VII.3. Approve Hopkins Pavilion Use Agreement; Stadler (CR2017-102)G�TY OF
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JuI 26, 2017 y° P K� NS Council Re ort 2017-102
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Approve Hopkins Pavilion Use Agreement
Proposed Action.
Staff recommends adoption of the following motion: Move that Council adopt
Resolution 2017-055, approvinq a Hopkins Pavilion Use Agreement between the
City of Hopkins and Hopkins Youth Hockev Association.
Overview.
In light of the Hopkins Youth Hockey Association's $1 million bank loan and
contribution to the Hopkins Pavilion lJpgrade project, Anchor Bank is requiring
that the City enter into this 10-year Pavilion use agreement. The proposed
agreement sets the number of hours and times of day the facility will be available
for HYHA use and the associated ice rates. Other than the City making a 10 -
year commitment to HYHA, there is nothing in the proposed agreement that
differs from how the City has historically worked with HYHA regarding their ice
rental hours or rates. HYHA typically rents about 70% of the available prime and
non-prime ice hours at the facility, which equates to 900 hours of the available
1,300 hours/season. City staff and our CityAttorney have negotiated the terms
of this use agreer�ent with HYHA and Anchor Bank. Staff is now seeking
approval of the Pavilion Use Agreement.
Primary Issues to Consider.
• Agreement terr�ns and conditions
Supporting Information.
• Resolution 2017-055
• Hopkin Pavilion Use Agreement
Steven J . Stad ler
Public Works Director �
Financial Impact: Y Budgeted: Y/N Y Sources: Projected $188,000
revenue for year 2018
Council Report 2017-102
Page 2
Analysis of Issues
Agreement terms and conditions
• Duration: 2017/2018 thru 2027/2028 hockey seasons
• Usage & ice rates: HYHA agrees to rent and City guarantees a minimum
of 900 hours of ice time each hockey season. First year ice rates are
$210/hr and $150/hr for prime and non-prime ice time, respectively. City
agrees to not increase ice rates by more than 5% in any year.
• City indemnification: HYHA must carry liability insurance and holds the
City harmless from any actions or claims resulting from HYHA use of the
facility. HYHA agrees to pay for any damages resulting from their use of
the facility or grounds.
• City must reimburse HYHA for any lost ice time if the Pavilion becorr,es
unavailable, except in the case of an act of God or HYHA negligence.
• HYHA agrees to cooperate with the City in the event State rules change
regarding HYHA use of the facility to ensure the tax exempt nature of the
city's bond financing. �
• Termination: HYHA may terminate if fiacility improvements are not
completed by Sept 15, 2019. City may terminate in event of ice rental
payment defaul� or if HYHA does not execute the Contribution agreement
and contribute $1 million to the project by March 31, 2018.
CITY OF HOPI�:INS,1l�NNESOTA
RESOLUTION NO. 2017-055
RESOLUTION APPRO`�ING E�:ECUTION OF HOPI�;Il�TS
PAVILION USE AGREEMENT WITH THE HOPI�:INS YOUTH
HOCKEY ASSOCIATION
WHEREAS, the City of Hopkins, Minnesota (the "City") owns an ice hockey and multipurpose
facility known as the I-�opkins Pavilion, located at 11000 Excelsior Boulevard in the City (the "Facility");
and
�iVI�REAS, the Hopkins Youth I-�ockey Association, a Minnesota nonpro�t corporation (the
"Association"), currently uses the ice arena within the Facility (the "Ice Arena") and rents space in the Ice
Arena o11 an annual basis for its youth hockey activities; and
W�-�REAS, the City and the Association have deter�nined to finance the const�-l.lction of certain
improvements to the Facility (the "Improvements"); and
W��REAS, the Association has agreed to contribute $1,000,000 to the City for the costs of the
Improvements with $50,000 in cash and $950,000 through a bank loan; and
VVHEREAS, Anchor Bank, N.A., a national banking association (the "Bank"), has agreed to loan
$950,000 to the Association (the "Loan") for the Association's contribution to the Improvements; and
W��REAS, as a condition of providing the Loan, the Bank requires the City to guaranty
$550,000 of the Loan, provided that the guaranty would be utllized only upon a default under the loan
documents by the Association, and the City intends to provide such guaranty through a general obligation
abatement note; and
UVHEREAS, the City, the Association, and the Bank will enter into a Hopkins Pavilion
Contribution Agreenlent pursuant to which the City will agree to guarantee the payment by the
Association of the Abatenlent Note in the event that the Association is unable to inake payments under
the Abatement Note or u1 ihe event that a default has occurred and is continuing under the documents
executed between the Bank and the Association with respect to the Loan; and
VVHEREAS, there has been presented before this City Council a form of I�opkins Pavilion Use
Agreement (the "Use Agreement") proposed to be entered into between the City and the Association,
which sets forth �the ter�ns of use of the Ice Arena by the Association for a term of ten (10) years;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the. City of Hopkins, Minnesota
(the "City"), as follows:
l. The Use Agreement is hereby in all respects authorized, approved, and confirmed, and
the Mayor and the City Manager are hereby authorized and directed to execute and deliver the Use
Agreement for and on behalf of the City in substantially the form now on file with the City Council but
with such modifications as shall be deemed necessary, desirable or appropriate, the execution thereof to
constitute conclusive evidence of their approval of any and all modifications therein.
