Loading...
HomeMy WebLinkAbout2009-12-03 Business and Economic Development Committee Minutes ' ' � SPECIAL COMMITTEE ON ARENA IMPLEMENTATION DECEMBER 3, 2009 Minutes �' Attendees: Hawes, Paimer, Bronson, Blanchette, Stone, Gratwick, Wheeler, Silver, Higgins, � Jonason, Baldacci, B. Nickerson, Osborne, N. Nickerson, Dyer, Tripp, Martin, Speronis, Ryder, Barrett, Cyr, Diamond, Brown, Ring, Nealley (Crowley absent due to flu) � 1. Review and Discussion of Additional Information to be Included in Final Draft of Findings of Marketing and Facility Report � At the last Special Committee meeting, Barrett noted there was much discussion about the recommendations of the report and the Special Committee asked for additional information. Staff returned to the consultants who in turn updated portions of the report. Copies were � provided via e-mail during the prior week. Foilowing the last session of the Special Committee, staff put together what it felt was a set of , recommendations that the Committee could consider and what staff (Barrett, Cyr, Dyer) determined best represented and consolidated what was discussed at the last meeting. � As additional background, Barrett said that the Special Committee sunsets at the end of Z009. Procedurally, should the recommendations be finalized, the recommendations would then go to � fuil Council most likely in the form of a Council Workshop. The final report of the consultants would need to be put into a single consolidated copy. Based on the Council's action, there would be some sort of a formal action at a City Council meeting. The Council will process the � Special Committee's recommendation and determine how to proceed from that point. ' 2. Review of Draft Committee Recommendation Hawes asked Silver to read through each of the Special Committee's recommendations to be � followed by comments following each. ' Recommendation i. Silver said the first recommendation reads that the Council accept and adopt the ERA/AECOM recommendations on the size of the new proposed new arena and meeting facility. There has been considerable confusion as � to the actual size of the new arena with many interpreting the recommendation for 5,400 fixed seats as indicating the new facility would be smaller than the current auditorium. The actual recommendation calls for a facility that will seat 6,300 for ■ basketball, 7,000 for concerts, and 7,400 for small stage events. A facility of this �` size with additional telescopic seating for basketball and floor seating for concerts and other events will meet Bangor's current and projected future needs. ' � , , A motion was made and seconded to accept recommendation number one. Dyer noted that in � the last sentence "with additional telescopic seating for basketball" strike the word �al. Hawes clarified that it is 5,400 seats plus the telescopic. Recommendation 2. The Special Committee is recommending that the City Council � also accept the proposed two-phase approach to the project with phase one � addressing the new arena and phase two addressing the expanded and renovated meeting space. Given financial realities, it may be necessary to advance this project in phases. There was unanimous agreement among Special Committee members � that the most pressing and immediate need is to repiace the auditorium. At the same time, there is strong recognition that expanded and renovated meeting space can and should be a major addition to our economy by attracting meetings and � conventions to Bangor. Diamond noted that the recornmendation is not that the City has to wait until phase one is � completed before moving forward but explicitly state that moving forward as quickly as possible can be concurrent/overlapping efForts. Hawes noted that item 3 does address Diamond's concern. Responding to Osborne, new General Manager of Hollywood Slots, Barrett said that , phase one calis for replacing the auditorium with a new arena. Included would be an overhead walkway to Holiywood Slots and an overhead walkway over Dutton Street. It also inciuded � putting in ice equipment that are necessary at time of construction to allow ice to be added later. Barrett said most of the proposed dates are outside of the window of what the Special Committee would feel comfortable with. The earliest date suggested is 2018. The hope of the � Committee is that phase one may be less than the $57M. If so, it allows the potential for speeding up phase two to an earlier date. There is also a potential for seeking other funding sources, which would move the phase two date to be moved forward. The variable is the cost of � phase one and if it will come in closer to $50M. Silver suggested looking at recommendation two and three separately. ' ' A motion was made and seconded to go forward�vith Recommendation 2 Recommendation 3: Silver said that this recommendation three reads briefly that � the Arena Committee urge the Council to move as quickly as is financially feasible to implement the phase two project. , Diamond suggested that the following be added after the language referencing the phase two , project: (,) regardless of the status of completion of phase one. Responding to Wheeler, Diamond said it is possible that phase one might be in the process of completion when financing is secured to the point where it may be possible to start phase two while completing phase one. Wheeler questioned use of the word "regardless." Barrett suggested: (,) including, � if at all possible, beginning phase two prior to the completion of phase one. He noted that for operationai needs the overlap could only be in the design element. Wheeler again said that he � doesn't disagree with the principle but he suggested using the phrase"if financially feasible." Hawes noted that the phase was included in the first part. � , ' � All were in agreement with recommendation 3 but no motion was made/seconded. ' Recommendation 4: Recommend that phase one should begin as soon as possible with the selection of an architectural firm to develop plans and specifications for a � new arena. A motion