Chamber seeks to stay afloat

Hayden Chamber of Commerce members are adamant that they don’t want the business group to go bankrupt over its money-losing air show, but that may be the only legal solution.

During a breakfast meeting Thursday, chamber members for the first time got specific details of how much cash is in the bank and options for paying debts of $128,000.

In a vote of confidence, members elected to retain seven of the remaining board members. The only person who got a vote of no confidence was Sen. Kent Bailey, R-Hayden, who is a past chamber president and didn’t attend the meeting.

Bailey said he was unsure why members voted that way, since he had no involvement with the air show. His security company did provide traffic control and security after the original contractor pulled out at the last minute.

Bailey said he was the only board member who said the entire board is responsible, not just President Randy Giddings. Giddings, who was also the air show manager, recently resigned.

Before the vote, board members each apologized for not having a better idea of what was happening with the air show planning. Several board members said they asked the air show committee for financial details early on but never got that information. Now they wish they would have stopped the show, postponing it until next summer.

“We were in the dark,” director Judith Conant said.

Even though it remains unclear exactly why last month’s Thunder Over the Prairie Air Show bombed financially, it was obvious most of the 50 members in attendance at Thursday’s meeting wanted to avoid bankruptcy. Some business owners even volunteered to write $500 checks or help with fund-raisers to gather the $128,000 needed to pay the remaining 28 creditors. Others questioned if the chamber could qualify for a loan.

Helen Johnson of The Dragon Slayers said the chamber represents responsible business owners and there’s nothing fiscally responsible about bankruptcy.

“It makes a very bad statement if we as members of the group take the easy way out,” Johnson said. “We need to make good on the debt.”

Post Falls attorney Freeman Duncan was hired by the chamber to do “triage” – trying to figure out how much money the show generated and how much cash the chamber owes creditors. He blames the financial problems on low ticket sales and insufficient sponsorships.

Duncan told chamber members Thursday the chamber has $40,000 in the bank to pay the 28 remaining creditors, who are owed $128,000. The creditors have until Friday to decide whether to accept the chamber’s offer to pay 31 cents for every one dollar owed.

The largest creditor, American On-Site Services, is owed about $33,400, which would mean they would get a $10,345 check. Yet an attorney for the company told Duncan it probably won’t accept the settlement.

If every creditor doesn’t agree to the offer, the chamber will consult a bankruptcy lawyer Monday. So far, five creditors have accepted the offer.

“There’s no other choice other than to seek the protection of bankruptcy,” Duncan said. “However, the chamber could survive and go on.”

Duncan said that the law requires the chamber to treat all creditors equally, that’s why all of them must accept the settlement. If they do agree to the 31 cents, Duncan said the chamber could still work to eventually repay the total debt.

The members weren’t happy with that answer. Some questioned why the creditors don’t just accept the loss and consider it a donation to the chamber. Then they said the chamber would work to eventually repay the money.

Five creditors have done that already – Boy Scouts, Avista Utilities, Interstate Concrete and Asphalt, Hayden Lake Irrigation District and Short Stop Shell. Duncan said that chamber President Randy Giddings, who recently resigned, also has agreed not to seek the $50,000 in seed money he personally gave to the air show.

Duncan also is donating his $6,000 legal bill and said he hopes that will encourage the creditors to “dig deep down in their corporate soul” and forgive the debt.

Interim Vice President Scott Jamar said there is a lot of unclear information remaining about the air show’s financial picture. He said one of those is about a contract with the Coeur d’Alene Press to provide in-kind services that the chamber never received. Yet the newspaper is listed as a creditor.

“So far we haven’t received any response,” Jamar said, declining to provide specific details. “We’re trying to gather information.”

The two-day air show at the Coeur d’Alene Airport cost about $350,000, yet it only generated about $120,000 from ticket sales, parking, the beer garden, vendors fees and merchandise sales. The chamber was expecting a lot more paying customers.

Of that $120,000 revenue, Duncan reserved $6,000 to pay the Idaho Tax Commission for sales tax generated from air show sales. A portion of that is also owed to Kootenai County for its half-cent sales tax. Duncan said he is working with the county treasurer’s office to get that debt forgiven. He is also hopeful the county will return a $2,300 cleanup deposit that was required to use the county airport.

About $10,000 of the money was also set aside to pay three businesses who bought about $32,400 in T-shirts, ball caps and other merchandise for the chamber to sell during the air show. Much of the merchandise didn’t sell and Duncan said the chamber is going to split the $10,000 among them.

Wanting to help, people have donated about $550 to the chamber in the last few days. Duncan said he is putting that cash in a special account, and it will go to help pay volunteers who had expenses such as gas for ATVs.

Jamar said he was happy with Thursday’s turnout and glad chamber members were so supportive. Now everyone must wait until Monday to see what happens with the settlement.

“We’re taking all the comments we got with great enthusiasm,” he said.