6.7. SR 03-11-1996ITEM 6.7.
',ty of
MEMORANDUM
TO:
FROM:
DATE:
Mayor & City Council
Pat Klaers, City Ad~s~rator
March 11, 1996
SUBJECT: Ice Arena Project Update
At the 2/19/96 City Council meeting, an update was provided to the City
Council on the Ice Arena project. At this 2/19/96 meeting, the Council
authorized the architects moving forward with the construction documents.
Additionally, the Council authorized some city contributions to the project.
These contributions are in addition to the $50,000 commitment that the City
Council made on December 11, 1995, in conjunction with the Mighty Ducks
grant application. This $50,000 contribution was identified as a last resort
funding, but the Council should assume that this contribution will be needed.
The Council will need to discuss the source of these funds at a later date,
assuming that the project moves forward and construction bids are awarded.
Attached for your review is a project delivery schedule as prepared by RSP
Architects. This delivery schedule highlights that bids will be presented to
the City Council on April 15, 1996. In order to accomplish this schedule, the
notice to go out for bids needs to take place around March 20. This allows
the notice to be published three weeks prior to the bids being due. It is
scheduled that the bids will be received on April 11, 1996.
Nothing has changed financially with this project since 2/19/96 and the
3//6/96 Star News article is accurate. The city feels comfortable that there is
at least $2.35 million available for this project. We hope that the bid for the
project will be about $2.5 million when taking into consideration all the
volunteer labor and contributions from local professionals in the construction
trade. The general feeling of the Task Force is that we will never know ff a
project can happen unless we actually go out and get bids for the project. We
know that ff bids are not favorable, and that ff they end up in the $2.6-$2.7
million bid range, then we are going to have a very difficult time moving
forward with this project. Even ffthe bids come in at the $2.5 million range,
there is still a gap between this amount and the available revenues, and both
the city and youth hockey may have to step forward with more funding in
order to have this project work.
13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425
Some additional information regarding this project includes the fact that the
city will be going to the School Board on March 26, 1996, with a request for
the School Board to approve a joint powers agreement and a resolution in
support of this project. These approvals by the School Board are necessary in
order for the city to avoid paying sales tax on the materials for the project
and in order for the city to go out for general obligation bonds for this project
rather than bonds that may have a higher rate (i.e., revenue bonds or direct
negotiations with the bank).
At this time the City Council is requested to approve going out for bids for
the Ice Arena project.
s:\council\icearup .doc