HomeMy WebLinkAboutCC PACKET 12041996 (2) Meeting Sheet
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106494
Box: 37
Folder: CC PACKETS 1997
Document: CC PACKET 12041996
•
CITY OF ST. ANTHONY
-CITY-COUNCIL WORK SESSION-AGENDA
December 4, 1996
6:00 P.M.
Council Chambers
I. CALL TO ORDER.
• II. ROLL CALL.
III. DISCUSS SAV 2 LIQUOR STORE.
IV. DISCUSS CITY HALL ISSUES.
1 . Cleaning Proposal.
2. ESI Phone System.
V. OTHER BUSINESS.
VI. ADJOURNMENT.
•
1�
i
MEMORANDUM
Date: November 15, 1996
To: Mayor and Councilmembers
From: Mike Mornson, City Manager
Re: SAV II Liquor Store
• Please find enclosed a counter proposal from First Bank for the SAV II Liquor Store based on
new construction costs estimated at$542,000. This is down from the previous bid of$631,000.
First Bank would like to City to inject another $75,000 and First Bank will inject another
$100,000 plus they want an annual percentage rent from the City's gross sale.
First Bank will invest$267,000 and the City $275,000. Mike Larson and myself will meet with
First Bank next week to review this proposal. Let me know what you think about the changes
by First Bank.
•
NOV-15-1996 14:15 FBS CREDIT ADMIN 612 973 2148 P.02i06
•
SIE N WECONPANY
8151 Bank Place
NPfP 1802
8023econdAwanae, South,
Nlneeapolla, AN 55402-4302
VIA FACSIMILE'TRANSMISSION
November 15, 1996
Mr. Michael J. Mornson
City Manager
Saint Anthony Village
3301 Silver Lake Road
St.Anthony,MN 55418-1599
Dear Mike:
I have attached a draft of the proposal for the SAV liquor store lease that we were going to discuss
in our meeting today. However,in light of the weather,I am sending this to you and we will
attempt to get together nod week.
• The attached proposal is basically the same as the previous lease proposal with two(2)changes.
The first change deals with the cost of the proposed leasehold improvements. Ste.Marie Company
has increased the amount required from the Landlord by over$100,000. The amount St. Anthony
is being asked to contribute for the leasehold improvements has been increased by$75,000.
The other change is the insertion of a percentage rent clause. This will provide a mechanism for
the Landlord to obtain increase in rent only if the Tenant has an increase in sales from the new
location.
Of course the provision for the Wells Lease will be deleted from any new lease.
Again,this is only a DRAFT of the proposal and the terms are subject to appropriate approvals.
We look forward to meeting with you and discussing the attached lease proposal.
2ly,reeEM:cCabe -
Vice President
LEWlhoh
Enclosure: I
• cc: Tom Lund
. NOV-25-96 MON 02:27 PM THE SCHOENING GROUP FAX NO, 9201369 P, 02
Memoriwdum
To: eke Mornson and Mike Larson,St.Anthony
From: 7bm Lund and.bob Schoening, The Schoening Group,Inc.
,Date: November 25, 1996
Be.. Liquor Store Relocation
As mentioned,we have put together proposal summary and rent estimates that take into
account proposed percentage rent Enclosed you will find a convarison of the Ste Marne
proposal&
With regard to constructing a new"city owned"Liquor Store on an altemative site,we
thought it might be useful if you had some construction cost and debt service estimates.
Our assumptions are below:
Basic Assumptions (estimates only)
Site Size: 60,000 square feet
Building Size: 8,500 square fee
• Land Cost: $480,000(58.00 per square foot)
Building Cost: $5507000($65.00 per square foot)
Soft Costs: $100,000($11.76 per square toot)
Financing.: $1,130,000, 8.25%per annum, 15 year amortization
The above assumptions result in au annual debt service payment to St Anthony of
$131,551 (S15.48 per square foot). If you amortize the building over 10 years, your
annual payment increases to $166,316($19.57 per square foot). To the extent you can
buy land for less, finance less, or borrow at a lower rate your debt service wM decrease.
Please call with any questions or if we can be of further assistance. We hope you find this
helpful.