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2. The Mayor, the City Manager, and other of�cials and staff of the City are authorized and
directed to execute any other documents and certificates deemed necessary to carry out the intentions of
this resolution or the Use Agreement.
Adopted by the City Council of the City of Hopkins, Minnesota this 31 St day of July, 2017.
Mayor
ATTEST:
City Clerk
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Fifth D raft
July 21, 2017
HOPI�:INS PAVILION USE AGREEMENT
THIS HOPI�:INS PAVILION USE AGREEl��IENT, dated , 2017 (the
"Agreement"), is between the CITY OF HOPI�:INS, � SOTA, a municipal corporation and political
subdivision of the State of Minnesota (the "City"), and the I�OPk:Il�TS YOUTH HOCKEY ASSOCIATION,
a Minnesota nonprofit corporation (the "Association"). The City and the Association are collectively
known as the "Parties."
RECITA.LS :
UVHEREAS, the City owns the ice arena and inultipurpose facility known as the Hopkins Pavilion,
located at 11000 Excelsior Boulevard in the City (the "Facility"); and
�VHEREAS, the Associ�.tion uses the ice arena within the Facility (the "Ice Arena") for its youth
hockey activities; and
�UVI�I�EAS, the Parties wish to enter into this Agreement to set forth the terms of use by the
Assoclation of the Ice Arena; and
NO�, THEREFORE, the Parties, in consideration of the representations, covenants and
agreements set forth herein, represent, covenant and agree as follows:
1. Duration of A�reement. The duration of this Agreement shall be for a total of ten (10)
hockey seasons, beginning with the 2017-2018 hockey season and ending after the 2027-2028 hockey
season. For purposes of this Agreement, each hockey season begins September 1 and ends March 15 of the
following year.
2. Usa e Hours. During the ter�n of this Agreement, and pursuant to the applicable usage
rates, the Association is guaranteed and agrees to secure and purchase a minilnum of nine hundred (900)
hours of ice time each hockey season. The Association shall meet with the Manager and the Scheduling
Coordinator of the Ice Arena to schedule these hours allnually as soon as possible but in no event later than
June 1 of each year for the following hockey season. The Association may be scheduled anytime during
each hockey season between the hours of 5:00 p.m. and 10:00 p.in. Mondays through Fridays, and any time
between the hours of 7:00 a.m. and 7:00 p.m. Saturdays and Sundays. The Associatlon is authorized to
purchase ice time before 5:00 p.m. Mondays through Fridays and between 7:00 p.m. and 11:00 p.m. on
Saturdays and Sundays, but will not be required to do so. Start times for ice time for the Association are
subj ect to change based on City needs . For the duration of this Agreement, at least one (1) week prior to
the beginnulg of each month during the hockey season, the Association must submit to the City a list of ice
time scheduled for the following month, together with the names of the specific user groups within the
Association who will be using the Ice Arel�a during any given block of ice time. All usage rate charges
will remain the salne for all user groups within the Association using ice time scheduled by the Association.
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3. Turn-Back Time. , The Association shall have the right to "turn back" ice time with at least
ten (10) days' written notice without charge; provided, however, that if the cancellation of ice time will
cause the number of hours purchased by the Association to fall below the minimum described in Section 2
above, the City shall charge the Association for the ice time. If the Association cancels the purchase of ice
time between two (2) and ten (10) days' written notice, the Scheduling Coordinator of the Ice Arena shall
499281v6 JAE HP110-98
advertise the availability of ice time on rinkfinder.com (or a similar website) in an attempt to sell the ice
time to an outside party; if the cancelled ice time is not purchased by another party, the Association shall
be required to pay for the cancelled ice time as though the ice tilne had not been cancelled. If the
Association cancels the purchase of ice time with fewer than forty-eight (48) hours' written notice, the
Association shall bear the expense for the cancelled ice time and the Scheduling Coordinator of the Ice
Arena shall be under no obligatlon to advertise or resell the ice time.
