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Home My WebLink About2009-01-12 09-046 ORDERCOUNCIL ACTION Item No. 0 9 0 4 G Date: 1-12-09 Item/Subject: Order, Authorizing an Amendment to the Lease with Bangor Historic Track — Barn Replacement Cost Sharing Responsible Department: Executive Commentary: For some time, the City and Bangor Historic Track have been in discussions regarding a cost sharing arrangement to replace the barns at Bass Park. At a July 2008 Council Workshop, staff was asked to work with Bangor Historic Track to develop a cost sharing agreement and identify a recommended funding mechanism. The attached outline summarizes the results of the discussions with Bangor Historic Track. In its simplest form, the City will provide 50% of the cost for each of two new barns up to a maximum of $900,000 per barn. Work would begin in 2009, and the City would make up to four annual payments, beginning in September 2009, of $400,000 each with any remaining amount due and payable in the fifth year. Certain contingencies are also identified, including the possibility that only one barn is replaced or that the second barn, if built, might be smaller. In return, the new barns will revert to the City at the end of the lease and the City will receive 50% of the new barn rentals paid to Bangor Historic Track. Funding for the City's share is proposed to come from the Downtown TIF. By making certain adjustments to the five year downtown capital plan, this source should provide the necessary funds. A copy of this plan is attached. Note that, in effect, the City's portion of the costs will be paid primarily through the additional property taxes paid by Hollywood Slots on their new facility on Main Street. Please note, however, that using this source will require an amendment to the City's State approved TIF plan. Department Head Manager's C-om-nments: City Manager Associated Information: Budget Approval: Legal Approval: Introduced for X Passage First Reading Rpfprral Page _of_ Finance Director City Solicitor aq, 046 Assigned to Councilor Haves January 12, 2009 CITY OF BANGOR (TITLE.) Order, Authorizing an Amendment to the Lease With Bangor Historic Track — Barn Replacement Cost Sharing WHEREAS, the horse barns at Bass Park were constructed in the 197Ws, are in poor condition, and have reached the end of their useful life; and WHEREAS, these barns are necessary for the continued operation of commercial harness racing at Bass Park and, therefore, the operation of slot machines in Bangor; and WHEREAS, the existing lease between the City of Bangor and Bangor Historic Track calls for the parties to jointly develop a barn maintenance plan; and WHEREAS, the parties have worked to develop such a plan and have mutually agreed that the current barns cannot be cost effectively renovated and must be replaced; and WHEREAS, the harness racing facilities at Bass Park, including the barns, are an essential element of the region's harness racing industry, support the region's only commercial harness racing meet, and provide a year-round training facility; and WHEREAS, the presence of harness racing at Bass Park has a positive economic impact due to the purchase of goods and services to support those engaged in this activity; and WHEREAS, replacing the current barns will improve the appearance of the Bass Park complex and have a positive impact on the surrounding residential neighborhood; and WHEREAS, these new facilities will remain the property of the City of Bangor and be returned to the City at the end of the lease in good condition, normal wear and tear excepted; NOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL OF THE CTly OF BANGOR THAT The City Manager is hereby authorized to execute an amendment to the Citys lease agreement with Bangor Historic Track setting forth a cost sharing arrangement for replacing barn(s) at Bass Park. Such amendment shall be in a form acceptable to the City Solicitor or Assistant Solicitor and shall be substantially consistent With the attached Outline — Barn Cost Sharing Proposal. BE rT FURTHER ORDERED, THAT: Staff is authorized to take the necessary steps to amend the City's State approved Downtown Tax Increment Financing Program to incorporate bam replacement as an approved project IN CITY COUNCIL January 12, 2009 Motion Made and Seconded for Passage Motion Doubted Vote: 7-1 Councilors Voting Yes: Blanchette, Bronson, D'Errico, Hawes, Nealley, Palmer and Wheeler Councilor Voting No: Gratwick Councilor Absent: Stone Pass CITY CLERK * 09-046 O R D E R (TITLE,) Authorizing an Amendment to the Lease with Bangor Historic Track - Barn Replacement Cost SharinZ i Assigned to Councito 41n!