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Financial statements paint worrying picture for Exploration Place

Regional district directors to consider loaning $500,000 to museum this Thursday
A worker moves a dinosaur bone that was part of an exhibit near the front entrance of The Exploration Place museum at Lheidi T'enneh Memorial Park.

The society that operates The Exploration Place has provided more detail in support of its quest to secure a $500,000 loan from the Regional District of Fraser-Fort George at the board of directors meeting this Thursday.

According to a backgrounder and audited financial statements in the meeting's agenda package, as of the end of 2023, the Fraser-Fort George Regional Museum Society incurred a net deficit of $417,332 in 2023, and the society's liabilities exceeded assets by $364,609.

The figures "indicate that a material uncertainty exists that may cast significant doubt on the Society’s ability to continue as a going concern," auditors say in the financial statements.

As of the end of the first quarter of 2024, the museum has kept its head above water to the tune of $11,946 in revenue over expenditures, but still some $55,324 lower than targeted.

Moreover, for Q2 this year, operating expenses are expected to exceed revenue by $57,080.

As of the end of March, the Society's line of credit stood at $145,000 and held about $25,000 in bank overdraft, down from $285,000 and $82,858 respectively as of the end of 2023.

Heading into 2024, the museum had budgeted to finish this year $269,078 in the black.

In March 2020 the pandemic forced the museum to close and at that time a $1.4-million renovation was launched with a plan to reopen by early-summer 2022. However, supply-chain issues and labour shortages postponed the re-opening to the end of October 2022.

The delay has "presented operational challenges," regional district staff have said in reports to directors.

At the end of 2023, the FFGRD advanced the Society $250,000 from its 2024 operating grant to assist with cash flow pressures. A further $250,000 was advanced at the end of this past January.

At the time, the directors were advised the funding should be considered an advancement on the 2024 grant until a loan agreement could be considered.

Under the proposed terms, the $500,000 would be paid back over five years with an interest rate of four per cent during the term.

Repayment would begin on January 1, 2025 and be made in 18 quarterly payments of $31,115.44 each and deducted from the Society’s operating grant from the regional district which is paid quarterly.

Interest would add up to $60,077.88 by the time the loan has been paid off on April 1, 2029. Through the Municipal Finance Authority, the regional district is able to borrow money at a favourable interest rate.

In 2023, the gross operating grant from the regional district stood at $843,655, reduced by $113,141 to service a loan held for the land and building in which Exploration Place is situated, leaving $730,514.

The gross grant is forecast to rise to $881,290 in 2024.