taken from us. Wow, what an amazing statement.
Another thing came out in the Herald’s article:
Executive Director Steve Hyman said the center also had to pay back money that it owed a promoter from 2003. The miffed promoter, he revealed publicly for the first time, is the reason there were so few concerts after 2003.
Wow, the Alerus gang is stiffing promoters, besmirching our good name. That’s not the way you conduct business around here.
I’ll keep going over the information I can dig up and report more as I find stuff.
It’s time for the gang running the Alerus center to step down and find someone that can live within our means. We don’t deserve to be lied to and misled.