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HomeMy WebLinkAbout2008-10-23 Business and Economic Development Committee Minutes ' SPECIAL COMMITT'EE ON ARENA IMPLEMENTATION COMMITT�EE , OCTOBER 23, 2008 Minutes Attendance: Susan Nawes, Michael Crowley, Free Martin, Kerrie Tripp, Brad Ryder, ' Mike Dyer, Norris Nickerson, Don Lewis, Evelyn Silver, Gerry Palmer, Peter , Baldacci, Hal Wheeler, Bruce Nickerson, John Johnson, Candy Guerette, Ed Barrett, Deb Cyr 1. Report of the Financing Subcommittee ' As a member of the Financing Subcommittee, Crowley defined the scope of the , subcommittee's assignment: financing for the new facility, what other objectives might be embraced as part of the initial assignment. The Fnancial Subcommittee felt the scope of the financial commitment of the taxpayers ought to be relieved , as much as possibie. The facility should not be built through property tax. As a former Councilor, Crowley felt that the current facility might require some type of operating subsidy from the properly tax. Bass Park has been successfui as a ' whole but it has required annual subsidy. The mission is to relieve the Bangor taxpayer of subsidizing a future facility. Current available funding options are racino fund and downtown TIF. Crowley � noted that other potential sources are the government. Crowley met with the � Maine Congressional Delegation for a candid discussion about the proposed facility. A potential funding source was identified through that discussion and a meeting has been established. Michaud's o�ce identified several grants or , external funding sources. Collins and Snowe's offices are jointly coordinating an upcoming meeting with the EDA. The Subcommittee asked itself the question "how do we look at the project outside of the traditional box?" They looked at a ' broader scope in the face of a national or local calamity and how a new facility could be used for medicai facilities and other types of attention. The Subcommittee is also in the process of schedule a meeting with the State ' Legislative Delegation. A new arena facility would be an investment that would benefit the state. Crowley has met with Penobscot County officials and has been encouraged to continue to do so. ' Other potential funding sources, such.as user fees, private development, and , complimentary or support organizations participating in a collaborative manner were discussed. Crowley spoke about public/private partnerships. One of the strongest avenues ' - for the City to explore is the likely investment of private development in and around an arena. Two parts to this supposal are: an $80-100M funding source ' needs to be identified for the arena itself and there is a need to find a way to generate tax revenue as a funding source for the arena or to offset operational expense subsidies that might otherwise be funded by the taxpayers. He spoke ' about office space, retail and hotel development around the arena area, and to , ' ' tie in the golf course and other assets which the City already has in place. The private sector could investment in this expanded project at its expense. It would generate land rent, income tax, and create a new synergy for that end of ' the City. He stressed that the area is an extension of downtown and the waterfront, and he referred to it as an entertainment district for Bangor. The Subcommittee not only looked at funding sources but also at defining the project , which in turn identified funding sources. � In order to ensure that this was something greater than a good conversation among creative individuals, Crowley shared the concept with a highly respected private developer, and this individual's enthusiasm was immediate. The developer confirmed that there are people willing to make such an investment if , assured that the auditorium/arena didn't skimp on its scope and that something credible is built with a long lifespan. Specific investors were noted by the , developer. Crowley said concept thinking from that discussion was tested with reliable private business sources. It has yet to be dismissed as radical, irrelevant or inappropriate for this region. ' Other discussion points included the necessity that a new facility be privately managed. He applauded the good work of the current staff at the civic , center/auditorium. Dyer was part of the discussion. All options need to be on the table: public/private investment, long-term funding strategies for the arena, and looking to bring in components that have historically been discussed; i.e. ! Golf Course, Paul Bunyan Park. , In further testing the waters, Crowley indicated the next step would be to issue a RFQ — Request for Qualifications for potential partners and/or developers in order to signal that the City is serious about the project, open for business, and ' , willing to move forward as a community. Communities in the region need to be supportive, and they need to be advocates on behalf of the project with their local officials, state offices, the governor, and the Congressional Delegation. ' The Financing Subcommittee will continue to work with the above noted contacts, will need to rewrite a funding strategy that is practical, and need to ' continue to talk this up around the community. The City Council needs to feel comfortable with the concept of a mixed use facility. � One member expressed