Agenda - Council Work Session - 03/09/2021

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CC Work Session 2.3. Meeting Date: 03/09/2021 Information Title: Discuss Request from the Anoka Area Ice Arena Association Board (AAIAA) Purpose/Background: The Anoka Area Ice Arena Association (AAIAA) is requesting that the City of Ramsey (see attached email) suspend collecting the 5% charitable gambling tax it currently collects from all charitable gambling locations operating in the city. The AAIAA contends that the size of the city's monthly collection represents at least one monthly payment per year toward their current proposed bond payment. Attached is a chart showing the collections from each of the three charitable gambling locations in the city, the 5% that the city collects from these operations, and the net amount (net of allowable expenses) received by each of the organizations. The AAIAA provides recreational services to the public in the Anoka Ramsey area. Their primary customer is the Anoka Hockey Association of which approximately two-thirds of the participants are Ramsey residents. The Elk River Hockey Association is also a significant user of the Anoka Ice Arena and has Ramsey residents as members in their association as well. The Arena is a private non-profit organization unlike most publicly owned and operated arenas in this area. The City has requested that AAIAA provide more detailed data in regard to the number and % of participants in their programs that are Ramsey residents. City staff is opposed to waiving collections for any one charitable gambling location. The Council has the options of contributing a portion of our total collections back to the AAIAA, or reducing or eliminating the 5% collection on charitable gambling. Based upon the attached documentation of the past 3 years of payments, the city collected a little over $16,000 in 2020 from AAIAA (with 3 months when $0 was collected due to shutdown from COVID). In 2019, the City collected about $21,000, and $16,300 in 2018. Note: Climb Theater is no longer contributing to the fund. They quit their charitable gambling operations in Ramsey as of November 1. They were grandfathered in when we passed our ordinance, even though they were not located within the City of Ramsey, and a charitable gambling location for the AAIAA Ice Arena twas approved because they serve so many Ramsey residents. The Anoka Ramsey Athletic Association (ARAA) operates the other Charitable Gambling location to support their operations. There is currently a balance of $322,000 in the Charitable Gambling Fund for year-end 2020. The City collected a total of about $69,000 in gambling revenue for 2020 from all organizations. The amount of collections for 2021 remains unknown, but activity seems to have rebounded from lows experienced during the early months of the pandemic. Currently, from the Charitable Gambling Fund, the city supports Youth First ($15,000), and Alexandra House ($5,000) from this fund. In 2020, the City also funded the Concerts -in -the -Park, and built Ford Brook Playground. These items totaled almost $88,000. In summary, the city has a gambling ordinance that requires a contribution to the City of 5%, and these funds are used to support important youth -related activities within the city. In the past, most spending decisions regarding this fund have been discussed as part of our annual budget process. Timeframe: 15-20 minutes Funding Source: