by Jim Boyle
The Elk River American Legion is in danger of closing once again.
It was announced at an emergency membership meeting on Sept. 26 that the post is behind on interest payments and 2010 taxes to the tune of $9,294.69.
Members voted to send a member of the Sons of the American Legion and a member of the American Legion’s executive board to meet with The Bank of Elk River in hopes of opening up a line of communication that could include an examination of the Legion’s options. Members of the Legion would at the very least like an extension of time to develop a game plan to save the Legion.
Dwayne Budreau, the finance officer for the American Legion Post 112, told the membership that the bank is calling for the Legion to catch up on about $5,000 in taxes it owes from 2010 and interest payments totaling more than $3,000 on a pair of lines of credit it established with the bank several years ago.
The Bank of Elk River would like to have the two lines of credit consolidated and a 10-year note drawn up, Budreau said.
The first line of credit was $100,000, and the second was for $50,000. Because the Legion’s property was used as collateral to secure the lines of credit, the Legion is in jeopardy of losing its building. There’s a sheriff’s sale planned for Nov. 8.
“The loans were taken out basically to sustain the business,” Budreau said.
They helped do that, but the Legion fell on hard times again a couple of years ago. Efforts were made to bolster business at the Legion, including a series of stories in the newspaper designed to boost the Friday night dinners and the bar business. The efforts have been met with some success, as the bar’s average daily register has more than doubled in the last couple of years, Budreau said.
Expenses have also risen, though, Budreau added.
The Legion has kept up with its taxes this year and is current with all of its vendors, but has not been able to keep up with interest payments or pay down its 2010 property tax bill. The Legion has been successful at booking its banquet space, which has bookings through the end of the year, according to Gloria Maher, the bar manager.
“We’re getting to where we should be with the business, but the time (to catch up) isn’t there,” Budreau said.
Mike Leistico, a member of the Sons of the American Legion, and Mike Beyer, the second vice commander of the Legion, who have been critical links to restoring Friday night dinners, have offered to meet with bank officials.
The Legion membership approved a motion for the pair to be able to speak on behalf of the Legion as it relates to its current loans and establishing a framework for future negotiations.
“I have a real soft spot for this place,” said Leistico.
Many do, and there is already an effort afoot to raise funds needed by the Legion.
The membership will meet again on Monday to assess the situation and discuss other potential measures that could be taken to save the Legion. The meeting will start at 7 p.m. at the Legion and will be open to the members of the Legion, its auxiliary and the general public.