4. Coaching and Supervision. During all tiines that the Association has access to the Ice
Arena pursuant to this Agreement, while on the property of the City, the Association shall be solely
respollsible for providing all coaching and supervision of the Association members, participants, players,
parents, coaches, and volunteers in conjunction wlth utilizillg the Ice Arena. The Association shall also be
solely responsible for ensuring that all members, participants, players, parents, coaches, and volunteers
follow any and all applicable rules, regulations, policies and procedures established by the City found in its
Facilities Policy and Procedures, as well as any and all, policies, procedures, laws or ordiilances.
5. Right to Sublet Hours. The Association inay sublet excess previously scheduled ice time
to other neighboring youth hockey associations. The Manager of the Ice Arena shall approve, in advance,
the groups that can sublet hours froln the Association. Each group subletting hours from the Association
must submit proof of insurance, as provided herein, to the Manager of the Ice Arena prior to approval of
the subletting arrangement. The Association assumes sole responsibility for allocating specific hours to
sublessors and sublet charges will match usage rates charged to the Association by the City for same. Sublet
Hours count towards the ininimum of nine hundred (900) hours of ice time that must be purchased by the
Association each hockey season.
6. Permission Sli�s and Participant Releases. Prior to participants using the Ice Arena, the
Association must obtain the written consent of every participant (including the written consent of the parent
or guardian for minor participants) in a manner and form satisfactory to the Associatlon. The consent form
used by the Association must lnake clear that the City is not responsible for any injuries arising out of use
of the Ice Arena under this Agreement.
7. Billin� and Payment.
(A) For the first one (1) year of this Agreement, the Association agrees to pay the City
a usage rate af $210.00 per hour for prime time ice tinle usage and $150.00 per hour for non-prime
time ice time usage. These usage rates apply to all ice time scheduled by the Association whether
scheduling is part of the original minilnum hours or is additional ice time. Payment will be made
by the Association to the City on a monthly basis, and is due within thirty (3 0) days upon receipt
of billing from the City. For purposes of this paragraph, "prime time ice time" shall mean 2:00
p.m. to 10:00 p.ln. on weekdays and 7:00 a.m. to 10:00 p.m. on weekends. "Non-prime time ice
time" shall mean all other tllnes.
(B) Ice time usage rates for years two (2) through ten (10) of this Agreement will be
set by the City prior to May 15 of the preceding year, and shall not increase by more than 5% each
year. If the City proposes to approve an annual rate increase, the Association will be notified prior
to the City Council's review of such increase.
8. Com�liance with Regulations and Lavvs. For the duration of this Agreement, the
Association agrees to abide by any and all applicable rules, regulations, policies and procedures established
by the City and found in the City's Facilities Policy and Procedures as well as any and all policies,
procedures, laws, or ordinances.
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9. Indemnification. The Association agrees to reimburse the City for all damages to the Ice
Arena, and any other portion of the Facility, or the Ice Arena's equipment resulting from the Association's
use of the Facility. The Association agrees to release, indemnify, and hold harmless the City from any and
all claims, demands, suits, actions, or liabilities resulting from injuries or death to any person, or damage
or loss of any property, arising from or alleged to arise from the Association's performance of this
Agreement. Each Party agrees to accepts full responsibility for its own negligence and actions.
10. Insurance. Prior to using the Ice Arena, the Association and any sublessor of the
Association must furnish the City with a Certificate of Liability Insurance in the amount of the maximum
liability lilnits for municipalities as set forth in Minnesota Statutes, Section 466.04 and any amendments
thereto. The Certificate of Liability Insurance must name the City as an additional insured. As of the date
of this Agreelnent, the applicable maximum liability limits are $500,000 per person and $1,500,000 per
occurrence.
11. Colnpensation for Dama�e. If it is established that any portion of the Facility's surrounding
landscape or parking lot is da�naged by the act or failure to act of the Association, its nlembers, agents,
sublessors, invitees, or its sublessors' melnbers, agellts, or invitees during the term of this Agreement, the
City will charge the Association the sum that is necessary to restore the premises back to its predamaged
condition.
12. Representations. The Association is an organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as alnended (the "Code"), exempt froln the payment of federal incolne
taxes ul�der Section 501(a) of the Code. During the term of this Agreement, the Association will maintain
its status as an organization described in Section 501(c)(3) of the Code and no revenues derived froln its
use of any portion of the Facility shall constitute " unrelated business income " within the meaning of
Section 513 (a) of the Code.
