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HomeMy WebLinkAbout1997-10-20 Finance Committee Minutes FINANCE COMMITTEE MEETING MINUTES OCTOBER 20, 1997 • Councilors Attending: Don Soucy, David Leen, Joe Baldacci, Jim Tyler, Pat Blanchette, Tim Woodcock Staff Attending: Edward Barrett, Ron Heller, Mike Dyer, Erik Stumpfel, Rod McKay Others Attending: Channel 5, Roxanne Saucier, Arvilla Vercelles, Mr. and Mrs. Day, Fred Vardamis Meeting convened at 5:00 pm 1. Executive Session - Poverty Abatement Donna Hightower, 64 Elm St., RE#54982. The abatement of 1998 taxes was denied. The Committee recommended that Mrs. Hightower enter into a payment arrangement with the City. 2. Bids: • a. Roof Replacement - Civic Center(Bass Park Complex) Roof Systems of Maine in Bangor($156,480.00) There were 6 bidders. The low bidder was Roof Systems of Maine in Bangor. The bid was within the budgeted amount. Recommendation is to award to the low bidder. This has to go to Council because it is in excess of$100,000.00. Committee recommended forwarding to Council. 3. Order Authorizing the Issuance of up to $2,000.000 Aggregate Principal Amount of General Obligation Bonds andiorNotes iitAntioi.pati_on Thereof and a Tax Levy Therefor This bond order, if approved, would authorize bonds for the construction of a multi- purpose stadium contingent upon three things happening: 1. By February 1, 1998, sufficient funds in addition to the proceeds of the bonds be committed to pay for the project cost. 2. By May 1, 1998, these additional funds be available and held in escrow. 3. Prior to issuance, an agreement satisfactory to City Council be entered into • between the City and the Bangor Blue Ox regarding the use of the facility. This will be on the Council Agenda on Monday, October 27, along with a Public Hearing. Questions Regarding the Proposed Multi-purpose Stadium Royce Day asked what is the need for the bond prior to having the first amount of money i that has been promised? Councilor Tyler explained that the City is looking for private donations and that a private donor is not likely to come forward and donate unless good faith is shown by the City. Fred Vardamis asked why the City has to show good faith and why didn't the City ask the Blue Ox to come up with 10% of what the project is going to cost? Councilor Tyler commented that the conditions in the order are the requirements that the Blue Ox show that good faith. The City will not be soliciting private funds. If the order is passed, the City will, in good faith, contribute 52,000,000, if and only if, there is a viable ball club willing to enter into an agreement and if they have enough money. If these conditions are not met, then the offer is withdrawn in its entirety because the conditions will not have been met. How can they be held in a contract for 20 years? If they go through bankruptcy, they can dissolve everything. City Solicitor, Erik Stumpfel explained that the terms of the agreement still remain to be negotiated. Hit's a 5, 10 or 20 year lease, whatever the rent is, one of the requirements you can negotiate in your lease is the requirement that they have a surety bond to guarantee a certain amount of income coming in even if they leave. This has not been decided yet. • If they go through bankruptcy, how do you collect? Erik explained that if you required a surety bond, that would be guaranteed by someone other than the Blue Ox and it would be unaffected by a bankruptcy. Finance Director, Ron Heller also explained that there are three triggers in the bond order. One is February 1st for the commitment and one is May 1st for the actual money in the bank. The third is an agreement satisfactory to the City Council, negotiated and in place prior to issuing the bonds. Does the Blue Ox have any money to put into this? A lot of other stadiums that have been quoted at the meetings are stadiums that were built by organizations and the Cities are not getting involved with these stadiums. Why is Bangor getting involved? At this point, it is not known if the Blue Ox have money to put into this stadium. Councilor Tyler does not feel that Cities not getting involved with stadiums is an accurate statement. According to the information given to the Committee, there may have been significant private funds put toward some of them, but many of them have not been paid for in their entirety by private funds. Edward Barrett explained that one of the options you have for potentially raising money is to sell naming rights. Erik pointed out that there is not clear guidance on this issue with regard to Bass Park. Councilor Baldacci understood that information received to be that there was only one in this • league that was actually privately owned, the rest were publicly financed. Councilor Blanchette asked Mr. Vardamis if the stadium in Michigan was erected on municipal owned property or privately owned property. Mr. Vardamis did not know at this time. Pat feels that one of the problems with putting a stadium at Bass Park is that the Bass Estate left the property to the City of Bantor to be used as a recreational area and the Cit can not sell it. It is unlikel that a lar•e