WAVE obtains loan to deal with impacts of COVID
Editor | December 23, 2020 1:00 AM
The WAVE fitness center is taking out a loan after modifications to operations due to the COVID-19 pandemic have resulted in a decrease in revenue.
City Council earlier this month authorized allowing the WAVE to obtain the loan against the building and property for the fitness center. The City of Whitefish owns the property and it is operated by a nonprofit.
City Manager Dana Smith said the membership is down at the WAVE and in response to the COVID-19 pandemic it has been following or even taking more restrictive measures regarding health measures. The WAVE has experienced significant financial impacts as a result, she noted.
“This summer there were no visitor passes and that’s a big part of their revenue,” she said. “This will refill their reserves or pay off other loans.”
The WAVE is using a new working capital program through the Montana Board of Investments to secure a loan for $500,000 and a grant for $175,000 to pay off a portion of the loan.
The WAVE plans to either use the money for reserves or depending on the continued impacts from the pandemic may use the money for operations.
In 2013, Council approved the Wave taking out a loan for $3.5 million for expanding the fitness center. Of that roughly $2 million remains outstanding on that loan.
The current estimated value of the WAVE is about $13.3 million.
Smith said there is only a low financial risk to the city by approving the loans. If the loans were defaulted and the property went into foreclosure then the city would need to invest any outstanding amounts in the property to ensure the city would not lose a valuable asset.
However, she noted, based upon the financial history of the WAVE and the city’s representation on the WAVE board of directors that would be highly unlikely to occur.