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<br />. <br /> <br />Memo to Mayor and Council <br />Page 3 of5 <br />May 20, 2003 <br /> <br />> Uncertainty as to the ultimate timing and operational impact of potential TCAAP <br />redevelopment. <br />> The upfront capital and ongoing operating costs to "carry" unallocated space. A <br />spreadsheet outlining the capital and operating costs is attached for the Council's <br />benefit. <br />> Over time, operations could expand or contract depending on circumstances. For <br />example, the County could take over all vehicle maintenance for Arden Hills <br />eliminating our need for a maintenance bay. This space could then be converted <br />to additional shop or heated storage space. <br />> There is flexibility in the existing space to accommodate additional equipment if <br />need be. For example, large heated vehicle stalls are 40 feet long while our <br />largest trucks are approximately 30 feet long. This will allow for additional <br />storage space if necessary. Further, it is possible to continue to take advantage of <br />space located in the water towers similar to what is done today. <br />> While it would be considerably more expensive, the County has indicated that <br />future building expansion will be possible if necessary. <br /> <br />. 4. Project Budget <br /> <br />Based on our reduction in square footage and the most recent pricing information from <br />Mortenson, the City's share of the project is estimated at $2,265,321. This is $545,626 less <br />than our previous estimate back in March of $2,810,947. The aforementioned estimate is <br />based on the schematic design. Prior to the project proceeding, Mortenson will provide a not <br />to exceed price (this is referred to as the gross maximum price by the County). It is <br />anticipated that this will be provided in mid June prior to the City Council's final approval of <br />the proj ect. <br /> <br />5. Ongoing operating expenses <br /> <br />Attached for your reference is an estimate of the operating expenses provided by the County. <br />Once in the building, expenses will be based on prior year actuals with oversight being <br />provided by the various partners in the facility. Based on the current estimate, we would <br />incur approximately $80,574 in annual operating expenses associated with this facility. Our <br />average for the last two years is $35,000 so this would represent an increase in expenditures. <br />However, a significant portion of this increase would be absorbed within the enterprise <br />funds. <br /> <br />6. Property Interest and Agreements <br /> <br />. <br /> <br />Previously, the County indicated that they would prefer to have a long term lease put in place <br />as opposed to having each partner own their portion individually. Based on input from the <br />Taskforce and City Attorney, staff is currently proceeding on the assumption that the City <br />wants to have an ownership interest in its portion ofthe facility. Currently, the City Attorney <br />