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Home My WebLink About12573 RESOLUTION NO. 12573 A RESOLUTION APPROVING THE PUEBLO URBAN RENEWAL AUTHORITY’S AMENDED 2012 MEMORIAL HALL RENOVATION BUDGET, THE 2013 MEMORIAL HALL RENOVATION BUDGET, AND THE 2013 PUEBLO CONVENTION CENTER OPERATING AND CAPTIAL BUDGET BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: The Pueblo Urban Renewal Authority (the “Authority”) fiscal year 2012 Amended Memorial Hall Renovation budget; fiscal year 2013 Memorial Hall Renovation budget; and fiscal year 2013 Pueblo Convention Center budget (collectively, the “Budget”), a copy of which is attached hereto, is hereby approved. INTRODUCED: January 14, 2013 BY: Ami Nawrocki COUNCILPERSON PRESIDENT OF CITY COUNCIL ATTESTED BY: CITY CLERK Background Paper for Proposed RESOLUTION DATE: # M-6 January 14, 2013 AGENDA ITEM DEPARTMENT: OFFICE OF THE CITY MANAGER SAM AZAD, CITY MANAGER JENNY M. EICKELMAN, INTERIM DEPUTY CITY MANAGER TITLE A RESOLUTION APPROVING THE PUEBLO URBAN RENEWAL AUTHORITY’S AMENDED 2012 MEMORIAL HALL RENOVATION BUDGET, THE 2013 MEMORIAL HALL RENOVATION BUDGET, AND THE 2013 PUEBLO CONVENTION CENTER OPERATING AND CAPTIAL BUDGET ISSUE Should City Council approve the Pueblo Urban Renewal Authority’s following budgets: Amended 2012 Memorial Hall Renovation Budget; 2013 Memorial Hall Renovation Budget; and 2013 Pueblo Convention Center Budget? RECOMMENDATION Approval of the Resolution. BACKGROUND The Urban Renewal Authority of Pueblo (the “Authority”) annual budget contains two sources of funding which involve the City – 3.3% of City of Pueblo sales tax (the “Vendors Fee”) and tax increment financing revenue (TIF) derived from within certain Urban Renewal Project Areas. The Vendors Fee has been authorized by City Ordinance No. 5810 to be used for payment of principal and interest on bonds for the Pueblo Convention Center, which the Authority owns and operates. It is also used, in accordance with the Ordinance, to cover any net operating loss of the Convention Center after application of Convention Center revenues. In November 2010, the voters of Pueblo approved City Ordinance No. 8196, authorizing the Authority to use the Vendors Fee revenue to issue bonds for the remodeling, restoring and maintaining of historic Memorial Hall. The Authority is bringing the amended 2012 Memorial Hall Renovation budget, the 2013 Memorial Hall Renovation budget, and the 2013 Pueblo Convention Center budget to City Council to confirm the Authority’s compliance with Sec. 14-4-17 of the City Code. FINANCIAL IMPACT The Pueblo Urban Renewal Authority budgets are attached. PUEBLO CONVENTION CENTER GLOBAL SPECTRUM FISCAL YEAR 2013 (January 1- December 31) INCOME STATEMENT BUDGET PROPOSAL BUDGETPROJECTED 20132012 # OF EVENTS454438 ATTENDANCE 53,20552,749 DIRECT EVENT REVENUE RENTAL REVENUE267,387252,215 SERVICE REVENUE133,401106,703 TOTAL DIRECT EVENT REVENUE400,788358,918 ANCILLARY REVENUE FOOD AND BEVERAGE REVENUE1,177,4971,157,835 AUDIO-VISUAL REVENUE54,33944,788 PARKING REVENUE00 DECORATOR SERVICES REVENUE27,28520,420 MERCHANDISE800117 TOTAL ANCILLARY REVENUE1,259,9211,223,160 TOTAL EVENT REVENUE1,660,7091,582,078 OTHER REVENUE28,00018,000 TOTAL GROSS REVENUE1,688,7091,600,078 EVENT EXPENSE SERVICE EXPENSE(137,580)(122,499) FOOD & BEVERAGE EXPENSE(469,509)(440,381) AUDIO-VISUAL EXPENSE(2,355)(1,611) PARKING EXPENSE00 DECORATOR SERVICES EXPENSE(543)(441) BUSINESS CENTER EXPENSE00 TOTAL EVENT