was made and seconded to accept recommendation 4. ' Recommendation 5: The Committee has been impressed by the creative and cost conscious approach by Don Dethlefs of Sink Combs Dethlefs. His approach has , shown that a facility that meets Bangor's needs is feasibly within the City's ability to pay. By loeating the new arena acijacent to the auditorium, he has made use of exis#ing topagraphy, made it possible for the auditorium to continue to operate � during construction of a new facility and allow for the reuse of the existing civic center and the foundation of the auditorium as weys to contain eosts. Further, he has for the first time presented an overall master plan for the entire Bass Park � Complex that lays out a variety of additional projects that will improve and integrate the various elements of this property. Based on his vision, creativity, cost conseious approach and experience in designing similar facilities around the country, the 1 Special Committee recommended that the Council authorize retaining Don and his f rm for the detailed design of this project and this to be done immediately. jBrown suggested that reference to first names be discontinued. He finds it more professional to use Mr. Dethlefs. Baldacci also asked recommendations should be noted as unanimous by the � Special Committeel. Hawes noted that each recommendation thus far has received unanimous approval. , A motion was made and seconded to accept recommendation 5. Recommendation 6. During the design phase of this project, potential facility _ ' management firms should be involved. This might best be accomplished through an arrangement between the selected design firm and one or more management firms. The Committee believes that one or more management firms may be willing to take ' on this task at no or low cost in light of the potential for their selection as the facility operator. Involving a management firm will insure that the design of the � facility will meet operational needs and maximize revenue production. A motion was made and seconded to approve recommendation. Jonason asked about the � relationship of the current management of Bass Park with a facility operator. Barrett said the City is the current management and City staff. The existing staff would also be involved in the design process. The City's thinking is that by getting management firms involved they will be � able to draw on a much broader range of experience as to what is necessary to make sure that the facility is designed in such a way that it is easy and as efficient as possible to operate and that the revenue potential is maximized. The current staff knows the facility and its � , ' shortcoming but may not be up to date on best practices in modern arenas. Jonason agreed � but talked about the current staff's institutional knowledge which would be valuable to an outside firm. Recommendation 7: Throughout the design phase, value engineering principles , should be applied to both the construction costs and operational costs of the facility. � While there should be no compromise on meeting the needs of the facility as outlined in the market analysis report, it must be constructed at a reasonable cost and be efficient to operate. Every dollar saved in designing and constructing a new � arena will shorten the period of time when phase two can be undertaken. Brown spoke about the need for a full discussion on the definition of value engineering � principles concept and how it works. Barrett said the basic idea is rather than depend on a single d�signer/de�ign firm to develop plans and specifications for an arena that other folks are utilized to look over their should€rs. One way is thraugh a construction manager at risk, � another is having a second firm look at the design arid allow them to come back with a series of recommendations that can be considered. Ryder asked for a better definition of reasonable cost-�. Responding, Barrett said in this context it is trying to bring the projsct in below the $57M � amount with the idea of finding savings that do not impact operations or quality but that can be used toward bringing phase two forward in the process. The Committee member suggested adding that wordage so as to not have a vague sentence. Silver suggested adding "it must be t constructed at th� most reasonable cost possible and be efficient to operate." Baldacci said the goal is to come in under the projected $57M and felt that wording would be clear enough. � SWggested�wording: "While there should be no compromise in me�ting the needs of the facility as outlined in the market analysis report, it will be constructed with a goal." "Commensurate with project costs that have been projected.""Our goal is to build it at a reasonable cost of less than $57M." Dyer suggested not being so specific about the amount but"below final budgeted � cost." Diamond asked if the purpose of this section is to establish a ceiling for the construction cost. Barrett said the purpose is to indicate that the City wants the building construded , correctly for as little as possible. Diamond suggested "as cost effectively as possible." Silver suggested removing the middle sentence of RecommendationJ (While there should be no compromise on meeting the needs of the facility as outlined in the market analysis report, it , must be constructed at a reasonable cost and be efficient to operate). A motion was made. Recommendation 8. The City should fully investigate and considering using the ' construction manager (CM) at risk system, a delivery method which entails a commitment by the construction manager to deliver the project within a guaranteed � maximum price (GMP). The construction manager acts as consultant to the owner in the development and design phases, but as the equivalent of a general contractor during the construction phase. When a construction manager is bound to a � guaranteed maximum price, the most fundamental character of the relationship is changed. In addition to acting in the owner's interest, the construction manager must manage and