07/10/18 Special Called Sports Authority Meeting

07/10/18  Special Called Sports Authority Meeting


SECONDS.>>IT GOOD MORNING. IF EVERYONE WILL TAKE THEIR SEATS, LET’S GET STARTED. THANK YOU ALL FOR BEING HERE. TODAY IS JULY 10TH, AND WE HAVE A SPECIAL INFORMATIONAL SPORTS AUTHORITY BOARD OF DIRECTORS MEETING TODAY. WE ARE PLEASED TO BE BACK AT NISSAN STADIUM, WE APPRECIATE THE TITANS FOR HOSTING US, AND I’M SURE BEFORE TOO LONG WE WILL ALL BE BACK HERE IN THIS FACILITY WATCHING SOME FOOTBALL, THE OTHER FOOTBALL, THE FIRST FOOTBALL. SO THANK YOU ALL FOR HAVING US TODAY. THE APPEALS PROCESS FOR ANY ACTION OF THIS BOARD CAN BE FOUND AT THE TOP OF TODAY’S AGENDA. AND WITH THOSE ITEMS NOTED, WE WILL GET STARTED AND TODAY WE WILL REVIEW THE MLS, STADIUM DOCUMENTS. I BELIEVE THAT JON COOPER WITH METRO LEGAL WILL KICK US OFF.>>AS IT IS COMING UP, I WOULD SAY THAT THIS IS AN INFORMATION SESSION ONLY, OH, THE BOARD WILL NOT BE TAKING ACTION TODAY. NEXT THURSDAY WE WILL BE BACK HERE AT NISSAN STADIUM AND THE BOARD WILL BE ASKED TO VOTE ON THE AGREEMENTS THAT WILL BE WALKED THROUGH THIS MORNING. AND THEN I ALSO WOULD JUST WANT TO POINT OUT THAT LAURA WOULD /W* /W* / WOMAC K, AND RON GOBBLE, AND OUR PROJECT MANAGERS. WITH WE HAVE A LIST FROM THE FINANCE DEPARTMENT, TO ANSWER ANY QUESTIONS.>>THANK YOU VERY MUCH FOR MAKING TIME TO COME TO A SPECIAL SESSION. I HOPE THAT IT WILL BE INFORMATIVE. JUST TO START OFF, AS A REMINDER, THE KEY DEAL TERMS WERE APPROVED BACK IN NOVEMBER WHEN THE COUNCIL APPROVED THE INITIAL BOND RESOLUTION THAT WAS A CONDITIONAL APPROVAL THAT HAD A LIST OF CONDITIONS, SOME OF WHICH HAD APPROVAL OF THE AGREEMENTS WHICH ARE GOING TO BE DISCUSSED TODAY. THESE AGREEMENTS ARE THE RESULT OF MONTHS OF NEGOTIATION WITH THE TEAM, WE HAVE MARGARET, AND THEN TOM CROSS, OUR ASSOCIATE LAW DIRECTOR AND I NEGOTIATED ON BEHALF OF METRO, AND WE RETAINED CRAIG HAMMOND WITH DICK INENSON WRIGHT, TO MAKE SE THAT WE WERE NOT MISSING THINGS. HE IS AN EXPERT IN STADIUM DEALS AND MUNICIPAL FINANCING AND HE NEGOTIATED THE DEVELOPMENT AGREEMENT FOR THE DETROIT PISTONS WHEN THEY RELOCATED TO THE LITTLE CAESAR’S ARENA, SO HE’S VERY FAMILIAR WITH HOW DEALS ARE STRUCTURED AND THINGS TO INCLUDE, TO MAKE SURE THAT THINGS ARE INCLUDED.>>THIS DEAL IS UNLIKE ANY OTHER PRO SPORTS DEAL THAT WE’VE HAD IN NASHVILLE, AND THAT’S A GOOD THING. IT IS A COLLABORATIVE EFFORT WITH THE TEAM, AND THE KEY DIFFERENCE, THE REALLY TWO KEY DIFFERENCES, FIRST THE TEAM IS RESPONSIBLE FOR THE LION’S SHARE OF THE DEBT SERVICE ON THE STADIUM CONSTRUCTION. SO THEY ARE BEARING THE BRUNT OF THE RISK ON DEBT SERVICE. THEY’RE ALSO RESPONSIBLE FOR ALL COST OVERRUNS WHICH HAS NOT BEEN THE CASE PREVIOUSLY. SO THAT WILL PROTECT METRO AND THE SPORTS AUTHORITY TO MAKE SURE THAT IF COSTS DO EXCEED WHAT’S BUSTED THEN THEY ARE RESPONSIBLE FOR 100 PERCENT OF THOSE. THE TEAM HAS, SINCE THEY ARE RESPONSIBLE FOR THOSE COSTS, THEY HAVE AN INVESTED INTEREST IN MAKING SURE THAT THE STADIUM IS BUILT ON TIME, AND ON BUDGET AND THE SPORTS AUTHORITY AND METRO HAVE A VESTED INTEREST IN MAKING SURE THAT IT’S BUILT WELL AND WILL LAST, SO THAT’S KIND OF THE COLLABORATION THERE TO MAKE SURE THAT THOSE THINGS ARE MET. THE TEAM HAS RETAINED ICON AS ITS PROJECT REPRESENTATIVE. ICON IS A LEADER IN THE SPORTS FACILITY CONSULTING FIELD. I THINKTY THAT THEY’VE BEEN INVOLVED IN $8 BILLION OF STADIUM DEALS INCLUDING ATLANTA, ORLANDO AND BARS HE WILL LOAN A FOR SOCCER. SO. I THINK THAT ICON WAS DETERMINED TO BE THE ONE TO OVERSEE THE DAY TO DAY CONSTRUCTION, AND REPORT TO THE SPORTS AUTHORITY REPRESENTATIVES AND HAVE REGULAR DISCUSSION REGARDING THAT, AND THERE NEEDED TO BE A POINT PERSON, AND IT WAS DETERMINED THAT ICON WAS BEST SUITED TO DO THAT.>>LET’S SEE DO WE HAVE THE POWER POINT. IS IT UP?>>THEY HAVE A COPY IN THEIR POCKET.>>IT IS AN ADDITION BEHIND TAB SIX THAT WAS LEFT ON THE TABLE, AND I’M NOT SURE IF IT’S QUED UP ON THE –>>AS LONG AS YOU ALL HAVE IT — THAT’S FINE. 9 SO THERE ARE THAT THE SPORTS AUTHORITY WILL BE — ARE PART OF THIS DEAL. THE FIRST IS A GROUND LEASE BETWEEN THE SPORTS AUTHORITY AND THE FAIR BOARD FOR THE ACTUAL STADIUM FOOTPRINT ITSELF. AND THEN THERE IS A STADIUM LEASE OR A TEAM LEASE WITH THE MLS, TEAM BETWEEN THE SPORTS AUTHORITY AND THE MLS, TEAM, AND WITHIN THAT ARE TWO AGREEMENTS. A GUARANTEE AGREEMENT AND A DEVELOPMENT AGREEMENT. AND THEN WE WILL HAVE A CONSTRUCTION ADMINISTRATION AGREEMENT AND FINALLY A CONSTRUCTION MANAGEMENT AGREEMENT. UNFORTUNATELY, THEY ALL KIND OF SOUNDALIKE.>>IS YOUR PRESENTATION ESSENTIALLY THE SAME MATERIAL AS THE MEMO.>>IT IS, YES.