EXPENSE(609,987)(564,932) TOTAL EVENT INCOME1,050,7221,017,147 TOTAL INCOME WITH OTHER REVENUE1,078,7221,035,147 INDIRECT EXPENSES EXECUTIVE168,308144,780 FINANCE162,180145,386 MARKETING & SALES236,974204,056 EVENTS115,889101,669 OPERATIONS142,208141,158 OVERHEAD*487,910492,245 FOOD & BEVERAGE OVERHEAD266,381257,024 TOTAL INDIRECT EXPENSES1,579,8501,486,317 Revenue Reimbursement for Memorial Hall Salaries(85,200)0 NET INCOME(415,928)(451,171) OPERATING SURPLUS/(DEFICIT) FOR CONVENTION CENTER(415,928)(451,171) Page 1 of 2 PUEBLO CONVENTION CENTER GLOBAL SPECTRUM FISCAL YEAR 2013 (January 1- December 31) INCOME STATEMENT BUDGET PROPOSAL BUDGETPROJECTED 20132012 NON-OPERATING INCOME Transfer in from Memorial Hall for O&M Subsidy593,178609,740 Transfer in from Memorial Hall for Debt Service534,515535,358 TOTAL TRANSFERS IN FROM MEMORIAL HALL1,127,6931,145,098 NON-OPERATING EXPENSES Capital Expense (scheduling software upgrade)8,0000 Debt Service Payment534,515535,358 Pueblo Urban Renewal Assessment155,087128,653 Misc Expenses/Trustee Fees3,0002,500 Maintenance Reserve00 Promotions Expense00 TOTAL OTHER VENDOR FEE EXPENSES700,602666,511 NET REVENUE OVER EXPENDITURES11,16327,416 (1) The Global Spectrum management fee and incentive fee are included in overhead. The 2013 base management fee is $129,372 of which 20% or $25,874 of the total base fee is deferred until the facility earns $1.4 million in gross revenue for the fiscal year. Upon annual audit certification of revenue the deferred portion is paid to Global Spectrum. Global Spectrum is also eligible for an incentive fee. The incentive fee is calculated on a quantitative and a qualitative component. The quantitative incentive fee is equal to 20% of gross revenue in excess of $1.5 million dollars each fiscal year and capped at 18.75% of the base management fee. The budget amount for 2013 is $24,257. The qualitative component of the incentive fee shall not exceed 6.25% of the base management fee for each year and shall be calculated as follows: The owner shall evaluate Manager's performance during the applicable year in each of the following categories: (1) Customer satisfaction scores-5% (2) Favorable relations with the Chamber and other stake holders-5% (3) Marketing efforts-5% (4) Financial performance-10% The owner shall determine an overall performance rating for each category. Once the total score is determined it shall be divided by 25 to determine the percentage of qualitative incenvite potential. The budget amount for 2013 is $8,086 dŚĞƚŽƚĂůďĂƐĞĂŶĚŝŶĐĞŶƚŝǀĞĐŽŵƉĞŶƐĂƚŝŽŶďƵĚŐĞƚĞĚĨŽƌϮϬϭϯŝƐΨϭϲϭ͕ϳϭϱ (2) The total 2013 vendor fee revenue budget is $1,658,955 Page 2 of 2 Memorial Hall 2013 Budget 2012 Amended 2013 BudgetBudget Income: Prior Year Carryover-Bond project fund6,500,0008,480,987 Prior Year Carryover-Vendor fee reserve1,240,0001,258,567 Prior Year Carryover-Mem. Hall Donation Acct98,4500 Investment and Interest Income2,50010,000 Memorial Hall Contributions50,000223,100 Vendors' Fees1,658,9551,655,895 Total Revenue:9,549,90511,628,549 Construction Expenditures: Memorial Hall Renovation Expenditures7,890,9503,000,000 Total Construction Expenditures:7,890,9503,000,000 Other Expenditures: Transfer to Convention Center for O&M593,178609,740 Transfer to Convention Center for Debt Svc534,515535,358 Debt Service Payment for Memorial Hall528,263528,263 Miscellaneous and Trustee Fees3,0003,000 Total Other Expenditures:1,658,9551,676,361 Net Revenue Over Expenditures$0.00$6,952,188.00