control construction cost to not exceed the GMP which would be a , financial hit to the construction manager company. Typically a CM at risk arrangement eliminates a low bid construction project. A GMP arrangement is a � � ' � typical part of the CM and owner agreement somewhat comparable to a low bid project, but with a number of adjustments and responsibilities required to by the CM. Before design of a project is completed, the CM is involved with estimating the � cost of constructing a project based on hearing from the designer and owner as to what is going/desired to be built. If some aspect of the desired design raises the � cost estimate over the budget the Owner wants to maintain, a decision can be made to modify the design concept instead of having to spend a considerable amount of time, effort and money re-designing and/or modifying completed construction � documents, or the Owner may decide to spend more money or obtain higher financial support for the project. This approach also maintains positive working relationships among the Owner, Architect/Designer, and Contractor and maximizes , the awareness among Owner, Architect/Designer, and CM of all parties' needs and expectations in order to perform their part of the project in the mosf efficient manner. , Brown asked how a CM is selected.. Subject to Council's approval, an architect has been engaged. Barrett said the City would primarily look toward qualifications, experience, � background, personnel assigned to the project and to solicit a Request for Proposals. It would be a competitive process. Responding to Brown, Barr�tt-said that normally a committee is put ' together with representation from the City Council, key stafF members, and individuals from outside the City with relevant experience to participate. Barrett agreed with Brown regarding the importance of selecting a right CM. Wheeler agreed with Barrett's recommendation for a � committee composition. He asked that it be formalized in a recommendation. Discussion contin�ed on the committee composition. ' A motion was made and seconded to approve Recommendation 9. Barrett said that a group should be composed made up of Council representatives, staff, individuals of the community with a requisite experience and representations from the Special Arena Committee to assist in � the process of evaluating proposals and for the selection of a construction manager at risk. Barrett asked for the Committee's indulgence to wordsmith the recommendation the following day and forward a revised copy to the Arena Committee for comment/review. , Wheeler noted that Barrett did not include the possibility of including outside individuals with � relevant experience. Hawes clarified that Barrett did include that language. Wheeler said he is referring to individuals who are not necessarily from the community but have unusual expertise. Barrett said he would remove 'from the community.' Wheeler thought it should be removed. � Hawes noted with no committee objection that Barrett's recommendation would be included with Recommendation 8. � Recommendation 9. If necessary and in order to achieve a guaranteed maximum price that will allow for Phase II to be undertaken sooner rather than later, � consideration may be given to deferring certain elements of the recommended Phase I project to include the enclosed walkways over Dutton Street and Main Street. 1 ' ' A motion was made and second to approval Recommendation 9. � Recommendation 10. The potential for other funding sources should continue to be � explored and pursued. Tn particular, Hollywood Slots should be approached to determine if it would be willing to underwrite all or a portion of the cost of the � pedestrian walkway over Main Street. Diamond asked if this is something that should be explicitly stated within the subject document ' or something dealt as a separate issue recommending that the first sentence of Recommendation SO remain. Silver said that the Arena Committee did have a subcommittee that started to look at a financial plan. She suggested that a second sentence be added about a , recommendation for a group of individuals to continue looking at the financial plan. Barrett said the Council would be looking at what it needs to do to try to implement some of the recommendations including a need for a separate committee or a continuation of the , subcommittee to work on the funding issue. Silver and Barrett agree.d that it did not need to be part of the recommendakion. Barrett said that the recommendation that'other funding sources be explored' covers it. y Osborne said it is important to keep the eye on the ball and that he still believes the important ' thing is to repl�ce the arena and going to Phase II, which is the economic driver. We urged the Committee to put together the pieces of Phase I that could be delayed and move as quickiy as possible with Phase II. � A motion was made and seconded to approve Recommendation 10 as amended. Recommendation 11. Once a GMP has been accepted, the question of when Phase , II becomes financially feesible should be revisited and a firm startdate established. To ensure that this phase of the project goes forward at the earliest possible date, consideration might also b� givEn to deferring all or a portion of the renovation ' costs associated with the existing Civic Center. While renovations and _ _ . improvements to this building are�ppropriate and needed, it is functional in its _ ___ _ current condition and a more pressing need exists for additional quality space and � the removal of those portions of the Auditorium that will remain after Phase I. Osborne noted that anything regarding health or safety of the occupants of the building are � required to be maintained. Hawes and Barrett said it would certainly be in the forefront. The Civic Center does not have any issues of concern in this area at this time. � A motion was made and seconded to approve Recommendation il as amended. Recommendation 12. In order to bring the entire project on line as soon as � possible, the Council