HomeMy WebLinkAbout2013-025 Council ResolutionCITY OF LINO LAKES
RESOLUTION NO. 13 -25
RESOLUTION APPROVING THE CIVIC COMPLEX LEASE AGREEMENT
WHEREAS, the City Council of the City of Lino Lakes determined to lease the portion of the
Lino Lakes Civic Complex formerly occupied by the Centennial Early Childhood Education
program (the "Facility "), and;
WHEREAS, Veritas Academy, a new private, not - for - profit school has expressed its interest in
leasing a majority of the Facility for its location, and;
WHEREAS, the City's Bond Counsel has reviewed the Lease Agreement and finds it to be in
compliance with Federal Tax Regulations for leasing the Facility to a non - governmental entity
within a Civic Complex that was financed with CIP tax exempt bonds, and;
WHEREAS, the City's Bond Counsel has reviewed the lessee's Mission Statement and Business
Plan and finds it to be compliant with the First Amendment in leasing a public, bond - financed
building.
NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Lino Lakes
approves the Civic Complex Lease Agreement.
• NOW, THEREFORE, BE IT FURTHER RESOLVED by The City Council of The City of
Lino Lakes that City staff and consultants are authorized and directed to take all other actions
required to carry out the intent of this Resolution.
Adopted by the Council of the City of Lino Lakes this 11`h day of March, 2013.
The motion for the adoption of the foregoing resolution was introduced by Council Member
Roeser and was duly seconded by Council Member Rafferty and upon vote being
taken thereon, the following voted in favor thereof:
Roeser, Rafferty, Stoesz, O'Donnell,
The following voted against same:
none
ATTEST:
•
Reinert
Jeff Reine , . yor
IP
•
CITY COUNCIL
AGENDA ITEM 6A
STAFF ORIGINATOR: Mary Alice Divine
MEETING DATE: March 11, 2013
TOPIC: Consideration of Resolution No. 13 -25 Approving a Civic Complex
Lease Agreement
VOTE REQUIRED: 3/5
INTRODUCTION
In February 2012 a commercial broker was hired to market the former ECFE of the Lino Lakes
Civic Complex for lease. A new, private, not - for - profit school is interested in leasing the
facility. Staff has been working with the broker to complete a Lease Agreement for City
Council consideration. Parties have come to a general agreement and the City's bond counsel
has reviewed the lease.
BACKGROUND
Veritas Academy would like to lease 9,635 square feet of the 9,938 square feet of the facility
on a 5 -year term. The facility will be used for elementary education. The remaining square
footage is located adjacent to the community room and will be withheld by the City for future
expansion of the community room. In addition, the academy has agreed to temporarily provide
the City with two of the rooms in the facility for evening parks and recreation programming if
needed, until enrollment increases to the point where they will be needed as classrooms. No
interior remodeling of the facility will be required for their purposes.
The lease arrangement is as follows:
Base Rent.
Months
Net Rent
SF
Per Period
Monthly
PSF
Net Rent
Net Rent
1 to 6
$2.50
9,635
$12,043.75
$2,007.29
7 to 12
$4.50
9,635
$21,678.75
$3,613.13
13 to 24
$7.00
9,635
$67,445.00
$5,620.42
25 to 36
$7.50
9,635
$72,262.50
$6,021.88
37 to 48
$7.75
9,635
$74,671.25
$6,222.60
49 to 60
$8.00
9,635
$77,080.00
$6,423.33
In addition to the base rent the lease agreement calls for the tenant to pay a proportionate share
of operational costs, including annual maintenance, utilities and insurance. The lease will be
effective July 1, 2012 through June 30, 2018. The academy will supply a $5,000 security
deposit on May 1. They are asking for council approval so that they can have assurance to
begin marketing the location to their prospective clientele. Broker commission is $16,259.
Two issues needed to be taken into consideration when leasing the facility. The civic complex
was financed with CIP tax exempt bonds. For federal tax purposes, the amount of square
footage being leased is within federal guidelines for leasing to a non - governmental entity. The
academy's business plan, mission and curriculum was also evaluated and found to be compliant
with the First Amendment regarding leasing a publicly financed, tax exempt facility to a faith
based school.
RECOMMENDATION
Approve Resolution 13 -25 approving the Civic Complex Lease Agreement
ATTACHMENTS
Resolution No. 13 -25
•
•