5.6. SR 06-03-1996ITEM 5.6.
~ity of
River
FROM:
DATE:
SUBJECT:
MEMORANDUM
Mayor & City Council
Lori Johnson, Asst. City Administrator
June 3, 1996
Public Hearing on Issuance of General
Obligation Ice Arena Bonds
Prior to the issuance of general obligation bonds for the ice arena project, the
city is required to publish notice of and hold a public hearing on the issuance
of such debt.
The city is anticipating issuing approximately $2,100,000 of general
obligation debt to finance the ice arena expansion. Based on the feasibility
study prepared by Marquette Partners and information supplied by the Elk
River Youth Hockey Association, it has been determined that approximately
$200,000 to $215,000 will be available annually to meet debt obligations. A
Project Budget and an Operating and Maintenance Budget are attached.
Additional information regarding the structure of the issue and the
anticipated interest rate will be available for discussion on Monday evening.
Action Requested
The Council must open the public hearing to take comment on the issuance of
general obligation debt for the ice arena expansion. There are no specific
items which need to be addressed during the public hearing and no resolution
needs to be approved at this time. Later in June a resolution or resolutions
authorizing the issuance, setting the terms and awarding the sale will be
presented to the Council for approval. Again, no action is required at the
public hearing other than to discuss the issue and take public comment.
council:icego
13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · (612) 441q7420 · Fax: (612) 441-7425
Elk River Ice Arena
Project Budget
May 6, 1996
Project Costs
Construction
Construction Contract
Parking Lot & Lights
Used Ice Equipment
Alternate Change for Used Ice Equip.
Subtotal Contruction
Construction Contingency
Soft Costs
Bond Issuance (Bond Counsel)
I.C.E. (Ice Consultant)
RSP Architects
Mortenson (Construction Manager)
Builders Risk Insurance
Legal
Engineering
Building Permit Surcharge
Soil Tests
Independent Testing Agency
Marquette Study
Miscellaneous
Other Project Costs (Contributed)
Loop Water Line (Water Fund)
Sewer Line (Sewer Fund)
Water Access Charge (Water Fund)
Sewer Access Charge (Sewer Fund)
Locker Room Accessories (ERYH)
Landscaping (ERYH)
Concession Equipment & Millwork (ERYH)
Scoreboards (ERYH)
Paint & Labor (ERYH)
Exterior Signage (ERYH)
Goals & Nets (ERYH)
Hockey Equipment (ERYH)
Rubber Floor (ERYH)
Overhead Doors (The Garage Door Store)
TOTAL PROJECT BUDGET
$ 2,121,706
37,320
66,200
619
2,225,845
106,305
15,000
27,500
125,000
112,000
5,000
10,000
1,000
500
2,750
7,100
11,000
1.000
2,650,000
Pr~e~ Revenues
G.O. Bond Issue
Mighty Ducks Grant
City Matching Grant (Plastics)
ERYH Matching Grant (Plastics)
Rogers Plastics Foundation Grant
ERYH
City Contribution*
TOTAL PROJECT REVENUES
$ 2,100,000
250,000
50,000
50,000
50,000
100,000
50.000
*To be repaid by contributions from ERYH over the next five years.
ESTIMATED ELK RIVER ICE ARENA OPERATING AND MAINTENANCE BUDGET
BUDGET YEAR
1996-1997' 1997-1998 1998-1999
Revenues
Ice Rental $ 295,970 $ 337,115 $ 348,914
lSD 728 Ice Rental 27,600 27,600 28,000
Admissions 25,000 30,000 30,000
Sign Rental 15,000 20,000 20,000
Dry Floor Events 6,000 6,000 6,000
Concession Rent 20,000 20,400 21,000
Vending Machine 18,000 20,000 20,000
Skate Sharpening 3,500 5,000 5,000
Miscellaneous 1.500 1.500 1.500
Total Revenues 412,570 467,615 480,414
Expenditures
Salaries 65,000 69,400 72,870
Benefits 12,000 15,000 15,750
Maintenance & Repair 25,000 39,000 40,950
Zamboni Op. & Maint. 5,000 6,000 6,300
Professional Services 4,000 4,000 4,200
Utilities 60,000 90,000 94,500
Insurance 20,000 20,000 21,000
Supplies 4,000 4,000 4,200
Dry Floor Events 1.500 2.000 2.100
Total Expenditures 196,500 249,400 261,870
Available for Debt Service $ 216,070 $ 218,215 $
*Partial year beginning December 1, 1996, ending May 31, 1997.
218,544
This operating budget is based on projections from the Elk River Youth
Hockey Association (ERYH), Marquette Partners (an independent consulting
firm) and the Ice Arena Task Force. ERYH supplied information to Marquette
Partners for a Ice Arena Expansion Feasibility Study which was completed in
April, 1994. After reviewing the document, the Task Force made adjustments
to the projections. The adjusted projections are presented above. Changes in
ice rental, admissions, and sign rental revenues could substantially change the
amount available for debt service. Commitment letters have been received
for part of the Ice Rental revenue, but rental agreements have not been signed.
The above projections are based on a June 1 to May 31 fiscal year. When City
operation of the arenas begins, the fiscal year will be January 1 to December
31.
5/7/96