Agenda Packets - 2013/05/06 - Laserfiche WebLink

Home Browse Search

Item No: 3 013 MOUNDS z T7� Meeting Date: WorMayk 6. cion �/1 Type of Business: Work Session City of Mounds View Staff Report To: Honorable Mayor and City Council From: James Ericson, City Administrator Item Title/Subject: Review the Super Rink Agreement and Request to Reduce the Escrow Fund Introduction: In 1997, the City of Mounds View, along with the cities of New Brighton, Arden Hills and Shoreview and Ramsey County, entered into a Master Agreement with the Minnesota Amateur Sports Commission to "sponsor" a sheet of ice at the National Sports Center Super Rink in Blaine. At the same time, the four cities (collectively referred to as SAMN) entered into a Supplemental Agreement with the Irondale Youth Hockey Association and the Mounds View Youth Hockey Association. This Supplemental Agreement indicates that the youth hockey associations would purchase a minimum of 2080 hours of ice time at the Super Rink. Discussion: Pursuant to the Supplemental Agreement, The youth hockey associations were required to deposit $300,000 into an escrow fund which would be used in the event the associations failed to meet their collective rental obligations. The escrow was required to grow to $400,000 four years later, with any dollars in excess of $400,000 (interest earnings) returned to the associations. The escrow account is presently at the $400,000 maximum. In a letter dated December 15, 2012 (attached for your review), the presidents of both youth hockey associations request the release of the escrow funds so that the money could be put toward capital improvements at the Schwan Super Rink. While the associations have an established track record of meeting their required ice time, releasing the full escrow puts the four cities at an unnecessary financial risk—the present day value of 2080 hours of ice time (at $195 per hour) amounts to $405,600. Should the associations fail to purchase any ice time, the obligation would then fall to the four cities every year until 2024. While such a scenario would seem unlikely, it is a risk nevertheless that should be avoided. Recommendation: Consider the request from the Irondale Youth Hockey Association and the Mounds View Youth Hockey Association to release the $400,000 of escrow funds presently held by the City of Shoreview, or a portion thereof. Respectfully submitted, V a'mu Gain—� James Ericson City Administrator