>>IT IS SHORT END. SO-SO WE’RE STARTING OFF WITH THE VARIOUS TIME LINES. WE HAVE TODAY’S INFORMATION SESSION. TOMORROW WE WILL HAVE THE SAME PRESENTATION TO THE FAIR BOARD ON JULY 17TH NEXT WEEK, THE FAIR BOARD WILL BE ASKED TO APPROVE THE GROUND LEASE, AND THEN ON THE 19TH THE SPORTS AUTHORITY WILL BE ASKED TO APPROVE THE AGREEMENTS THAT WE’RE GOING TO DISCUSS TODAY. AFTER THAT, THE COUNCIL WILL CONSIDER THE REQUIRED LEGISLATION IN AUGUST AND SEPTEMBER.>>THE CONSTRUCTION MANAGEMENT AGREEMENT WILL BE PRESENTED TO THE SPORTS AUTHORITY EITHER AT THE AUGUST 16TH MEETING OR AT THE NEXT MEETING DEPENDING ON THE PROCUREMENT SCHEDULE AND I’LL GET INTO THAT MORE. SO THEN FINAL APPROVAL FROM THE COUNCIL WOULD BE IN SEPTEMBER, AND THE REVENUE BONDS WOULD BE ISSUED SOMETIME LATE FALL BEFORE THE END OF THE YEAR AS THE ANTICIPATED SCHEDULE. YOU’LL FIRST TALK ABOUT THE GROUND LEASE BETWEEN THE SPORTS AUTHORITY AND THE FAIR BOARD. THIS IS A 30- YEAR LEASE. THE FAIR BOARD WILL HAVE NO BE IF RESPONSIBILITY FOR THE BUILDING OF THE STADIUM. THE FAIR BOARD IS BASICALLY JUST LEASING THE PROPERTY AS IS.>>THE FAIR BOARD WILL BE CONSENT TOGETHER THE TEAM LEASE AGREEMENT AS A SUBLEASE OF THE GROUND LEASE. SO THEY WILL BE, WHILE THEY’RE NOT A DIRECT PARTY TO THE TEAM LEASE, IT IS INCORPORATED INTO THE GROUND LEASE TO WHICH THEY ARE A PARTY.>>AND JOHN, I THINK THAT YOU’RE REFERRING TO THE LEASE AGREEMENT WHICH IS BEHIND TAB TWO OF EVERYONE’S PACKET. SO YOU’LL GO DOCUMENT BY DOCUMENT. AND IF YOU HAVE ANY QUESTIONS FEEL FREE TO STOP ME. UNFORTUNATELY, THE POWER POINT IS NOT IN THE I’M ORDER THAT THE SUMMARY IS. BUT THE SUMMARIES HAVE THE TITLE OF THE DOCUMENTS ON THEM. SO YOU SHOULD BE ABLE TO REFER BACK TO THAT.>>SO WE’RE STARTING WITH –>>WE’RE STARTING WITH THE GROUND LEASE.>>YEAH. TAB FOUR.>>I DON’T HAVE WHAT YOU HAVE. I JUST WANT TO MAKE SURE THAT WE’RE ALL STARTING FROM THE SAME PLACE.>>OKAY.>>AND THE TEAM LEASE, ARE SURVIVE THE GROUND LEASE, SHOULD THAT LEASE EVER TERMINATE.>>THERE IS A STANDARD RECOGNITION, AND INTERNMENT AGREEMENT THAT IS INCORPORATED INTO THE GROUND LEASE, BASICALLY JUST ENSURING THAT THE TEAM LEASE STAY IN PLACE, REGARDLESS OF THE- WHOEVER OWNS THE PROPERTY OR THE PARTIES OF THE GROUND LEASE. THERE’S ENSURING THAT THERE IS NO NUISANCE, OR SEXUALLY ORIENTED USE, OR THINGS THAT ARE OBNOXIOUS USES AND IT IS FOR PURPOSES OF THE STADIUM LEASES.>>AND THE GROUND LEASE IS WHAT THE FAIR BOARD IS REVIEWING TOMORROW, AND WILL REQUIRE ACTION FROM THE FAIR BOARD, THAT IS THE ONE ACTION THAT THE FAIR BOARD IS APPROVING AT THIS POINT. ALL OF THE OTHER AGREEMENTS, THE SPORTS AUTHORITY WILL BE ACTING ON AS WELL.>>ANY QUESTIONS ON THE GROUND LEASE. NEXT IS THE DEVELOPMENT AGREEMENT >>THAT’S TAB THREE. THIS AGREEMENT IS BETWEEN THE SPORTS AUTHORITY, AND WALSH MANAGEMENT, LLC, IT IS A SUBSIDIARY TO THE TEAM, IT IS ONE OF THE ROADS THAT COME THROUGH THE FAIRGROUNDS, THAT’S WHERE THE NAME CAME FROM. THIS DEVELOPMENT AGREEMENT IS FOR THE CONSTRUCTION OF A 30,000 PLUS SEAT STADIUM PURSUANT TO METRO CODE REQUIREMENTS IT WILL BE LEED, SILVER CERTIFIED. THIS IS A COOPERATIVE EFFORT AS I SAID BETWEEN THE SPORTS AUTHORITY AND THE TEAM SINCE THE TEAM IS BEARING THE BULK OF THE DEBT SERVICE ICON WILL BE SERVING AS THE TEAM OR AS WALSH’S REPRESENTATIVE, AND RON GOBBLE AND CPS, WILL BE OVERSEEING IT ON BEHALF OF THE SPORTS AUTHORITY. THERE WILL BE A DEVELOPMENT COMMITTEE THAT IS ESTABLISHED, AND THE PURPOSE OF THE DEVELOPMENT COMMITTEE IS TO FACILITATE COMMUNICATION AND COOPERATION THROUGHOUT THE CONSTRUCTION PROCESS. THIS WILL BE A FOUR MEMBER COMMITTEE, TWO REPRESENTATIVES FROM THE MLS, TEAM, AND TWO FROM THE SPORTS AUTHORITY. IT WILL BE UP TO THE RON GOBBLE WILL SERVE AS ONE OF THE MEMBERS, THEN THE OTHER MEMBER WILL BE UP TO THE SPORTS AUTHORITY TO DECIDE. THAT COULD BE EITHER MONICA OR A SPORTS AUTHORITY MEMBER.>>THE TEAM REP WILL CERTAIN OF AS THE CHAIR OF THE DEVELOPMENT COMMITTEE, AND AS I SAID, THEIR PURPOSE IS TO WORKING TOGETHER THROUGHOUT THE DESIGN AND CONSTRUCTION PROCESS TO ADDRESS ISSUESAS THEY COME UP AND JUST MAKE SURE THAT WE HAVE A SMOOTH PROCESS.>>IT WOULD HAVE AN ADVERSE IMPACT ON FUTURE CAPITAL NEEDS. THE APPROVAL OF THE COMMITTEE WOULD BE REQUIRED, AND THEY WOULD HAVE TO HAVE SOME GOOD FAITH NEGOTIATIONS, TO MAKE SURE THAT OARE PROTECTED UNTIL HE WARRANTED TO CHANGE SOMETHING THAT COULD RESULT IN A GREATER CAPITAL EXPENSE, OR A CAPITAL EXPENDITURE EARLIER THAN WHAT WOULD OTHERWISE BE REQUIRED.>>[ INAUDIBLE ] SPORTS AUTHORITY TO MAKE A DECISION.>>THAT IS THE RESPONSIBILITY?.>>RIGHT. IF THERE WAS AN IMPASSE. THE AGREEMENT REQUIRES THAT THERE BE A GOOD FAITH EFFORT TO RESOLVE THAT DISPUTE.>>I UNDERSTAND THAT. BUT IF THERE IS AN IMPASSE, THE WAY THAT THIS IS WRITTEN, IS THAT THE SOCCER CLUB REPRESENTATIVES WOULD MAKE THE ULTIMATE [ INAUDIBLE ] AS TO CAPITAL EXPENDITURES, THEN IT’S METRO THAT IS RESPONSIBLE FOR THE CAPITAL EXPENDITURES.