Subject to change as finalized by the City Clerk. For a final official copy, contact the City
Clerk's Office, (319)753-8124.
MINUTES OF THE PROCEEDINGS OF
THE BURLINGTON, IOWA, CITY COUNCIL
Special Meeting No. 38
September 22, 1997
The Burlington City Council met in special session at 7:00 p.m. with Mayor Sandell, Council
Members Heland, Henry, Scott and Thomas, present.
SPECIAL MEETING NOTICE ACKNOWLEDGED
PRESENTATION FROM SOLID WASTE COMMISSION TO JANE WOOD, CITY
MANAGER
DISCUSSION: David Plyman, City Administrator for West Burlington presented Jane Wood,
City Manager, with a plaque for serving on the Solid Waste Commission. He stated that he
appreciated her commitment to the Solid Waste Commission from 1993 to 1997. All present had
opportunity to speak and nothing additional was filed in the office of the City Clerk.
RESOLUTION:
1. Resolution Approving Appointment of Voting Delegates for the Annual Congress of Cities
DISCUSSION: None.
(VOTE: 5 - "AYES") ADOPTED
PUBLIC HEARING:
1. Statement: Consideration of Lease Agreement with Catfish Bend Casinos, LC
COMMENTS: The City Manager reviewed the lease agreement with Catfish Bend Casinos, LC to Council and the viewing audience. She stated that the proposed lease provides for the following under the premises leased clause: exclusive use of the Port Building to the south line of the Great River Bridge for the time the boat is docked in Burlington; 190 parking spaces designated under the Great River Bridge with Catfish Bend responsible for signage; acknowledgment that the area is owned by the State and subject to additional conditions; not less than 40 parking spaces at the far north area of Riverside Park (to be built prior to 10/15/98); spaces are not leased; spaces are controlled by the City; 633 square feet of existing facilities at the Port of Burlington building; maximum number of parking spaces south of Memorial Auditorium (south of Market Street lift station) mainly for employee parking (30 spaces designated for vehicles with boat trailers); parking area between Port and Memorial Auditorium shall be monitored by Catfish Bend -- City will notify Catfish Bend when events are expected to have over 750 in attendance; City will post; Catfish Bend will move employees and patrons off riverfront when 750 people are anticipated at the Port or Memorial Auditorium or area in between; and 350 foot area on the riverfront extending 40 feet north of the Port of Burlington building to 140 feet south and 125 feet east. She stated that the utilities clause included additional language that the City would remove above ground utilities at Big Muddy's and Lessee agrees to contribute $1,000.00 towards the cost of removal. She stated that the signage clause provides that Catfish Bend will install landscaping ($2,500.00) cap) by entrance sign. She stated that the maintenance clause provides additional language that the City will maintain premises except for damages and repairs resulting from Catfish Bend's use, and that the City will hire an engineering team to assess condition of seawall -- Leasee will reimburse up to $10,000.00. She stated that the term of the lease was five years with an option to renew for five years. She stated that the exclusivity clause restricts non-gambling boats to 7 consecutive days of docking, and restricts docking privileges to excursion boats over 75 without prior consent of Lessee. She stated that Catfish Bend would pay the City of Burlington $108,000.00 annually, ($9,000.00 monthly) She stated that the community investment clause has been deleted from the new lease with Catfish Bend, along with the riverfront events clause due to limit of docking season from October through April. Scott Power, legal counsel, stated that the indemnification clause spells out $4,000,000.00 insurance coverage needed to protect property, real or personal, located on the leases premises when Catfish Bend is docked in Burlington. He stated that the assignment and subletting clause allows Catfish Bend to assign and sublet the lease. He stated that the phrase "liquidated damages are immediately due and payable" was deleted from the lease. The City Manager stated that the taxes clause provides that Catfish Bend will collect and remit to the State of Iowa all sales tax revenue derived from the operation of its boat, and the property tax exemptions only apply to Burlington. She stated that the permits clause provides that Catfish Bend will be responsible for obtaining all permits. She further stated that the part-time operation clause of the lease allows for part-time operations for approximately 6 months, no earlier than October 15th, and ending not later than April 30th of each year. The Finance Director reviewed the financial aspect of the lease. He stated that the City would receive the following revenues: lease payment $108,000.00; gaming revenue $250,000.00; BADCO $62,500.00; Hotel/Motel Tax $50,000.00 for a grand total annually of $470,500.00 for riverfront improvements. He stated that the proposed improvements to be funded included the following: south parking lot $280,000.00; Port/Auditorium Plaza (Base) $1,500,000.00; water feature option $250,000.00; prior deficit $70,000.00 for a total of $2,100,000.00 He stated that the year