AR-Big League Dreams -construction of sports park

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Following is a summary of the estimated financial results of the Big League Dreams proposal versus other City alternatives: Big League Dreams City Staff Operated City Staff Operated 22 acres 22 acres 11 acres Annual Debt Service $801,000 $765,000 $465,000 Annual Maintenance 0 $350,000 $200.00 Gross Annual Costs $801,000 $1,115,000 $665,000 Less: Tax Revenue (10 year average) ($300,000) $0 $0 Lease Revenue (10 year average) ($280,000) $0 _ $ Net Annual Cost (10 year average) 221 00 1.115.000 As evidenced by the above estimates, the Big League Dreams proposal is clearly the most cost effective alternative for the City. In addition, the aesthetic benefits and positive impact on the community create a very beneficial situation, which is difficult to quantify in economic terms. As part of the agreements, Big League Dreams provides consulting services during the planning and construction phases of the project to assure adherence to the proprietary nature of their product and assist the City in obtaining a quality sports park. They are not the developer or contractor. They will assist the City during the process of public bidding for the architectural and construction components of the project. Their consultant fee for this phase of the project plus consultation during construction amounts to $420,000 and is included in the $8.9 million project cost estimate. Of this amount, $30,000 has previously been paid to Big League Dreams pursuant to City Council approval. The balance of $390,000 is payable at $41,000 per month for the first six months after approval of the agreement(s), and $16,000 per month over the following nine months. Big League Dreams asserts that the consulting fees are used to help offset initial staff training and start-up costs which are incurred solely by them in the amount of approximately $600,000. Big League Dreams has constructed facilities in Cathedral City and Mira Loma. Another facility is under construction in Chino Hills. They are in the planning stages with Redding, Manteca, and Yakima, Washington. Big League Dreams has a proven track record along with the aforementioned national exposure and marketing capabilities. The Parks, Recreation, and Family Services Commission has toured the Cathedral City and Mira Loma sites and will be available during this presentation for any questions of them that may occur. While approval of these agreements obligates the City to Big League Dreams regarding the aforementioned consulting fees, there are still numerous actions necessary over the next several months to result in final project approval by the City Council. These include, but are not limited to, environmental assessments and findings, public bidding and award of bids, debt financing matters, and final land acquisition details. In summary, after nearly two years of research and work regarding a suitable site and negotiations with Big League Dreams, it is staff's contention that this proposal is the best alternative for delivering a long-term quality sports park to the Colton Community. FINANCIAL IMPACT A Large portion of this report is concerned with financial impact, and it would be redundant to repeat the verbiage within this section of the report. However, in summary, the key fiscal aspects of approving these agreements include a maximum annual cost to the General Fund approximating $800,000, which is expected to be offset by additional average annual revenues approximating $580,000 over the next ten years. The net estimated annual financial impact over the next two years has been included within the approved 2001-03 budget. The net estimated annual General Fund cost of $221,000 over the next ten years compares favorably to other alternatives which range from $665,000 to $1,115,000