>>IT WOULD REALLY BE — THEY WOULD MAKE THE CALL ON THINGS THAT DON’T HAVE CAPITAL REQUIREMENTS. IF THERE IS A DISPUTE, THEN THAT’S WHEN WE WOULD HAVE TO HAVE A GOOD FAITH NEGOTIATION AND POSSIBLY BRING IN A THIRD PARTY TO MEDIATE IF WE COULD NOT COME TO AN AGREEMENT ON THE SOMETHING THAT WOULD HAVE A CAPITAL EXPENDITURE IMPACT.>>SO WHY IS IT THAT METRO — THIS SEEMS TO BE DIFFERENT. FIRST OF ALL IS DEAL POINT THAT COUNCIL PASSED OR IS THIS SOMETHING THAT JUST HAS BEEN NEGOTIATED.>>ICON WAS NOT PART OF THE — AT THE TIME. THEY HADN’T GOTTEN THAT FAR DOWN THE ROAD.>>SO WHY IS IT THAT OUR REPRESENT TOUGHS, CAPITAL PROJECT SOLUTIONS AND [ INAUDIBLE ] ARE NOT MAKING THIS ULTIMATE DECISION?>>AS I SAID, IT WAS DETERMINED, A WHILE AGO THAT ICON HAS THE EXPERIENCE TO DO THIS, AND METRO DOES NOT. I MEAN WE HAVE, OBVIOUSLY RON, AND OUR REPRESENT TOUGHS CAN OVERSEE THE PROJECT AND MAKE SURE THAT IT’S BEING BUILT APPROPRIATELY, BUT AS FAR AS DAY TO DAY OVERSIGHT IT WAS DETERMINED THAT ICON WAS BEST POSITIONED TO DO THAT, AND FROM A CONSTRUCTION MANAGEMENT STANDPOINT, THE CONSTRUCTION MANAGER IS GOING TO HAVE TO HAVE SOMEONE THAT MAKES DECISIONS, AND SO THAT WAS TO FACILITATE, AND MAKE SURE THAT IT GETS BUILT ON TIME.>>DO WE HAVE AN AGREEMENT WITH ICON OURSELVES.>>METRO DOES NOT. THAT’S JUST YOU THE TEAM. WE HAVE AN AGREEMENT, THERE’S A SEPARATE CONSTRUCTION ADMINISTRATION AGREEMENT THAT IS WITH THE TEAM THAT SPELLS OUT ICON’S RESPONSIBILITIES.>>AND WE ARE PRIVEI DO THAT.>>THAT’S ONE OF THE AGREEMENTS THAT WILL BE APPROVED.>>IT SUITS MAY THEY WILL [ INAUDIBLE ]ALLY ADVERSE IMPACT ON THE AUTHORITY’S FUTURE CAPITAL EXPENSE OBLIGATIONS UNDER THE LEASE.>>RIGHT. FOR THOSE THAT DON’T HAVE A MATERIAL IMPACT.>>SO OTHERWISE, IT’S ESSENTIALLY THE COMMITTEE, THE DEVELOPMENT COMMITTEE THAT HAS THE PURVIEW OVER THE DAY TO DAY –.>>ICON WILL REPORT TO THE DEVELOPMENT COMMITTEE AND THE DEVELOPMENT COMMITTEE IS REQUIRED TO MEET REGULARLY THROUGHOUT THE PROCESS. DO THEY HAVE EXPERIENCE WITH PUBLIC FINANCING.>>MARY?>>[ INAUDIBLE ] STUMPS THAT HAVE BEEN BUILT WITH PUBLIC FINANCING?>>I DON’T KNOW OFF THE TOP OF MY HEAD. I WOULD TO GET THAT TO YOU.>>MY QUESTIONS ARISE FROM BASICALLY A SUMMARY THAT HAS BEEN PROVIDED. I JUST WANTED TO GET CLEAR ON WHAT ICON’S RELATIONSHIP IS BETWEEN THE PARTIES. YOU HAVE THE TEAM, AND THE TEAM HAS A SUBSIDIARY, WALSH MANAGEMENT, AND WALSH MANAGEMENT IS THE LESSEE OR ACTUALLY THE SUBLESSEE OF THE GROUND LEASE IS TO THE SPORTS AUTHORITY, AND THE SPORTS AUTHORITY LEASES TO WALSH, AND WALSH IS A SUBSIDIARY OF THE TEAM. AND IN A DEVELOPMENT AGREEMENT ICON, THE THIRD AND FOURTH BULLET POINTS, I DON’T KNOW IF YOU HAVE THIS OR NOT. IT SAYS THAT ICON WILL SERVES A WALSH’S REPRESENTATIVE AND RON GOBBLE, AND CAPITAL PROJECT SOLUTIONS WILL SERVE AS AUTHORITIES FOR METRO DURING CONSTRUCTION.>>RIGHT. AND THEN IT GOES ON AND SAYS THAT WALSH AND AUTHORITY WILL ENTER INTO A SEPARATE CONSTRUCTION AGREEMENT, WHEREBY ICON WILL ESSENTIALLY SERVE AS THE AUTHORITY’S AUTHORIZED REPRESENTATIVE TO MANAGE DAY TO DAY DESIGN AND CONSTRUCTION OF THE PROJECT. SO IS ICON THE AUTHORITY’S REPRESENTATIVE OR.>>WELL, IT’S — WALSH HAS THE CONTRACT WITH ICON OR THE TEAM WILL HAVE THE CONTRACT WITH ICON. BUT IN THE CONSTRUCTION ADMINISTRATION AGREEMENT, METRO IS ESSENTIALLY OR THE SPORTS AUTHORITY IS DELEGATING TO THE TEAM THROUGH WALSH TO OVERSEE THE DAY TO DAY CONSTRUCTION. SO THEY ARE ESSENTIALLY SERVING AS THE SPORTS AUTHORITY AUTHORITY AGENT IN THAT RESPECT. YOU STILL HAVE YOUR OWN REPRESENTATIVES THAT ARE OVERSEEING THE PROJECT AS A WHOLE TO MAKE SURE THAT METRO IS PROTECTED.>>AND THAT’S GOING HE WILL HA /TKPWOB /TKPWOB /TKPWOB /TKPWOB / GOBBLE HAILS >>HOW DID WE MILWAUKEE CONRESPONSIBLE FOR MEETING THESE DEAD LANES FOR WHICH THE AUTHORITY SHALL BE MEET CERTAIN DEADLINE. HOW IS ICON RESPONSE TO THE [ INAUDIBLE ] HOW DOES THAT WORK, HOW ARE THEY ACCOUNTABLE?>>WELL, THE TEAM IS WHO IS THE MOST TO LOSE, IF THERE IS A DELAY OR SOMETHING LIKE THAT. SO I MEAN IF THE TEAM BREACHED PART OF THE AGREEMENT TO THE SPORTS AUTHORITY’S DETERMINIATRIMENT, WE COULD SEEK A REMEDY THERE. BUT THERE IS NO CONTRACT PRIVITY WITH ICON. SO IT’S REALLY THEIR RELATIONSHIP WITH THE TEAM, AND THEN SERVING AS THE TEAM’S REP THAT MAKE THEM ACCOUNTABLE. AND WHAT IS THE PENALTY, JUST OVERALL IN THAT FOR INSTANCE, WHAT THE PENALTY, IF THEY’RE NOT READY, BY JUNE, WHAT IS THE PENALTY. THERE ARE NO LIQUIDATED DAMAGES THAT THE SPORTS AUTHORITY WOULD HAVE TO PAY. THERE ARE NO SPECIFIC DAMAGES PROVISION AT ALL IN THAT EVENT. IT WOULD BE BASED ON THE ACTUAL DAMAGES AND THAT WOULD JUST HAVE TO BE DETERMINED AT THE TIME, AND EVERYONE UNDERSTANDS THAT THE NEW FAIRGROUNDS BUILDINGS WILL BE CONSTRUCTED AND THE PROPERTY WILL BE DELIVERED READY FOR CONSTRUCTION BY THAT DEADLINE.