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HomeMy WebLinkAboutR-86-0415J-86-437 5-28-86 RESOLUTION NO.8Gl415 ' A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE A LAND USE AGREEMENT, BETWEEN - THE CITY AND THE MIAMI SPORTS AND Q EXHIBITION AUTHORITY, IN A FORM - w ACCEPTABLE TO THE CITY ATTORNEY AND r INCORPORATING CERTAIN TERMS AND CONDITIONS; FURTHERMORE AUTHORIZING THE CITY MANAGER TO APPROVE ON BEHALF OF THE COMMISSION THE DEVELOPMENT AGREEMENT BETWEEN THE AUTHORITY AND THE DECOMA_ VENTURE PROVIDED IT IS CONSISTENT WITH i TERMS AND CONDITIONS AS SET FORTH HEREIN. { a _— l i WHEREAS, the City of Miami and the Miami Sports and Exhibition k- z, Authority have selected the Decoma Venture, a Texas Joint Venture, as the developer of a multi -purpose coliseum and; j WHEREAS, as part of the Southeast Overtown/Park West 3 Redevelopment Project, the Miami Sports and Exhibition Authority and the Decoma Venture will utilize property provided by the City in x' RT addition to other property, for the development of the multi -purpose - coliseum; and WHEREAS, the City Manager and the Miami Sports and Exhibition Authority have negotiated with the Decoma Venture over the terms of a Development Agreement and Land Use Agreement and the negotiations have resulted in the summary of terms which is attached hereto and made a part hereof; and WHEREAS, the City of Miami wishes to expedite the development of the multi -purpose coliseum in order to facilitate the acquisition of a National Basketball Association expansion franchise; and WHEREAS, the Miami Sports and Exhibition Authority by resolution dated December 16, 1985 provided that prior to expending bond proceeds for the hard costs of construction, the Authority would obtain the consent of the City of Miami Commission to the Development Agreement; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: CM C01=9SION 3=77NG 4F MAY 29 08 8E-415', �fMARK1 1 Section 1. The Commission hereby authorizes the City Manager to execute a land use agreement between the City and the Miami Sports and Exhibition Authority in a form acceptable to the City Attorney incorporating the terms and conditions included in the summary of terms (Exhibit A) attached hereto. Section 2. The Commission hereby authorizes the City Manager to approve the Development Agreement between the Miami Sports and Exhibition Authority and the Decoma Venture on behalf of the I Commission in fulfillment of the Authority's December 16, 1985 i resolution and the Preliminary Development Agreement between the ;i City, the Decoma Venture and the Authority which was authorized pursuant to Resolution No. 86-414, adopted this date, provided that the terms and conditions of the Development Agreement are consistent with the terms and conditions included in the summary �3 of terms (Exhibit A) attached hereto. PASSED AND ADOPTED this 29th day of MAY . 1986. X ER L. SUAREZ, MAYOR City Clerk PREPARED AND APPROVED BY: &a,t� ROBERT F. CLARK Chief Deputy City Attorney APPROVED„AS TO FORM AND CORRECTNESS: LUMAI A. DOUGUERTY City Attorney RFC/wpc/pb/M143 SG--415 - -1- MIAMI ARENA BASIC BUSINESS TERMS AND ARRANGEMENT A. Outline of Business Agreement 1, Parties_ Miami Sports and Exhibition Authority and Decoma Miami Associates, .Limited ("Operator"). Decoma Venture consisting of affiliates of Barker Interests Ltd, Linbeck Construction Company, and HSA Management Inc., (or a limited partnership in which Decoma. is the sole general partner) shall remain sole general partner. 2. Tern: 32 years plus 2 10-year renewal options. 3. Decoma Equity Contribution: Provide a letter of credit or some other evidence equally as acceptable to Authority for $7.1 million at the time of contract execution, with remaining project costs funded by the Authority. PROJECT FUNDING SUMMARY MSEA $42,879,000 Decoma 7,121,000 Total Estimated Project Cost $50,000,000 4. Distribution of Proceeds: Decoma MSEA a) Net Operating Income (NOI) When NOI is between 0 and 1.75 million. 57.5% 42.5 Greater than 1.75 but less than 3.5 million. 45% 55% Greater than 3.5 million. 40% 60% b) Seat User Charge When charge is between 0 and 1.35 million. 75% 25% Greater than 1.35 million. 