Agenda - Parks and Recreation Commission - 08/14/1997

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Case #2 RECOMMEND FIVE-YEAR CAPITAL IMPROVEMENTS PROGRAM By: Mark Boos, ParkslUtilities Supervisor Background: The City Council's Finance Committee is scheduled to receive the Park and Recreation Commission's 1998-2003 Capital Improvements Plan on Tuesday, August 26, 1997. Earlier this evening, the first public hearing for the Parks CIP will have been conducted (City Council will conduct another public hearing later in the year on the entire budget package). Any comment at this public hearing should be thoroughly addressed before forwarding any recommendation to the Finance Committee. Observation: Upon review of the July meeting minutes, it appears that the only change recommended was with regard to the Community Center bond issue. The recommended change was for an increase from the estimated $1.8 million dollar facility to a 3-to-5-million dollar project. During earlier discussions, it was noted that inclusion of the Community Center (and the bond issue) was added in the fifth year so as to promote discussion about the Community Center. It wasn't certain whether $1.8 million would be adequate or if the City would be the sole provider for the facility's construction (versus a partnership such as the Federal Amateur Sports Center, Anoka County Parks, etc.) What is certain is that bond referendums for this purpose will be difficult, and 3 to 5 million dollars is a great deal of money. The City Administrator provided the following statistics relative to bond payments at 6% interest over 20 years. 5 million dollar bond 4 million dollar bond 3 million dollar bond 2 million dollar bond $435,923 each year $348,738 each year $261,554 each year $174,369 each year The 1997 Tax Levy is $2,047,813. The entire General Fund Budget for 1997 is $3,769,865. Given the substantial relationship to the annual budget that the bond payment would require, it is doubtful that a Community Center of the larger magnitude will be realized in this time frame. The attached CIP still shows the 1.8 million dollar Community Center in the year 2003, but with the feasibility study occurring in 2002, under the General Fund category. Too large of a bond/referendum may defeat the primary purpose of the Community Center's inclusion in the CIP at this time (early discussions about its importance to the Community as a whole) by not seeming credible in comparison to typical expenditures. 3