one receipts would total $470,000.000. He further stated that the City would finance $1,630,000.00. He stated that an average annual debt service at 4.66% based on $1,700,000.00 of debt was $472,728.00. The City Manager stated the City will be leasing the area on the riverfront for the operation of an approximately 60 foot by 210 foot riverboat and an approximately 30 foot by 120 foot service barge. She stated that between the two facilities the use would be restricted to offices, dining, kitchen, shuttle, casino and other customer amenities. She stated that the lease restricts where the service barge will be placed site wise and utilized similar to the way that the service barge had been leased in past operations. She stated that it would not be the two or three story barge that would have a restaurant, and offices as previously discussed. She further stated that any deviations in the lease would need approval by the City Council. Charles Ornduff, Chairperson of the Riverfront Advisory Committee, stated that the Riverfront Advisory Committee met and reviewed the lease. He stated that the Committee made a couple of motions to amend the lease which failed. He stated that the Committee did approve amending item 2 D. of the lease to "No more than 40 parking spaces". He stated that it was a good lease and recommended that Council approve the lease with the exception of item 2D. The City Manager stated that 40 parking spaces were being built. Mayor Sandell stated that it was a moot point and thanked the Riverfront Advisory Committee for reviewing the lease. Jim Rheinschmidt, representing the Southeast Iowa Regional Riverboat Commission stated that he was in favor of the new lease as written. He urged Council to approve the lease as soon as possible. He further thanked staff for their work in writing the lease. Larry Williams of 2600 Sunrise Lane stated that he no longer had any concern in regard to the lease of the riverfront. He thanked the Council for their work on the lease. Kim Hunsaker, Chairperson of the Burlington/West Burlington Area Chamber of Commerce stated that Catfish Bend has contributed to date an estimated $12,000,000.00 in direct revenues to the City and Burlington Area Development Corporation. Dave Ebbing, Economic Vice Chairperson of BADCO, stated that approximately $700,000 has been used for infrastructure work in the Flint Ridge Business Park and monies have been contributed to Burlington Steamboat Days, and Downtown Partners, Inc. Linda Long of 2202 Racine stated that the location of the riverboat was better than first decided by the City. She stated that she appreciated the efforts made by the City and Catfish Bend. She stated that it was great that the City printed the entire lease in the newspaper. She stated that she liked the part-time lease. She stated that the feedback that she has received is that parking will be a challenge for seniors parking at the riverfront. The City Manager stated that the seniors have been parking due south of Memorial Auditorium, which has better access to the Auditorium and was well lit. She stated that the City knows which events at the Port and Memorial Auditorium have attendance of 750 or more and will notify Catfish Bend in advance so that they can move their employees. She stated that the City will be working under the three strikes and your out rule. She stated that if Catfish Bend has three strikes against them they would lose their lease with the City. She further stated that Catfish Bend has a good track record in Ft. Madison in providing room to park for events. Linda Long asked that the City contact their user group when the boat ramps are being built as they have retired engineers that would be willing to help plan the boat ramps. The City Manager stated that the City did not anticipate that they would re-engineer the south boat docks. Mayor Sandell emphasized that the City would not be re-engineering the south boat docks, but would be keeping the north boat docks open. Dave Hanrahan of 1709 Oak Street stated that the City would be receiving only 4% of the gross revenue of Catfish Bend. He stated that the City of Des Moines receives 20 to 24% of the gross revenue from Prairie Meadow Race Track. He stated that the lease was not favorable to the City of Burlington. He stated that item #13 under the lease needed to be amended to read "no earlier than October 15th and end not later than April 30th. Mayor Sandell stated that the monies received by the City of Burlington from Catfish Bend were negotiated. He stated that Burlington would be receiving more monies than the City of Ft. Madison for their lease with Catfish Bend. Council Member Thomas questioned how the gaming revenues would be paid to the City. The Finance Director stated that the City would receive gaming revenue monies weekly. Council Member Heland questioned the exclusive use of parking with Catfish Bend. The City Manager pointed out that there needed to be a correlation between a lease of something in exchange for a lease payment. She stated that the City cannot have a lease payment if they are not leasing something. She stated that was where the exclusive use concept came in. Gary Hoyer, legal counsel for Catfish Bend, stated that parking was