#07 Wisconsin Hockey Partners Advertising Signage at ice rink
CITY MANAGER DEPARTMENT MEMORANDUM
September 9, 2009
MEMO TO: City Council
MEMO FROM: Eric Levitt, City Manager
SUBJECT: Request for City Council to determine whether to overturn City
Manager’s decision on WHP advertising signage at the ice rink.
Background Information
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The City Manager has attached the February 19 Communication for
background. He has also provided the signage requests under consideration.
Councilman Perrotto and Councilman Brunner requested that the Council review
the City Manager’s decision on the signage that has reference to Miller Lite.
WHP requested that the City authorize their proposed signage for the rink in
accordance with the contract language attached. The City Manager after
reviewing the language of the contract, the signage and the tape of the City
Council discussion, determined that the signage including four signs that had
reference to Miller Lite and Miller Draft were appropriate within the contract
language, but that the in-ice logo for Miller Lite was not authorized.
It is the City Manager’s understanding that the two Council members have
requested review specifically to evaluate whether the signage for Miller Lite
needs to be covered between games. WHP has requested that the City Council
additionally review the City Manager’s decision not to authorize the in-ice logo.
Suggested Motions
1. I authorize the beer related signage only for the four hours during the
Janesville Jets games and request removal of signage during off-game
times.
2. I authorize the advertising as authorized by the City Manager.
3. I authorize the advertising as authorized by the City Manager and
additionally authorize an in-ice logo for Miller-Lite.
CITY MANAGER DEPARTMENT MEMORANDUM
March 16, 2009
MEMO TO: City Council
MEMO FROM: Eric Levitt, City Manager
SUBJECT: Action on approving design contract for ice rink building
modifications.
Introduction
File Resolution 2009-569 authorizes the City Manager to execute a Use
Agreement with the Wisconsin Hockey Partners, LLC (WHP) to utilize the
Janesville Ice Center as their team home rink. This agenda item requests City
Council action on the City of Janesville making modifications to the Ice Center
and to potentially sign an agreement to accommodate a new Junior A Hockey
Team. The next section represents an update since the January meeting.
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Update for March 23 City Council meeting
The City Council brought forward several areas to be further reviewed.
1. Concerns with involvement from the user groups.
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The City conducted an initial needs analysis meeting with the
architect and the user groups.
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Angus Young will be bringing back potential design options based
on the need analysis at a user group meeting at the end of March.
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City Council can adopt a motion to approve the contract with a
capital cost limitation.
2. Financial component
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The City anticipates making approximately $15,000 + per year in
increased net income.
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Areas that were looked for additional income included having ticket
add-on fee or collecting a percentage of beer sales revenues.
However, neither of those options were added to the contract.
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Security costs remain shifted to the WHP. This is a cost the City
initially shared in.
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The needs analysis has brought forward some necessary capital
items (i.e. restroom improvements and heating elements) that were
not included in the initial estimates. This may increase construction
costs and total project. We do not have an updated cost as of this
date.
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Future Capital cost sheet is attached.
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The Youth Hockey Advertising and Concessions contract has
ended and the City is in the process of renegotiating the contract.
3. Concerns with alcohol sales at the ice rink.
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The Contract now states that alcohol will be sold in separate area.
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Having designated sections will be further investigated as the
design moves forward but can’t be committed to at this time
Background Information
The City Administration was contacted in the late Spring of 2008 by a group of
local investors interested in bringing a North American Hockey League (NAHL)
franchise team to Janesville. After fiscal analysis and discussions with the City
Administration, the investors decided to review use of the existing ice facility.
July 18,
The City Administration met with the City Council in closed session on
2008 and again on October 13, 2008
in closed session. The City Council
directed the City Administration to proceed with negotiations and identify cost
estimates for building modifications. The City Administration has negotiated a
Use Agreement with the WHP (copy attached). The Engineering Division has
identified a cost estimate of approximately $200,000 for necessary building
modifications and architectural fees. This cost estimate could change after an
architect prepares plans and specifications and the City goes through the public
bidding process.
City staff met with many of the current user groups at the Ice Center on
September 2, 2008. There could be impacts with schedule changes if this new
Junior A Hockey Team comes to Janesville. The team anticipates practicing
during weekday afternoons and have games on Friday and Saturday nights. All
of the user groups were receptive to any schedule changes. They felt the
advantages of having a Junior A Hockey Team in Janesville outweighed some
slight inconveniences of schedule changes.
Further Analysis provided at the February 23rd Council meeting
The City Manager reviewed several aspects of this proposed project since the
last meeting based on comments and concerns raised. The areas reviewed are
the financing of the construction, the operational costs, impacts to programming,
potential for the team to end the lease, and user input.
Capital Financing
1.
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The estimated cost is a total estimated cost of not to exceed
$229,000.
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The City Manager has communicated his intent to try to maintain
the total cost at approximately $200,000 if possible.
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The construction can be financed via borrowing new funds or
reallocating in May from existing borrowed funds.
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The financing would equal approximately $1 per year for an
assessed house of $113,000.
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Annual Operations
2.
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2008
The year resulted in a subsidy of approximately $85,000.
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reduce the property
If the Junior team came to the City it would
tax subsidy
by approximately $15,000 to $20,000 (all other factors
remaining stable.)
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The ice rink currently subsidizes other recreation programming
such recreation night and camps by approximately $20,000. This is
due to a contract with the school using the rink for free and then
allowing use of their facilities for free.
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Other recreation programs operated by the City range in subsidy
from $109,000 to $228,000 (The number does not include the
100% subsidy of parks capital program and parks programming)
This shows that the rink is the lowest subsidized recreation
program and that an element of all recreation programs is that they
are subsidized by property taxes.
