CR 09-047 Proposed Increase to Pavilion - Hourly Ice Rental RatesMay 19, 2009 Council Report 2009 -047
PROPOSED INCREASE TO PAVILION
HOURLY ICE RENTAL RATES
Proposed Action.
Staff recommends adoption of the following motion "Adopt Resolution No. 2009 -033 increasing
the Pavilion Prime and Non -Prime Hourly Ice Rental Rates effective September 1, 2009 ".
Overview.
The Pavilion prime hourly ice rental rate has been increased every two years based upon
projected operational expenses and projected hours to be sold. The last ice rental rate increase
was September 1, 2007. After reviewing ice rental rates, prime time hours and the demand for
ice rental hours of surrounding arenas, staff recommends a $10.00 increase to the prime hour
ice rate and a $15.00 increase to the non prime hour ice rate to help budget revenues meet or
exceed expenses.
Primary Issue to Consider.
• Should the prime and non -prime ice rental rates be increased?
Supporting Information.
• Detailed background
• Rate comparisons with other arenas or similar facilities
• Analysis of issue
• Res ftXion No. 2009 -033
ram
Don Olson, Pavilion Manager
Financial Impact: $13,000 Annual Increase To Revenues Budgeted: Yes
Source: Pavilion Enterprise Fund Related Documents (CIP, ERP, etc.): 2009 Pavilion Budget
Notes:
Detailed Background.
In the past, ice rental prime rate increases have been in increments of $10.00, increasing every
two years. The last increase was on September 1, 2007. The rate increases will help revenues
meet expenses in the Pavilion budget; expenses that increase each year as the facility gets
older and operational costs increase. Non -prime ice has only increased by $5 per hour since
1997 in order to stay competitive with other arenas for the non -prime hour rentals. Staff now
feels the market will allow a $15.00 increase to the non -prime rate and still keep the Pavilion's
non -prime rate lower than other arenas to increase usage of non -prime hours. Turf rental rate
was increased for the 2009 turf season and dry floor hourly rental rates have no proposed rate
increase at this time in order to attract users and stay competitive with other facilities offering
the same types of rentals.
The proposed rate
Prime Time Hours
Non -Prime Hours
Turf Rental
Dry Floor Rental
increase is as follows:
Current Rate Proposed Rate
$170.00 $180.00
$110.00 $125.00
$ 80.00 no increase
$ 55.00 no increase
All rental rates will be determined by recommendation from the Pavilion Manager and the Park
Board and approval by the City Council as stated in section 2.10 of Legislative Policy #5 -E
Pavilion (Ice Arena) operation. The Hopkins Park Board has been presented the proposed rate
increases and supports the increases.
PRIME HOURLY ICE RATE COMPARISON OF SURROUNDING ARENAS
Plymouth
Eden Prairie
Edina (Braemar)
Brooklyn Park
New Hope
Minnetonka
St. Louis Park
2008 -2009
Prime
Non -Prime
$170.00
$170.00
$175.00
$140.00
$170.00
$120.00
$180.00
$135.00
$191.00
$150.00
$170.00
$170.00
$160.00
varies
2009 -2010
Prime
Non -Prime
$180.00
$180.00
$180.00
$150.00
$175.00
$175.00
$185.00
$140.00
$191.00
$150.00
$180.00
$180.00
$165.00
varies
The City will be able to increase the prime ice rental rate and still be comparable to other arenas
on high demand prime hours. Non -prime rate is intentionally lower to attract users to low
demand non -prime hours. Ice rental user groups are aware of the proposed changes and have
not voiced any concerns about the increase.
Analysis of Issue.
• Should the prime and non -prime ice rental rate increase?
The purpose of the rate increases is to help revenues meet or exceed expenses in the Pavilion
budget. The proposed prime rate of $180.00 /hr is comparable to west metro average. Staff feels
that the market will bear both rate increases.
City of Hopkins
Hennepin County, Minnesota
Resolution No. 2009 -033
Hourly Ice Rate for Prime and Non -prime Hours at the Hopkins Pavilion
WHEREAS, the City of Hopkins has established Legislative Policy #5 -E, Pavilion (Ice
Arena) Operation, Section 3.05; Rates for hourly ice rentals, and
WHEREAS, the rate for prime time and non -prime ice rental hours will be determined by
recommendation from Pavilion staff and Park Board and approved by the City Council,
and,
WHEREAS, an adjustment of the hourly ice rental rates must be made to offset
operational expenses, and,
WHEREAS, surrounding facilities have indicated comparable rate increases,
NOW THEREFORE BE IT RESOLVED, that the City.Council of the City of Hopkins
hereby repeals the existing hourly prime and non -prime ice rental rates effective August
31, 2009, and,
BE IT FURTHER RESOLVED, that the hourly prime and non -prime ice rental rates in the
Hopkins Pavilion is set as follows:
Prime Time Ice Rental Rate: $180.00 /hr
Non -Prime Time Ice Rental Rate: $125.00/hr
BE IT FURTHER RESOLVED, that the effective date of these new rates be in force in
connection with all billing rendered hereunder from and after September 1, 2009.
Adopted by the City Council of the City of Hopkins this _ day of 2009.
10
Gene Maxwell, Mayor
Attest:
Terry Obermaier, City Clerk