5.3. SR 04-01-1996ity of
iver
Item 5.3.
MEMORANDUM
TO:
FROM:
DATE:
Mayor and City Council
Pat Klaers, City Administrator
April 1, 1996
SUBJECT: Ice Arena Update
As expected, the School Board approved the joint powers agreement which
governs the ownership, operation, and maintenance of the proposed ice arena
facility, and the resolution which approves the ice arena project and
financing at its March 26, 1996, meeting. The city had requested approval of
these documents. Approval of the resolution allows the city to sell general
obligation bonds for the project. Approval of the joint powers agreement
allows the city to obtain the construction materials and supplies for the ice
arena project on a tax exempt basis.
The City Council must approve the joint powers agreement in the same form
as approved by the School Board. Attached is the material that was provided
to the School Board and which they approved. The Board did change Item
#2, and this change is also attached for your review. The city attorney has
not had an opportunity to review this change, but I will be able to talk to him
before Monday's meeting and I should have a clean copy of a joint powers
agreement to present for the City Council's consideration.
The City Council also has to approve a resolution regarding the project and
the financing of the project. The city resolution will be nearly identical to the
attached resolution that the School Board approved, but we will have to
change some of the names and titles. Additionally, the School also changed
Item #2 in this resolution, and this change is identified in the same attached
material that was previously noted. A clean copy of this resolution and
Attachment A will be provided to the City Council for its consideration on
Monday evening after I have had a chance to review this material with the
city attorney.
The finance information for the ice arena project is attached as the exhibit to
the resolution. This is the material that was originally provided in the
13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425
financial feasibility study by Marquette Partners. This information was
updated and amended by the Ice Arena Task Force and these changes were
approved by the City Council. This information was included in the grant
application that the city submitted a few months ago. Hopefully this
information is on the conservative side and that by possibly using GO
bonding, the city can then get $2.1 available for the project. This is the figure
currently being used in the project funding estimate.
On Monday evening, I hope to present the City Council with a clean version
of the joint powers agreement and resolution. The documents will be nearly
identical to the attached material. Consistent with the goals of the Ice Arena
Task Force, staff will be recommending approval of the resolution and joint
powers agreement.
s:XcouncilXicarupd.doc
JOINT POWERS AGREEMENT
GOVERNING TI-IE OWNERSHIP, OPERATION AND MAINTENANCE
OF THE ELK RIVER INDOOR ICE ARENA COMPLEX
THIS AGRF_~MENT, entered i~o this day of ,1996 by and between the CITY
OF ELK PJ'V'ER, a M/anesota municipal corporation (the City) and ELK RIVER INDEPENDENT
SCHOOL DISTRICT NO. 728, a Minnesota public corporation (the Schoo~ District).
WHEREAS, the City, with the cooperation of the Elk River Youth I-lockey Association and the
School District, is proceeding with a project to expand and improve the existing Elk River Indoor Ice
Arena (the Project); and
WHEREAS, the Project includes the construction of a second indoor ice arena to be constructed
adjacent to and integrated with the existing Elk River Indoor Ice Arena; and
WHEREAS, the intent of the Project is that the expanded and improved Indoor Ice Arena
Complex (the Facility) will be used predominately for youth athl~ic activities, including activities
sponsored by the School District; and
Wt-IEREAS, the City and the School Dhtrict have entered into a Real Estate Agreement (the Real
Estate Agreement) pursuant to which the School District is selling property to the City for the Project;
and
WHEREAS. the School District has agreed in the Real Estate Agreement to cooperate in the
Project by entering into a Joim Powers Agreement governing the ownership, operation and maintemmce
of the Facility, as requirexl by Minnesota Statutes, Section 297A.25, Subd.
NOW, THEKEFORE, in consideration of th~ mutual covenants and agreements hereinafter
contained, it is hereby mutually agreed by the City and School District as follows:
1. Ownershit2. Following purchase by ~ City of the Property defined in the Real Estate
Agreement, the School District shall have no ownership of the Facility or the property on which it is
located. The City shall have the right to transfer ownership of the Facility and property on which it is
located to a public or nonprofit entity, subject to approval of the School District its provided in the Real
Estate Agreement.