Impacts to programming
3.
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The major programming that will be impacted is Friday night skates on
game nights. There may also be some programming that has to be
moved around due to the camps and practice schedule, but should
have more minimal impact.
Wisconsin Hockey Partners, LLC
The WHP is a Limited Liability Company that is licensed to operate in the State of
Wisconsin.
NAHL League Information
oldest Junior A Hockey
The NAHL was founded in 1975 which makes it the
League in the U.S.
The NAHL consists of 17 teams in three divisions (West,
Central and East). The Janesville team would be part of the Central Division with
six other teams from Minnesota, Iowa, South Dakota and Illinois. Janesville
would be the site of the first Wisconsin team. The league prepares 16-20 year
old hockey players who wish to play collegiate hockey. The team consists of 23
players plus support staff, of a head coach, two assistant team managers and an
equipment manager. The staff is paid a salary. The hockey players are not paid
because of their amateur status, but receive a stipend for living expenses. The
hockey players would room and board with local families and receive monthly
compensation for expenses.
The team would use practice ice on Monday-Thursday afternoons and play
games on Friday and Saturday nights. The team would play 30 home games
and have a similar number of away games. Their hockey season is September
to April. They would also rent summer ice for camps and team try-outs.
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The NAHL has a minimum seating capacity limitation of 1,500 spectators. The
Janesville Ice Center has bleacher seating for 1,000 spectators. The NAHL is
willing to make an exception for Janesville until they see how the league
develops. The NAHL has made this same accommodation for other ice rinks
with similar seating limitations. Although the Ice Center only has seating for
1,000 spectators, the building capacity is 2,266 people.
Community Survey
The WHP conducted a market study in November 2008 by interviewing 358
Janesville residents to identify community reaction to this new Junior A Hockey
Team coming to Janesville. The survey results concluded the following:
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53% somewhat agreed or strongly agreed that the City should promote
more sports and recreational activities.
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48% stated that they or someone from their household had attended at
least one sporting event in Janesville during the past year.
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65% stated that they or someone from their household had attended at
least one City sponsored event during the past year.
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94% stated it was important to have the ability to watch local and
Wisconsin athletes play sports.
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51% stated they consider themselves fans of hockey.
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49% stated they were interested in seeing an amateur sports franchise in
Janesville.
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54% stated they liked the idea of a NAHL Junior A Hockey Team in
Janesville.
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48% stated they would likely attend a Junior A hockey game in Janesville.
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21% stated they were more likely and 67% stated they were less likely to
attend a Junior A hockey game if beer was served.
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68% stated a Junior A hockey team would have a positive impact on the
community.
The community survey added insights to information gathered from other teams
for the WHP.
Use Agreement Highlights
The Use Agreement provides for a five year term which is renewable. The WHP
will pay the City for ice rental time and rental fees for dedicated team locker
rooms and office space. The Use Agreement allows the WHP to apply for an
alcohol license which would be served only during games. They would stop
selling alcohol at the end of the second period. The WHP will also sell team
merchandise. The WHP will assume the advertising rights inside the Ice Center
which are currently allotted to the Janesville Youth Hockey Association (JYHA).
The JYHA had a contract that ended prior to 2008 that provided that they pay the
City $10,000/year and receive the ability for these advertising rights. JYHA has
not renewed the contract due to the net loss of funds to the club.
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The WHP has agreed to allow JYHA to continue operating the concession stand
which provides food and non-alcoholic beverages. The WHP would have the
right to sell other food products which are not provided by the JYHA concession
stand as long as they are not directly competing with JYHA.
Building Modifications
Any building modifications to the Ice Center would occur within the limits of the
existing building footprint. Current program space would be modified or
combined to make the existing space more functional for the NAHL and the City.
The Administration is proposing to hire an architect to prepare building plans for
future City Council review.
The NAHL requires dedicated space for a locker room, showers, office space
and equipment storage. Preliminary review of the building would suggest we
convert the warming room and concession stand area to locker rooms and office
space for the new team. The existing entrance lobby and community room would
be converted to the new concession area with public space to serve as a
warming room. Beer would be served in this area as well. The main entrance
would be shifted to the old entrance on the west side of the building. Some
vehicle circulation and parking changes would be needed outside the building.
The Engineering Division has estimated a cost of $200,000 for building, parking
and architectural services. The cost for these building modifications and site
improvements would be funded by the City.
Ice Scheduling Impacts
The WHP will use the Ice Center approximately 420 hours per year. This usage
level will have some impacts on our current master schedule for user groups.
City staff has met with all the user groups in the early Fall and they are receptive
to any schedule changes. Most of the impact will be with Friday night public
skating sessions, Saturday night Youth Hockey games and weekday figure
skating practices. There will be no impacts on Friday and Saturday when the
team has away games. The new team will begin playing in September 2009
which would be the earliest impact on our master schedule.
NAHL Expenses and Revenue
WHP plans to sell adult admission tickets at approximately $9 a game. WHP will
provide discounted ticket prices of $6 to $7 for youth, seniors and group outings.
It has been indicated that an average of 700 spectators at each home game and
hopefully more spectators for league playoffs and tournaments is necessary for
this to be successful long-term.
City Manager Recommendation
The City Manager has continued negotiations with WHP representation since the
last meeting. The proposed contract attempts to balance the interests of WHP
and the City of Janesville.
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Proposed Motion
I move to approve File Resolution 2009- 569 and to move forward with
renovations at the rink at a cost not to exceed $______________.
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