NOV-25-96 MON 02;27 PM THE SCHOENING GROUP FAX NO, 9201369 P. 03
COMPARISON OF LEASE PROPOSALS
SAV Liquor Store
St.Anthony Vfdage,Minnesota
•
Landlord Offer Tenant Response Revised Landlord
(11176198) (11/78/98) Offer(111211991
PROPOSAL TERMS
Promisee,ON 8,508 8F 81508 6F 8,508 OF
Lease Tumt Ph4sen(16)years Fifteen(16)years Fifteen(15)years
:aneedstlen of Complete: $148,171 Complain: $148,171 Complete:, 4148,171
1lpecho Weds Leaser benefit to City of SAV benefit to City of SAV benefit to City of$AV
:onsetrodon Cost Est by Walsh: 15601000 8650,000 !650,000
W.Tan4m Contrlbudenr 0275,000 1278,000 0278,000
Est.Lsndlerd Contribuden: !278,000 0278,000 0275,000
Base Rent,PSP. D25
Yew t-5: 48.26 $8.50
Yom 6-10: 48.78 7.25
Year■11-18: 17.28 =8.00
Parcent■ge Rant - -----, - -- - -
Years 1-8: 5%of Was a 41.2M Nene 3%of salsa 41.6M-MOM
Yeira 8.101 8%of sales>SIAM Nene 3%of sales 11.7M-02.2M
yaws 11-16: 5%of sake> 11.8M None 3%of solve I1.9M-02AM
Londlord Offer Tenant Responie Revised landlord
FWANCLAL ANALYsis (t 1/161981 (11/18/98) Offer(11121/981
Yre. Yrs. Yea. YN. We. Ym. Yrs. Yrs. Yrs.
1_s 9.10 11.16 L 6.10 11•tll 1-s s.10 11 .1s
Searodo A:Salta at s1.7M
Annual Base Ram ; 183,183 067,418 081,$"1 1 $63 ,163 487,416 $01,6091 1 165,289 1811889 088,048
Annutl P tQ.Rent r 16 000 t t 0 l 1 6 000 0
Tata/ i 4788,1103 472,416 366,669 it 1 163,183 467,416 481,889 i i $61 289 181,869 188,048
P rs Foot i 49.18 48.61 17.84 i i 18.25 46.76 !7.26 1 1 $7.21 47.25 $8.00
Ann Avg.over Tarin _' 072,418 ! 467,418 1 1 MASS
Per Square Peet 48.51 ( 46.75 l r 47.49
Ann.Profit ever Current
t t
at 2M.alta,ten Pota.Rent 376,000 !88,000 696,000 1 i 4100AW 4100,000 3100,000 1 1 494,000 1100,000 $100,000
.Seenarb be Salve at$21CM
Annual Bae Rent 1 !69,183 457,416 181,809 i 1 483,163 087,418 181,809 1 1 $55.299 381,688 488,048
(Annual Pate.Rent i 40,000 20.000 2Q.000 i i o O Q 1 1 16,000 8,000 3.000
Cemblmd Total 1 083,163 187,418 381,888 t t 163,163 457.419 48!,689 t $70,298 670,889 !71,048
Pu Square foot 1 110.88 110.28 38,80= { 48,25 18.76 37.76 1 1 18.28 48.31 18136
Ann Avg,over Tenn 1 187,418 1 1 057AIS 1 1 $70,669
P:r Square fleet 1 310.29 ; 1 $0.75 1 1 48.31
Ann.Pre fft over oun'ent 1 1 1 r
11.2M 4.144,Tess Pato.Rene 1 e120,000 3130,000 !!40,000 1 1 1160,000 31e0,000 $100,000, ! $145,000 4161,000 1167,000
soen!lo a saltie as 42.aM t t
Anrw■t Ba■e Rent 483,183 !67,418 381,868= t 453,183 467,416 461,869 1 1 066,288 4811889 466,048
Annual P1etQ.Rent 80.000 50 40,0001 tO 4
21 1 27.000 21.000 16,800
Combined Total t 41!3,163 4107,4-19 $101,6881 1 153,183• 057,416 481,889 i i $82.289 182,883 099,048
Per Square Peet = 113.30 SIZ03 111.86 1 1 18.25 $8.75 47.28 1 1 39.87 48.72 49.78
Ann Avg.bear Term r 4107,416 i = 4157A18 i $men
Per Square PVet 1 1 412.93 i t 48.75 1 1 $9.72 l t
Ann.ProfR over eurre,t t t t t
/1.310 eaka,less Psty.Rent i $180,000 3190,000 $200,0001 i 4240,000 $240.000 $240,0001 i 8213.000 4239,000 $225.000
r t t i t
Nntat
11.1 Annud Profit Calculations us swaps annual figures over the o ntba legs term(15
years)based on a 30%Profit margin an grass sales,as provided by SAV Liquor.
