06/25/1980 Meeting - Laserfiche WebLink

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. lease payments are deducted from the income the appraisal indicated that income would;be negative $25,000, a minor amount. This indicates a nominal value for e the parcel. Also, the conference center lease terms are fair. Tax increment bonds ;can be used to pay the operating expenses when a deficit occurs. Howard Rankin, bond counsel, agrees with that opinion. It is true that the agency should be sure of the track record of the developer and this developer is putting 25 percent equity into this project. There is no security arrangement, since the $100,000 for the parcel will be paid in cash. The sum of $33,000 has already been paid by the developer for the Hilton franchise. In reply to the question of construction and no standards or criteria being listed on it, there are design criteria for all downtown renewal projects, and the staff feels they will easily comply. In regard to the question of comple- tion and damages resulting from delay, the City is adequately protected. A management agreement has been provided. There was a question that the developers should be required to maintain a certain level of quality of upkeep and they will be held accountable to the same standards that the City follows for the conference center. There is a change in the contract on shared footings. The contract has been changed to read that the City will pay a pro-rated share if a shared footing is used. Provision will be made for up to 425 parking spaces if this can be done within the $2.5-million budget. In regard to use priority, the main conference space will be booked for events generating hotel room counts. That is how the developer was attracted to the project. Booking records will be readily accessible so that the City can determine that proper booking procedures are be i n g f 0 11 owed . At Dick Reynolds. suggestion, there will be electronic recall e of the booking information. As a practical matter, the hotel has the right to book the main conference center for an entire year, but it is on a first-come, first-serve basis. It would not freeze out the City's use unless they had 365 days of confirmed bookings. The City can book the main conference space. There are provisions for annual review. Booking of the main conference space without generating room count has been limited to five days per year. There was concern from the City Attorney that in regard to the main conference space, it was uncertain what "reasonable" room count meant. Mr. Richards stated that the final test would be the financial success of the hotel and arbitration would be employed if necessary. Booking terms are favorably written for the developer, to the extent that the conference center is for private use, and it will be subject to taxation. There is no provision for escalation of the minimum rent through the 55-year period. At the end of the 32nd year, operating expenses will be paid for by the hotel as long as the amount does not go beyond the three percent. There was a quest ion as to whether arbitrat ion shaul d be used to reso lve quest ions such as payment of rent. Mr. Richards feels this is the judgment call. After three years of deferred payment, if they do not start making payments at the end of that time, on 20 days' notice, use of the conference center can be closed to the developer. And finally, assignment standards have been specified by the City. . 6/25/80--6