LAKE DELTON — They will gather here in a few weeks to celebrate the rebirth of this village’s namesake lake.

The governor will attend, boats will parade and thousands of small walleye will be released into their new aquatic home during the event on June 9.

But the gathering comes at a price.

Many of the businesses that rim the 267-acre man-made Lake Delton will be paying for last summer’s mess for years to come.

They have refinanced and taken on second mortgages. And while hope and water have returned to the iconic tourist hub, some are still waiting for bookings to return to levels seen prior to the lake draining into the nearby Wisconsin River.

“We don’t know what’s going to happen,” said Chris Allessi. He and his wife, Linda, own the Sandrift Resort on the lake’s northwest shore. “That’s the question.”

More than 9.2 inches of rain fell June 7 and 8, causing widespread flooding, raising the lake’s water level. Lakeside businesses and homeowners had been sandbagging to keep the water away from property, but on June 9 the land beneath Highway A on the lake’s north side gave way, draining the lake into the river and destroying five homes.

The state and village combined to spend $6.1 million to repair the breach, rebuild Highway A and modify the dam so it can handle more water. Debris also was removed from the lake bottom and a boat landing was improved.

The Allessis saw revenues plummet last year by almost $100,000 at their 13-room resort, one of the smallest on the lake. Some of their former guests have started new vacation traditions elsewhere while a lack of fish means a group that typically rents the whole resort in September might not be back for a few years until the fish are bigger.

The Allessis applied, but were turned down, for loans from the U.S. Small Business Administration and a loan from Sauk County before taking out a second mortgage with a bank.

“I applied for everything,” Linda Allessi said. “They had me jumping through hoops.”

At the 29-room Delton Oaks Resort, on the northwest side of the lake, Kate and Bill Pettit worked with their bank to avoid a second mortgage. They were allowed to delay their debt payments between August 2008 and August 2009, with one large payment due later this summer. They will return to monthly payments in September.

“I’m not concerned with being able to make that (lump-sum) payment,” Kate Pettit said. “It’s a long winter. We have to make enough this summer to get us through next May. It’s the winter that worries me.”

On the opposite side of the lake at Baker’s Sunset Bay Resort, revenue last year was down 40 percent, forcing co-owner Dawn Baker to refinance the 74-room property owned by her family for the last 28 years.

But things are looking up. Reservations are on the rise when compared with last year, the lobby is getting a makeover and the outdoor pool is being refurbished.

Baker continued to hold nightly campfires on the beach last summer, but this year there will be water to reflect the moon’s glow.

“It looks really good,” Baker said of the lake. “So many things happened last year that I don’t foresee happening this year.”
That included $4-a-gallon gasoline and the plunging economy.

Local tourism officials also are trumpeting the lake’s return and say that despite the challenges of last summer, overall tourism spending for the Wisconsin Dells area increased in 2008 by 3.9 percent to almost $1.1 billion when compared with 2007. Spending in June, July and August rose 3.3 percent when compared with 2007 to more than $510 million, according to a new report. The drained lake only affected a small percentage of the businesses in the area, said Romy Snyder, executive director of the Wisconsin Dells Visitors & Convention Bureau.

“We’re a small community that comes together during good times and bad,” Snyder said.

Kathy and Steve Zowin, who started Lake Delton Watersports in 1978, lost hundreds of thousands of dollars in revenues with no water for their watercraft rentals and parasailing rides. The couple used a $460,000 low-interest SBA loan and a $20,000 interest-free loan from Sauk County to pay off higher-interest debt. They will make payments of more than $3,700 a month for the next 15 years to pay off the SBA loan.

“It’s an irretrievable loss,” Steve Zowin said of the lost revenue. “You can’t make it up, ever. It’s just gone.”

The silver lining, however, is an expanded business.

To generate revenue last year, the Zowins began renting watercraft at Shipwreck Bay Bar & Restaurant on Castle Rock Lake near Mauston, something that will continue. They also will start a water-taxi business on Lake Delton this year, hoping there will be more interest in the lake following last year’s disaster.

Kathy Zowin smiled as she skippered a pontoon boat last week for the first time since the lake was refilled. A row boat, kayak and one of the Original Wisconsin Ducks shared the water.

“It feels normal,” Zowin said. “We need lots of sunshine this year.”