12.1 The ficuree above aro cod at"only.Presented for dlustradva pun"M.
MEMORANDUM
DATE: November 25, 1996
TO: Michael Morrison, City Manager
FROM: Kim Moore-Sykes, Management Assistant
ITEM: City Hall/Community Services/Stonehouse Cleaning Bids
We received the following bids in response to the Request for Bids sent out to interested
cleaning services.
Compton's Commercial Cleaning Inc.
Bid with Sales Tax Total
City Hall: $864.00/week $920.16 $47,848.32
Community Services: $648.00/week $690.12 $35,886.24
Stonehouse: 750.00/week $798.75 $41,535.00
• Total Bid: $125,269.56
Coverall Cleaning Concepts
City Hall: $5,410.10/month $64,921.20
Community Services: $932.63/month $11,191.56
Stonehouse: $1,390.93/month $16,691.16
Total Bid: $92,803.92
*� Weekly cleaning of floors is an additional $1,200/month; $14,400/year. ($107,203.92)
Ilona's Janitorial Service, Inc.
City Hall: $1,607.49/week $83,589.48
Community Services: $1,004.78/week $52,248.56
Stonehouse: $ 755.28/week $39,274.56
Total Bid: $175,112.60
In reviewing these bids, it appears that if the City chooses to go with a cleaning service for
the new building, Compton's Commercial Cleaning, Inc. is the low bidder for the City
• Hall portion of the building.
e e
MEMORANDUM
DATE: November 26, 1996
TO: Mike Mornson, City Manager
FROM: Roger Larson, Finance Director
ITEM: COMMUNITY CENTER/CITY HALL - MAINTENANCE CONTRACT
I have reviewed the maintenance cleaning bids for the new City Hall/Community Center. The
analysis I performed was to compare costs of a cleaning service versus City personnel.
Based on my evaluation of the bid opening, the low bidder for cleaning City Hall is Compton's
at $47,848. It is relevant to acknowledge that this bid is approximately $9,000 higher than last
summers estimated cost of$39,000.
• My original analysis indicated that it would require 1 1/2 full time employees to provide
cleaning services equal to services performed by the cleaning service. When comparing the
estimated costs and the cost for those two employees (including benefits) the cleaning service
was the most cost effective between the two options.
The analysis was as follows:
1) One full-time employee $ 32,200 (New Hire)
2) 1/2 full-time employee $ 16,100
$ 48,300
3) Estimated cleaning costs $ 39,000
Savings $ 9,300
However, comparing the actual bid for services versus City employees, both options are equal
in cost ($48,300 versus $47,848). Therefore, the intangibles of this issue should be addressed
to help determine the best direction for the City. They could include:
1) Do we gain better control by having our own employees clean City Hall?
2) What will it cost for cleaning supplies provided by the contract?
3) Will we need to purchase cleaning equipment related to cleaning the building?
4) Additional questions and discussion?
• Another issue associated with the increase in cost is the budget. When preparing the 1997
budget, I inflated the original estimate and budgeted $42,000 for cleaning services. Based on
actual bids, we need to seek additional revenues to balance this budget.
• Two possible solutions to increase revenues would be:
1) At year end, transfer excess general fund revenues (similar to what we did
when I.D.S. #282 wasn't paying annual rent)to the Community Service Fund.
2) Revise the debt service schedule for the New City Hall/Community Center
to increase* the operation & maintenance contribution by $7,500 from the
School District.
* By increasing the school's O/M contribution it decreases their debt service contribution and
extends the repayment of the $1,200,000 by three years (total of 23).
