CCP 09-30-1996 - Laserfiche WebLink

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I' a-I I r- Resolution of the Finance Committee of the City of Arden Hills r, Adopted at the Meeting of September 26, 1996 I RESOLVED, That the Finance Committee of the City of Arden Hills hereby expresses the foliowing concerns to the City Councii regarding the proposal that the city participate in the I financino of a four-sheet ice arena in Blaine .... -- Weare concerned that: I The city's obligation to guarantee each year 15.5% of 2080 hours of ice time on one rink at $125 per hour -- about $40,300 per year at current prices -- is in effect a growing contingent I liability risk to our park and recreation funds for 25 years. The long-term financial viability of the project is questionable because of the lenders' J requirement that general obligation bonds of Anoka County be issued. The lenders must be unwilling to rely on the guarantee of the hockey associations to service the debt. Apparently they will not accept revenue bonds, but require the full faith and credit of the cities. The tax J capacity of our city should not be mortgaged for 25 years. Ramsey County has put $500,000 of our tax money in support of the project - using an II increased levy to do so, We believe that is enough loca! support, The size of the project -- $10 million with bonding for $7 million for 25 years of debt service -- I is out of proportion to the city's size and resources. Presently there are only 144 participants from A'den HilS A'd"n H;IIS \"0' 'Id b" th" sm"lle"t pia"'" ;n th" "'oup -- \"" h"'''' n" ... "" . ........ '"~ ..... ..........." ..... I ....n 1'\.1'" ....... ~' ...... .......... ,'-" assu'~nce o' g~.t:_~ fair "ea'~~nt fo' 0' ,. p^"ti~:pant~ la! I -.;:;:t lll\:f " llll~l I UI all",' 1.:10. I There is no draft Master Agreement to review for proper protection of the city's interest. Management and costs of the facility will not be in the cities' control. Incentives to operate I efficiently are lacking in a government-guaranteed revenue operation. The hockey asssociations do not now have the promised $500,000 "escrow fund" raised. A I $500,000 "escrow fund" would not cover 2 years' default in time commitment for one sheet of ice. I Arden Hills has not had the project analyzed by public finance counsel. THEREFORE, We urge the City Council to withhold any commitment to the project. ~ - .. -