4.7. SR 11-17-2003 - Laserfiche WebLink

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City TO: FROM: DATE: SUBJECT: MEMORANDUM Mayor and City Council Pat Klaers, City Administrator November 17, 2003 Update on the Bailey House Item 4.7. On July21, 2003 the City Council approved the leasing of the Bailey house to Love Elk River for transitional housing. At this time it appears that the city will not take over ownership of this house in order to lease it to Love Elk River until spring 2004. In order to facilitate Love Elk River's planning for the future, it is appropriate for the cityto determine its lease amount for this property. It is not the intent of the city to make a profit off of the leasing arrangements for transitional housing. The lease amount for the Nord property, which the city owns and leases to Love Elk River (the propertyis just north of the golf course), is $300 per month. It is suggested that the lease amount for the Bailey house be $425 per month. The per month breakdown is as follows: · $50-insurance · $150-taxes · $100-initial repair work (five year payback) · $100-major appliance replacement and floor covering replacement · $25-this allows $300 per year for miscellaneous expenses Please see the attached memo from Phil Hals regarding some of the above noted expenses. There is always some uncertainty in estimating furore repair and maintenance expenses. The finance director has provided the estimate for taxes and insurance. As we are not trying to make a profit off of this leasing arrangement, I think that $425, and at the most $450 per month should be sufficient to meet our needs. Recommendation It is recommended that the City Council establish the lease amount for the Bailey house for the first twelve months at $425 per month and for the second twelve months at $450 per month; with the rental amount beyond the first twenty-four months to be determined at a future date. S:\Council\Pat\2003\BaileyHouseLease.doc