•
NEW CITY HALL/COMMUNITY CENTER Original - 20 Years
O/M O/M O/M City School TIF
City School Total Debt Service Debt Service Debt Service
1996 $0.00 $0.00 $0.00 $208,642.00 $0.00 $208,642.00
1997 $34,764.00 $28,456.00 $63,220.00 $177,551.00 $71,544.00 $249,095.00
1998 $35,807.00 $29,310.00 $65,117.00 $177,938.00 $70,690.00 $248,628.00
1999 $36,881.00 $30,189.00 $67,070.00 $177,973.00 $69,811.00 $247,784.00
2000 $37,987.00 $31,096.00 $69,083.00 $177,684.00 $68,904.00 $246,588.00
2001 $39,127.00 $32,027.00 $71,154.00 $177,095.00 $67,973.00 $245,068.00
2002 $40,301.00 $32,988.00 $73,289.00 $181,093.00 $67,012.00 $248,105.00
2003 $41,501.00 $33,978.00 $75,479.00 $179,628.00 $66,022.00 $245,650.00
2004 $42,765.00 $34,997.00 $77,762.00 $182,682.00 $65,003.00 $247,685.00
2005 $44,038.00 $36,047.00 $80,085.00 $185,127.00 $63,953.00 $249,080.00
2006 $45,359.00 $37,129.00 $82,488.00 $182,064.00 $62,871.00 $244,935.00
2007 $46,720.00 $38,242.00 $84,962.00 $183,475.00 $61,758.00 $245,233.00
2008 $48,121.00 $39,390.00 $87,511.00 $189,100.00 $60,610.00 $249,710.00
2009 $49,665.00 $40,571.00 $90,236.00 $188,916.00 $59,429.00 $248,345.00
2010 $51,052.00 $41,789.00 $92,841.00 $188,029.00 $58,211.00 $246,240.00
2011 $52,584.00 $43,042.00 $95,626.00 $0.00 $56,958.00 $0.00
2012 $54,161.00 $44,333.00 $98,494.00 $0.00 $55,667.00 $0.00
2013 $55,786.00 $45,663.00 $101,449.00 $0.00 $54,337.00 $0.00
2014 $57,459.00 $47,033.00 $104,492.00 $0.00 $52,967.00 $0.00
2015 $59,183.00 $48,444.00 $107,627.00 $0.00 $51,556.00 $0.00
2016 $60,959.00 $49,898.00 $110,857.00 $0.00 $50,102.00 $0.00
Total $934.220.00 $764.622.00 $1,698.842.00 $2.756.997.00 $1.235,378.00 $3.670.788.00
Payment goes Chandler TIF
to Transfer
Fund #310 to
to Fund #315
Replenish
$1,200,000
Revised - 23 ears
NEW CITY HALUCOMMUNITY CENTER
O/M O/M O/M City School
City School Total Debt Service Debt Service Debt Service
1996 $0.00 $0.00 $0.00 $208,642.00 $0.00 $208,642.00
1997 $34,764.00 $35,956.00 $70,720.00 $185,051.00 $64,044.00 $249,095.00
1998 $35,807.00 $36,810.00 $72,617.00 $185,438.00 $63,190.00 $248,628.00
1999 $36,881.00 $37,689.00 $74,570.00 $185,473.00 $62,311.00 $247,784.00
2000 $37,987.00 $38,596.00 $76,583.00 $185,184.00 $61,404.00 $246,588.00
2001 $39,127.00 $39,527.00 $78,654.00 $184,595.00 $60,473.00 $245,068.00
2002 $40,301.00 $40,488.00 $80,789.00 $188,593.00 $59,512.00 $248,105.00
2003 $41,501.00 $41,478.00 $82,979.00 $187,128.00 $58,522.00 $245,650.00
2004 $42,765.00 $42,497.00 $85,262.00 $190,182.00 $57,503.00 $247,685.00
2005 $44,038.00 $43,547.00 $87,585.00 $192,627.00 $56,453.00 $249,080.00
2006 $45,359.00 $44,629.00 $89,988.00 $189,564.00 $55,371.00 $244,935.00
2007 $46,720.00 $45,742.00 $92,462.00 $190,975.00 $54,258.00 $245,233.00
2008 $48,121.00 $46,890.00 $95,011.00 $196,600.00 $53,110.00 $249,710.00
2009 $49,665.00 $48,071.00 $97,736.00 $196,416.00 $51,929.00 $248,345.00
2010 $51,052.00 $49,289.00 $100,341.00 $195,529.00 $50,711.00 $246,240.00
2011 $52,584.00 $50,542.00 $103,126.00 $0.00 $49,458.00 $0.00
2012 $54,161.00 $51,833.00 $105,994.00 $0.00 $48,167.00 $0.00
2013 $55,786.00 $53,163.00 $108,949.00 $0.00 $46,837.00 $0.00
2014 $57,459.00 $54,533.00 $111,992.00 $0.00 $45,467.00 $0.00
2015 $59,183.00 $55,944.00 $115,127.00 $0.00 $44,056.00 $0.00
2016 $60,959.00 $57,398.00 $118,357.00 $0.00 $42,602.00 $0.00
2017 $62,788.00 $59,120.00 $121,908.00 $0.00 $40,880.00 $0.00