excitement with the report and supported the mixed use and public/private partnership concept. He asked for a definition of ' qualifications. Crowley said it involves putting all of these elements on the table, indicating the size of the current properly, the vision for mixed use, public/private partnership, to see who has the interest, capacity and t qualifications to participate in the process. Crowley noted that the City will have to make concessions on who is partnering and helping to manage what is invested in that area in the future. He stressed that it is time to step up and ' move forward. , ' Guerette asked if there is sufficient information to step up and to present this , request to the City Council. Crowley deferred it to the Mayor and two Councilors present. Hawes said her personal opinion is yes. The Council has been and continues to be very interested to see the project move forward. Further ' information will be gathered at each level during the process. The City needs to promote what it is looking to do in that area. Wheeler thanked Crowley for � preparing the scenario for the committee, the public, and the City Council. He has also spoken with individuals with expertise in this area. He thinks that the current council is already sold on the plan, but he noted that at least two new � councilors will be incoming in November. He feels that upcoming councils in the next two years will be supportive. Palmer said the City has spent enormous resources and energy on the downtown, the waterfront, the racino/hotel , complex, and fixed a blighted area in the process. The City has Bass Park, a golf course, an international airport, a public transportation system, and they need a central link. There needs to be strong as iron connections between these assets ' to help them grow. Palmer said he is concerned about meeting the timeline established. He agreed with the need to step off. Nickerson said he could not be in more agreement with how Crowley presented , the information. It is important to reiterate continually that the objective is to keep this neutrai and not to place the burden on taxpayers. This type of project ' is the right scope, it is a strong economic development activity, and will attracting additional industry and investment to the area. � Crowley said it would be helpful for the Subcommittee to have a green light to continue on this track of seeking a $60M+ investment in the City and that the ' Committee agree that not only raising money but removing the current tax burden to subsidize the auditorium operation is a reasonable objective. The Subcommittee would like to come back with some financial revenue projections � on the'what iY scenarios and would work with City staff to come up with ideas. He would like to come back to the full Arena Committee with elementary visual conceptual drawings. ' Ryder commented there are two perfect examples — Penn National and the waterfront area — that were eyesores for the City and now it is a wonderful , attraction for the City. A motion was made and seconded to direct the Financial Subcommittee to move , forward. 2. Report of the Marketing and Facility Subcommittee ! • Review of Draft RFP for Marketing and Facility Sizing Barrett said the Marketing and Facility Subcommittee met over the summer and , discussed updating the 2002 marketing study. He reviewed some materials which were distributed with the agenda. T he Marketing and Facility , Subcommittee's aim is to update the marketing study to determine more , 1 , specifically the size and nature of a new facility, the cost of the facility, and effectively presenting a number of options such as "if you want to meet 90% of the market, you need a facility at this size and this cost." The second alternative ' is 'can the project be done in phases?'The project scope is to look at the facility's historic use, looking at demographics of the area to determine the types and numbers of events supported by the arena, look at other area facilities so as , not to compete, and look at utilization. The study would provide options on market demand and on size and phasing. He referred to information on a series ' of companies that perform studies. An RFP would be issued with a response date, a committee would be put together to assist with reviewing the proposals, and then make a recommendation to the full Arena Committee. Qualifications, ' capability, experience of the firms, approach to be taken to identified tasks, and surveying of potential users, similar climate, similar communities, and the cost would all be considered. It normally takes a 3-4 week period for responses to be ' received. Barrett said he would look for a consulting firm as a continuing source of expertise as needed. , Responding to Hawes, Barrett said the Subcommittee is prepared to move forward. � � In light of the earlier discussion, one member asked if either in the RFQ should look at marketing implications about the mixed use proposal. Any responder would need to know the scope. He expressed concern that there might be an , impact on the recommendation and the market in isolation versus multi-use. Barrett said he will put something together to ask if the multi-use is a feasible , approach. Tripp suggested a consultant would look at what is happening in facilities around , the area, not just Bass Park. Responding