should consider: . Designating a portion of annual Downtown TIF revenues to the project. The , Downtown TIF has performed better than original projections. Where $1.9 � i 1 � million was initially anticipated from this source in the current Fiscal Year, actual receipts will be $2.4 million. As the City invests in new facilities at Bass Park, we anticipate that additional development will also take place in the ' downtown TIF district. We recommend that at least $500,000 per year be d�dicated from this source for future project costs/debt service requirements. � Please note that this will also provide some potential cushion to protect the general taxpayers of the City should the projection of future years slot revenue not be met. ,' • Consider financing all or a portion of the Phase I and Phase II projects for a period longer than 20 years. While we acknowledge that eutending the debt � service on the projects will have an impact on total interest costs, we believe that the projects should be undertaken as soon as possible in order to take advantage of an advantageous construction cost environment, provide a / stimulus to the local construction industry, and move the economic impact, particularly of the meeting and convention facili�y, forward in tirYie. ' � Brown and Barrett discussed the Downtown TIF. The potential for using some of the Downtown TIF money for this project was included in the Ci .ty's project submission and financial , plan to the DECD. Rcsponding to Wheeler, Barrett talked about what the City would need to do to obtain an increase in the meals and lodging tax to be dedicated to a new arena. It would require a change in State Law. Wheeler stated that his opinion is that the City should again try , for an increase in the meals and lodging tax. Responding to Silver, Wheeler said it would be an additional recommendation to Recommendation 12. He didn't feel that it needed to be handled by vote. ' A motion was made and seconded to approve Recommendation 12. � Recommendation 13. Given the size and scope of this project, the Council should seek state enabling legislation to exclude any borrowing associated with it from the statutory debt limit under which the City must operate. While the pro�ect could be � undertaken without exceeding the limit, we do not believe that the City's future ability to undertake other capital projects should be limited by it. rA motion was made and seconded to approve recommendation 13. � Recommendation 14. A private management firm should be engaged to operate the facility and should be selected well in advance of the date of estimated opening. � Baldacci suggested adding an advisory board that reflects the entire region and that would have representation of individuals recommended by the City Council and beyond. The board would review a private management firm. Without financial assistance from outside of Bangor, ' Wheeler would not support including representation of other communities in such an advisory board. Nealley agreed with the suggested advisory committee if it is relative to a financial interest. Tripp agreed with the advisory group concept but stressed the need to be very , ' ' specific in the membership chosen to serve. Jonason agreed but thought that in addition to ■ that recommendation that`well in advance' needs to be better defined. � A motion was made and seconded to approve recommendation 14. , Barrett suggested that an advisory committee be made a separate recommendation, , recommendation 15. One member noted that the operating deficits are going to rest on the backs of the City , taxpayers like now. She further noted that funding and a private management company is at the discretion of the City Council. She did not feel an advisory board was necessary. Brown said that the operator needs a group with which to work. Dyer said that a private management , firm would propose an operating budget to the City Council, which will either approve or change it. Anything that the operator does will be with the owner of the facility. Monthly updates will be required from the firm to the Council. , Diamond suggested that language include that the Arena Committee encourages the Council to consider in the future appointing a citizen advisory committee to assist in its advocacy for and � accountabiliry of the new arena. It does give the responsibility to the Council to determine it but it does make it clear that the Arena Committee has an interest in rrraking sure that the ' possibility is explored. Barrett suggested "the Council should consider establishing an Advisory Board to insure that the � management firm is held accountable and that adequate oversight is provided. Membership on the board should be designed to insure that those entities or organizations with a significant financial interest in the facility are represented as well as those with a non-financial or special , interest as weil as representatives of the general public." A motion was made and seconded to approve Recommendation 15. , The Arena Committee's conclusiQn: Overall, therefore, it is the reeommendation of the Special Committee on Arena Implementation that the City immediately enter , into a design contract for Phase I, that ground be broken for the Phase I project no later than the summer of 2011, and that Phase II follow as quickly as possible given � funding and financing realities. Diamond suggested '�Phase II follow" be changed to '�Phase II proceed." � Responding to Nealley, Diamond said that the Collins Center for the Arts does have an outside advisory group which does not have any authority over the operation but provides input, ideas � and advocacy for the interests of the various stakeholders. Responding to Nealley, Silver said she was not certain that a formal list of requirements was available for the Collins Center advisory group. ]onason noted that the Cultural Commission is an advisory group to the City , Council and it works well. Higgins said she was concerned that the management company be required to report to the Arena Committee. ,