2. Ooeration and Maintenance. TI:~ $chogl District/shall halve no re~onsibi~ty fi,r the
opera~,n and maintena{tce of the Facility. Thiff operaO6n and rc(fintenan~ o? the faci. lity/~hall be the
responsibility of City/ or such other entitq_Cto wh'Ich the ~ity dele~gates cfm or re(ore of these
respt6nsibilities. .~
3. Ice Rental Contr~.ct. TI~e City, or such other entity as shall be resp~msible for operation
and maintenance of the Facility, simll enter into a Long-term agreement for rental by School District of
ice time in the Facility, at an hourly rate not to exceed the "forecasted hourly rates" set forth in Exhibit A
attached hereto, increased by increases not greater than the greater of five percent or the cost of living
adjustments as determined appropriate by the Consumer Price Index, Minneapolis/St. Paul. The ice time
agreement shall also provide priority scheduling for School District.
IN WITNESS WHEREOF, the parties hereto have executed this Joint Powers Agreement on the
above date.
CITY OF ELK RIVER
By:
Hem'y A. Duitsman, Mayor
And:
Sa~dra A. Thackeray, City Clerk
ELK RIVER INDEPENDENT SCHOOL
DISTRICT NO, 728
By:
Its:
And:
Its:.
EXHIBIT A .'
ELK RIVER ARENA - ICE RENTAL CONTRACT
f ~ g'~- ' -/~' P' G COWZ'RACT# -"~
, a~i~g ~ a agent of
Ca) Tot~.l number ot c~:imatcd hour~ to r~ser~t: C~ ! Rout3.
('Data alld times will ~ finaIiz~ be,,N~,.~ ~t a~ng a~nt ~ ~c E~ ~vcr A~M ~t)
~ ~ ~ing for ~ ~ng (~on) of ~ ~ ~n ~ ~ys an~ ~ls pm~ for
g~ ~ pu~ ~I1 ~ ~c r~ih~ cf ~c 3~g Agent ~ ~c ~ub or Or~go~ ~t ~
or i~ ~ ~agtr.)
199!-96 1996-9~ 1997-9~ 19~-99
?~t ~k S105 ~5 S110 $85 SI15 S90 S120 X95
N~ ~ $I20 S~ /121 $~0 $130 $95
S~1 Ln ~on ~ ~m S~ ~ ~g~ 2:30 pm ~ ~ ~rd ~ ~n p~ m~
Additional ~wicts tad
An Ad~tional $f.00 pc ho~r will
To~ c~l~tiou of do~ owed:
Ho~a)~ ' ~ b) S~ =
PAYMENT SCHEDULE:
(paymtnts one third of total)
NOVI!iIHB ER Is-t:
JANUARY he:
A~'RFL lst:
~ ~g ~ ~ {i~ ~ ~ ~ ~ ~ 14 (f~n)
~r or ~n~g CIu~ or O~ou ~ ~ie ~ r~h~u~
~e a~ Ci~ or Orgu~fion ~li ~ held t~]le for ~t of~c
~i~ cun~,'~,.-~ is rcnu-n~ to thc £ik River
It is ~r understcx~d and
T~ fir~
~c ~n~ ~ent
~ui~d
~~ng
Club or
· e E~ ~er ~'em ~get.
(Club or Organization NamO
Arena: (612) 411~; l $
CONTRACT #: _
CONTI~CT DATE:
RESOLUTION NO. 96-
BOARD OF OOMMI$$:ION~'RS P ' ~ ~ ~ :~::
ELK RIVER INDEPENDENT SCHOOL DISTR'ICT NO. 728
A RESOLUTION APPROVING THE ELK RIVER ICE ARENA EXPANSION
PROJECT AND APPROVING THE FINANCING FOR THE ELK
RIVER ICE ARENA EXPANSION PROJECT
P003
WHEREAS,
the City of Elk River (the City), with &¢ cooperation of the Elk River Youth Hockey
Association, is proceeding with a project to expand and improve the existing Elk River Indoor
Ice Arena (the Project); and
WHEREAS,
WHEREAS,
the Project includes thc construction of a second indoor ice arena to be constructed adjacem
to and integrated with the existing Elk River Indoor Ice Arena; and
the intent of the Project is that the expanded and improved indoor ice arena facility will be
usexl predominately for youth athletic activities, including activities sponsored by Elk River
Independent School District No. 728 (the $chonl District); and
WHEREAS, the City and the School District have entered into a Real Estate Agreement pursuant to which
the School District is selling property to the City for the Project; and
WHEREAS,
the School Distri~ has agreed in the Real Sstate Agreement to cooperate in thc Project by the
adoption of a resolution approving the arena and its financing, as required by Minnesota
Statutes. Section 475.58, $ubd. 3(a)(2).
