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TO: Honorable Mayor and Members of the Common Council FROM: Jon Urben, General Services Manager DATE: December 10, 2024 SUBJECT: Res 24-674 Approve Amendment to The Grand Oshkosh, Inc. (TGO) Lease and Operating Agreement

BACKGROUND

The City and The Grand Oshkosh, Inc. (TGO) have a lease and operating agreement that grants TGO the right to manage, market, promote and operate the City’s Grand Opera House.  In return, the City pays TGO an annual management fee allocated from the City’s annual hotel room tax.  In 2020 the City of Oshkosh and TGO entered into an amendment for the lease and operating agreement that extended current lease to 2030 with the option for one additional five-year lease renewal term.  In concert with the One Opera House Square capital project, and the associated memo of understanding document outlining both parties’ commitments with the project, TGO is seeking to amend the lease and operating agreement renewal term.

ANALYSIS

The following is a brief description of the only proposed amendment in the lease and operating agreement: Article II. Term This Article sets for the term of the Agreement.  The proposed amendment is to change the current renewal for one additional five (5) year term to up to three additional five (5) year terms, potentially to 2045. All other language remains the same.

FISCAL IMPACT

Per the current lease and operating agreement, once the City’s room tax has reached $2,000,000 TGO will receive an annual management fee of $200,000.00.  In 2023 the City’s room tax met this threshold and TGO’s 2024 annual management fee is now at $204,000.00.  For each of the years following, the management fee will be increased 2% from the prior year.

RECOMMENDATION

Based on the City’s strong partnership with TGO, and in support of the One Opera House square capital project, staff recommends amending the current lease and operating agreement to fulfill TGO’s request for up to three additional five-year terms lease renewal options, beginning in 2030, and potentially to 2045.  Staff recommend the Council approve this amendment with The Grand Oshkosh, Inc., P.O. Box 1004, Oshkosh, WI, 54903 for the Grand Opera House Lease and Operating Agreement.

Attachments RES 24-674

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