By Emily Votruba
In the space of a couple of weeks straddling April and May, Solstice Fest 2015 went from being on, to off, to back on again.
On April 15, Bill Soper, chair of the Solstice Committee, and Diane Jenks, village council president, had a discussion, based on advice from State Treasury officials, that led to them canceling Solstice. I posted this to the Alert Facebook page that day: “BREAKING: According to chief Solstice organizer and Parks & Recreation Commission member (and council member) Bill Soper, Solstice Fest is canceled this year. Soper spoke with Diane Jenks, who spoke with State officials. It is illegal for a municipality to hold a revenue-generating festival. Were an outside organization to step up and run the festival, it could be held in the Village. Elberta is under intense state scrutiny because of its deficit situation, and village officials are learning all kinds of things they didn’t know before about state regulations.”
A flurry of discussion followed in comments.
Within a few days, Bill Soper, Joshua Herren (longtime Solstice volunteer), Betsy Mas, and Frederik Stig-Nielsen had registered with the State as a nonprofit corporation: Elberta Solstice Foundation (ESF). Jenks asked me (I am currently the main Village web page updater) to replace an announcement I had been asked to post saying the fest was canceled with a note that it would go on under ESF’s auspices.
As of the end of April, ESF did not yet have 501(c)3 status, but that is their intention. In an April 29 email reply to me, Stig-Nielsen, who received his Michigan attorney’s license this year, wrote: “Elberta Solstice Foundation is registered with the Michigan Department of Licensing and Regulatory Affairs as a ‘domestic nonprofit corporation.’ We decided to incorporate as a nonprofit because we want donors, sponsors, volunteers, participants and the community at large to feel secure that we are not doing this for our own personal gain, and that none of the benefits or profits will inure to any board members or shareholders. Any money that is raised is therefore secure from any impropriety, as our articles of incorporation specifically prohibit (in accordance with IRS standards) such a trickle down of economic or other benefit to the members of the corporation. As far as 501c3 federal tax exempt status goes, we have not yet applied, but are in the process of preparing our application.”
The Village’s contacts at State Treasury had advised Jenks and Council that it is illegal for a municipality to hold a festival such as Solstice. Such events must be run by outside organizations. Solstice was initially run by the Elberta Economic Development Corporation, of which Diane Jenks was a member. After council decided to dissolve the EDC, the Parks and Recreation Commission started running the festival. Several members of Parks and Rec, including Bill Soper, had been active in making the festival possible since the very beginning, and having the Commission run it seemed perfectly natural. No one had any idea that there was a law we were breaking. Under the leadership of Jen Wilkins, a P&R member, Solstice had three successful years, during which it raised revenue rather than just breaking even. The Parks and Recreation Commission currently has about $20,000 in its bank account that is Solstice revenue, some of which, up until early spring, the Commission had intended for use funding Solstice.
Early on this year there had been concerns about how Solstice would come together, after the departure of Jen Wilkins from council, Solstice Committee, and Parks & Rec in September. I personally had decided to pull back from involvement in the festival because of increased work obligations. Bill Soper was confident that he could pull it off, but as of the April Parks and Recreation meeting, it seemed clear to me that much work remained to be done. Cathy Anderson, a member of Solstice Committee and Parks and Rec treasurer, and a member of the Budget Finance and Audit Committee, had expressed concerns about there not being a detailed proposal in place for this year’s festival or any kind of organizational time line. She was unable to make it to the April meeting, but had asked that we hold a vote on whether or not to hold Solstice Festival for real. We did not hold that vote.
The Village is still in a crisis-level budget deficit situation—about $600,000 short in its General Fund Balance. And the Deficit Elimination Plan the Village submitted to the State last year has been rejected. The newly elected (2014) council is saddled with the responsibility of coming up with an acceptable DEP plan and developing and maintaining policies and procedures to cure past improprieties. If the Village fails to produce an acceptable plan and level of progress toward tightening the ship, the possibility of Emergency Manager takeover is real.
In all this, transparency and avoiding the appearance of conflict of interest is crucial. But in a tiny community like ours, inevitably, people wear many hats. I, for example, am currently the secretary of the Parks and Recreation Commission. Bill Soper is a council member and a member of the Parks and Recreation Commission. ESF is legally a separate entity from the Village, but Soper is a member of ESF. This means that Soper may want to recuse himself from voting on ESF related Solstice matters both at council and at Parks and Recreation meetings.
This morning I received this message from Diane Jenks:
“The Elberta Solstice Festival Contract will be presented at a meeting at the community building at 401 First Street Elberta Mi. 5:30 Tuesday May 5,2015 It is not a special council meeting. Council, BFA [Budget Finance and Audit] Committee and Parks and Rec are invited to attend. The Contract with Elberta Solstice Foundation will go before Council at the May meeting and by previewing and input from the governing bodies we can make recommendations to council. This is the first time a private party will be renting the whole park and I hope it will be a positive experience for the village….”
On Thursday May 14 at 7, Parks and Rec holds its regular meeting (also in the Community Building), and we will review a proposal by ESF concerning use of Village Solstice materials/equipment/signage, etc., all of which is Village property, and much of it was created by volunteers who want assurance that their work will be used to help the Village. The Commission may well decide to use this as an opportunity to generate some revenue by selling or renting some of the equipment. With Solstice slated for the third weekend in June, it seems awfully late to be sorting this all out, and some feathers are ruffled, to say the least. But making this transition in as orderly a fashion as possible, with respect for the concerns of all the stakeholders, while making it clear to the State that is really is a complete transition, is vitally important. I have nothing against Solstice Fest, and deeply hope it can go on. But if the transition can’t be made smoothly and thoroughly and fairly, I’d rather see it wait till next year.
*Corrections/additions made after the initial posting are in bold type