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Item 3.
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| City Council Regular | |
| Date: | 12/16/2024 |
| Title: | Memorandum of Agreement between the City and Yellowstone Ice Foundation |
| Presented by: | Chris Kukulski, City Administrator |
| Department: | City Hall Administration |
| Presentation: | Yes |
| Legal Review: | Yes |
| Project Number: | N/A |
RECOMMENDATION
Staff recommends the City Council approve the enclosed Memorandum of Understanding (MOU) between the City and Yellowstone Ice Foundation which establishes the parties’ commitment to enter a public-private partnership to build an ice facility and necessary infrastructure at Amend Park.
BACKGROUND (Consistency with Adopted Plans and Policies, if applicable)
In September 2024, the City solicited proposals for a proposed recreation campus at Amend Park that includes an overall site plan and architectural design of an indoor recreation/sport court facility that incorporates a minimum of four full-sized or eight middle school-sized basketball courts. A&E Design submitted a proposal that was selected and Council awarded the professional services contract on December 9, 2024.
The City concurrently solicited proposals for an indoor recreation facility located at the Amend Park recreation campus. Yellowstone Ice Foundation (YIF), a local non-profit organization, submitted a proposal that was selected to build an ice facility that would be owned by YIF but located on City-owned property at Amend Park. Due to the unique and complex nature of drafting a ground lease to address the multitude of issues involved with such a partnership, the City is consulting with Chris Johnson of Worden Thane P.C. who has significant experience in this area to assist with drafting the lease.
YIF’s proposal includes a financial commitment from Signal Peak Mine to donate $6 million ($3 million cash and $3 million debt) to fund the construction of the ice facility. It is the City’s understanding that the first $3 million must be encumbered before the end of the year. Therefore, the proposed MOU provides assurance from the City that we are working in good faith to partner on the project. This will allow YIF to encumber the funds while a more detailed lease is negotiated. Because much of the detail necessary for the lease agreement is dependent on the design of the recreation campus, the parties will not be able to finalize a lease until around March 2025.
The MOU outlines the general understanding of the parties’ roles and responsibilities in the partnership and indicates a commitment to work together in good faith to reach a more detailed agreement defining the specific responsibilities and obligations of each party. It does not comprise every issue because there are many "unknowns" at this point. However, paragraphs 5 and 6 identify the majority of the issues that will be described more specifically in an agreement.
The City concurrently solicited proposals for an indoor recreation facility located at the Amend Park recreation campus. Yellowstone Ice Foundation (YIF), a local non-profit organization, submitted a proposal that was selected to build an ice facility that would be owned by YIF but located on City-owned property at Amend Park. Due to the unique and complex nature of drafting a ground lease to address the multitude of issues involved with such a partnership, the City is consulting with Chris Johnson of Worden Thane P.C. who has significant experience in this area to assist with drafting the lease.
YIF’s proposal includes a financial commitment from Signal Peak Mine to donate $6 million ($3 million cash and $3 million debt) to fund the construction of the ice facility. It is the City’s understanding that the first $3 million must be encumbered before the end of the year. Therefore, the proposed MOU provides assurance from the City that we are working in good faith to partner on the project. This will allow YIF to encumber the funds while a more detailed lease is negotiated. Because much of the detail necessary for the lease agreement is dependent on the design of the recreation campus, the parties will not be able to finalize a lease until around March 2025.
The MOU outlines the general understanding of the parties’ roles and responsibilities in the partnership and indicates a commitment to work together in good faith to reach a more detailed agreement defining the specific responsibilities and obligations of each party. It does not comprise every issue because there are many "unknowns" at this point. However, paragraphs 5 and 6 identify the majority of the issues that will be described more specifically in an agreement.
ALTERNATIVES
City Council may:
- Approve; or,
- Not Approve
FISCAL EFFECTS
Cost estimates are not available, since the site development and ice facility are in the early stages of design. The cost of infrastructure and parking necessary to support the ice facility will be paid by the city through the sale of SBURA TIF bonds. Yellowstone Ice Foundation will raise all funds necessary to build, maintain and operate the indoor ice facility. It is also anticipated that YIF will cover their proportional cost of off-site operational expenses.