11.3. SR 03-05-2018 - Laserfiche WebLink

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Ice Arena Plan Presented here is one possible solution to Ice Arena situation $12,000,000.00 City issues bonds for the project. This is the amount stated on 2016 referendum material that the city would spend if the referendum failed. There were two other larger numbers listed but this was the lowest number. I have been an advocate of a voter referendum for the $25 million dollar project that we talked about but if we bond for $12 million I don't think we would need the referendum. I think the council would be keeping its word by following up with the $12 million after the referendum failed. We would still need to put the local sales tax question on the November ballot. Proceeds from that sales tax could be used to cover any arena construction cost overages, park improvements and dredging of Lake Orono costs. With the reduction in debt, we may only need a 1/4% sales tax rather than 1/2% but that can be determined before the November vote and after we get the sales tax analysis report from the U of M extension office. If the local sales tax vote does not pass the impact on property tax owners would be about /z of the numbers we have previously talked about. $1,500,000.00 From city's Great River Energy fund and General Fund reserves Some of the Great River Energy funds have been committed to Wayfinding but future annual contributions to that fund should cover most of the Wayfinding costs. Our general fund reserves have always been pretty high. A one time deduction from that fund will be quickly replaced in the next few years if we continue to follow the recent pattern of not using all budgeted dollars. $1,500,000.00 Contribution from Youth Hockey and Figure Skating toward cost of building I am proposing that these two groups pay the city $75,000 annually for 20 years. The amount for each group could be based on number of participants or ice hours rented. This cost would be in addition to the amounts these groups pay for ice rental. My research of recent ice arena projects has shown the following: St. Louis Park -Youth hockey paying $2.2 million over 10 years on recent $11 million arena project Maple Grove -Youth hockey paying $1.2 million over 13 years for West Rink project Lakeville -Youth hockey has been paying $95,000 per year since 2005 to pay off debt on 3 sheet arena Edina -Youth hockey paying $800,000 toward recent ice improvements Luverne-Youth hockey and local business paid $700,000 of $1 million project It is not uncommon for youth hockey to pay capital cost and hourly ice rental. Other youth groups in Elk River are paying capital costs, although obviously in lesser amounts. To be fair their playing facilities don't cost anywhere near what ice arenas do. I know we have had capital costs paid by youth football, youth lacrosse, youth baseball and youth softball. Basically we are charging youth hockey and figure skating 10% of the cost of the improvements. Many Elk River citizens would call that fair. The $1.5 million would be taken from our sewer trunk fund (current balance ii more than $3 million) and reimbursed as yearly payments are made by youth hockey and figure skating. $15,000,000.00 Total project cost