NOW, THEREFORE, the Board of ~ of Elk River Independent School District No. 728 do resolve as follows:
1. The Board of Con-..m~s[engrs of Elk River Independent School District No. 728 dOeS
hereby approve of the Elk River Indoor lee Arena expansion and improvement project; and
2. The Board/~f Cornmissiffners of Elk Ri~r Indcpen~nt School l~4strict No. 728
hereby approve of the fi~lncing plan, ~*tached as Exhi~t A to this fcsoluti~_[~9_n~ IkFp3_~_~iver Iffdoor
Ice Arena expansion a~d improvem~t project. / -(~c e 4/4~ ct~ ~
This resolution pa.qsed and adopted the 25th day of March, 1996.
ELK RIVER INDEPENDENT SCHOOL DISTRICT
NO. 728
By:_
Its:.
Its:
EXHIBIT A - PAGE 1
REVISED PROPOSAL BY SUB-COlVIMITTEE
OF ~ PROJECTED STATEMENT OF CASH FLOW
FROM THE FEASIBH..ITY STUDY COMPLETED BY MARQUETTE PARTNERS
Thc Sub-committee established from thc EDA meeting has taken thc numbers from thc Feasibility Study presented to thcm
by Marquette Partners and have made revisions where they feel more accurately fits our program here in Elk River. The
committee has also scaled back thc project to be constructed in phases to bring down thc initial cost of thc project
FEASIBILITY ERYHA ARENA SUB-COMMITTEE ADJUSTMENT
STUDY ACTUALS PARTIAL SEASON FULL
NUMBERS FOR BEGIN NOV. 15 SEASON
REVENUES: 1995-96 1993-94 FOR 1995-96 FOR 1996-97
* Ice Rental 318,000 112,755 286,920 338,000
* lSD 728 Ice Rental 27,000 22,152 25,800 27,000
Admissions - 35,000 13,020 .30,000 30,000
* Dry Floor Events 4,000 4,147 6,000 + 6,000 +
* Sign Rental 10,000 6,200 20,000 20,000
Concessions 63,000 29,144 50,000 60,000
Vending Machine 23,000 11,590 18,000 20,000
Skate Sharpening 5,000 2,352 4,000 5,000
Miscellaneous Income 2,000 2,000 2,000 2,000
Total Revenue $487,000 $203,360 $442,720 $508,000
EXPENSES:
Salaries 74,000 47,122 65,000
Benefits 15,000 '2,701 12,000
Repairs &Mtce. 39,000 14,500 25,000
Professional Services 4,000 2,275 4,000
° Utilities 120,000 33,279 60,000
' Insurance 24,000 13,000 20,000
Administrative/Supplies 4,000 2,500 4,000
* Zamboni 7,000 2,404 5,000
Concession Merchandise 38,000 19,862 28,000
Dry Floor Events 1,000 1,450 2,000
Total Expenses: $326,000 $139,093 $225,000
CASH FLOW AVAILABLE
FOR DEBT SERVICE: ['$ 161,000.] $64,267 L $ 217,720 J
76 000
15 000
· . 39 000
4 000
90 000
20 000
4 000
6 000
32 000
2,000
$288,000
L$ 220,000]
Existing Arena Debt-May 1,1995-November 1, 1995.
Revenues: Indoor Soccer Spring & Fall 1996/Spring 1997
.*~= Items we adjusted from the Feasibilit7 Stud~.
ERYHA ACCOUNTS AS OF 2/23195 ....
