09-10-01 Council Meeting Minutes

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REGULAR MEETING SEPTEMBER 10, 2001 the operations of the Hall of Fame. The City has finally concluded an Interim Agreement that makes that division. It is a five (5) year Interim Agreement, retroactive to January 1, 2001, and as part of that Agreement it is necessary for the City to transfer some additional funds. As of December 31, 2000 there was an operating cash balance of four hundred fifty thousand dollars ($450,000.00) that was used for operation of the Hall to cover regular expenses. As part of the Agreement the City is transferring that operating cash balance to the NFF for their use while they are operating the Hall. In the event that the operation of the Hall should revert to the City, under the original agreement, this amount would also revert to the City for the continued use for the operation of the Hall. In the event that the Hall should stop operating, the City must return to the NFF the $1.9 million dollars that they have invested into the operation of the Hall. In the event that the Hall should close, the four hundred fifty thousand dollars ($450,000.00) would be applied as a credit against that $1.9 million dollars that the City would owe to the NFF. Additionally, the City operated the Hall from January 1 St through May 31 It because an agreement was not in place. During that time there were revenues that came into the Hall as well as expenses that went out and the City must appropriate a cash amount to the NFF for that period of time. Also, in the current budget the Council appropriated one hundred fifty thousand dollars ($150,000.00) in professional sports development money for the Hall of Fame. That was the minimum amount by the agreement with the NFF that the City was required to provide. More professional sports development dollars are coming in and therefore the Council is being asked, as part of this appropriation, to increase the amount of professional sports development dollars available to what it is projected will be the amount received this year. Those dollars will only be expended in so as far as the NFF has qualifying capital expenditures at the Hall to draw those dollars down. In conclusion, the Mayor asked for the Council's favorable consideration. This being the time heretofore set for the Public Hearing on the above bill, proponents and opponents were given an opportunity to be heard. There was no one present wishing to speak i-n . favor of this bill. Mr. Jim Cierzniak, 1156 East Victoria Street, South Bend, Indiana, stated that he would like to see the Hall of Fame closed and that transferring the operation of the Hall to the NFF means very little. He stated that he cannot believe that they can operate the Hall better than the City. Mr. Cierzniak outlined the amounts of money which the City has already transferred to the NFF. He noted that the City has an obligation of over $2 million dollars per year for the next seventeen (17) years in expenditures. The bond payment is $1.4 million dollars and will not be retired until 2018. In addition, the Hotel Motel tax is currently about four hundred sixty -two thousand dollars ($462,000.00) and the Sports Development Fund is two hundred fifty thousand dollars ($250,000.00) to three hundred thousand dollars ($300,000.00). He noted that both the Sports Development fund and the Hotel Motel tax have grown considerably within the last three (3) years. Those numbers are going up considerably and the City is obligated to send it all to the NFF as there is no cap. Those totals could be at least $2.1 or $2.2 million dollars a year. Mr. Cierzniak further noted that the City will face considerable costs in capital expenditures in maintaining the Hall. The City is obligated to pay for anything that goes wrong with the exterior and still faces the amount of $1.9 million dollars which is an obligation and not a gift as was told. There was no one else present wishing to speak to the Council concerning this bill. In rebuttal, Mayor Luecke urged the Council not to pull the plug on the Hall of Fame as the Interim Agreement will yield a better running of the Hall. It has established the responsibilities where they belong. The building is the responsibility of the City and that obligation is to pay for the construction of it and to maintain it. The NFF's keenest interests are in the operation of the Hall and they will bring some additional attention to it. In conclusion, Mayor Luecke stated that he believes this is the appropriate way to move forward. 10