50% 50% EXHIBIT A 86--415. . 5, Fees for Decoma Provided Services a) Development Fee - 3% of project cost. b Construction Fee- Per standard guaranteed maximum price contract (GMAX) 25% of savings to contractor. In J addition the balance of savings (i.e. 75%) to the Authority to be applied to project costs. c) Management Fee: i. Fixed $275,000 per y6ar plus 5% or CPI adjustment. ii. Variable 12% of operating income over $1.5 million; payable only f o r those years in which the operating revenue and seat use charges exceed operating expenses. 6. Construction Matters: a No contracts will be executed until the final construction plans and project budget are approved by the Authority, its experts, and the City Manager. b) With regard to furniture, fixtures, and equipment (FF&E), any concessionaire pre -payments (up to $2,000,000) shall be deemed Decoma private capital and shall be utilized entirely for project costs; the portion of any concessionaire prepayments in excess of $2,000,000 (other than loans or equity contributions) shall be treated as operating income and distributed as provided for in 4 (a) above. Neither the City nor the Authority shall have any liability for, or interest in, any loan or equity contribution made to Operator/Decoma by a concessionaire or other long term tenant such as an NBA or NHL team owner. 7. Authority Protections Against Deficits and other Liabilities: a) Authority verifies pro forma operating statements. Current projections demonstrate immediate profit even without an NBA team* (See attached pro formas and event commitments section describing the additional types of revenue producing events independent of NBA basketball). b) No liability for operating losses resulting from operating expenses more than 115% of approved budget for such year. c) Authority review of budgets in each year. d) Reserve Fund for operating losses and capital replacements funded up to $3 million from guaranteed fund in place as per 1985 bond issue. iC 86-41.4j". e) Authority approval of major use event contracts* f) Decoma will provide 14% of operating losses after first fi exhausting reserves, in years when the operating revenue and MSEA's seat use charges are less than operating expenses. g) Operating expenses shall include $50,000 each year, increased to $150,000 each fifth year as a contribution out of operating income to the replacement reserve fund. 8. Cancellation by Authority: The agreement shall be cancellable as follows: (a) with cause, with no fee for termination. (b) without cause, on the 17th and 30th anniversary with a termination fee equal to the greater of 7.5 times the average of the best five years or Decoma's equity investment. 9. Non Competitiou Provision City will not sponsor a competing facility to the Arena at which substantially similar events can be presented on a commercial basis to audiences of comparable size other than the James L. Knight International Center, Ralph Monroe Marine Stadium (as they presently exist), and the proposed new Exhibition/Convention Hall Facility. B. Land Use Agreement: (1) Parties: City of Miami and Miami Sports and Exhibition Authority. (2) (3) pa th eq ye Term: 99 years. Land Use Payment: A payment of $300,000 per year shall be MIAMI ARENA BASIC BUSINESS TERMS AND ARRANGEMENT A. Outline of Business Agreement 1. Parties: Miami Sports and Exhibition Authority and Decoma Miami Associates, Limited ("Operator"). Decoma Venture consisting of affiliates of Barker Interests Ltd, Linbeck Construction Company, and HSA Management Inc., (or a limited partnership in which Decoma is the sole general partner) shall remain sole general partner. 2. Term: 32 years plus 2 10—year renewal options. 3. Decoma Equity Contribution: Provide a letter of credit or some other evidence equally as acceptable to Authority for $7.1 million at the time of contract execution, with remaining project costs funded by the Authority. PROJECT FUNDING SUMMARY MSEA $42,879,000 Decoma 71121,000 Total Estimated Project Cost $50,000,000 4. Distribution of Proceeds: Decoma MSEA a) Net Operating Income (NOI) When NOI is between 0 and 1.75 million. 57.5% 42.5 Greater than 1.75 but less than 3.5 million. 45% 55% Greater than 3.5 million. 