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Oilers face tough decisions

Summer collegiate baseball team addressing financial shortfall

Posted: August 14, 2014 - 8:34pm

The Peninsula Oilers board of directors and concerned community members are set to begin a major fundraising push that will determine not only the fate of the 2015 season, but the future of the organization itself.

Wednesday night at Coral Seymour Memorial Park, a perfectly cut and lush field looked more than ready to take on a 42nd season of Oilers baseball, a pursuit of a fourth National Baseball Congress World Series title and an attempt to add to the 118 major league alumni listed on the grandstand.

Inside the clubhouse, though, the scene was less idyllic.

A meeting of the Oilers fundraising committee, open to the public, drew about 15 people seeking to battle the serious short-term and long-term financial problems faced by the organization.

After the meeting, Michael Tice, president of the board, was asked if desperate is the right word to characterize the Oilers at this point.

In the meeting, Tice said the Oilers need to raise about $170,000 to get through next season.

“We are desperate to get by at this point,” Tice said. “I’m desperate.”

In the meeting, Tice said the Oilers have the money to issue general manager James Clark, the lone full-time employee of the organization, his next paycheck, but not the one after that.

After the meeting, Tice said the Oilers are already about $66,000 in the red for their current fiscal year, which started on Oct. 1, 2013, and runs through Sept. 30. Tice said it costs the Oilers $9,000 to $15,000 monthly to operate out of season.

In a Monday interview, Tice, who has been on the board for 10 years and president for the last three, gave a history of the Oilers finances that led to the current plight.

The biggest factor has been the decline of gaming revenue from bingo and pull-tabs.

Tice said the days are gone when the Oilers could count on gaming revenue to cover the budget. He said that revenue has declined by 75 percent or more since 2004.

In the first 10 years of this century and before, the Oilers were able to augment gaming money with ballpark advertising and fundraising to become one of the most recognized collegiate summer baseball teams in the country, even while balancing budgets, running surpluses and having extra funds to donate to other community causes.

The Oilers won NBC titles in 1977, 1993 and 1994, with those three titles placing them in a tie for fifth on the all-time list. The Oilers also are tied for fourth in finals appearances with six.

The Oilers’ last finals appearance came in 2011, when they lost to the Santa Barbara (California) Foresters. The Oilers have not been back to the NBC since.

Tice said going to Wichita, Kansas, for the NBC costs between $30,000 and $45,000 and is too expensive for the organization at this point.

“It used to be we would talk about whether we had enough money to go to Wichita, not about whether we had the cash flow to have a season next year,” said Kenneth Cole, board vice president, after Wednesday’s meeting.

The NBC tournament is a good example of a second factor Tice cited in the Oilers declining long-term financial health — overspending.

“We went through a stage of overspending, and with overspending and gaming declining, the two had to come to a head at some point,” he said.

Tice said items like Wichita trips and a new sprinkler system for the ballpark were not reckless spending. They were valuable items consistent with the mission of the Oilers.

“Hindsight is always 20-20, and looking back at it from where we are now, those were things we couldn’t necessarily afford at the time,” he said.

Tice said the declining financial health was brought into sharp focus in 2010.

“We had some issues with a former employee that put us into financial trouble,” he said.

Tice said the matter was settled out of court, and he cannot name the former employee or give more details of the situation due to a nondisclosure agreement that was part of the settlement.

By 2012, when Tice became president and Clark the GM, the Oilers finances were such that the club had to borrow $150,000 by remortgaging the bingo hall the club owns in Old Town Kenai.

“That was about a third of the value of the building and that was a very difficult thing for the Oilers to do,” Tice said. “It took them 20 years to pay off that building and be free and clear of the mortgage, and then they had that mortgage again.”

Taking such a drastic step meant any and all expenses were under scrutiny.

“For three years, every year, I’ve cut everything I can, then next year I find even more to cut,” Clark said after Wednesday’s meeting. “I don’t want people to think the Oilers are reckless in their spending.

“Every year, I’m scrimping as much as I can and doing only what it takes to play baseball.”

Tice said the loan covered the budget shortfall in 2012. In 2013, the loan and the settlement from the former employee covered the shortfall.

For 2014, the Oilers had to replace the roof on the bingo hall to the tune of $40,000 and cover another shortfall, so another loan of $70,000 was taken out. Before the season, the roof blew off the grandstand at Seymour Park, but there is no money to fix that.

Clark said he has increased sponsorship money each year to the point where there is no additional space on the outfield wall for advertisements.

The GM said cost-cutting and increased sponsorship simply haven’t been enough to make up for declining gaming revenue and the increased cost of putting on a baseball season.

Tice said the cost of the baseball season for 2014 was $171,000, a number that has been rising due to increasing cost of airline tickets, supplies and maintenance for the field.

This past season, the Oilers charged players fees for the first time. And after letting their field and building maintenance employee go, Clark assumed those duties in addition to his GM duties.

Tice even said the club cut the limit on its credit card in half to further make sure all spending is necessary.

The Oilers also sold the condo where coaches would stay during the summer prior to the 2014 season, so Clark housed the coaches and lent the coaches his personal vehicle.

“As far as I can tell, we’ve cut everything there is to cut,” Tice said.

That financial plight is what spurred the meeting Wednesday. Unless the Oilers can raise money fast, the organization is faced with a series of bad and worse choices.

At the top of that list is the decision about whether to keep Clark and the decision about whether to take out another loan.

In Monday’s interview, Tice said the decision on whether or not to keep Clark is tough because Clark has more than pulled his weight and has been a financial plus to the organization. Losing him would mean the board members would have to pick up a ton of volunteer tasks.

At the same time, Tice said the organization currently doesn’t have the money to keep paying Clark, unless another loan is taken out.

“You’re shooting yourself in the foot no matter what,” he said. “It’s the old saying, ‘Do it with volunteers and you get what you pay for.’”

At the same time, Tice said after Wednesday’s meeting he is not in favor of taking out another loan from the bank.

“If we would have another emergency like we did with the roof, we would have nothing to fall back on,” he said.

Tice said he is optimistic about the Peninsula Pucks and Balls Fundraiser, which is being put together by Kassik’s Kenai Brew Stop in October to benefit the Oilers and the Kenai Peninsula Brown Bears. The Oilers will also do the Gusher fundraiser in February.

But it is going to take more than that.

The plan Wednesday was for everybody in attendance to write down possible donors on a sheet and get that sheet to Clark.

Clark would then contact the donors, with the assistance of the board member or community member if necessary.

Tice and Clark also said community members or businesses wanting to help don’t have to wait to be contacted. They can contact the Oilers on the web at oilersbaseball.com or via phone at 283-7133.

There will be another meeting on Aug. 27 where the future of the Oilers should be a lot clearer.

“It’s going to be a make or break two weeks,” Cole said after the meeting.

There were a lot of mea culpas from the board members Wednesday about talking about fundraising ideas in the past and not following through.

Tice made it clear that another two weeks of talk and no action would jeopardize the organization.

Cole said at the beginning of the meeting that the time is quickly approaching for the Oilers to get coaches and players for the upcoming season, and to get on the Alaska Baseball League schedule.

“All the great intentions in the world will not get us a season,” Tice said. “We have to go full bore at this and get this done.”

Dan Gensel, board member and radio voice of the Oilers, said the question that will be answered is how much the Oilers matter to the community.

“We need to find out if baseball is still a viable entertainment venue for the Kenai Peninsula,” Gensel said. “We may be trying to save something that no one else wants saved. I hate to say it.”

The question is how many people like Tice remain. He moved to the Peninsula in 1999 and was drawn to the Oilers as an entertainment option for his wife and two young kids.

As he learned more about the Oilers, how they gave scholarships to area high school students, furthered the careers of area players like future major leaguer Chris Mabeus and conducted baseball clinics across the Peninsula, Tice got more involved by hosting players and joining the board.

“We can do this, I know we can do this,” Tice said during the meeting Wednesday. “I’m not trying to be negative.

“We just can’t afford to all come back to the same meeting a few weeks from now and talk about what we’re going to do. We need to be doing things.”

Reach Jeff Helminiak at jeff.helminiak@peninsulaclarion.com.

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