Bleeding Red

EAGLE RIVER – The financial shape of the Keweenaw Mountain Lodge still appears to be in dire straits.

The August balance sheets revealed bleak news to the Keweenaw Mountain Lodge Board on Wednesday, which is made up of the Keweenaw County Board.

Dining revenue was down from the previous year by $32,615.57, or just over 40 percent. Likewise, bar income was down 48 percent. For an eight-month period, from January through August 16, the gross profit was down 14.7 percent, while supply costs increased 14 percent and employee costs were up by 29.9 percent.

“Any time you have an all-new staff hired, you’re going to have some turn-over, some amount of re-training, some of that expense is reflective of having these hours to get these people up to speed,” Carl Johnson, accountant reported to the Lodge Board.

While there were not many county residents in attendance at the meeting, some did speak during the public comment period.

“It seems like the board is taking this like it’s good to go,” Paul Mihelich said. “We have some major problems here. I don’t know if anybody else is seeing this, but net income (is) down, bottom line, 71 percent for August. Then for the year, net income down 266 percent? I don’t know. You really gotta think about this one, fellas.”

Frank Kastelic, also a Keweenaw County resident, expressed concern over expenditures.

“I’ve been listening to the reasons set forth for the expenses being up, revenues are down,” he said. “There’s a lot of reasons that things like that happen if you’re in business, and that’s basically what you’re in: business. The problem I had is understanding how long the county can go (with) deficit spending of this size.

“I would think that the lodge is pretty much into the county right now. If you add, at this point, another $127,000 that doesn’t reflect the $72,000 in interest on the loan that’s going to go on top of that. I believe that deficit spending is illegal for any type of municipality. At what point do you say enough is enough? Or what services does the county start cutting out because of the lodge?”