Boerner
Friends group down $800,000
County weighs bailout
July
18, 2005 -- Friends
of Boerner Botanical Gardens, hit with poor
investment performance and a big debt payment,
lost about $800,000 in the value of its assets
during 2004, according to county documents.
Now
officials of cash-strapped Milwaukee County
need to figure out whether it can help the cash-strapped
operator of the Boerner Education and Visitor
Center and how any help should be packaged.
A
workgroup established to develop ways for the
county to work with the Friends came up with
four alternatives:
- The
county could do nothing. That would let
the it off the hook financially for now,
but the Friends could give the entire Boerner
operation back to the county, which could
cost about $1.2 million annually.
- The
county could contribute $151,000, as it
did last year, to take some of the financial
pressure off the Friends.
- The
county could give the Friends a traditional
loan. "A loan could add to the debt
burden of the Friends, driving them into
further financial duress, with the potential
that they would be unable to recover from
their current situation," according
to a memo from County Budget Administrator
Stephen Agostini.
- The
county could loan the Friends about $1 million,
to be repaid over a specified number of
years, to allow the Friends to cover costs
for the next several years. Agostini's memo
labeled this option a "modified loan,"
but didn't specify how it would differ from
a traditional loan.
The
Friends group was formed in 2000 to help support
the Boerner Botanical gardens. In December 2002,
it took over full operation of the visitors
and education center. In October of last year,
the Friends notified the county that Friends
needed county financial assistance to keep the
center going.
The
county kicked in the $151,000, that was not
enough to overcome financial setbacks.
The
group had a particularly tough time in the investment
market, where its portfolio lost $365,000 in
value last year, according to a Friends memo
to Agostini.
The
group also had to shell out $74,000 for a letter
of credit fee, and $300,000 for a principal
loan payment on debt incurred for the construction
of the Education and Visitors Center, which
the Friends helped finance.
The
Friends memo said the group will review its
investment portfolio, embark on a 5-year, $1
million capital campaign, reduce staffing and
review its investment expenses.
The
Friends also said it is setting up a $750,000
endowment fund, which will boost asset value.
