07/22/93 Board of Public Works Special Meeting Minutes

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SPECIAL MEETING JULY 22, 1993 Mr. Horton noted that there are three (3) reasons why this was done. First, to double check internal numbers. Second, the City intends to issue a bond for this project. As part of that process, when the bond is marketed, it will be necessary to have this independent study. Third, any sponsor or donor will want to know the projected cash flow. Therefore, Economics Research Associates was asked to conduct this study. Mr. Horton stated that Economics Research Associates is the best in the field and their methodology was thorough. They studied comparables and did an analysis of every event conducted in this region. The conclusions of the report state that in year one the project will generate approximately $2 million dollars in earned operating revenue and a net operating revenue of $155,000. The net revenue will then decline to a low of $92,000.00 and will then pickup. Mr. Horton noted that it is anticipated that during the first year the project will be heavily support by a local market. There will then be a slight decline and then a pickup as the national share increases. By year ten (10) it is anticipated that attendance will be at 190,000 with revenue of $2.4 million dollars with excess operating revenue at $560,000.00. Mr. Horton noted that Economic Research Associates projects that this project, as an independent free-standing operation, will be self-supporting. City Attorney Richard Nussbaum stated that the Board of Public Works and the Century Center Board of Managers will have submitted to them for their approval and ratification Agreements between the City of South Bend and the Hall of Fame. Mr. Nussbaum noted that on July 13, 1992, a press conference was held announcing that the Hall of Fame was coming to South Bend. Mr. Nussbaum thanked the members of the negotiating team for their hard work which resulted in a fair agreement arrangement that will protect the City and the National Football Foundation and College Hall of Fame. Mr. Nussbaum presented to the members of both boards his overview of the project which is as follows: PARTIES 1. The National Football Foundation and College Hall of Fame, Inc., (NFF), a New York not -for -profit corporation qualified for recognition as exempt from taxation under Section 501(c)(3) of the Internal Revenue Code. 2. City of South Bend - Board of Public Works (BPW) and Century Center Board of Managers (CCBM) AGREEMENTS 1. License Agreement (LA) - Allows use of College Football Hall of Fame (HOF) artifacts, exhibits, intellectual property rights (NFF-BPW). 2. Management Agreement (MA) - Defines management and operation of HOF (NFF-CCBM) 3. License Agreement and Management Agreement cross reference each other and are internally consistent. TERM Forty (40) years and automatic renewals of five (5) years unless one (1) year notice given prior to end of renewal period. GOAL 1. Mechanism for issuance of tax-exempt bonds to finance construction to be paid through private donor and sponsorship program. 2. Establish a revenue stream which will pay for operating expenses to make the Hall of Fame self sufficient. 3. Provide for a world -class redevelopment project in downtown South Bend.