Minutes - 1999/03/22 - Laserfiche WebLink

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Mounds View City Council March 22, 1999 Regular Meeting Page 36 Council Member Stigney stated the fifth sentence on Page 2 of the Lease Agreement indicates "...during the term hereof an amount calculated by multiplying (I) the total gross revenues..." and the seventh sentence indicates "Demised Premises, Time (ii)..." He requested clarification regarding the Roman Numerals. Assistant to the City Administrator Schmidt noted the first Roman Numeral (I) should be lower case. She explained that these numbers simply represent the two different points of the calculations. She indicated the first point pertains to total gross revenues received by the tenant for all children's monthly, weekly, daily and hourly tuition, and the second point represented 2.5 percent, provided. City Administrator Whiting stated these points refer to the calculation used for paying the tuition portion of the monthly rent, which, as agreed upon in the initial agreement, would be calculated for the year 1999, and would be applied for the succeeding years. He advised that this was the amount, over and above the base rent, that the Children's Home Society would pay the City each month. Council Member Marty noted the next sentence that indicates "...Percentage rent to be paid shall be increased to at least three percent (3%) greater than the Percentage Rent payable in the previous year." He inquired if this applied only to the percentage rent, and not the overall rent. City Administrator Whiting stated this was correct. He explained that this is an inflationary factor, which provides that the City does not lose ground to inflationary costs. Council Member Marty inquired if the percentage rent was based upon the number of children at the facility. City Administrator Whiting stated this was correct. Council Member Marty stated it appeared that the overall rent could be increased 3 percent to cover inflation, and that this not only be based upon the number of children. Assistant to the City Administrator Schmidt stated the percentage rent only pertains to the actual tuition, and does not include the base rent of $30,000. Council Member Marty inquired a 3 percent increase could be included each year in the base rent. Council Member Stigney stated this would be appropriate, in that from this point forward, the rent would be fixed, regardless of any inflation factor. City Administrator Whiting stated these were not the issues that led to the reconsideration of the initial agreement with the Children's Home Society. He pointed out that much of that agreement with Children's Home Society was simply transported into the current document, and the concern about their ability to pay in excess of the $30,000, was essentially the only reason for revisiting the agreement at all. He explained that the City has already agreed to this once, therefore, he had never contemplated bringing it up with them again. He stated he could certainly ask them, however, he would request some direction as to the response, if they do not agree to this.