to Guerette, Barrett suggested that the RFP be issued, a seledion ' committee formed to review the RFP's, the top ranked proposers be invited for an interview, and a recommendation be made to the Arena Committee who would in turn make a recommendation to the City Council on who to select. , Dyer said that, if private developers are to be sought, the City doesn't need to reinvent the wheel. The developers would be doing the research work. , Responding to Silver, Barrett said there are two potentially interre�ated but ' totally separate questions when it comes to the issue of multi use and commercial elements. Is it feasible to construct a facility and to include within it other uses; i.e. commercial, hotel, residential. The larger question is: what is the , redevelopment potential of a facility both on other potential available property on Bass Park and/or in the immediate viciniry stretching from I-395 to downtown and picking up the Bangor WaterFront. Regarding the first question, Barrett said , a consultant could provide an answer. Regarding the economic spin-off and other development, he indicated that is probably a question that could be better ' ' answered by some of the potential partners to whom Crowley referred. Crowley , stressed that the concept from the Financial Subcommittee in terms of the scope of the project needs to be woven into the Marketing Study RFP. Barrett suggested that he get together with Crowley to integrate the two. Another , member agreed. A member commented that trying to obtain private investment is good and very , creative. He asked if a time limit is involved. Crowley said he is hopeful to have the information within the next couple of months. , Someone noted that if it takes six months for a RFQ and 90 days to answer, it would be nine months before knowing if a private firm expresses interest. By ' spring, Crowley said he would like to see the project proceeding on two tracks: one is Crowley's suggestion and, secondly, to continue to explore in detail what can be done and when it can be done if a private developer does not step up to , the plate. A member said it appears to be turning into an arena with meeting rooms coming afterwards. Barrett said no, as it appears clear that both are wanted and needed, but the concept of phasing can be explored. HOK has also � suggested an arena first, meeting space second. The second option is sizing -- starting smaller and adding later. � Martin said he likes the idea of an entertainment district in Bangor, as suggested by Crowley. Responding to Martin, Crowley said there are a variety of ways to � attract out of state private developers, but it first needs to be developed as a vision for the City of Bangor's future. It has to be put in tangible terms that the City is willing to embrace. Martin agreed with Crowley's way of thinking. ' Tripp asked if the group is ready to go to the `dive off' point and if dollar amounts have been identified. Crowley said the Financial Subcommittee's mission ' was to structure a concept that addresses the $80M question. Added to the equation is 'how can this be accomplished without eve� burdening the taxpayers of Bangor?' From this discussion, Crowley feels the following will take place with ' the Financial Subcommittee between now and the next full Arena Committee: develop an abstract RFQ spec sheet that will mesh with the RFP process for the marketing study; develop revenue suggestions that might be plausible from the ' public/private partnership to identify what money is being talked about; a bonding scenario; and a pencil on paper visual. Crowley has already asked Cyr , to pull together some number concepts. Wheeler spoke about the current global economy as well as the local and state ' economy. He spoke about asking the Legislature for a local option sales tax of �/z%. Hawes indicated that Crowley needs to leave the meeting early and she thanked him for the work he presented. ' Palmer spoke about the phasing the project and previous comments by Jon Johnson. Johnson said it is critical to have out-of-towners come to Bangor for a � night. Having a single day tournament, a hockey game, event at the Civic , ' , Center are all terrific, but they bring people in enmass for a day only. To encourage growth, it requires overnighters. While the meeting rooms are not absolutely critical prior to the arena, he hopes the meeting rooms and kitchen ' part of the project does not get lost by concentrating so hard on the arena.. But the arena isn't going to build businesses in Bangor to pay property taxes. Responding to Palmer, Johnson said anyone who operates a hotel or restaurant, , knows that, if an individual stays overnight, they spend $300/room, dining at $40/dinner, $20/breakfast. ' 3. Other Issues/Items ' Barrett will look for a potential meeting date no later than mid-January to reconvene the Arena Committee. � Barrett said the Marketing and Facility Subcommittee met over the summer and discussed updating the 2002 marketing study. ' Crowley will meet with the Financial Subcommittee meeting within a month. Barrett said that staff will start the RFP process, and he will get back in touch ' with the Marketing Subcommittee. Hawes said work is in progress to plant a flag on the proposed site and she will ' notify the Committee when that takes place. ' , , , —__ �— , ' ' - , '