>>I’LL TALK ABOUT THE CONSTRUCTION TIME LINE BRIEFLY. AS MENTIONED, YOU’VE GOT THE SITE CONSTRUCTION COMMENCEMENT DATE WOULD BE ON JUNE 30TH. PRIOR TO THAT, IN FEBRUARY, THE FINAL PLANS WOULD BE BE SUBMITTED TO MLS, FOR APPROVAL. SO THE FINAL STADIUM PLANS WOULD BE SENT TO THEM FOR SIGNOFF, AND THEN CONSTRUCTION COMMENCING ON JUNE 30, 2019, WITH A TEAM OCCUPANCY DATE OF FEBRUARY 19, 2021. SO THAT’S THE CONSTRUCTION PERIOD WOULD BE FROM JULY 19TH THROUGH FEBRUARY 21ST. AS FAR AS THE CONSTRUCTION FUNDING SOURCES, THE SPORTS AUTHORITY WOULD ISSUE UP TO $225 MILLION IN REVENUE BONDS. THESE WOULD BE ISSUED LATER IN THE FALL. IN ADDITION TO THAT, YOU HAVE A $25 MILLION CONTRIBUTION FROM THE TEAM TOWARDS THE STADIUM, AND THERE IS A SEPARATE AGREEMENT THAT YOU’VE ALREADY APPROVED WITH THE TEAM FOR THEM TO COVER THE DESIGN AND OTHER RELATED COSTS PRIOR TO THE ISSUANCE OF THE BONDS. AND THAT’S SOLELY THE TEAM’S RISK. SO THEY’RE BEARING THE RISK OF FRONTING THOSE EXPENDITURES JUST TO KEEP THE PROJECT MOVING. BUT THE SPORTS AUTHORITY HAS NO OBLIGATION FOR THOSE EXPENSES IF THE DEBT ISN’T ISSUED. AND THEN YOU ALSO HAVE $25 MILLION IN METRO GENERAL OBLIGATION BONDS THAT WILL BE ISSUED. AND THAT IS FOR INFRASTRUCTURE COST, ASSOCIATED WITH THE CONSTRUCTION OF THE STADIUM. IN ADDITION TO THAT 25 MILLION, THERE’S ANOTHER $25 MILLION IN GENERAL OBLIGATION BONDS FOR THE NEW FAIRGROUNDS BUILDINGS, BUT THAT’S SEPARATE, THAT’S NOT PART OF THIS CONSTRUCTION PROCESS. AND AS I SAID, THE TEAM IS RESPONSIBLE FOR ALL COST OVERRUNS. SO WHATEVER THAT TOTAL AMOUNT IS, AND THE GUARANTEED MAXIMUM PRICE, IF IT GOES ABOVE THAT, THISSERER OUT OF POCKET FORRAL OF THOSE COSTS.>>. I’MING GO THAT THE CONSTRUCTION AGREEMENT DETAILS. WHAT TAB IS THAT, KIM?>>FIVE. THIS WOULD BE AN AGREEMENT BETWEEN THE SPORTS AUTHORITY AND WALSH WITH ICON SERVING AS WALSH’S REPRESENTATIVE. AS I SAID THIS WAS DETERMINED TO BE THE MOST EFFICIENT PROCESS AND IN EVERYONE’S BEST INTEREST TO MAKE SURE THAT THE STADIUM IS CONSTRUCTED ON BUDGET AND ON TIME, AND EYE CONHAS THE EXPERIENCE THAT METRO DOESN’T WHEN IT COMES TO OVERSEEING THESE KIND OF PRO PROJECTS. CONSTRUCTION ADMINISTRATION CONCEPT IS MODELED AFTER WHAT COBB COUNTY DID WITH THE ATLANTA BRAVES RECENTLY FOR THEIR NEW STADIUM. IT HAD A SIMILAR FINANCING STRUCTURE ALTHOUGH THE COUNTIES EXPOSURE, AND OUT OF POCKET COST IS SIGNIFICANT GREATER THAN WHAT METRO’S WILL BE. BUT THE CONCEPT WAS THE SAME WHERE THE TEAM PUT IN A CERTAIN AMOUNT OF MONEY, THE CITY ISSUED THE DEBT, AND THE CITY MADE SOME LEVEL OF CONTRIBUTION.>>SO ICON WILL BE RESPONSIBLE FOR MAKING SURE THAT THE ARCHITECT AND THE CONSTRUCTION MANAGER DESIGN AND BUILD THE STADIUM, AND THAT’S THE BASIS OF THIS AGREEMENT, AND THE DESIGN, AND THE ARCHITECT STRUCTURE, AND WILL BE REQUIRED TO MEET WITH THE SPORTS AUTHORITY REPRESENTATIVES THROUGHOUT THE PROJECT. ICON’S RESPONSIBILITIES INCLUDE DEVELOPING THE PROJECT MILESTONES, THE TIME LINES, FOR WHEN CERTAIN THINGS HAVE TO BE COMPLETED, IT WILL ALSO TO BE TO WORK WITH THE CONSTRUCTION MANAGER TO GET THE GUARANTEED MAXIMUM PRICE IN PLACE, AND THAT WOULD BE DONE IN CONSULTATION WITH THE SPORTS AUTHORITY REPRESENTATIVES, AND THAT WOULD BE AN AGREED TO GUARANTEED MAXIMUM PRICE. THEY WILL BE RESPONSIBLE FOR MONITORING ALL CONSTRUCTION COSTS IN RELATION TO THE PROJECT BUDGET AND THE GUARANTEED MAXIMUM PRICE. THEY WILL BE REQUIRED TO HOLD PROJECT TEAM MEETINGS REGULARLY.>>YES, KIM.>>WHEN YOU SAY. IS THAT THROUGH THE DEVELOPMENT COMMITTEE PROCESS.>>THAT WILL BE PART OF IT. AND HERE WE’RE TALKING MORE DAY TO DAY OVERSIGHT, AND COMMUNICATION, SO THAT’S REALLY RON GOBBLE, AND CPS AND IF THERE ARE ISSUES THAT WOULD GO TO THE DEVELOPMENT COMMITTEE.>>BECAUSE I SEE THAT THE CHANGE ORDER SECTION FOR THIS AGREEMENT SAYS IT’S IN ACCORDANCE WITH THE DEVELOPMENT COMMITTEE PROCESS.>>RIGHT.>>THE QUESTION IS WHAT IS THE PROCESS?>>THAT WILL BE DETERMINED ONCE THEY START.>>THEY WILL MONITOR ALL OF THE PUNCH LIST ITEMS, AND MAKE SURE THAT EVERYTHING IS PROPERLY DOCUMENTED TO REVIEW ALL CONTRACTOR’S PAYMENT APPLICATIONS. THOSE WOULD BE SUBMITTED TO THE SPORTS AUTHORITY BUT ICON WOULD HAVE REVIEWED ALL OF THOSE TO MAKE SURE THAT THEY ARE CORRECT.>>AND THEN IF THERE ARE ANY CHANGE ORDERS NEEDED, ICON WOULD SUBMIT THOSE TO THE SPORTS AUTHORITY FOR APPROVAL. THERE’S SOME QUESTIONS ABOUT THAT PROCESS. AT WHAT POINT DO WE GET A CHANGE ORDER, IF THE COST OF THE STADIUM IS MORE THAN 225 MILLION, THAT’S WHEN –>>IT WOULD BE A CHANGE FROM THE FINAL PLANS, WHATEVER THE FINAL PLANS ARE; IS THAT RIGHT, TOM?>>SO IF THERE’S A — I DON’T KNOW WHAT THOSE WOULD BE.>>SO WE DON’T KNOW YET.>>NO.