adequate on the riverfront. Council Member Heland stated concern that Section 2.E of the lease did not provide for amble green space. The City Manager stated that the lease did not need to be specific about green space as the City Council has total control for the parking spaces at the plans and specifications stage. Council Member Heland stated that most of his concerns have been answered. The City Manager reminded the viewing audience that there were two different snow removal crews. She stated that one of the crews removed snow from the emergency street snow removal, and the other crew removed snow from parking lots. She stated that the riverfront parking lot would have top priority under the parking lot snow removal. Council Member Henry questioned if Catfish Bend would object to amending the lease with "40 paved spots at the far north area by Shoquoquon Boat Club." Gary Hoyer, legal counsel for Catfish Bend stated that the reason the lease was worded as such was to give Council flexibility. He stated that Catfish Bend was happy with 40 parking spaces. He stated that it gives the City flexibility in designing 40, 41 or 42 parking spaces. Council Member Henry stated that if the riverboat gambling comes up for referendum in the year 2002 and is defeated by voters, Catfish Bend would have 180 day period to terminate business. He stated that with the City having a 5-year capital improvements program, it would not give the City time to plan for budgeting. Gary Hoyer, legal counsel for Catfish Bend, stated that the City would be locked in for a five year term. He stated that when the lease expires it would be Catfish Bend's option to renew the lease with an annual 180 day escape clause during that 5 year term. Mayor Sandell stated that the State Bowlers Tournament would be held in Burlington in 1998 and would be running past April 30th date. He stated that he would prefer the lease be amended to end on May 15. The City Manager stated that the original lease ended on May 30th. She stated that area boaters use the riverfront heavily during the month of May. Mike Brouwer, President of the Chamber of Commerce, stated that the State Bowling Tournament would be held in 1998, and the Senior Bowling Tournament will be held in Burlington in 1999. He stated that Burlington has a good chance to host the State Bowling Tournament again. He stated that he would like to see Catfish Bend docked in Burlington when the bowlers were in Burlington. Rose Lee, Director of Women's Bowling, stated that many of the women bowlers traveled to Ft. Madison to gamble during the State Women's Bowling Tournament held in Burlington. Mayor Sandell stated that he was in favor of amending the lease by adding "external marketing/community event" language to the lease ending date. Dan Kiehl, General Manager of Catfish Bend, stated that Catfish Bend has sponsored a bowling tournament in the past. He stated that he would like the opportunity to extend the lease. Council Member Thomas stated that many of his questions had been answered by staff. He thanked Catfish Bend for being good corporate citizens. Council Member Scott stated that most of his concerns were answered at the hearing. He stated that many people had signed petitions against the boat being docked in front of the north boat docks. He stated that the City Council listened, staff listened, and Catfish Bend listened. He stated that it was a good lease. Jim Rheinschmidt stated his concern for the delay of the Zoning Board of Adjustment meeting on October 23, 1997. The City Manager stated that the Council has the option to work with the Zoning Board of Adjustment to schedule a public hearing now and issue a special use permit conditioned upon the change of the downtown plan. She stated that it was an option staff had discussed and was an option for Council to consider. She stated that the only reason the City was adhering to the proposed time table was to protect the public process. Mayor Sandell questioned if it would be wrong to indicate to the Zoning Board of Adjustment that the City intends to modify the river boat zone and that they were free to issue a permit based on the variance of not being a zoning ordinance, and not being located in a riverboat zone. Scott Power, legal counsel stated that it would be difficult to grant a variance under the zoning laws, as the zoning laws were very restrictive. Linda Long stated that she hated to see the lease railroaded through the Zoning Board of Adjustment, but the process followed. The City Manager stated that the City did a time line with Catfish Bend and Catfish Bend had stated that they could live with the time line. She stated that under the proposed time line there would be only one reading. Gary Hoyer, legal counsel for Catfish Bend, thanked the City Manager for always being prepared, and a tough negotiator. He wished her well at her new position as City Manager in Beloit, Wisconsin. All present had opportunity to speak and nothing additional was filed in the office of the City Clerk.
Motion to Close CARRIED
ADJOURNMENT 8:45 p.m. APPROVED: October 6, 1997
Kathleen P. Salisbury John K. Sandell
City Clerk CMC Mayor
(See tape on file in the office of the City Clerk for complete discussion and documentation.)