40% 60% b) Seat User Charge When charge is between 0 and 1.35 million. 75% 25% Greater than 1.35 million. 50% 50% EXHIBIT A ss-ails: . 5. Fees for Decoma Provided Services a) Development Fee - 3% of project cost. b) Construction Fee- Per standard guaranteed maximum price contract (GMAX), 25% of savings to contractor. In addition the balance of savings (i.e. 75%) to the Authority to be applied to project costs. c) Management Fee: i. Fixed - $275,000 per year plus 5% or CPI adjustment. ii. Variable - 12% of operating income over $1.5 million; payable only for those years in which the operating revenue and seat use charges exceed operating expenses. 6. Construction Matters: a) No contracts will be executed until the final construction plans and project budget are approved by the Authority, its experts, and the City Manager. b) With regard to furniture, fixtures, and equipment (FFSE), any concessionaire pre -payments (up to $2,000,000) shall be deemed Decoma private capital and shall be utilized entirely for project costs; the portion of any concessionaire prepayments in excess of $2,000,000 (other than loans or equity contributions) shall be treated as operating income and distributed as provided for in 4 (a) above. Neither the City nor the Authority shall have any liability for, or interest in, any loan or equity contribution made to Operator/Decoma by a concessionaire or other long term tenant such as an NBA or NHL team owner. 7. Authority Protections Against Deficits and other Liabilities: a) Authority verifies pro forma operating statements. Current projections demonstrate immediate profit even without an NBA team. (See attached pro formas and event commitments section describing the additional types of revenue producing events independent of NBA basketball). b) No liability for operating losses resulting from operating expenses more than 115% of approved budget for such year. c) Authority review of budgets in each year. d) Reserve Fund for operating losses and capital replacements funded up to $3 million from guaranteed fund in place as per 1985 bond issue. 86 -41.5-- e) Authority approval of major use event contracts. f) Decoma will provide 14% of operating losses after first exhausting reserves, in years when the operating revenue and MSEA's seat use charges are less than operating expenses. g) Operating expenses shall include $50,000 each year, increased to $150,000 each fifth year as a contribution out of operating income to the replacement reserve fund. 8. Cancellation by Authority: The agreement shall be cancellable as follows: (a) with cause, with no fee for termination. (b) without cause, on the 17th and 30th anniversary with a termination fee equal to the greater of 7.5 times the average of the best five years or DecomaIs equity investment. 9. Non Competition Provision City will not sponsor a competing facility to the Arena at which substantially similar events can be presented on a commercial basis to audiences of comparable size other than the James L. Knight International Center, Ralph Monroe Marine Stadium (as they presently exist), and the proposed new Exhibition/Convention Hall Facility. B. Land Use Agreement: (1) Parties: City of Miami and Miami Sports and Exhibition Authority. (2) Term: 99 years. (3) Land Use Payment: A payment of $300,000 per year shall be paid to the City of Miami as a ground lease payment for the first thirty (30) years. Thereafter, the land use payment shall be equal to the fair market rental value adjusted every five (5) years. ati J FORM 4 Mfl- ORANDUM OF VOYIF'.l CONFLICT LAST NAME —FIRST NAME —MIDDLE NAME THE BOARD. KENNEDY Rosario WHICH I SERVE IS A UINITOF•LiCOM MISSION, AUTHORITY, OR COMMITTEE ON MAILING ADDRESS 3500 Pan American Drive UCITY 13COUNTY 13 OTHER LOCAL AGENCY ESTATE CITY COUNTY Miami Dade NAME OF POLITICAL SUBDIVISION OR STfTE AGENCY DATE ON WHICH VOTE OCCURRED City of Miami CO fission May 29, 1986 NAME OF BOARD. COUNCIL, COMMISSION, AUTHORITY, OR COMMITTEE WHO MUST FILE FORM 4 This form is for use by any person serving on either an appointed or elected board, council, commission, authority, or committee, whether state or local, and it applies equally to members of