Minutes - Council Work Session - 04/26/2011

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Councilmember McGlone pointed out some projects take over 18 months, and even 12 months may not be fair. City Attorney Goodrich suggested a discussion take place in the near future to define probation. City Administrator Ulrich stated research will be conducted and brought to a future meeting to discuss changing the policy. 3) Proposed Lease Agreement for 7039 Hwy 10 by RM Golf Carts Economic Development/Marketing Manager Backman reviewed the Staff report. Mayor Ramsey stated his support to approve the agreement, stating this helps retain a good business, and puts a property on the tax roll. Discussion took place regarding the amounts of the lease proposal and the payments to the City. Economic Development/Marketing Manager Backman acknowledged the first year revenues would not be as much due to the fact that the business owner has a significant outlay in cash to move in. The owner is aware that he is taking a large risk. He also noted the plan was always to structure the payments to cover the taxes. He noted it is hard to know what amount the assessors will place on that land and the owner is planning to cover all his insurances. Councilmember McGlone suggested language be added to the agreement to the effect that "the lease payment would never be less than the taxes owed." City Administrator Ulrich suggested adding a 3 -year provision to the agreement in case this property needs to be purchased for the highway. He said he does have a concern that the taxes could exceed the rent. Mark Kaufman, property owner, agreed that language could be added to the agreement regarding the amount of rent to cover taxes. Consensus was reached to recommend the City Council consider approving the proposed five - year lease, noting the taxes will not exceed the lease payment at any time, with RM Golf Carts, Inc. Councilmember Wise suggested adding language to make sure the lease covers the taxes plus a 2% buffer to cover any administrative fees. Mayor Ramsey stated he could see the point of this suggestion, though having the property utilized is worth more than the 2% language. City Attorney Goodrich indicated he would add to the agreement that the owner can have access starting May 1 to begin upgrades, and not pay rent until June 1. - City Council Work Session / April 26, 2011 Page 3 of 4