>>THERE MAY NOT BE ANY. ALTHOUGH I WOULD ASSUME ON A PROJECT OF THIS MAGANITUDE YOU HAVE SOME CHANGE ORDERS IN CONSTRUCTION.>>LET ME JUST GIVE YOU AN EXAMPLE.>>SAY THAT STEEL GOES UP, AND IT WAS. SO DOES THAT COME TO US?>>I DON’T KNOW THAT WOULD BE A CHANGE ORDER, IF IT TAX IT OVER THEN THE TEAM WOULD BE RESPONSIBLE FOR PAYING FOR THAT. DURING THE DESIGN PROCESS, YOU LOCATED REST ROOMS IN ONE PLACE, AND WHEN YOU WEPT THROUGH THE PROCESS, YOU MAY NEED TO MOVE THEM TEN FEET, AND SO IT MAY NOT BE COST, IT COULD BE JUST THE DESIGN, AND YOU HAVE A CONTRACTOR WORKING THROUGH THE GAND P, AND IT COVERS THE PRICE, AND THAT DEALS WITH STEEL, AND MATERIAL, SO THIS IS MORE ABOUT CHANGING THE DESIGN. DO YOU HAVE ANYTHING ON THAT RON?>>A CHANGE ORDER IS TECHNICALLY ANYTHING WITH TIME OR MONEY, ONCE THAT GMP, IS ESTABLISHED. SO YOU WOULD BE MODIFYING THE GMP, SO I THINK THAT THE TEAM WOULD STILL BE RESPONSIBLE FOR IT, AND IT WOULD STILL HAVE TO GO THROUGH THIS PROCESS FOR REVIEW BY THE DEVELOPMENT COMMITTEE, AND THEN ULTIMATELY BY THE AUTHORITY. SO IF YOU HAVE A CHANGE LIKE THAT, OR CHANGE OF SOME MLS, STANDARD OR SOME OTHER ISSUE THAT COMES UP OVER THE TWO YEARS THAT IT’S UNDER CONSTRUCTION, AFTER THE GMP, IS SET, AND AGAIN, I THINK THAT THE DOCUMENTS, AS I READ THEM ARE CLEAR, THE TEAM IS RESPONSIBLE FOR THOSE OVERRAN R OVERAGES. WHAT I’M TRYING TO UNDERSTAND, WE AT THE SPORTS AUTHORITY WILL NOT BE WEIGHING IN WHETHER IT GOES OVER BUDGET OR NOT. THE DOCUMENTS TAKE CARE OF THAT. THE ONLY THING THAT WE GET IS WHAT THE VARIOUS CHANGES ARE IN DESIGN; IS THAT RIGHT? [ INAUDIBLE ] TIME AND MONEY. I HAVE TO RELY ON RON, AS TO WHAT CHANGE ORDER MEANS IN THIS CONTEXT, IN THIS INDUSTRY. BUT IT SOUNDS LIKE IT’S MORE TIME OR MONEY. SO IF THE COST IS GOING UP, OR SOMETHING GOING TO TAKE LONGER IN THESE PROJECT MILESTONES ARE SET, AND IF IT’S GOING EXTEND BEYOND THAT, THEN –>>OUR FOCUS AS I UNDERSTAND IT, WILL BE ON ANYTHING THAT HAS A CAPITAL IMPROVEMENT IMPACT GOING ON LATER ON, AND SO IF THEY MAKE A CHANGE ORDER, THE CHANGE ORDER WILL GO UP OR DOWN, AND IT DOESN’T HAVE TO ALWAYS BE AN INCREASE, SO A CHANGE ORDER TO SOMETHING THAT SAY WE WOULD GENERATE CAPITAL IMPROVEMENTS, OR ISSUES, SOME SUBSTANDARD HVAC SYSTEM OR SEATS OR SOMETHING LIKE THAT, THEN THAT’S WHERE WE WOULD WEIGH IN AND BE MONITORING THAT THROUGH THE PROCESS. THAT’S MY UNDERSTANDING. IF IT DEALS WITH THE DESIGN AND THE COST IMPACT TO IMPLEMENT AN MLS, STANDARD, THEN THAT’S THE TEAM’S RESPONSIBILITY.>>DID I GET IT RIGHT?>>THAT’S RIGHT. SO LET ME JUST ASK, ALONG THOSE SAME LINES, I’VE BEEN THROUGH A FEW BUILDINGS DURING MY TIME ON THE BOARD HERE, AND SO ONE OF THE MAIN THINGS THAT HAS COME UP IS THAT THESE ITEMS THAT HAVE BEEN NEARED OUT OF THE ORIGINAL PLAN, SO THINGS THAT HAVE COME BACK TO HAUNT US, AND WE END UP WITH THESE CAPITAL EXPENDITURES THAT, YOU KNOW, I WOULD BE CONCERNED THAT WE DIDN’T TAKE SHORT CUTS ON OUR INITIAL PLAN, AND END UP TWO YEARS, THREE YEARS DOWN THE ROAD WITH US TRYING TO FIGURE OUT HOW TO RUN THAT.>>AND THAT’S WHAT RON WILL BE MONITORING TOO, AND CPS TO MAKE SURE THAT THAT DOESN’T HAPPEN.>>THIS IS A FOLLOWUP. I HAD TWO QUESTIONS. SO JUST TO SUMMARIZE, WHAT WILL BE — YOUR AND CPS’S RESPONSIBILITY, AND WHAT WILL BE YOUR AUTHORITY IF YOU HAVE — IF YOU SEE SOMETHING THAT YOU DON’T LIKE?>>WELL, AND LET ME JUST FOLLOW UP. LOOKING AT A SUMMARY, IT SAYS THAT THERE’S A FOUR MEMBER DEVELOPMENT COMMITTEE, COMPRISED OF TWO REPRESENT RIFS FROM THE AUTHORITY, AND TWO REPRESENTATIVES FROM WALSH AND THEN THE DEVELOPMENT COMMITTEE WORKS TOGETHER THROUGHOUT THE DESIGN DEVELOPMENT CONSTRUCTION PROCESS. ONE OF WALSH’S REPRESENTATIVES WILL SCHERZER OF AS THE CHAIRMAN OF THE COMMITTEE, AND WILL BE ABLE TO MAKE DECISIONS AMONG DISPUTES WITH COMMITTEE MEMBERS, UNLESS IT WOULD HAVE HAVE A MATERIAL ADVERSE IMPACT ON THE AUTHORITY’S FUTURE, AND YOUR AUTHORITY, AND YOUR RESPONSIBILITY IS OVERSEEING WHAT OUR FUTURE CAPITAL EXPENSE RESPONSIBILITIES WILL BE, AND EYE TELLS US THAT MIGHT IMPACT THAT?>>THAT’S OUR PRIMARY RESPONSIBILITY, AS THE DESIGN IS BEING DEVELOPED, WE’LL BE REVIEWING THOSE, COMMENTING ON THOSE DESIGNS, AS WELL AS IN COMPLIANCE WITH METRO STANDARDS AND CPS WILL BE FOCUSING MOSTLY ON THAT ASPECT OF IT, OF COMPLAINS AND QUALITY CONTROL AND THOSE KIND OF THINGS.>>WOULD YOU BE MAKING PERIOD I CAN REPORTS TO THE AUTHORITY.>>YES, SIR. >>. HE ASKED THE QUESTION OF WHAT IS YOUR AUTHORITY, AND THE QUESTION ALSO GOES TO, IF THERE IS NOTHING THAT, YOU KNOW, IS TIME SENSITIVE, AND THERE’S A SHORT CUT WAY OF DOING IT, THAT MAYBE IT’S NOT WHAT YOU THINK THAT’S WHAT IS TO BE DONE TO THAT SITUATION, SO YOU GET IN AN IMPASSE, AND THEN YOUR ROLE IS TO MAKE SURE THAT FOR THE PUBLIC FOR THE TAXPAYER THAT THIS BUILDING IS IN THE CONDITION THAT SHE IS TALKING ABOUT, AND YOU WILL MAKE SURE THAT IT DOESN’T HAPPEN, OR COME TO THE BOARD OR DO SOMETHING TO MAKE SURE THAT WE’RE NOT USING MATERIALS THAT –>>ABSOLUTELY. AND WE’VE GOT THE DEVELOPMENT COMMITTEE AS THEY DEFINED IT, AND THAT WOULD BE THE FIRST PLACE WE WOULD GO.>>WE HAVE AN ISSUE HERE AND WE HAVE TO RESOLVE IT, AND HOPEFULLY THAT’S WHERE IT WOULD BE RESOLVED, AND I’M CONFIDENT THAT’S WHERE MOST OF THESE WILL BE. IF WE DO GET TO THAT IMPASSE, IT WILL GO THROUGH MEDIATION, OR ARBITRATION OR LUKE THAT TO DEAL WITH IT. OUR JOB IS TO LOOK OUT FOR THE AUTHORITY’S BEST INTEREST. AND WE’VE GOT A LOT OF OTHER ISSUES GOING ON, AS WELL AS COORDINATING AROUND THE EDGES, AND THE FAIRGROUNDS PROJECTS AND ALL OF THE THINGS THAT HAVE TO GO ON AND THAT PROPERTY AS IT STAYS OPERATIONAL. BUT WE WOULD DEFINITELY BE THERE. THAT’S OUR ROLE. THANKS RON.>>IF THERE’S NO MORE QUESTION ON THE CONSTRUCTION ADMINISTRATION AGREEMENT I WILL MOVE ON TO THE TEAM LEASE. THIS IS THE STADIUM LEASE, BETWEEN THE SPORTS AUTHORITY AND WALSH.>>TAB TWO.>>OKAY, THIS WILL BE ALSO A 30- YEAR TERM TO MIRROR THE GROUND LEASE TERM AND THE DEBT ISSUANCE OF THE TEAM WILL PAY ANNUAL RENT TWICE A YEAR, AND THE ANNUAL RENT IS THE TOTAL AMOUNT OF THE DEBT SERVICE REQUIRED FOR THAT YEAR. DEBT SERVICE IS PAID TWICE A YEAR, AND SO THE RENT PAYMENTS WILL BE DUE PRIOR TO THE DEBT PAYMENTS. AND AND SO THE ANNUAL RENT IS THE TOTAL AMOUNT OF DEBT SERVICE. NOW, THEY WILL GET A CREDIT OR WHAT THE DOCUMENTS REFER TO AS A RENT REDUCTION. THIS CONCEPT WAS PART OF THE RESOLUTION APPROVED BY THE COUNCIL. AND THE RENT REDUCTION IS THE TOTAL AMOUNT OF THE TICKET TAX REVENUE, AND THE SALES TAX REDIRECT COLLECTED AT THE STADIUM. SO THEY WILL GET WHATEVER WE COLLECT IN THESE, THEY WILL GET CREDIT BASICALLY TOWARDS THE RENT OR THAT CAN BE USED TO OFFSET THE RENT. THERE IS A GUARANTEE FOR TEN YEARS THAT THOSE TAX REVENUES WILL GENERATE A CERTAIN AMOUNT. THIS IS ALL PART OF THE COUNCIL RESOLUTION. IT WOULD BE — THE GUARANTEE IS $4 MILLION FOR YEARS 1 THROUGH 5. AND $3 MILLION A YEAR FOR YEARS 6 THROUGH 10. AND IF THERE WAS A SHORTFALL IN TAX REVENUES, THAT WOULD BE COVERED IN THE ANNUAL OPERATING BUDGET. NOT FROM SPORTS AUTHORITY REVENUES, BUT THROUGH THE METRO GENERAL FUND AND APR APROPREATED THAT WAY. WALSH WILL BE RESPONSE FOR ALL OPERATING AND ALL MAINTENANCE EXPENSES, UTILITY, SECURITY, EVERYTHING.>>I THINK IT WOULD BE HELPFUL, IF YOU DON’T MIND IF THEY LAY OUT WHAT THOSE EXPENSES ARE, WHAT IS UNIQUE TO SOME OF OTHER OTHER AGREEMENTS IN THE PAST, I THINK IT’S MUCH CLEARER, FROM A BOARD PERSPECTIVE, I THINK IT WOULD BE HELPFUL. AND I DON’T KNOW IF MAYBE –.>>YOU’RE TALKING ABOUT SECTION FOUR OPERATING EXPENSES OF?>>YES.>>YES.>>JUST SO THE BOARD CAN HEAR. I KNOW IN THE PAST WE HAD SOME ISSUES REGARDING WHAT’S CONSIDERED CAPITAL, AND WHAT’S CONSIDERED OPERATING, AND IT’S EXPLICITLY LAID OUT IN SECTION IF WE WANT TO READ THOSE ALLOWED.>>I THINK THAT WE CAN.>>SO OPERATING COSTS WOULD BE ALL OF THE STAFFING COSTS ASSOCIATED WITH OPERATING THE STADIUM.>>THOSE WOULD BE THE TEAMS OR WALSH’S EMPLOYEES. EXTERIOR WINDOW CLEANING, EXTERIOR PAINTING, FACADE INSPECTIONS AND MAINTENANCE. REPAIR, REPLACEMENT AND MONITORING OF ALL FIRE LIFE SAFETY AND SPRINKLER SYSTEMS. SNOW AND ICE REMOVAL. SECURITY EXPENSES. LIGHTING FACILITIES. LANDSCAPING. SIGNAGE. PROPERTY MANAGEMENT FEES TO THE EXTENT THAT THERE WERE ANY. ALL SUPPLIES, AND MATERIALS NEEDED FOR THE OPERATION, INSURANCE EXPENSES WHICH WE’LL GET INTO LATER. MAINTENANCE EQUIPMENT.>>MAINTENANCE AND REPARTY OF ALL MECHANICAL, ELECTRICAL AND PLUMBING SYSTEMS. UTILITIES INCLUDING GAS, ELECTRIC CABLE, INTERNET, WATER AND SEWER. DRIVEWAY AND PARKING AREA MAINTENANCE. REPAIR REPLACEMENT REFURBISHMENT AND GENERAL MAINTENANCE OF THE STADIUM ITSELF AS A WHOLE INCLUDING THE PLAYING FIELD PORTION. SERVICE OR MAINTENANCE CONTRACTS WITH INDEPENDENT CONTRACTORS LIKE YOUR HVAC CONTRACTORS, ELECTRICAL CONTRACT OOR CONTRACTORS.>>THE ONLY THING THAT’S NOT AN OPERATING EXPENSE IS WHAT IS CONSIDERED A CAPITAL EXPENSE. AND THOSE ARE ALSO DEFINED BUT IT’S IN ACCORDANCE WITH THE GOVERNMENTAL ACCOUNTING STANDARDS, OR ACCOUNTING STANDARD PRINCIPLES. ANY QUESTIONS ABOUT THE OPERATING MAINTENANCE? ONTO THE CAPITAL EXPENSES.>>A NOVEL PART OF THIS DEAL THAT WE DO NOT HAVE IN IN I HAVE THE OTHER DEALS IS A PORTION OF THE TICKET TAX WILL GO DIRECTLY TO CAPITAL EXPENSES. SO WE WON’T BE IN A SITUATION WHERE WE ARE NOW WITH SOME OF OUR FACILITIES WHERE THEY’RE GETTING SOME YEARS ON THEM, AND CAPITAL NEEDS ARE REALLY STARTING TO SURFACE AND YOU DON’T HAVE A DEDICATED FUNDING SOURCE FOR THAT. SO STARTING IN YEAR SIX OF THE TEAM LEASE, THE TICKET TAX, $0.50 FOR YEARS 6 AND 7, AND $0.75 FOR YEAR EIGHT THEREAFTER WILL BESET ASIDE SPECIFICALLY FOR CAPITAL EXPENSES. IN ORDER TO MAKE SURE THAT THE SPORTS AUTHORITY KNOWS WHAT CAPITAL EXPENSES WILL BE COMING, THERE’S A REQUIREMENT THAT THEY PROVIDE A CAPITAL ASSET MANAGEMENT PLAN, AND THAT WOULD START IN YEAR SEVEN OF THE AGREEMENT, AND THAT PLAN WOULD BE PREPARED BY AN INDEPENDENT CONSULTING IF I REMEMBER. IT /TPEURPL /TPE FIRM, AND ASSESSMENT OF THE ENTIRE STADIUM, AND YOU I THINK THAT YOU WOULD HAVE HAVE EVERY OTHER YEAR, A CAPITAL ASSET MANAGEMENT PLAN SUBMITTED.>>[ INAUDIBLE ] THE TICKET TAX [ INAUDIBLE ].>>IT DOES. THE TICKET TAX WILL START AT $1.75 DAY ONE. THAT WILL BE PART OF THE ORDINANCE THAT COUNCIL APPROVES IS ESTABLISHING THAT TICKET TAX, AND THEN IN YEAR SIX, IT WILL GO TO $2.25, WITH $0.50 FOR CAPITAL.>>THE LEASE INCLUDES A REQUIREMENT THAT NASHVILLE BE USED IN THE TEAM NAME AT ALL TIMES AND THAT THE TEAM MAINTAIN OPERATIONS HERE IN NASHVILLE. THEY WILL BE ENTITLED TO PLAY UP TO THREE GAMES AT ANOTHER LOCATION IN NASHVILLE.>>IF FOR SOME REASON THEY DETERMINE THAT THEY NEEDED TO DO ONE AT NISSAN STADIUM OR SOMETHING, IT WAS SOME KIND OF SPECIAL GAME, THAT WOULD BE AT THEIR DISCRETION. BUT IF THAT HAPPENS, THEY HAVE TO REIMBURSE METRO FOR THE LOST TICKET AND SALES TAX REVENUE THAT WE OTHERWISE WOULD HAVE COLLECTED AT THE STADIUM. SO IF WE HAVE TO COME OUT OF POCKET BECAUSE OF THEM PLAYING A GAME SOMEWHERE ELSE, THEN THEY HAVE TO REIMBURSE US FOR THAT.>>AND JOHN, ONE OF THE THINGS THAT IS WORTH NOTING TOO IS THAT IN THE CAPITAL ASSET MANAGEMENT PLAN THAT I GUESS THE CONSULTANT WILL ALSO HAVE TO SUBMIT AN ANNUAL BUDGET BEFORE METRO THAT IS TO BE APPROVED EACH YEAR.>>FOR THE CAPITAL EXPENSES.>>YES. IT WOULD GO BEFORE COUNCIL?>>IT WOULD GO BEFORE THE AUTHORITY, I THINK.>>IT SAYS PRESENT SUCH BUDGET TO THE DIRECTOR OF FINANCE IN METRO.>>IT WOULD BE THE FINANCE DIRECTOR SIGNING OFF ON THAT. TO THE EXTENT THAT THERE’S ANY OUT OF POCKET EXPENSE FOR METRO FROM THE GENERAL FUND OR SOMETHING THAT WOULD BE PART OF THE BUDGET.>>FOR WHAT REASON MAY THEY WANT TO PLAY AT A DIFFERENT LOCATION?>>WE DON’T THINK THAT’S VERY LIKELY, BUT IT COULD BE POSSIBLE, THERE COULD BE A FRIENDLY WITH AN INTERNATIONAL TEAM, AND WE THINK THAT IT WOULD DRAW MORE THAN WHAT THE SIZE OF THE STADIUM WOULD BE, IT’S JUST TO ALLOW FLEXIBILITY, BUT THETUM IS WHERE ALL OF THE REGULAR MLS, GAMES WOULD BE PLAYED.>>THANK YOU.>>SINCE THE TEAM IS TAKING ON THE RESPONSIBILITY FOR THE DEBT THEY WILL GET TO KEEP THE REVENUE THAT THEY GENERATE AT THE STADIUM SO THAT WOULD BE CONCESSIONS, NAMING RIGHTS, ADVERTISING AND STADIUM EVENT PARKING FOR THEIR EVENTS. A LOT OF DISCUSSION WENT INTO SCHEDULING COORDINATION BECAUSE THE FAIRGROUNDS DOES HAVE EVENTS THERE REGULARLY THROUGHOUT THE YEAR AND WE WANTED TO MAKE SURE THAT THEY CAN CONTINUE TO PROVIDAL OF THE EVENTS THAT THEY’RE REQUIRED BY CHARTER TO PROVIDE. SO THE TEAM MUST USE GOOD FAITH EFFORTS TO ACCOMMODATE FAIRGROUNDS EVENTS SPECIFICALLY THE FLEA MARKET BECAUSE THAT’S PRETTY MUCH A FIXED EVENT. YOU KNOW WHEN THOSE ARE GOING TO BE HELD. BUT THEY WILL BE REQUIRED TO COORDINATE THEIR SCHEDULING WITH THE FAIRGROUNDS AND THE TEAM IS CONFIDENT THAT THEY CAN DO THAT WORKING WITH MLS, TO MAKE SURE THAT WE GET A SCHEDULE THAT WORKS FOR EVERYBODY. THE SPORTS AUTHORITY AND SLASH METRO WILL BE ENTITLED TO 20 PUBLIC USE DAYS. THAT’S SIGNIFICANTLY MORE THAN WE HAVE IN THE OTHER FACILITIES. SO THAT WOULD BE 20 DAYS OF RENT FREE USE OF THE STADIU FOR WHATEVER EVENT WE WANTED TO DO. WE WOULD RESPONSIBLE FOR PAYING THE OPERATING COSTS ASSOCIATED WITH THAT EVENT. BUT WE WOULD NOT HAVE TO PAY THE TEAM ANY RENT FOR USE OF THE STADIUM. THE TEAM IS REQUIRED TO MAINTAIN FULL REPLACEMENT COST INSURANCE ON THE FACILITY. SO INSURANCE REQUIREMENTS, OBLIGATION THAT’S ON THE TEAM. IT WILL ALSO BE REQUIRED TO PROVIDE $50 MILLION ON COMMERCIAL LIABILITY INSURANCE, NAMING METRO AS AS I ADDITIONAL INSURED. THEY WILL BE REQUIRED TO INDEMNIFY THE SPORTS AUTHORITY FOR DAMAGES OR INJURIES RESULTING FROM THEIR OPERATIONS TO PROTECT THE SPORTS AUTHORITY FROM FUTURE CLAIMS OR LAWSUITS. THERE IS AN UNCONDITIONAL TEAM GUARANTEE FOR ALL RENT PAYMENT THROUGHOUT THE ENTIRE TERM AND FOR THEIR CONSTRUCTION CAPITAL CONTRIBUTION AS WELL AS COST OVERRUNS, SO THEY HAVE TO PROVIDE — THERE’S A GUARANTEE AGREEMENT INCORPORATED INTO THE LEASE THAT PROTECTS METRO TO MAKE SURE THAT ALL OF THE DEBT SERVICE THROUGHOUT THE 30 YEARS IS COVERED. THE COUNCIL ADDED A REQUIREMENT THAT REQUIRED THE GUARANTEE PROVISION, IN THE CASE THAT JOHN INGRAM IS NO LONGER THE CONTROLLING OWNER OF THE TEAM THERE WOULD BE NEW SUCCESSOR GUARANTEES THAT METRO WOULD HAVE TO APPROVE TO MAKE SURE THAT METRO’S PROTECTED.