Council revamps VFW aid package

By Brent Shrum Western News Reporter

A week after moving to reconsider the Veterans of Foreign Wars club¹s pleas for a financial bailout, the Libby City Council voted Monday night to look into a revamped aid package that involves loaning the group around $350,000 from the city¹s economic development fund.

After numerous rejections by the Libby Area Development Co. — which until October was used by the city council to review requests for assistance from the $8 million federal economic development grant received in 2000 — and the council itself, the council last week gave the VFW proposal another hearing. While previous requests had been for a $250,000 grant, group spokesman Terry Andreessen asked the council last week for a $145,000 grant to help it refinance the loan on its building. Councilman Lee Bothman presented an alternate proposal, which he had worked out with Andreessen.

Bothman¹s proposal involved giving the VFW $10,000 per year for the next five years along with the $5,000 the Center for Asbestos-Related Disease had offered to repay annually in return for a $250,000 grant from the city. The CARD¹s initial proposal had been to award the $5,000 as an annual scholarship to a local student pursuing a medical education, but in approving the grant the city council reserved the right to change the nature of the repayment.

This week, City Attorney Scott Spencer presented a new proposal he helped craft along with Andreessen and Bothman.

Under the new proposal, the city would use the payments from a $320,000 loan made earlier this year to the buyers of Kootenai Paving — $4,374 per month — to help the VFW pay off its debt. By combining that with $1,100 per month from the VFW — less than half its current monthly loan payment of $2,366 — the loan would be paid off in 79 months. The VFW would then begin paying the city back at a rate of $1,500 per month for about 25 years, Spencer said.

The package would result in the city investing about $350,000 and the VFW eventually paying back $443,000, Spencer said.

VFW representatives have told the council that the club is unable to make its payments and will be forced to sell its building if it doesn¹t receive help from the city. The VFW built the structure after its old hall collapsed under a heavy snow load in the winter of 1996-97.

Club representatives have cited services the VFW offers to the community including loaning free medical equipment like wheelchairs and walkers, providing emergency shelter and a space for the distribution of government surplus goods and commodity foods, and placing flags along the streets on holidays.

Noting resistance to helping the club because of its bar and casino, last week Andreessen told the council that if the city doesn¹t help the VFW the group will find a smaller space for those functions and the only thing lost will be the ³vital services² the club provides.

Andreessen said the club¹s auxiliary plans to file for non-profit tax-exempt status to aid it in its fund-raising efforts. The VFW also plans to seek one-time donations from its membership and acknowledges the need for better management and to stop the ³leakage² that has occurred in the past, he said.

The new proposal is preferable to the proposal offered by Bothman last week because it provides a long-term solution and gives the city an interest in the building, Spencer said. Because the VFW has expressed an inability to make its next payment — due Dec. 15 — and because the council needs time to review the new proposal, the plan calls for the city to make that payment in full, Spencer said. If the proposal is ultimately rejected by the council, the payment will be ³a gift,² he said, but if the proposal is approved it will be added to the amount to be paid back to the city.

The council voted unanimously to make the current loan payment and to formally consider the proposal at its regular January meeting. The only council member to express concerns about the proposal was Gary Huntsberger, who noted a question about how the VFW bailout fits in with the intent of the original $8 million grant, which was economic development and infrastructure. Huntsberger suggested the council seems to be acting on emotion and said he¹d like to see a rationale for spending the money on the VFW.

³We seem to have lost our focus on what this money is really for,² he said.