$ (15,776)
$ 6,000
CHECKING
'SAVINGS
CD MATURES 5/95
CD MATURES 8/95
PULLTABS
PLEDGE CARDS AS OF 2/24195: 3 YEAR PLEDGE
PLEDGED CASH RECEIVED
62,000
26,529
20,000
20,000
47,000
15,105
3,067,
$ 10,000
On 2/27/95 at ERYHA monthly Board meeting the ERYI-IA Board approved the donation of $75,000 cash to thc new Arena
Project available immediately and an additional $25,000 pledge backed by the ERYHA Pulltab Account available upon
request. This money is to be used to further the progress of the Ice Arena project and/or to begin early construction of thc
project if thc Ice Arena Task Team decides it is needed. See attached minutes.
EXHIBIT A - PAGE 2
ELK RIVER ICE ARENA
PROPOSED OPERATING AND MAINTENANCE BUDGET
REVENUES:
Season
1996-1997 1997-1998 ~998-1999
Ice Rental $ 338,000 $ 354,900 $ 372,645
School Dist. 728 Rental 27,000 28,350 29,768
Game & Tournament Admissions 30,000 31,000 31,000
Dry Floor Events 6,000 6,000 6,000
Sign Rental 20,000 20,000 20,000
Concessions 60,000 60,000 60,000
Vending Machine 20,000 20,000 20,000
Skate Sharpening 5,000 5,000 5,000
Miscellaneous Income 2,000 2,000 2,000
TOTAL ... 508,000 527,250 546,413.
EXPENDITURES:
Salaries & Benef'~s 91,000 94,640 98,426
Supplies 4,000 4,500 5,000
Repair & Maintenance 39,000 40,000 41,000
Professional Services 4,000 4,000 4,000
Utilities 90,000 90,000 90,000
Insurance 20,000 21,000 22,000
Zamboni 6,000 6,000 6,000
Merchandise for Resale 32,000 32,000 32,000
Dry Floor Events 2,000 2,001 2,002
TOTAL 288,000 294,141 300,428
EXCESS REVENUES (EXPENDITURES)
AVAILABLE FOR DEBT SERVICE
220,000 233,109 245,985
Estimated annual Debt
$ 190,000 $190,000 $ 190,000
Estimated annual debt assumes issuance of $2,000,000 G O twenty year
bond with an initial interest rote of 6.9%.
Page 1
EXHIBIT A - PAGE 3
REVISED PROPOSAL BY SUB-COMIVIn'TEE
Below is the documentation for the changes we have made to the numbers on the previous page. The first full year of
operation has been delayed until the 1996-96 season. The two years shown is the partial season of 1995-96 where thc
Arena is e~imated to be in operation by November 15, 1995, and the full season e~imates ending IViay 31, 1997.
Assumptions were that the years following would have a similar cost percentage adjusUnents as shown in the Feasibility
study. .
REVENUES:
ICE RENTAL:
The hourly rates to be charged for ice time is as follows:
1995-96 1996-97 1997-98
NON- NON- NON-
PRIME PRIME PRIME PRIME PRI~E PRI~E '
Sept-March: Rink 1 $100 $85 $105 $90 $110 $90
Rink2 $115 $g5 ' $120 $90 5125 $90
April-August: $100 $85 $8'5
School Day Hour~: $ 50 $ 50 $ 50
The Feasibility Study stat.ed a rate orS100 for !995-96 and $105 for 1996-97. This rote will be used for the
present smaller rink but the New Olympic rate will be $115 and $120 for the 1995-96 and 1996-97 seasons. As the
study stated Anoka, being our closes~ ice sales competitor, rate was $115 for 1995-96 for their new sheet. The Elk
River Youth Hockey Board has taken the position in the past several years that we need to charge an hourly ice
rental rate that will cover our building expenses and the above rates help us achieve this goal. We would propose
that the Associations renting large amounts of ice time rent a share of both ice sheets in their contracts. The
average cost to them would then be $107.50 per hour for the 1995-96 season. The Feas~ility study t~s Elk River
School District 72g with a contract of $26,400 in 1994-95 and $27;000 in'1995-96. We took that as a separate
line item because ora change in contract agreement beginning in 1994-95. The contract is now on an hourly basis
at the going rate per hour. The estimate is 240 hours multiplied by the rate of both sheets divided by 2. For they
will be shaming both sheets of ice. The hourly rental agreement with the Elk River School District has allowed the
Ice Arena to sell additional hours, at a lower rate, during the daytime for preschool skating lessons and Elk River .
