Banadad Trail Association

Board Meeting Conference Call

July 12, 2012

Present:  John and Barb Bottger, Peter Spink, Karla Miller, Ted Young, Tom Rice, Wayne Monsen, Chris Matter, Andy Jenks, Anne Rykken

Agenda approved.

Motion to accept minutes from May retreat minutes.  Peter moved.  Andy seconded.  Motion passed.

Committee Reports

Finance – No report. 

Membership – No report.

Forest Service Meeting

Very positive meeting.  Some of the forest service people are at work on projects now.  Their availability towards the end of the summer depends on their firefighting obligations.  We will have a motion to entertain during the financing plan for the reroute.

West End Trail Connection

Ted and John met with Mike Prom yesterday.  There is a good understanding of the numbers and who is going to do what.  It got more interesting because any agreements will involve three people, - the current, legal landowner, the Proms, and the BTA. 

Proms were worried about liability.  Ted says his company’s insurance can cover this.  Proms are fine with the BTA doing some work on the Trail before the 3 – year period. 

If we decide to move forward with this project, Proms will start with the legal work.

Costs – The total cost of the project is a little over $9,000.  Ted has talked with the DNR to make sure we know which numbers are covered by the grant.  BTA estimated costs include the appraiser, the Natural Heritage Review and 25% of the grant which totals $3,540 for the BTA.  If we are going to use the grant, this project must be completed by June 30, 2013.  We are in an immediate cash flow crunch in order to proceed with the appraisal.

What is the appetite for incurring this debt?  There is a potential for a $1,500 grant from the USFS.  If we do that, the request would be for work on the existing trail because they do not award grants for work done on private property.  If we got this, we wouldn’t see the money until next Spring.

We can also apply for $500 from the Arrowhead Electric Cooperative which could be rather unlikely.

This adds up to the need to consider a loan because it is a cash flow issue.   Karla is uncomfortable because fundraising is then done to pay down debt.

Ted says we have a $6,000 loan with the county with interest rate based on T-bonds, around 3%.  It would be very easy to ask the county to rewrite the existing loan using the $12,000 from the snowmobile as collateral.  This project is so crucial to the survival of the Banadad that Ted is willing to gamble on it.  If we can’t cover the loan, Ted would figure out how to be sure the BTA does not take on the debt.

Andy agrees with Karla and understands that it is very common to take out a bridge loan due to a cash flow.  It is probably easier to raise money during the ski season.  This seems like an essential project for the trail.  We do have a business problem if we can’t get members but we have to have this trail.

Peter understands it is a near term cash flow issue but we’ve never been able to demonstrate getting memberships so the concern is how we are going to keep paying our expenses.

Ted feels very confident that we will get the $1,500 from the USFS and that the banks will give $500 each, especially when it is connected to this project.

Chris understands the situation and questions whether this can come soley from membership.

John asks if the board is comfortable with Ted and John to proceed with a detailed financial plan?  Ted says we need to hire an appraiser by the end of July and to get the trail work done before the snow falls.

Do board members have other ideas for raising funds?

Motion to get a short-term bridge loan for $1,500 to pay for an appraiser.  Andy moved and Wayne seconded. 

Discussion – We’ll need more money in the fall so we will also have to be aggressive with other fundraising.  We can’t get grant money until the appraisal is done.  This loan would be an unsecured loan from the bank.  Let’s get two banks on board with a contribution of $750 each first.  The banks should be told that there is a board approval to ask for a loan if we are turned down for the philanthropy.

Amended motion.  Motion to get a short-term bridge loan for up to $1,500 to pay for an appraiser.  Andy moved and Wayne seconded.  Ayes - 5   Nayes – 4  Motion passed.

Ted and John will proceed as discussed with the banks and will report back to the board.

Peter is just as unsure about the future of the organization as he is about the short-term expense for this trail reroute.

How will we raise the rest of the money?  Andy says we have a great plan with USFS support.  We should be able to fancy a letter to the membership and ask for a cash donation.  Barb will draft a letter for the membership fundraising effort.  The letter should include a picture of the flagged trail and emphasize the parking and access to the trail from the west end.

Motion to have John and Linda write a letter to Dennis, the Forest Ranger to request for funding of $1,500.  John moved and Andy seconded.  Motion passed.

Annual Meeting Date

The annual meeting will be on Saturday, October 20, 2012.

Maps

Andy reports that they are waiting for the west end of the trail to be finalized before maps are printed.

Karla will ask Linda about putting a request for funds on the Give MN site. 

Motion to adjourn.  John moved and Andy seconded.  Motion passed.