/_T7.II/. a �, i OUTLINE — BARN COST SHARING PROPOSAL Phase One Phase One consists of the demolition of Barns A, B, C, and D and the construction of a new 100 horse barn. Demolition is scheduled for Winter 2009 with construction to begin Spring 2009. 1. The City will reimburse Penn National for 50% of the cost, up to an amount not to exceed $900,000, for the work associated with Phase One. 2. Documentation of cost shall be presented to the City by Bangor Historic Track. 3. The City shall reimburse Penn National as follows: one-half of the reimbursement, up to a maximum of $400,000, will be made no later than September 30, 2009; the remaining one-half, again up to a maximum of $400,000, will be paid no later than September 30, 2010. Should any additional amount be owed, that amount will be carried forward into Phase Three of the project. 4. Upon mutual agreement, the City may undertake certain elements of the work or provide certain required materials for the work. The value of any work or material supplied by the City for Phase One shall be included in the total cost of Phase One and 50% of the value of City work shall be deducted from the initial payment scheduled to be made prior to September 30, 2009. The amount of the deduction shall be based on the estimate for the work provided by Bangor Historic Track and dated April 25, 2008 or, if not specified in the estimate, on an amount mutually agreed to by the parties. Phase Two — Demolition of Barn F Barn F will be demolished during winter 2010 and after completion of the Phase One barn. The City shall share in 50% of the cost of demolishing Barn E and restoring its site to a safe and usable condition. Upon mutual agreement, the City may undertake all or a portion of this work and, if so, BHT shall credit the City for 50% of these costs, based upon the estimate for the work provided by Bangor Historic Track and dated April 25, 2008. This credit shall be applied toward any additional amounts that may become due from the City as a result of the Phase Three work outlined below. Should any of this work be performed by others than the City, the cost of that work shall also be carried forward into Phase Three. Phase Three — Alternate A: New Barn Constructed This will consist of constructing a second new horse barn in Spring 2011. Once completed, Barn E will be demolished. 1. No later than December 30, 2010, the City and Bangor Historic Track shall meet to review utilization of the new and old barns in order to determine the necessity, if any, of constructing a second new barn. If utilization of the barns indicates that the demand exceeds the space available in the newly constructed barn, a replacement barn of a size agreed to by the parties will be constructed. 2. If such barn is constructed in calendar year 2011, the City will again reimburse Penn National for 50% of the cost, up to an amount not to exceed $900,000. Here again, the City may undertake certain elements of the work, including demolition of the remaining old barn, or provide certain materials in accordance with number 4 of Phase One above with credit for the work to be taken against the payment to be made by City to BHT no later than September 30, 2011. 3. Documentation of cost shall be presented to the City by Bangor Historic Track. '19 046 4. Any reimbursement due, up to a maximum of $400,000 and to include any amounts that may be due as a result of Phase II work, will be made no later than September 30, 2011; additional reimbursement, if any and up to a maximum of $400,000, will be made no later than September 30, 2012. Any remaining amount owed to BHT shall be paid no later than September 30, 2013. Phase Three — Alternate B: No New Barn Constructed If construction of a second new barn is not needed, Barn E will be demolished during the Winter of 2011 and the site restored to a safe and usable condition. The City shall share in 50% of the cost of demolition and site restoration and, upon mutual agreement, the City may undertake all or a portion of this work. If the City does so, BHT shall reimburse City for 50% of City costs based upon the estimate for the work provided by Bangor Historic Track and dated April 25, 2008 or as may be mutually agreed by the parties. City and Bangor Historic Track agree to make any reimbursements required no later than September 30, 2011. Additional Work to Protect Track Surface In order to limit potential damage caused by vehicle use of the track when entering or exiting the infield for event related parking, the City shall construct a new access road along the inside of the Buck Street side of the track. This will limit vehicle access to the infield