Minutes - Council Work Session - 03/09/2021

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payment on that debt service. He stated that there are over 200 Ramsey residents that skate in the Anoka organization. He noted that Ramsey residents are also members of Anoka High School and the Elk River organization, which both use ice time at the arena. He stated that turf was also installed to provide soccer and lacrosse use. Councilmember Musgrove asked why the tax came about. She stated that the organization receives revenue from the ice time it rents, and the fees paid by members. She asked if the high school pays for ice time. Mr. Lichter replied that the high school does rent ice time at a lower rate because it uses off-peak ice time, and the remainder of the time is sold to the Anoka and Elk River associations. He stated that those funds cover a portion of the operations for the facility. He stated that the remainder of the operation costs and capital needs are funded through charitable gambling. Councilmember Musgrove asked the precedent that would be set in giving these funds back as a contribution. City Administrator Ulrich replied that the City has not typically given contributions outside of its boundaries so this would somewhat set precedent. He noted that the City has been asked to participate in City wide events in that manner in the past which it chose not to participate in. He stated that while this would set precedent, it would not necessarily be a bad precedent because of the number of Ramsey residents that use the facility. He stated that there is a benefit in keeping the fund solvent as it can be used to offset general fund expenses as well. He stated that the five percent tax ensures that some of the funds earned through charitable gambling go back to the community. Councilmember Musgrove asked for details on reducing the tax to 2.5 percent rather than the five percent. She asked the duration AAIAA is requesting the five percent tax be waived. Mr. Lichter replied that AAIAA would like to see a period of 20 years to align with the payment of the debt services for the infrastructure improvements. City Administrator Ulrich commented that $69,000 are collected annually through the five percent tax therefore reducing that to 2.5 percent would reduce that by half. Mayor Kuzma commented that he does not support lowering the five percent tax as he would be concerned that would set a precedent to open to the door for requests from other entities. Councilmember Musgrove asked if the $69,000 is generated through only the AAIAA charitable gambling. City Administrator Ulrich stated that his reply was if the tax were reduced across the board for all charitable gambling entities, not just AAIAA. Councilmember Riley commented that he did not believe the City could play favorites and tax one entity one amount and another entity another amount, therefore he would not want to change the City Council Work Session / March 9, 2021 Page 5 of 9