News of the Shakopee River Valley Festival dissolving caused a stir this weekend after social media users raised concerns about the final destination of the nonprofit’s remaining funds.
The Shakopee Valley News reported in January that Joy Newgard, the now-dissolved festival’s chair, chose to donate the nonprofit’s remaining $7,900 to a thrift store and youth shelter in Two Harbors, Minn. in honor of her late mother.
“Even tho (sic) I could have blessed a nonprofit in the town I grew up in (Shakopee), I didn’t,” Newgard wrote in a Two Harbors Facebook group in December. “I am giving back to the Two Harbors area in my (mom’s memory).”
When Sandy Doherty, former Derby Days co-chair, read the story about the dissolution and resulting donation, she was struck that the festival’s board didn’t opt to donate the money to another Shakopee organization.
After writing about her frustration and ethical questions on social media and seeing many commenters felt similarly, Doherty decided to submit a formal complaint to the Minnesota Attorney General expressing her concerns.
“If the money was raised for a Shakopee town festival, that money should have either been given back to the donors or at least keep it within the city of Shakopee,” Doherty told the Shakopean. “It doesn’t seem right that she raised money for a town festival and then is giving that to a charity that is out of our area.”
Doherty decided to move forward with a formal complaint so the Attorney General’s Office can ensure the decisions about remaining assets were made appropriately.
When a nonprofit dissolves, its board of directors must approve a plan that includes where remaining assets will be distributed. Roger Menden, one of three board members and festival treasurer, said he suggested the group donate the funds locally, but he was overruled.
“I too was hoping it would stay in town,” Menden said.
Menden suggested giving to the Shakopee Chamber of Commerce, but that idea was “shot down” because of apparent legalities with entity types. Belle Plaine’s BBQ Days celebration was also an option, but “for some reason it couldn’t go there either.”
The discussions about where to send the money took place over email, Menden said, and he never attended an in-person board meeting. Ultimately, the final decision landed on Newgard.
“Everything was done legally, it just should have stayed in town, and I 100% agree with that,” Menden said.
Newgard maintains that her choice was ethical and that people should be happy the money will help people in need.
In a Shakopee Cares public Facebook post on Sunday night that has since been deleted, Newgard expressed anger with community members who questioned the ethics of the donation but weren’t willing to volunteer for the festival when she tried to get it off the ground a few years ago.
She also suggested that because some of the funds were donated by businesses outside of Shakopee, there’s no obligation to keep the money local.
“VERY LITTLE of the funds raised ‘VIA ME’ came from Shakopee or even Scott County businesses,” Newgard wrote.
The Shakopean did not obtain a comprehensive list of donors for the festival’s two years in operation, but photos of sponsorship banners indicate the following businesses and organizations supported the festival in 2018:
- Cub Foods Shakopee
- Shakopee Mdewakanton Sioux Community
- Collective Enterprises
- River Rock Dental
- South Metro Federal Credit Union
- R. Menden Accounting & Tax Service
- Riverfront Printing
- Bituminous Roadways
- Lano Equipment
- Automotive Repair Center
- Lions Tap
- Ames Construction
- Burnsville SpeedPro Imaging
- Dairy Queen
When contacted by the Shakopean, Newgard again expressed anger with the community, at times shouting and cursing.
“The general public didn’t want the festival. It ran for two years and we struggled. Barely anybody came,” she said. “I didn’t get hardly any in-kind donations because everyone was giving to Rhythm on the Rails. I don’t need to be approved by the local public that didn’t want this festival.”
Newgard said she wanted to donate the remaining $7,900 to another town festival, but she couldn’t find one that qualified as a 501(c)3 nonprofit. When asked if she had considered distributing the funds to the Shakopee Diversity Alliance International Festival, Newgard said she had never heard of it but wouldn’t have been against the idea.
“I don’t even know what that is. I don’t know if it’s still running. This was all put on my back. I wouldn’t have been against doing that, but my mom passed away,” she said. “I was up against a wall here trying to get this done.”
Newgard said she stands by her decision and doesn’t need to explain herself further.
“I was getting pressured to get this dissolved and get this money moved and, you know what, I don’t have to explain anything to anybody. The state of Minnesota already approved it,” she said. “Only God can judge me in the end.”