to two track crossings — one near the Buck Street entrance to the Civic Center Parking lot and a second at the North end of the track near the current barn complex. The entire cost of this work, to include engineering, construction, permitting, and other directly related costs, not to exceed a maximum of $35,000, shall be deducted from the reimbursement due to BHT from City as a result of Phase One and due on or before September 30, 2009. Bangor Historic Track may, at its own expense, purchase and install other material or equipment as it may deem necessary to provide further protection of the track at the two vehicle access locations. Other Terms and Conditions 1. Once a Phase One or Phase Two new barn is placed into service, the City shall receive 50% of the rentals paid to Bangor Historic Track for use of the barn(s) up to and including a maximum amount equal to the amount the City has reimbursed Bangor Historic Track for its portion of the cost of the barn, including the value of any work performed or materials provided by the City. 2. At the end of the term of the lease, including any extension thereto, the newly constructed barns and any other associated facilities, including equipment storage buildings or other structures associated with harness racing at Bangor Historic Track, shall become the property of the City of Bangor and shall be returned to the City in good condition, normal wear and tear excepted. 3. This agreement is subject to State of Maine approval of an amendment to the City's downtown TIF district to include barn replacement as an eligible project. 4. This agreement shall be renegotiated in the event of any significant change in State law or other event beyond the control of the City of Bangor that restricts the ability of the City to raise sufficient revenue through the Downtown Tax Increment Financing program to meet its commitments under that program including those set forth in this agreement. DOWNTOWN TIF DISTRICT FIVE YEAR CAPITAL IMPROVEMENT PROGRAM Downtown Tax Increment (TIF) Funds Available TIF Fund Balance Projected TIF Revenues Available TIF Funds Current Projects Pickering Square Parking Garage Maintenance Columbia Street Parking Deck Replacement Debt Service (on $1.1 M Bond) Columbia Street Parking Deck Replacement Cost over Bond Amount (Projected Cost = $1.3 M) Subtotal Remaining Balance Onaoina Projects Sidewalk Improvements Minor Downtown Projects Subtotal Remaining Balance Potential Proiects Bass Park Barn Replacement - City Share (1/2) Kenduskeag Stream Trail Repair/ Bridge Construction Waterfront Park Improvements Old Police Station Demolition / Parking Lot Expansion Potential Acquisition of Uhaul Property, Demolition and Creation of Waterfront Parking, 20 Year Bond (Assessed at $501,000) Potential Acquisition and Demolition of Pike Industries / Barrett Paving Storage Tanks, 20 Year Bond (Assessed at $967,000) West Market Square improvements Exchange Street Sidewalks (coinciding with New Court House Completion) Main Street Sidewalks Main Street Underground Utility Improvements Waterfront Parking Structure, 300 spaces @ $16,000 / space - debt service on 20 year bond Abbott Square Parking Deck - 300 spaces @ $16,000 / space - debt service on 20 Year Bond Remaining Balance Notes * December 27, 2006 Becker Structural Engineers, Condition Assessment, Pickering Square Parking Garage, Appendix C, Table 2, Life Cycle Costing Projected Total Project cost 09 04C FY 10 FY 11 FY 12 FY 13 FY 14 71112009 71112010 71112011 71112012 71112013 to to to to to 6/30/2010 6/30/2011 30/2012 6/30/2013 6/30/2014 $ 87,560 $ 18,829 $ 77,823 $ 184,408 $ 44,126 $ 1,903,000 $1,903,000 $1,903,000 $1,903,000 $ 1,903,000 $ 1,990,560 $1,921,829 $1,980,823 $2,087,408 $ 1,947,126 Ongoing $ 308,381 $ 388,903 $ 244,540 $ 217,216 $ 45,518 $1,300,000 $ 85,000 $ 83,100 $ 81,000 $ 79,000 $ 77,000 $ 200,000 $ 593,381 $ 472,003 $ 325,540 $ 296,216 $ 122,518 $ 1,397,179 $1,449,826 $1,655,283 $1,791,192 $ 1,824,608 Ongoing $ 50,000.00 $ 50,000 $ 50,000 $ 50,000 $ 50,000 Ongoing $ 15,000 $ 15,000 $ 15,000 $ 15,000 $ 15,000 $ 65,000 $ 65,000 $ 65,000 $ 65,000 $ 65,000 -f--1,332,179 $1,384,826 $1,590,283 $ 1,726,192 $ 1,759,608 $1,800,000 $ 400,000 $ 400,000 $ 400,000 400,000 $ 200,000 $ 50,000 $ 50,000 $ 843,653 $ 400,000 $ 443,653 $ - $ 500,000 $ 500,000 $ 775,000 $ 57,026 $ 57,026 $ 57,026 $1,300,000 $ 95,656 $ 95,656 $ 95,656 $1,100,000 $ 926,700 $ 463,350 $ 463,350 $ 846,000 $ 423,000 $ 423,000 $4,800,000 $ 353,192 $ 353,192 $ 353,192 $4,800,000 $ 353,192 $ 353,192 $ 1,313,350 $1,307,003 $1,405,875 $1,682,067 $ 1,482,067 Bond Years 20 Interest Rate 4.00% $ 18,829 $ 77,823 $ 184,408 $ 44,126 $ 277,541