School gym classes or special events.
The 1995-96 season identified ice ~:ental hours is 2982 hours (2564 prime, 259 non-prime). The red flag
here is that if we cannot guarentee that the facility will be open November 15~ 1995 this will affect the contracts
with St. Michael, Monticello and Osseo. The attached letters show there interest in renting ice from our facitlity.
They need to finalize where they will be practicing and holding games very soon probably sometime in March.
TMs total dollar figure comes to $312,720 of which we deducted the Elk River School District amount of $25,800
because it exist on a separate line. The attached spreadsheet verifies these numbers.
The 1996-97 season we identified the same number of contracts as well as some .luly/August
rental of hours that we are presently working on. Specificly a Diane Ness Power Skating, Puck Handling/Shooting,
Paul Ostby Goalie Clinic~. There is about 400 to 500 miscellaneous hours stated on the attached spreadsheet to
verify these numbers. The total dolhr amount is $364,653 with 3360 hours (2922 prime and 261 non-prime)'
shown. Of this about 400 Hours need to be identified yet. Also there is approximately 40 hours a month during
the prime season available that will most likely be rented. Elk River Youth Hockey will have a much better
estimate of increased hours because of increased number of teams by the fall of 1995. Them is a good chance that
2-3 teams will be added for the season of 1995-96 and probably 1-2 more in the season of 1996-97. The ERYHA
Board has committed in their minutes of 2/27/95 to purchase a minimum 1055 hours for 1995-96 season and
.depending on adding teams an additional 100 hours are possible. The 1996-97 committment was for 1150 hours
with an estimated 1% increase each year..
EXHIBIT A - PAGE 4
ADMISSIONS: The admissions amount was dropped to $30,000 from the Feasibility Study of $35,000. The basic
agreements that exist for ticket sales is the Arena would get a base rate to cover expenses for the hours of the game
and then a 50/50 % split on any ticket sales above this base rate. The base rate does change for the different Ice
Arenas depending on seating capacity.
In 1995-96 the agreement with Elk River High School Boys games which were/V/Varisty games was a
5600 base rate aind a 50/50% split thereafter. The total dollars for Non.-conferance ($600+$'773; Attendee, ag: 850
(Adults 490, Students 338)), Conferance ($4800+$4071.50;At: 5363(Adults 2527,Students268 I)) and Sections
(5600+$615; At:636,A277,S36I) for 1995-96 Season for the boys was $11,460. The Girls IV/Varsity games were ·
as follows: $300 Base rate for a single game or $500 Base rate for a IV/Varsity game together and a 50/50 % split
thereafter. The Girls were not in a conferance this past 1995-96 season so we worked only with the Elk River
School District for an agreement The 5500 base rate for two games will most likely increase.to 5600 for the 1995-
96 season. The revenue from the girls program was $4,100 base rate plus $94.50 split for a total of 54194.50
(Attendance: 1256(Adults 793, .Students 42 I). This totals 515,655 for 1994o95.
The 530,000 is based on the following: Increase in attendance due to the increase in seating capacity from
700 to over 1000, increase in adult ticket prices by 51 (1995o96:4087/2 split=S2043), the addition of St. Michael
and Monticello JV/Varsity Games being held in'the Arenas ($,~800 base for each School), and the conitinued
enthusiasm for the Girls program. This brings the total to $27,300 with no increase in attendence and only a base
rate charge to Monticello and St. Michael. An agreement has not been worked on with these two Schools for there
games which muses a caution flag to go up here unless we can gaurentee that the Arena will be available for there
games very soon (Mid March) they will need to Schedule the games.somewhere else.
DRY FLOOR The Feasibility Study stated the possibility' for additional usage was there for indoor soccer or other
EVENTS: events but excluded them from the Study figures. We did not add indoor soccer in to this total for the
details of purchasing the carpet and setting up a league has not been finalized. The Number is for other Dry Floor
Events which is above 55500 for the 1994-95 season as of 111195. The events presently held are: Circus (May),
Arts & Craft Show ('May), Gun Show (April), Youth Dance (June) and part of the revenue from the ERYHA Golf
Tournament has gone to the building fund in the past.
