The Cook County-Grand Marais Joint Economic Development Authority, or EDA, is in crisis. There’s no money to pay its bills.
At a special meeting on Tuesday, Jan. 26, the EDA board of directors met to discuss the budget and the current shortage of funds dogging the organization. Director Matt Geretschlaeger said the EDA has more invoices than it has funds. He also said the problem wasn’t going away and asked the board if the organization could or should continue, saying, “I guess the question is, do you want to continue on with what we’re doing? And it seems awfully difficult to do that. I’m not certain that we have the ability to stay in business.”
A revised EDA budget for 2010 projects an operating deficit of more than $42,000. Current outstanding bills payable total about $41,000. No substantial income can be expected until the EDA receives half its annual levy from the county in June of this year.
EDA board member Don Davison favors going back to the city of Grand Marais and the County to ask for help. “We have no independent way of raising any money whatsoever,” said Davison. “I mean we are an agency of the city and county and we are dependent on them. And I can’t imagine them letting their planning and zoning board, or a particular office, or a highway department, say go off on your own and worry about how you’re going to pay your bills next month. I think we have to go back to them and say, it’s nothing we did. Virtually all of the deficit we’re talking about is due to MPCA action on the project up here. If it weren’t for that, we would not have a cash flow problem. And I think we should go back to the city and county and say, we need additional funding to put a Band-Aid on this and make it go away.”
During the construction of Cedar Grove Business Park, repeated citations for stormwater runoff violations went unaddressed. The Minnesota Pollution Control Agency stepped in and is fining the EDA and its contractor $277,000. The EDA is contesting the fines and has racked up nearly $50,000 in legal fees. The issue has yet to be resolved, and whether or not the EDA will be held liable for the fines, or recover any of its attorney’s fees remains to be seen.
The EDA board was unable to come up with any solutions during the meeting and in the end decided to form a committee with representatives from the Cook County Board of Commissioners, the Grand Marais City Council, and the EDA to try to come up with a plan to address the immediate cash flow shortage as well as the EDA’s looming budget deficit.
“There are multiple parties here at stake and at risk,” said EDA board chair Mike Litfin,
“I will be honest, I don’t have a solution, I don’t know what the best way to resolve this is, other than I know that everybody’s going to have to come to the table and work something out. Or, if we can’t come to some sort of an agreement from a funding standpoint, like Matt says, we need to close the doors and spread it out to the parties that be. I’m not sure anybody really wants that, so there has to be some sort of resolution with everybody involved,” said Litfin.
The new committee plans to meet in the near future, but no details are available at this time. The fate of the EDA rests with the committee.