HomeMy WebLinkAboutMINUTES Town Board Special Meeting 2013-02-07Town of Estes Park, Larimer County, Colorado, February 7, 2013
Minutes of a Special Meeting of the Board of Trustees of the Town of
Estes Park, Larimer County, Colorado. Meeting held in the Town Hall in
said Town of Estes Park on the 7th day of February, 2013. Meeting called
to order by Mayor Pinkham.
Present:
Also Present:
William C. Pinkham, Mayor
Eric Blackhurst, Mayor Pro Tenn
Trustees Mark Elrod
John Ericson
Wendy Koenig
Ron Norris
John Phipps
Greg White, Town Attorney
Frank Lancaster, Town Administrator
Lowell Richardson, Assistant Town Administrator
Cynthia Deats, Deputy Town Clerk
Absent: None
Mayor Pinkham called the meeting to order at 3:00 p.m. and all desiring to do so,
recited the Pledge of Allegiance.
TOWN BOARD COMMENTS .
Trustee Ericson stated that over the past years the Board has maintained a
conservative fund balance, operating on a 'pay as you go' type philosophy; and noted
that the Town has no outstanding debt at this point in time.
PUBLIC COMMENT.
Mayor Pinkham stated that a proposal related to the EPiC performing arts center (PAC)
development is scheduled to be heard at the February 26, 2013, Town Board meeting;
and said public comment taken during today's meeting would be limited to 15 minutes.
TeresaMaria Widawski, county resident, spoke in favor of the EPiC proposal to develop
a performing arts center on the Park Theater Mall property. She stated that a group
called Friends of the Rocky (FOR) has been formed and is soliciting support for the
project in the form of newspaper ads, signatures, and letters of support. She said the
theater is wanted and needed, encouraged support for the theater project, and asked
that the Town embrace the responsibility of solving the parking problems without further
delay.
Peggy Campbell, President and CEO of Visit Estes Park, spoke in support of the EPiC
performing arts center project. She said although there are issues related to parking
that need further discussion, the performing arts center could play a role in achieving
the goal of a year around economy in Estes Park. She said Estes Park must develop
all -season attractions and destination demand generators as Colorado mountain ski
destinations actively compete for Estes Park's summer tourist traffic.
Johanna Darden, Town resident, said a recall of trustees would divide the community.
She said there are many residents who, for various reasons, are opposed to the Rocky
being located downtown; and said she would prefer the performing arts center be
located at Stanley Fairgrounds.
David Habecker, Town resident, said the Town could have a performing arts center at
Stanley Park if the Board had borrowed money, and said being conservative and never
borrowing money are not the same things.
Board of Trustees — February 7, 2013 — Page 2
Stan Black, county resident, and EPiC trustee, said he believes in EPiC's mission to
build a performing arts center in Estes Park and he believes in the Estes Park
community. He said he is overwhelmed by the public expression of support for the
performing arts center and said the PAC represents economic development and
renewed vitality for the community. He said at some point congestion and parking must
become a top priority and that perhaps the Rocky represents that tipping point. He
stated a new purchase option agreement that explicitly addresses parking solutions will
come forward to the Board for consideration at the Town Board meeting on February
26`h.
1. ACTION ITEMS.
1. BUILDING STALL BARN AND/OR MULTI -PURPOSE EVENT CENTER
(MPEC).
Johnson Consulting (MPEC Pro Forma) — Charlie Johnson of Johnson
Consulting provided a summary of the pro forma for the multi -purpose event
center. In developing the report, interviews were held with industry
participants, lodging owners, show producers, management teams, and
fairground staff; and the market was compared to a variety of other regional
and national markets. He said not many high quality assets exist at the
fairgrounds at this time. Concerns identified included old and aging buildings,
and a lack of multi -purpose exhibition space and obsolete technology, which
leads to the inability of the existing facilities to accommodate events such as
state conferences, exhibitions, and trade shows. Mr. Johnson stated that an
opportunity exists for the MPEC to become a year-round regional facility,
attracting users who want state-of-the-art technology and flexible space. The
location at the Stanley Fairgrounds provides easy access from Front Range
communities, and is a strategic location for taking advantage of abundant
recreational opportunities. The facility would support equestrian -related
events at the Fairgrounds during the summer season and expand into the non -
peak season with a variety of activities. He estimated attendance numbers
would increase by 100,000 plus people annually and estimated a close to
break-even financial projection. He said the Town subsidizes current
downtown events and operations at the Fairgrounds to the tune of $500,000
and expects operation of the new building can be added for approximately the
same cost and said the operating deficit is comparable to other markets. He
noted the financial projection includes $500,000 for pre -opening advance
marketing and recommended active marketing and management operation
strategies. He said building the MPEC makes sense and said improvements in
marketing and management at the conference center and establishing an
alliance with The Ranch would be beneficial.
