Horse Center expecting bigger loss

New projections show it may lose $48,000 more

February 06, 2000|By Erika Niedowski | Erika Niedowski,SUN STAFF

A new set of financial projections for the Horse Center shows the Columbia facility is expected to lose $48,000 more than was forecast in December, but officials are recommending that the Columbia Association continue running it rather than sell it or shut it down.

The income and expense projections, released Friday to the Columbia Council, were the fifth set provided by CA staff in less than a year. They amount to another setback for the troubled facility, which is used by about 600 Columbia residents and has lost an estimated $1.5 million since 1986.

The revised projections show an expected loss of $395,000 during the current fiscal year and the next, compared with a $278,000 loss over the same period in CA's preliminary fiscal 2001 budget, which was released in December.

The Columbia Council called for the financial review -- the second in less than a year -- after the center's head and two advisory committee members resigned, the barn manager and several barn hands left and budget projections showed the facility losing $120,000 more next year than officials projected last spring.

A 10-year plan released at that time projected that the center would lose a total of $146,000 this fiscal year and next, and was on track to break even -- for the first time -- in fiscal year 2006.

The revised capital budget for the Horse Center includes $117,000 in expenditures, $15,000 less than originally proposed.

Rob Goldman, CA's vice president for the sport and fitness division, said yesterday that he couldn't comment on the new figures until after a staff presentation Thursday to the Columbia Council.

During that presentation, staff will outline various options for the facility, including closing it, leasing it, selling it or using the 88-acre property for something else, possibly an indoor/outdoor soccer center, petting zoo or golf training facility.

The staff recommendation will be for CA to continue managing and operating it.

"The staff believes that offering equestrian services to the Columbia community is a unique amenity which positively adds to making Columbia a special and diverse community," says an association report on the facility.

The Horse Center's net "book value" is estimated at $540,000, according to the report.

If CA did not lease out the facility or the land, it would cost CA $102,000 every year to have it closed because of interest payments, insurance and other costs, the report says.

The Columbia Council, concerned about its financial performance and level of residents' use, debated closing the center last year. In the course of those discussions, Goldman provided three sets of income and expense projections over a six-week period.

The projections from March 11, based on CA's economic model, showed the center losing $1.7 million over the next 10 years. The projections from April 2, based on CA's "best assumptions based on current trends," showed the center losing $1.3 million over the same period.

The third set, dated April 22, showed the facility breaking even after six years. Goldman said that set, which was in part what persuaded the council not to shut the facility, was based on "best-case optimistic projections."

Before the recent staff shake-up, which began in mid-December, CA's proposed budget for fiscal year 2001 showed the facility well behind that goal, losing $164,000 rather than the originally projected $46,000.

At a budget work session last month, council representative Jean S. Friedberg Jr. of Hickory Ridge village called it "perfectly appropriate" to consider whether CA should get out of the "horse business."

In his letter of resignation from the Horse Center advisory committee, former Vice Chairman Daniel P. Bednarik of Columbia questioned CA's fiscal responsibility and called for a state audit of the homeowners' group.

The state attorney general's office has said it would not investigate CA's finances unless there were evidence of criminal wrongdoing.

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