By Patrick Winderl/Havre Daily Newsemail@example.com
City and county officials said they were surprised by the announcement of the H. Earl Clack Foundation that management responsibility of the Heritage Center would be returned to the city on July 1.
"I didn't know until I got the letter," Havre Mayor Bob Rice said today. "Elaine Morse asked if it was a surprise to me, and I said, 'Absolutely.'"
Morse, president of the Clack Foundation, did not return phone calls seeking comment.
The Clack Foundation on Friday sent letters to Rice, City Attorney Jim Kaze and the Hill County Commission saying it was planning to relinquish control of the Heritage Center to the city.
"It certainly wasn't something that was on our radar screen," County Commissioner Doug Kaercher said Tuesday afternoon.
The Heritage Center is home to the H. Earl Clack Museum, which is operated by the county and supported by the Clack Foundation, a private group.
The foundation began leasing the former U.S post office and courthouse in 1996 after the city bought the landmark from the U.S. Postal Service. After a five-year lease expired in 2001, the foundation continued to operate the building under a tenancy-at-will agreement.
The foundation and the city had been attempting to negotiate a new lease when the foundation made its announcement, Rice said this morning.
Since February, the city has presented the foundation with three contract proposals, all of which were rejected, said Havre City Council member Tom Farnham, who chairs the council's Finance Committee.
"We've been working on it for the last couple months. About the middle of May, the city attorney, after spending numerous hours on it, sat down with the foundation and they said didn't want a contract," Farnham said.
Rice said one of the major obstacles to signing a new lease has been the condition of the boilers at the Heritage Center.
"It has to do with the boilers. One boiler is almost down, and the other is on its last leg. It's going to cost $20,000 to fix it, and the foundation didn't want to be left holding the bag, and the city doesn't have the money to fix it," he said.
Rice said he has been speaking to Morse to identify possible solutions, and plans to meet with the County Commission next Wednesday to discuss the issue.
Rice said the City Council will have to decide how to proceed. He said he will brief council members after meeting with county officials and foundation board members.
"It will be a council decision. After Wednesday's meeting, I'll know a little more about how the commission feels about this, and what the foundation wants from us," he said. "I think right now it's really premature to even be speculating about what's going to happen."
Rice said his office was inundated with calls about the Heritage Center this morning.
"I got calls from several of the tenants (at the Heritage Center), and they're concerned about this. I got a couple of calls from people in the community and they're concerned as well," he said.
"I think a lot of people think the foundation is trying to hold the city hostage, and I don't think that's the case. They're good people and they work very hard. They're just going broke. People need to understand the position they're in, and I'm trying to look at both sides."
The foundation has a genuine financial need, Rice said.
"What Elaine told me yesterday is that they take in $1,600 in rent, and even after they spend that, they have to come up with $2,200 every month. Every month, they have to come up with $2,200 just to keep the doors open," he said.
That shortfall exceeds the amount of income from the foundation's endowment fund, which it has been using to help maintain the Heritage Center.
In January, the museum board transferred $50,000 from its own endowment fund to that of the Clack Foundation. Under an agreement between the two parties, the museum board would retain ownership of the money, but would allow the foundation to use it to generate interest from investments.
The $50,000 pushed the foundation's endowment past the critical $250,000 mark, which meant it could then tap the interest from the fund.
That interest has provided about $600 a month for the foundation to help maintain the Heritage Center, but the money is not enough, said Ron VandenBoom, who chairs the museum board.
The foundation had threatened to turn the building over to the city when foundation officials appealed last year to the city for financial help.