MPEC — Director Winslow stated the MPEC is designed as a multi -use facility
with equestrian use included, but not as the primary use. Equestrian use will
be necessary for approximately four weeks in the summer after which time the
horses will be moved out of the facility and the building can be used for events
such as sporting events, wrestling tournaments, and boat and RV shows. Bob
Herrfeldt, Director at The Ranch, supported mixed equestrian and non -
equestrian use of the building on a temporary basis. He said converting the
building from equestrian use and preparing it for multi -purpose use is tough
and not something you would want to do often, but it is doable. He
recommended the building design include features that make the conversion
and cleanup easier to accomplish. Director Winslow said the engineering of
the building will work noting flipping the building will only happen once per
year. Mr. Herrfeldt said a relationship already exists between staff at The
Ranch and Stanley Fairgrounds staff. He said Loveland and Estes Park serve
two distinct markets and don't compete for events. With the addition of the
MPEC at the Fairgrounds, groups that cannot be accommodated at The Ranch
could be referred to Estes Park.
Board of Trustees — February 7, 2013 — Page 3
Stall Barn — Director Winslow said the stall barn is designed with equestrian
use as the primary use and secondary multi -purpose uses, such as car, boat,
and RV shows, and could also house educational and training events such as
equestrian symposiums and clinics during the winter season.
Dir. Zurn said the stall barn is an insulated facility designed for human
occupancy, but bare bones. The stall barn design contains restrooms and a
small lobby, and the MPEC design contains restrooms, a lobby, and offices
that are heated with natural gas. In both buildings the main room contains a
separate heating system to allow it to go unheated if not being used for an
event. The recommended budget for the stall barn is $1.684 million for the
stall barn and associated site work. For the MPEC, site work, and offsite turn
lanes required by the Colorado Department of Transportation (CDOT) the
estimated budget is $4.418 million. The budget for both buildings combined is
$6,187,550. Dir. Zurn said to remove the event center related aspects of the of
the MPEC such as second story lobby, offices, and ticket space and
essentially build another stall barn would deduct 1800 square feet from the
building at a savings of $180,000. However, these savings would likely be lost
to the costs associated with redesigning and rebidding the structure, in
addition, the flexibility of use would also be lost. Town Administrator Lancaster
stated that the stall barn is needed to maintain our current inventory of
programs but does not expand our capacity. The MPEC will allow expansion
into new markets and new programs for new revenues, in addition to meeting
the needs of existing programs. Mayor Pinkham pointed out that if the old stall
barns are not replaced, some of the existing fairground events may be lost.
Mayor Pro Tem Blackhurst said the Town has spent $1 million on the arena
and $2 million on a new grandstand and this is the next step in the continuing
process for the master plan of the Fairgrounds. Director Winslow estimated
the cost of furniture, fixtures and equipment (FF&E) to open the MPEC facility
at $76,000 to be paid out in 2014 which would include bare bones FF&E and
rental of stalls. IT estimates around $200,000 for technology for both buildings
which would provide backbone IT services and wireless internet access.
Financial Options — Dir. Zurn reviewed the bids received in response to an
RFP for construction of the stall barn and MPEC individually as well as in
combination. Five bidders responded with Dohn Construction coming in as low
bidder as noted below:
Bidder
Dohn Construction, Inc.
Heath Construction
Taylor Kohrs LLC
Krische Construction, Inc.
Sampson Construction Co., Inc.
McCauley Constructors, Inc.
Buildings by Design LLC
Growling Bear Co., Inc.
Schedule A
MPEC
$3,629,000
$3,870,000
$3,955,513
$4,071,000
$4,187,000
$4,239,600
$4,982,985
$5,300,000
Schedule B Stall
Barn
$1,464,000
$1,517,000
$1,634,205
$1,598,000
$1,715,000
$1,622,500
$1,840,224
$2,136,000
Schedule C
Schedule A & B
including Alternates
$5,171,500
$5,481,000
$5,714,518
$5,741,000
$5,988,400
$5,797,400
$6,823,289
$7,621,700
The bids are for the buildings only and do not include site work, off site
requirements, or landscaping. Dir. Zurn noted that the MPEC was designed
under the 2003 building codes and the design is grandfathered until the end of
March 2013. After that time some redesign would be required to meet 2009
codes. Town Administrator Lancaster pointed out that, as owner of the
property, the Town could apply for a building permit which would grandfather
the design for the life of the permit. Dir. Zurn said the bids received from the
contractor are good for another 70 days.
Finance Officer McFarland said at a previous study session he estimated $2.3
million available for capital projects. He said based on additional grant monies
Board of Trustees — February 7, 2013 — Page 4
received by the Town for the parking structure, funds moved from the General
Fund for projects in Streets, and December sales tax the actual figure could be
$2.2 million to $2.5 million. He noted that funding options are fairly broad
depending upon the Board's decision and could include a combination of cash
and financing. One option would be ten- or 20-year term Certificates of
Participation (COP), with ten-year term being preferred as it would involve
much less interest being paid over the term of the COP. He stated the current
interest rate on a ten-year COP is 2.25% and 3.5% on a 20-year COP.
Attorney White said there is no vote required to enter into a Certificate of
Participation. In response to a question by Trustee Ericson, Finance Officer
McFarland said it is a reasonable assumption that the construction of the stall
barns could be funded from monies in the Community Reinvestment Fund.
