Agenda Packets - 2016/08/08 - Laserfiche WebLink

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Item No: 07J Meeting Date: August 8, 2016 Type of Business: Council Business City of Mounds View Staff Report To: Honorable Mayor and City Council From: James Ericson, City Administrator Item Title/Subject: Resolution 8617, Authorizing the Sending of a Notice of Termination of Lease to Creative Kids Academy - Mounds View, Inc. Introduction: A few times over the last year or so, the YMCA had expressed an interest in becoming the child-care provider at the Mounds View Community Center. The current provider, Creative Kids, has a lease with the City that expires on July 31, 2018. The lease does allow for the option of early termination by providing the tenant with a one-year notice in writing. Representative from the YMCA attended the Council’s work session to discuss their proposal for providing child care services at the Community Center. Discussion: The current tenant, Creative Kids Academy - Mounds View, Inc., has been in the facility since 2008 when it took over the lease from the previous tenant who had been operating a business under the same name for years prior to 2008. The current tenant has been a stable fixture in the building, and the City has had no reason to explore other child care tenant options for the space. Recently the YMCA approached the City with this proposal and asked the Council to give it some consideration. According to online reports, the YMCA is one of the largest not-for-profit child care provider in the country. There are child care services in many of the YMCA facilities in the metro area. The YMCA has reviewed the current lease and believes that it would be able to provide the same or a greater level of child care service in the leased space. Other benefits of having the YMCA as the provider is that it combines all leased space under one management entity. Presently, the child care space is general empty on weekends and after hours, the YMCA would be positioned to use this space in conjunction with other programs, making the space more efficient and more cost-effective to operate. In addition, the YMCA proposes to use their own custodial services at the same cost we are paying our current vendor, thus eliminating the need to have multiple cleaning venders in the building and freeing up city staff to address other maintenance and exterior facility needs. Other benefits to the City would include the elimination of an annual property tax payment, saving us about $8,400 each year. While the lease with the current tenant does not expire until July 31, 2018, there is a clause in the agreement that allows the City to terminate the lease at any time upon a one-year written notice to the tenant: