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HomeMy WebLinkAboutSP February 20, 2004 ~ ~ C I T Y o F ~ 3-H>'-f NDOVE 1685 CROSSTOWN BOULEVARD N.W.. ANDOVER. MINNESOTA 55304. (763) 755-5100 FAX (763) 755·8923 . WWW.CI.ANDOVER.MN.US SPECIAL CITY COUNCIL MEETING - FEBRUARY 20,2004 -MINUTES A Special Meeting of the Andover City Council was called to order by Mayor Mike Gamache at 4:06 P.M., Friday, February 20, 2004 at the Andover City Hall, 1685 Crosstown Boulevard NW, Andover, Minnesota. Councilmembers Present: Don Jacobson, Mike Knight, Ken Orttel, Julie Trude Councilmembers Absent: None Also Present: John Erar, City Administrator Jim Dickinson, Finimce Director Tony Howard, Community Center Capital Campaign Frank Kellogg, Community Center Capital Campaign Darren Lazan, Community Center Capital Campaign COMMUNITY CENTER ISSUES Council reviewed various memos relating to the sharing of the concessions, construction costs and fundraising with the YMCA. Councilmember Jacobson asked what amount has been raised through the campaign and where they think they will be in the middle Df March. Tony Howard noted that the amount now is between $675,000 and $700,000. Some of the larger companies such as Medtronic, Ryan Companies and United Properties have been contacted but it is not known what, if anything, they would contribute. Mr. Lazan's group is going to kick off on February 24th at 5:30 pm, Mr. Howard explained that 200 volunteers are needed and on1y 30 have signed on so far. Frank Kellogg stated that the other athletic associations are willing to help also. Councilmember Knight asked what they project as their ultimate figure. Mr. Kellogg stated between 2 and 2.5 million dollars. Councilmember Jacobson stated that the third paragraph of the letter from the YMCA disturbs him where it says "the city agrees to be solely responsible for any resulting negative fmancial impacts to the YMCA and the City." His understanding of the letter is that up to 1.6 million dollars will go to the YMCA and if that amount is not raised the city would be required to make up the difference. Mr. Erar stated that we are not really giving the YMCA any money; we're giving them proceeds as a buy down on their cost. Special City Council Meeting February 20,2004 - Minutes Page 2 Councilmember Jacobson noted that the Memorandum of Understanding says whatever we raise will be split 51/49 and the letter from the YMCA contradicts that. Mr, Erar explained that the resolution says that the YMCA's commitment to the facility is dependent on the fundraising. They don't want to start construction before the fundraising is complete. Councilmember Jacobson understands that the Y is concerned about making their debt service payments. He asked what it would mean for a $200,000 house if we raised 2 million to 2.5 million and gave 1.6 million to the YMCA. Mr. Dickinson noted that the original estimate was $39-$45 and this would change to $50-$56 on a $200,000 house. Mayor Gamache noted that the YMCA would not move ahead with this project if they were doing the fundraising. The Council made the decision that the ice arena would be done in October 2004. Robie Wayne s<rid that they would extend out their fundraising until they meet their goal, Mr. Erar explained that the letter from the YMCA was not a demand but a clarification of their position. It is an issue of affordability for the YMCA. The camp<rign would help buy down their portion of the debt. They need to keep their debt service payments at the level where they can afford to go ahead with the pnject. Councilmember Orttel suggested that the city capture excess revenue from the YMCA if they go over the number of memberships they need. Mr. Erar noted that the YMCA knows they will be paying a full year of debt service in 2005 even though they will not be occupying the building until the middle of the year. Mr. Dickinson explained that the city is looking at the possibility of not using capitalized interest but buying insurance instead. The YMCA's interest payment in 2005 would be $305,000 and the city's would be $315,000. Councilmember Jacobson thought that Mr. Erar should go to the YMCA and get something that we can both agree on before March 16. Mr. Erar stated that the principal argument is that the Y needs to keep their cash flow costs at $500,000 - $575,000. The capital camp<rign should be extended until 2005 prior to opening the rest of the facility. Councilmember Jacobson stated that the YMCA needs to be reminded of what we told our residents regarding the amount that would be on their property taxes. He felt that the city needs to have something in writing by the 16th of March. Mr. Erar noted that the calculations on park dedication fees are going to be approximately $250,000 more than anticipated on Andover Station South and suggested any additional fees go to the facility. - - Special City Council Meeting February 20, 2004 - Minutes Page 3 Mr. Erar was requested to: 1) achieve a balance where the YMCA needs to be. Keeping their payments to $550,000 a year will be the first goal; 2) to extend the campaign until June or July of2005; 3) Based on the level of memberships, if it's above their number would the city be able to share in that revenue stream. Concession Split Mr. Erar explained that the split would be the 51/49 for the concessions. Councilmember Trude suggested that the concessions be a separate agreement. Mr. Erar stated that given the fact that the lease is a legal document it's important to have the 'concessions put in the lease. A part of the lease could read that every 12 months we will re-evaluate the concessions. RLK LETTER RLK has submitted a proposal for traffic engineering services to determine the amount of present and future traffic on Hanson Boulevard due to the development adjacent to the Community Center. Motion by Jacobson, seconded by Trude that we accept the RLK proposal. Vote on motion: Yes - Gamache, Knight, Trude, Jacobson; No - Orttel. Motion carried. Motion by Orttel, seconded by Jacobson to adjourn. Motion carried. Meeting adjourned at 5:36 pm. Respectfully submitted, (}:.L; U ~ Vicki Volk, City Clerk --