Mayor Pro Tem Blackhurst calculated the ten-year debt service on a financed
amount of $4,687,550 at $528,698 annually. He calculated the annual
principal and interest for the MPEC at a cost of $4.418 million with 20% down
to be $398,637 based on a ten-year COP at 2.25%. Looking at the same
scenario for the stall barn financing $1,347,520, the annual principal and
interest would be $153,966. He said there is money in the budget to make that
work even without any increase in revenues. He noted that does not include
FF&E or a $500,000 non -capital operating expense for pre -operating
expenses.
Town Administrator Lancaster said building the MPEC, the stall barns, and/or
protecting the conference center represents an investment in a sound financial
economic base for the community and is a way to increase the amount of
money available to address infrastructure needs and fund basic services.
Trustee Elrod commented that the pro forma indicated the importance of the
MPEC being marketed, targeted, and launched appropriately to increase its
potential, and spoke to the development of a business plan and collaboration
with The Ranch. The pro forma also indicated the MPEC would operate at a
deficit which is not unusual for facilities of this type, and projected an increase
in spending resulting in $782,000 in new sales tax to the Town annually.
Trustee Norris said the pro forma shows that the MPEC has potential
significant economic value and said his concerns about the compatibility of
horse events have been alleviated. He said the capital estimate needs to
include money for state of the art audio/visual facilities based on a particular
scope. Trustee Koenig asked if the capacity of the conference center would
complement the MPEC. Mr. Johnson said the conference center is great for
educational content and food and beverage functions and could be
complemented by having exhibition space. He also noted that a performing
arts center would not compete with the MPEC but rather be very
complementary. Trustee Ericson suggested the level of activity projected in
the pro forma for 2015 may be too aggressive.
Mayor Pinkham recessed the meeting for a ten minute break at 5:00 p.m.
The meeting resumed at 5:10 p.m.
PUBLIC COMMENT.
Joy Barnett, David Habecker, Lindsay Lamson, Rick Benton, Tony Bielat, Chris Woods,
and TeresaMaria Widawski, all spoke in favor of the project. The Board was
encouraged to approve construction of both the stall barn and the multi -purpose event
center and take advantage of current financing opportunities.
Kay Norton Haughey, Town resident, spoke in favor of the projects but requested the
Board consider relocating the buildings to the southeast corner of the fairgrounds
property so there would be less impact on the Reclamation neighborhood.
Board ofTrustees — February 7.2O13—Page 5
Trustee Ericson said hoisconcerned about competition coming from other mountain
resorts and ski resorts and the ongoing liability ofthe existing stall barns. Hestated ho
is in favor ufthe K8PEC and how it ties in with economic development. It was moved
and seconded (Ericson/Norris) to have staff come back to the Board on February
12^' with two specific resolutions for the cost and funding of the stall barn and
multi -purpose event center ho be built atthe Stanley fairgrounds.
Discussion ensued. Mayor Pro T*m Blaokhunt stated his desire to give staff direction
to move forward and fund both projects with cash and COPs. He recommended using
$1.25 million in cash and financing the balance to build out the project including add
alternates and turn lanes. He said this has been a topic of conversation since the
1970e. has been studied for the past six years, and said it is time to move ahead.
Trustee Norris noted that with construction bids that came in lower than expected and
low interest rates he is prepared to consider both projects but would like to consider
them separately. He said construction of the stall barns is an immediate need, but said
he wanted more market assurance on the MPEC, voicing a concern about a void in the
marketing plan for the K8PEC. He said he would like staff to come back to the Board
with firm capital estimates for each pnojeot, a cash flow analysis that would include
upfront pre -operating expeneea, and debt service to provide a clear understanding of
the initial outlay, the borrowing options and recommendations, and have discussion
about potential synergies with the theater project.
Mayor Pro Twm B|ackhurst reiterated that the Board has been studying this project for
years. He said to say that more information and time is needed does not serve the
community well and said itiotime tomove ahead.
Johanna Darden, Town resident, voiced agreement with Trustees Eh000nand Norris
and said the Board needed to have all the facts together before making a decision.
Dr. James Durward, County resident said the topic has been over -studied and the time
to move forward is now.
Kay Norton Haughey, Town resident, asked the Board to act in the best interest of the
community. She said based on a recent survey only 2096 of the respondents favored
construction ofthe [NPEC.
A substitute motion was made. It was moved and seconded (B|aokhurst/Brod) to
approve the construction ofboth the multi -purpose event center and the stall
barn at the prime that would include the on -site improvements outside the
buildings with the exception that the Town still needs to decide on add -alternates
for the sbs|| barn' and that we allow staff to detennine what is the best way tw put
together financing package using umah and Certificates of Participation on o
ten-year note, and the motion passed. Those voting ''No''Trustees Ericson, Norris,
and Phipps. Those voting "Yes" Trustees Elrod and Koenig, Mayor Pro Tom
B|aokhurs\.with Mayor Pinkhamvoting ^Yen^\obreak the tie.
Whereupon Mayor Pinkhamadjourned the meeting at0:08p.m.
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VViUiamC. Pinkham. Mayor
Cynthia A. Deats, Deputy Town Clerk