2018 $64,672.00 $60,894.00 $125,566.00 $0.00 $39,106.00 $0.00
2019 $66,612.00 $62,721.00 $129,333.00 $0.00 $37,279.00 $0.00
Total $1.128.292.00 $1.097.357.00 $2.225.649.00 $2.861.997.00 $1.202.643.00 $3.670.788.00
Payment goes Chandler TIF
to Transfer
Fund #310 to
to Fund #315
Replenish
$1,200,000
• MEMORANDUM
DATE: November 22, 1996
TO: Michael Mornson, City Manager
FROM: Kim Moore-Sykes, Management Assistant
ITEM: ESI Communications Meeting with Staff
Pat McCarty of ESI Communications met with Staff to explain Off Premise Extension
(OPX) capability that the new telephone system will have. OPX will reduce the number
of telephone lines that the City uses for the City telephones and faxes in various
departments, thereby reducing the City's cost.
Currently, the City has 11 lines dedicated to Police, Public Works, Fire and the Liquor
Operations at a cost of $580.59 per month. US West also charges the City an additional
$50.00 per month for the ability to transfer calls that come to the City Hall to anyone of
these facilities. The City's total monthly charge is approximately $630.59 (also includes the
• $50.00/month transfer charge).*
Pat proposes that the City retain its main line that carries the 789-8881 and 781-9323 phone
numbers and use OPX that is available through US West. Instead of having several
telephone lines to the various City facilities, the main City line can be used to receive and
direct the incoming call to the desired department.
For example, if someone calls the Fire Department (non-emergency), it will come in on the
main line and the telephone computer reads the OPX number and directs it to the Fire
station. If no one answers, it could be programmed to roll back to City Hall to be
answered by Judy or go to the Fire station's voice mail. All this can be done for one
monthly line charge.
The Department Heads had concerns about how this new system, especially since this
conversion will require that the departments affected will have to change their telephone
numbers. The Police Chief was very concerned because of the number of agencies that
would have to be notified about a change in telephone numbers. Pat indicated that the
conversion could happen anytime after the City's main line is installed in the new building.
After the meeting, everyone seemed pleased with the OPX system.
Pat provided the attached cost benefit analysis. The total conversion to OPX will pay for
itself in approximately 16 months. The OPX installation costs are from US West.
• 'Pat inadvertently left the Police Department out of the comparison he did. Including
their department cost for two lines, the estimated CURRENT COST is $740.59.
Sheetl
• ST.ANTHONY VILLAGE
OPX(OFF PREMISE EXTENSION)COMPARISONS
US WEST OPX CHARGES INSTALLATION: $480.93/ 1ST CIRCUIT
$257.07/ADD'L CIRCUITS/ EACH
CURRENT OPX MONTHLY OPX
DEPARTMENT COSTS COSTS SAVINGS INSTALL
FIRE HALL
AT&T Spirit $105.58 $68.38 $37.20 $738.00
2 lines/6phones
WATER PLANT $35.74 $34.19 $1.55 $480.93
1 Line/3 SLT
SHOP (t?ukG.0 ,149)$110.53 $68.38 $42.15 $738.00
AT&T Spirit
21-ines/4Phones
SAV II $109.58 $68.38 $41.20 $738.00
• 21-ines/2-Line phones
SAV I AND $219.16 $136.76 $82.40 $1,252.14
STONEHOUSE
4 Lines
ITT Cortelco
ZSD.AO
TOTALS $580.59 $376.09 64-Z $3,947.07
BREAK EVEN POINT FOR INSTALLATION CHARGES: %,'SMONTHS CA�A5D,-ftm*
Dec:
Fire,
� cvo�s
Pagel