The committee has concluded ~er talking with the Soccer Board that indoor soccer could bring in
revenues of 512,000 to 518,000 by'charging $45-565 per hour. Some Arenas acutally make more on indoor soccer
than hockey because of the loxver cost of maintenance. Elk River has a growing soccer program. We believe that
the spring of 1996 there will be indoor soccer in the present arena. The money to pay for the expenses will be
obtained from fundraisers, ERY]-.IA Pulltabs, etc. by ERYI-.IA, the Soccer program etc.. An estimate of~,000 for
the Spring of 1996 and 510,000 for Spring of 199'7 is listed on the bottom of the page. This could be increased by
an agressive program with indoor soccer in the fall as well. Anoka started indoor soccer this past year (1994) and
received revenues of about $12,000 the first year. Some of the expense items would be a carpet to be purchased for
the floor with estimated cost of $30,000, and raising and protecting the lights.
SIGN RENTAL: The committee felt with a strong campaign that sign rental could increase by 510,000 in the
new arena. There is a committee within ERYHA that is working on sign rental packages and has started to
contact local and surrounding community businesses for sign rental contracts. The signs will be high quality on 8'
dasher boards around the rink. There is a estimated 42 and 36 possible dasher board signs in the Olympic rink
and the present fink.
ADDITIONAL The additional revenues sve noted on thc bottom of the page includes the soccer program and a
LINE REVENUES: "statement from ERY'HA for donations toward the New Ice Arena Project.
Other types of revenue are fundraising events that youth hockey does every year. The track record for the
past eight years shows an average profit per year of about $15,000. The ERYHA Pulltabs, which is in operation at
Dicks Reveffront Bar, would be another source of revenue. For this to be used it would need to be approved at a
ERYHA Pullmb Gambling Board meeting and the State Gambling Board and a form would need to be filled out by
the City of Elk River. The Pledge Drive for the new Arena is just beginning and ~ accumulated over $15,000 on
3 year pledged committments and $3065 in actual cash as of 2/24/95. There is a Arena Dinner Fundraiser
scheduled for March Ill, 1995 that will raise some more revenue for the Arena. We estimate 515,000 per
year should be available. We realize that this may not be able to be used as revenues in the cash flow estimate but
we wanted to make a note that these will be available for other expenses or improvements. Other additional
income could be special fund-raisers, and pledges from individuals, groups and industry to possibly raise and
additional 550,000 to 575,000 per year. There are approximately 500 kids involved in hockey and skating within
ERYHA and an additional 70-80 boys & girls involved at the High School level.
Note: The bottom of the sheet shows ERYI-IA balances of their accounts as of the date stated.
EXHIBIT A - PAGE 5
REVISED PROPOSAL BY SUB-COMMITTEE
.EXPENSES:
SALARIES: The salary amount we adjusted for 1995-96 season due to the late November 15th start down to $65,000
fi.om the Feasibility Study and increased it by $2,000 to $76,000 for the 1996-97 season.
The present Arena Manager salary is $30,250, part t/me Ice crew is about $ I 1,500 and concession
workers are about $5700 for the past 1994-95 season for a total salary of $47450. For 1995-96 the budget figure of
$65,000 is a good number for the two rinks would only be open for 6 months. 'The 1996-97 increase to $76,000
would increase both Ice crew and concessions workers as w~ll as increase the Arena Manager's Salary. At present
we have one full time Arena Manager and one half time employee during the skating season and other pa~ time
Ice Crew (5-6) and Concession (5-6) workers. ,
BENEFITS: Thc benefits we felt wer~ high but if the City / EDA takes over Operations of the Axenas this would be thc
same as the rest of the city employees. At present the Arena Manager receives a $1000 IRA annually and paid
medical Blue Cross Blue Shield insurance coverage $1700. The Arena Manager also receives mileage at a ~ate of
· $.25 cents per mile which came to about $450 in 1993-94.
REPAIRS Fiscal year ending 1994 & 1995 shows the actual Repairs and Ma/ntenance cost at about $14,500.
