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8.2sr MFAC Ordinance Powers and DutiesDiscussion Item To Item Number Multipurpose Facility Advisory Commission 8.2 Agenda Section Meeting Date Prepared by Presentation April 22, 2024 Tim Dalton, Facility Superintendent Item Description Reviewed by MFAC Ordinance Powers and Duties Joe Stremcha, Assistant City Administrator Reviewed by Action Requested Staff will present City Council direction regarding facility rental rates and contracts. Background/Discussion At the March 18, 2024, City Council work session, all commission and board ordinances, bylaws, powers and duties, and conflicts of interest were reviewed. Included is a memo from City Attorney Jared Shepherd regarding his findings on conflicts of interest and perceived conflicts of interest within the MFAC. Financial Impact None. Mission/Policy/Goal Appropriately govern in an ever-changing environment. Attachments  8.2 at1 Campbell Knutson Memo 3-18-2024  8.2 at2 2024 MFAC Meeting Dates and Standing Agenda Items Furniture and Things Community Event Center Mission Provide an environment of diverse and inclusive activities with opportunities that contribute to the wellbeing of all by listening to the needs and desires of the greater Elk River community. Respecting our past, serving the present and preparing for tomorrow. Furniture and Things Community Event Center Vision An inclusive and accessible facility, incorporating sustainable practices, while creating opportunities that foster pride in our community with a commitment to quality of life. MEMORANDUM F ROM:J ARED S HEPHERD,C AMPBELL K NUTSON,P.A. D ATE:M ARCH 18, 2024 R E: P OTENTIAL C ONFLICT OF I NTEREST MFAC FACTS In 1996, to help manage the ice rink, the City created an advisory Arena Commission. The commission membership included members of the city council, as well as designated seats for representatives of groups that frequently used the ice rink such as the school district. As the ice rink grew over the years to include new types of facilities, the commission expanded to include designated members representing these new uses, and, in 2020, the City established the Multipurpose Facility Advisory Commission (MFAC) to replace the Arena Commission. Current membership on the MFAC includes designated seats representing facility users, ice uses, the city council, the school district, the senior center, and two at-large members. At the same time as its uses and membership expanded, the MFAC also expanded its duties, which currently include recommendations about use fees and discounted rates. QUESTION PRESENTED Does thescope of the MFAC, with representatives from user groups advising on the fees their own groups will be required to pay, create a likely conflict of interest for Commission Members? ANALYSIS State law prohibits public officers from participating in contracts with the city (such as a rental agreement for using city facilities) if the officer has any personal financial interest. Minn. Stat. § 471.87. Years after creating the MAFC structure, the City also enacted a conflict of interest ordinance that is stricter than statutes. City code § 2-132 aims to protect the “credibility of local government” by prohibiting any financial or business interest in matters city officials and employees oversee in an official capacity. The city code directs employees and officials to be cautious, and to avoid any activity which even “suggests a conflict of interest.” City Code § 2-131 explicitly states that commission members are subject to these requirements The MFAC currently advises on both the base rates and any potential discount rates for use of the City’s facility. MFAC members, however, explicitly represent certain groups that will be responsible for paying those rates. There is clear logic in having facility users—who will be most familiar with the facility and what services are needed—provide input on how best to operate the facility. But their inclusion on a City commission could create the appearance that certain groups have been given the power to set their own terms. This is especially true given the City Council’s more recent directions to have the facility become revenue-neutral. As the facility needs to raise 1 230334v3 more money to cover its operating cost, any discount given to one group will need to be made up by fees paid by others. This at least creates the appearance of a direct conflict over what base rates and discounts the MFAC recommends. RECOMMENDATION We recommend altering the MFAC to remove the user groups. This change will prevent the appearance of a conflict of interest or a conflict, in factor, that is institutionally-created for Commission members User groups should be, of course, still welcome and able to submit suggestions and apply for discounted rates. But this change would clarify that they are doing so on their own behalf as facility users, and that no user group is being given unfair access to the City’s decision-making process. 2 230334v3 Meeting Dates and Standing Agenda Guidelines Multipurpose Facility Advisory Commission 2024  Election of board positions  Re-examine by-laws if needed and review the February 12, 2024 goals and projects recommended and 6:30 p.m. FT Center budgeted for by the City Council  Approve all policies for the facility (Operational/Ice/Turf/Rooms) April 22, 2024  Public annual hearing to receive 6:30 p.m. FT Center community feedback (Originally April 8, 2024. Rescheduled due the County Board of Equalization Meeting)  Review draft capital improvement plan to the city council that includes capital replacements, repairs, and additions. The plan shall project improvements over a June 10, 2024 rolling ten-year period. 6:30 p.m. FT Center  Review preliminary budget - balancing facility revenue and expenses. The budget will include projected revenue, expenses, transfers, and capital improvements.  Review FT Center budget  Review Advertising and naming rights August 12, 2024 revenue from previous year. 6:30 p.m. FT Center  Develop and provide a verbal annual report on October 14, 2024 the outcomes and activities of the facility to city council. 6:30 p.m. FT Center  Approve meeting dates for next year  Review all policies for the facility. (Operational/Ice/Turf/Rooms) December 9, 2024  Review value/mission statement and a 6:30 p.m. FT Center mission statement for the commission amend as needed.