13 . Default by the Association. In the event of a default by the Association hereunder, whether
for failure to make payments for ice time, or for failure of any other covenant, condition, obligation or other
matter or requirement contained in this Agreement, the City may deliver written notice of such default to
the Association at the address provided herein. If the default specified in the notice is not cured by the
Associatioll within fifteen (15) days following the City's notification of sarne, the City may terminate this
Agreement, seek damages for unpaid ice tilne (both past and future) or other damages, resell ice time, and
seek any other relief available at law or in equity.
14. No Liability. The City shall not be liable to the Association if the Ice Arena becomes
unavailable for use during any ice time, except that the City shall reilnburse the Association at the currellt
rate per hour of lost ice time, provided that the Ice Arena's unavailability is not the result of an act of God
or caused in whole or in part by negligence on the part of the Association, its inembers, agents, sublessors,
invitees, or its sublessors �nembers, agents, or invitees.
15. Promotional Activity. The Association agrees not to conduct any prolnotional activity and
not to advertise any event to be collducted at the Facility without the prior approval of the City.
16. Bindin� Effect. This Agreement shall be binding upon the Association, its successors and
assigns. It shall be binding upon the City, its officers, employees, member, agents and representatives
together with their heirs and assigns.
17. Notices. All written notices (which may be sent by email) shall be provided to the Parties
at the following addresses or at other addresses as designated by the Parties: �
499281v6 JAE HP110-98
If to the City: Hopkins Pavilion
11000 Excelsior Boulevard
Hopkins, l��T 5 5 3 43
Manager: Don Olson
Email: dolson@hopkinsmn.com
Phone: 952-548-6392
Scheduling Coordinator: Beth Kivett
Email: bkivett@hopkinsmn.com
Phone: 952-548-6390
If to the Association: Hopkins Youth Hockey Association
P.O. Box 117
Hopkins, MN 5 5 3 43
Attentlon: President
18. Relationship of the Parties. Nothillg in this Agreement shall constitute or cause the Parties
to have created a partnership, j oint venture or agency relationship.
19. Modification of A�reement. Any modification of this Agreement or additional obligatlon
assulned by either Party in connection with this Agreement shall be binding only if evidenced in a writing
signed by each Party or an authorized representation of each Party.
20. Governin� Law. This Agreement shall in all respects be governed by and interpreted under
the laws of the State of Minnesota.
21. Entire A�reement. This Agreement shall constitute the entire agreement between the
Parties regarding use of the Ice Arena by the Association. Any prior understanding or representation
regarding use of tlle Ice .Arena preceding the date of thls Agreement shall not be binding upon either Party
except to the extent i�lcorporated in this Agreement.
22. Bond-Financed Ilnprovelnents to Facility. The Association acknowledges and understands
that the City intends to issue tax-exempt general obligation bonds to finance certain improvements to the
Facility building in the near future. The Association understands that, as an organization described in
Section 501(c)(3) of the Code, it may use bond-financed property of the City. However, the City inay
require that the Association agree to additional covenants related to this Agreement and the use of the
Facility in conjunction with the issuance of its general obligation bonds in order to ensure the tax-exempt
nature of the bonds. The Association agrees to cooperate with the City in the event additlonal covenants
are necessary.
23. Consideration for Ho�kins Pavilion Use A�reement. The Association acknowledges and
understands that the City is entering into this long-term Agreelnent in part because of the Association's
agreement pursuant to the �Iopkins Pavilion Contribution Agreeinent of even date herewith (the
"Contributlon Agreement") to contribute $1,000,000 to the renovation and expansion of the Facility.
25 . Ter�nination of A�reement. If the renovation and expansion of the Facility is not completed
by September 15, 2019 (in time for the Association to use the renovated Facility for the 2019-2020 hockey
season), the Association may terminate this Agreement. If the Association does not execute the
Contribution Agreement and does not contribute $1,000,000 to the renovation and expansion of the Facility
by March 31, 2018, the City may terminate this Agreement.
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IN WIZ`NESS VV�REOF, the undersigned Parties have executed this Hopkins Pavilion Use
Agreement as of the date and year first written above.
CITY OF HOPI�:INS, l��NNESOTA
By
Its Mayor
By
Its City Manager
S-1
499281v6 JAE HP110-98
Execution page of the Association to the Hopkins Pavilion Use Agreement, dated as of the date and year
first written above.
HOPI�:INS YOUTH HOCKEY ASSOCIATION
�.
Its
Its
S -2
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