& MTCE. We thought the $39,000 was on the high side but left it as is for the full 1996-97 season. Wedid reduce it
for the partial season of 1995-96. We feel some of the expenses could be reduced by using city staff'when needed
for special projects. And to be able to use city owned equipment insteadOf renting it.
UT~n%Es: The utilities we felt were very high. The total for 1993-94 was $33,$00 and the Actual + Budget for
1994-95 season is at about $33,000. The biggest expense for the utility group is the Electric at about $23,500
1993-94 and $24,$00 for' 1994-95. Gas at $7000, Telephone at $1g00 and san/ration at $1,100. The new building
will be bigger and a larger ice sheet but with newer technology should be more efficient also. The Elk River
Municipal Utilities Commission has given this project an Economic Development Rate for a 5 year term. The
estimate for tripling the electric usage with the special rate would put the cost at about $63,000 for the 1995-96
season. Doubling these other expense the total would be about $g2,000. So we feel a conservative estimate of
$90,000 is justified. See Attached.
INSURANCE: Them is a new Insurance Company, Cartier Insurance Agency Duluth, Iv[N that strictly insures Ice
Arenas and the estimate we received from them was $20,000. 1993-94 insurance totaled $13,000 which includes
Property $2560, Liability $3400 + Open Skate $155 + Rollcrblading $250+Dance & Circus $130, Employee
Dishonesty $1 I0, Crime $150, Boiler $1600, Worker Compensation $3200, Accident & Medical $900.
ZAMBONI: Zamboni Maintenance and Fuel for 1993-94 totaled $2404. 1994-95 is estimated at $3,200. We felt the
maintenance was a little on thc high side seeing that in thc 3 previous years we did not total $7,000. But
r~ngnizing that thc Zamboni is aging that an increase to $6,000 in 1996-97 should be adequate.
DRY FLOOR Increased to $2,000. ,
EVENTS:
EXISTING
ARENA
DEBT:
In November 1995 the debt on the existing arena will be paid off. The balance as of May I, 1995 is
about $15,776. The debt is held by three banks, First National Bank of Elk River, Bank of Elk River,
and State Bank of Rogers. The payment is $2,500 principle plus interest which is based on one
percentage above the T-Bill rate, not less than 8%and not more than 10%. The numbers are shown based
on an 8% rate.
PAYMENT
OF PARTIAL
S~ARIZS:
There is a request by the committee members to otEset some of the Salaries by payment from
the City (Park fees) or Park and Recreation Board for improvements. This may only be needed for the
fir~ three year~ or so depending on the bond structure.
Rerision Date: 2."27/95,revfeas3,dpm
Resolution
Paragraph 2 - Amendment
The Board of Directors of the Elk River Independent School District No. 728, as
required by the Real Estate Agreement, has reviewed the City's financing plan, and
to the extent made necessary by the Real Estate Agreement and applicable law,
does hereby approve of that plan (which is attached hereto as Exhibit A). By
providing its approval to the financing plan, the Board does not on its behalf or on
behalf of the School District, accept any responsibilities incidental to the financing
plan. The Board does not intend that it or the District be financially liable to any of
the parties to the plan. By this Resolution, the Board of Directors is simply
acknowledging that the proposed plan appears to be consistent with the law and is
designed to accomplish the goals outlined in the Real Estate Agreement and the
Joint Powers Agreement between the City of Elk River and Elk River Independent
School District No. 72.8 regarding the Elk River in-door ice arena expansion and
improvement project.
Joint Powers Agreement
Paragraph 2 - Amendment
Operation and Maintenance. The School District shall have no responsibility for the
operation or maintenance of the Facility. The operation and maintenance of the
Facility shall be the responsibility of the City, or such other entity to which the City
delegates one or more of these responsibilities. The City and/or its delegates, shall
operate and maintain the facility consistent with the Real Estate Agreement,
applicable law governing the use of property used by public schools and the
purposes for which this Joint Powers Agreement and the Real Estate Agreement are
designed, the public and the public schools' use of the property and improvement
subject to the Elk River Indoor Ice Arena expansion and improvement project.
bd/misc/Ice