advisory and non -advisory bodies who are faced with a voting conflict of interest. As the voting conflict requirements for public officers at the local level differ from the requirements for state officers, this form is divided into two parts: PART A is for use by persons serving on local boards (municipal, county, special tax districts, etc.), while PART B is prescribed for all other boards, i.e., those at the state level. PART C of the form contains instructions as to when and where this form must be filed. PART A VOTING CONFLICT DISCLOSURE FOR LOCAL PUBLIC OFFICERS [Required by Section 112.31430), Florida Statutes (Supp. 1984).] The Code of Ethics for Public Officers and Employees PROHIBITS each municipal, county, and other local public officer FROM VOTING in an official capacity upon any measure which inures to his special private gain. Each local officer also is prohibited from knowingly voting in his official capacity upon any measure which inures to the special gain of any principal (other than a government agency as defined in Section 112.312(2), Florida Statutes) by whom he is retained. In any such case a local public officer must disclose the conflict: (a) PRIOR TO TH E VOTE BEING TAKEN by publicly stating to the assembly the nature of his interest in the matter on which he is abstaining from voting; and (b) WITHIN 15 DAYS AFTER THE VOTE OCCURS by describing the nature of his interest as a public record in this part below. NOTE: Commissioners of a Community Redevelopment Agency created or designated pursuant to Section 163.356 or Section 163.357, Florida Statutes (Supp. 1984), or officers of independent special tax districts elected on a one -acre, one -vote basis are not prohibited from voting. In such cases, however, the oral and written disclosure of this part must be made. I, the undersigned local public officer, hereby disclose that on Mag 9 A , 19 86_..: (a)1 abstained from voting on a matter which (check one): inured to my special private gain; or X inured to the special gain of Decoma Venture , by whom I am retained. My husband, David T. Kennedy, has served as a consultant to Decoma Ventur in the past. I therefore, abstain from voting on this matter. CE FORM 4. REV. 1044 Mug I (b) The measure on which 1 abstained and the nature of my interest in the measure is as follows: R-86-415: Land use agreement with the Miami Sports and Exhibition Authority; further approving agreement with Authority and Decoma Venture dealing with Sports Arena. Date Filed n� Signature Please see PART C for instructions on when and where to file this form. PART S VOTING CONFLICT DISCLOSURE FOR STATE OFFICERS [Required by Section 112.3143(2), Florida Statutes (Supp. 1994).] Each state public officer is permitted to vote in his official capacity on any matter. However, any state officer who votes in his official capacity upon any measure which inures to his special private gain or the special gain of any principal by whom he is retained is required to disclose the nature of his interest as a public record in Part 8 below within IS days after the vote occurs. I, the undersigned officer of a state agency, hereby disclose that on (a) I voted on a matter which (check one): inured to my special private gain; or inured to the special gain of (b) The measure on which 1 voted and the nature of my interest in the measure is as follows: Date Filed Signature Please see PART C below for instructions on when and where to file this form. PART C FILING INSTRUCTIONS , 19 . , by whom I am retained. This memorandum must be filed within fifteen (1 S) days following the meeting during which the voting conflict occurred with the person responsible for recording the minutes of the meeting, who shall incorporate the memorandum in the meeting minutes. This form need not be filed merely to indicate the absence of a voting conflict. NOTICE: UNDER PROVISIONSOF FLORIDA STATUTES1112.317(1963).AFAILURETOMAKEANYREQUIREDDISCLOSURECONSTITUTESGROUNDSFORANDMAY BE PUNISHED BY ONE OR MORE OF THE FOLLOWING: IMPEACHMENT, REMOVAL OR SUSPENSION FROM OFFICE OR EMPLOYMENT. DEMOTION, REDUCTION IN SALARY, REPRIMAND. OR A CIVIL PENALTY NOT TO EXCEED 115,000. CE FORM 4 • REV. 10-94 PAGE 2