HomeMy WebLinkAbout92-116 v
RESOLUTION NO. 92-.116
• RESOLUTION APPROVING MEMORANDUM OF
UNDERSTANDING AND RELATED DOCUMENTS
FOR PROPOSED ICE ARENA PROJECT
WHEREAS, the City of Lakeville, Minnesota (the City), the Lakeville
Housing and Redevelopment Authority (the Authority), Independent School
District No. 194 (the District), the Lakeville Community Corporation (the
Corporation) and the Lakeville Hockey Boosters, Inc. (Boosters) propose to
undertake the development of a 40,000 square foot ice arena facility in the City of
Lakeville adjacent to the new senior high school (the Project); and
WHEREAS, the parties have had discussions relating to the scope of
the Project, the proposed financing structure, and the future roles and
responsibilities of the parties relating to the operation of the Project; and
WHEREAS, a draft Memorandum of Understanding has been. prepared
and reviewed by the parties which describes the Project, the budget for. the Project,
the financing requirements for the Project and the actions to be taken by the parties
to successfully complete the development of the Project, and which Memorandum
of Understanding includes, as exhibits thereto, a proposed form of (i) a Lease-
Purchase Agreement to be executed by the City and the Authority, pursuant to
• which the the Authority would issue revenue bonds to construct the Project and the
City would, subject to its lease cancellation rights, lease-purchase the Project from
the Authority for rentals sufficient to retire the revenue bonds, (ii) a Sublease
Agreement between the City and the Corporation pursuant to which the
Corporation would assume the responsibility for operation of the Project, including
normal operation, maintenance, insurance and similar expenses, and will agree to
pay sublease rentals each year according to a schedule attached to the sublease which,
together with certain. gaming receipts to be received pursuant to the Gaming
Revenue Agreement hereinafter referred to, will provide sufficient funds to the City
to pay the rentals required to be paid by the City under the Lease-Purchase
Agreement, and (iii) a Gaming. Revenue Agreement to be entered into between the
City and Boosters whereby Boosters will agree to pay to the City profits from its pull-
tab operations (and any other future gaming operations) in an amount equal to
$70,000 per year plus 90% of the profits in excess of $70,000, which funds will be used
by the City to help pay the rental payments due under the Lease-Purchase
Agreement; and
WHEREAS, the Memorandum of Understanding also provides that (i)
to accomodate the desires of the Authority, City, Boosters and District to have a
voice in the operation of the Project, the parties will create an advisory committee
consisting of representatives of the Authority, City, Boosters, Corporation and
District to advise the Corporation on the operation and management of the Project,
• (ii) the District will commit to rent, at the then current rental rates, 140 hours of ice
~y
time annually (July 1 through June 30) for a period of 5 years and the District shall be
• permitted to use up to 50 hours of ice time rent free each year (July 1 through June
30) during non-prime time hours and (iii) the City shall be permitted to use up to 50
hours of ice and/or dry floor time each calendar year during non-prime time hours;
and
WHEREAS, the Memorandum of Understanding further provides that
the parties will in good faith endeavor to carry out their respective responsibilities
as set forth therein, but shall not incur any legal liability for damages or otherwise
because of their failure or inability to do so.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City
of Lakeville, Minnesota, as follows;
1. The Memorandum of Understanding, together with the Lease-
Purchase Agreement, Sublease Agreement and Gaming Revenue Agreement
attached thereto, are hereby approved in the form prepared and submitted to this
Council.
2. The Mayor and City Clerk are hereby authorized to execute the
Memorandum of Understanding on behalf of the City, and, at the appropriate time
as established in accordance with the terms of the Memorandum of Understanding,
to execute the Lease-Purchase Agreement, Sublease Agreement and Gaming
Revenue Agreement on behalf of the City. The authorization to execute said
documents includes the authority to approve such changes and modifications
therein as said officers deem appropriate upon consultation with the City Attorney
and which do not materially change the substance of the transaction as set forth in
the drafts heretofore submitted to this Council
3. The Mayor and City Clerk are also authorized to execute such other.
documents, certificates and agreements as may be necessary or desirable to complete
the development of the Project in accordance with the Memorandum of
Understanding, provided such additional documentation has been reviewed by the
City Attorney and further provided such additional documentation does not
materially modify the substance of the transaction as approved by the Council
pursuant to this Resolution.
Adopted this 6th day of July, 1992.
Mayor
J~,
Attes 1 r, ;
. City Clerk