>>THE TEAM WOULD NOT BE ALLOWED TO ASSIGN THE LINE WITHOUT THE SPORTS AUTHORITY’S PERMISSION. AND FINALLY, THE AGREEMENT INCLUDES STANDARD PROVISIONS THAT MLS, REQUIRES, AND ALL MLS, MAKING THEM A THIRD PARTY BENEFICIARY, AND ALLOWING MLS, TO STEP INTO THE SHOES OF THE TEAM, IN THE EVENT OF A DEFAULT. IF THE TEAM DIDN’T PAY RENT FOR WHATEVER REASON, OR SOMETHING, THEN MLS, COULD STEP IN TO CURE DETERMINE FAULT. THE DEFAULT.>>[ INAUDIBLE ] >>LET’S SAY THAT THE TEAM WANTED TO GET SOMEONE ELSE TO MANAGE THE STADIUM. SO IT WENT FROM WALSH TO BOB’S MANAGEMENT, THEN THE SPORTS AUTHORITY WOULD HAVE TO APPROVE THAT.>>ANY QUESTIONS ON THE TEAM LEASE?>>ON SECTION TEN WHERE IT SAYS RIGHT OF ENTRY AND USE. IT TALKS ABOUT THE AUTHORITY HAVING RIGHT OF ACCESS, BUT IT NEVER ACTUALLY USES THE TERM, I USE”, AND IT WOULD HAVE ACCESS TO OFFICE SPACE FOR ACCOMMODATING ANY AUTHORITY MEETINGS AND I WOULD ASK MAYBE LOOK AT THAT IN THAT CONTEXT AGAIN.>>MARY DID YOU HEAR THAT?>>I JUST WANT TO SAY THAT THIS IS A DIFFERENT AGREEMENT THAN WHAT WE HAD. AND I THINK THAT IT REALLY [ INAUDIBLE ] SOME OF THE OTHER AGREEMENTS, AND IT’S A KEY PART OF THIS WHOLE AGREEMENT AND VERY SUPPORTIVE OF THE TICKET TAX, [ INAUDIBLE ].>>WE’VE LEARNED SOME LESSONS OVER THE PAST 20, 30 YEARS.>>IT’S A MUCH BETTER DEAL.>>WE THINK SO.>>I HAVE A QUESTION ABOUT THE GUARANTEE. AS I UNDERSTAND IT WHAT WE’VE GOT BECAUSE WE HAVE THE SPORTS AUTHORITY LEASING TO WALSH MANAGEMENT, AND THE TEAM IS THE GUARANTOR OF THAT LEASE. AND THE TEAM IS AN LLC. AND IT’S NOT AN INDIVIDUAL.>>RIGHT.>>NOW, THE LEASE PROVIDES, IF JOHN JOHN, INC. CEASES TO BE THE OWNER OF THE TEAM. THAT THEY [ INAUDIBLE ] GUARANTEE AGREEMENT ACCEPTABLE INTO [ INAUDIBLE ]. MY QUESTION IS WHAT IS THE NET WORTH OF THE TEAM RIGHT NOW, BECAUSE THEY ARE THE ONES THAT ARE GUARANTEED THE DEBT?>>I DON’T KNOW THAT. I DON’T KNOW THAT THEY COULD SAY THAT.>>THAT’S NOT SOMETHING THAT CAN SEE [ INAUDIBLE ] >>WELL, THE REASON I ASKED IS BECAUSE IT WAS IN THE GUARANTEE, THERE WAS A PROVISION THAT TALKED ABOUT DISCLOSURE, LITIGATION, AND THINGS, AND IT WAS — IT WAS A PROVISION THAT GUARANTOR WOULD MAKE DISCLOSURES. YOU’VE GOT A NET WORTHLESS THAN WHAT’S SET FORTH IN SECTION 24, AND SECTION 24 IS RESERVED, AND FIRST OF ALL, I’M NOT QUESTIONING ANYBODY’S INTEGRITY OR ANYTHING ALONG THOSE LINES. BUT WE’VE GOT A GUARANTEE FROM AN LLC, AND I’M TRYING TO FIGURE OUT WHO THE MEMBERS ARE, WHO THE OWNERS ARE.>>THE DISCUSSION AT THE COUNCIL WHEN THIS WAS TALKED ABOUT WAS BASICALLY TRUST AND FAITH IN JOHN INGRAM AND HIS COMMITMENT TO THE CITY, AND THAT HE WILL LIVE UP TO WHAT HE SAYS THAT HE WILL DO. THIS IS A LOCAL WELL KNOWN BUSINESSMAN WHO HAS STRONG TIES WITH THE COMMUNITY. SO THAT THE COUNCIL FELT COMFORTABLE WITH A TEAM GUARANTEE AS LONG AS HE WAS THE TEAM. IN THE EVENT THAT HE WAS NO LONGER THE CONTROLLING INTEREST, THEY THEN WE WOULD NEED TO SEE, DEPENDING ON THE NEW OWNER, SOME PERSONAL GUARANTEAS, AND THINGS LIKE THAT. SO IT’S REALLY JUST KIND OF A FAITH, AND TRUST.>>AS I UNDERSTAND, THIS IS A [ INAUDIBLE ] SATISFY THE COUNCIL. VERY MUCH SO.>>NOT NECESSARILY A LOT OF DISCRETION. A LOT OF THOUGHT WENT INTO THAT LANGUAGE THAT WAS HEAVILY NEGOTIATED AT THE COUNCIL LEVEL.>>LAST, FINALLY I WILL MOVE ON TO THE CONSTRUCTION MANAGEMENT AGREEMENT WHICH YOU DO NOT HAVE BEFORE YOU TODAY. THIS IS KIND OF A PREVIEW OF WHAT WILL COME. THIS IS GOING THROUGH THE PROCUREMENT PROCESS RIGHT NOW. THIS IS THE ENTITY THAT WILL ACTUALLY BUILD THE STADIUM. THE CONTRACTOR, DEVELOPER WHATEVER YOU WANT TO CALL IT, THAT’S REFERRED TO AS THE CONSTRUCTION MANAGER, AND THE DEADLINE FOR THE CONSTRUCTION MANAGEMENT RFP, RESPONSES IS I THINK JULY 17TH. SO THAT’S COMING UP. AND SO ONCE THE BID CLOSING DATE HAS PASSED, THEN THE EVALUATION COMMITTEE WILL REVIEW THAT, AND ULTIMATELY BRING THAT AGREEMENT TO THE SPORTS AUTHORITY FOR APPROVAL. SO IT’S STILL IN THE PROCUREMENT PROCESS RIGHT NOW.>>THEY WOULD OBVIOUSLY, THE RFP, REQUIRES THAT THEY HAVE SUBSTANTIAL EXPERIENCE ON SIMILAR PROJECTS, TO MAKE SURE THAT YOU’RE GETTING A CONSTRUCTION MANAGER THAT HAS THE EXPERTISE AND CAPACITY TO BUILD THE PROJECT. THEY WOULD BE RESPONSIBLE FOR HELPING ICON COME UP WITH THE — OR PLEADING ICON WITH THE GUARANTEED MAXIMUM PRICE RESPONSIBLE FORM COMPLETING THE STADIUM ON TYPE, AND WITHIN BUDGET, A FINANCE THEY DID NOT DO SO, THERE ARE LIQUIDATED DAMAGES PROVISIONS, BASED UPON COMPARABLE VENUES, WHERE THEY WOULD HAVE TO PAY FOR ANY DELAYS, OR BE RESPONSIBLE FOR THE COST THE TEAM INCURS AS A RESULT OF DELAYS, SO THAT WOULD BE NOT ON THE AUTHORITY, BUT ON THE CONSTRUCTION MANAGER. THERE ARE ALSO THE FRFP, HAS THE 30 PERCENT DBE, GOAL FOR THE CONSTRUCTION OF THE PROJECT. AND FINALLY, YOU WILL BE TALKING ABOUT THE COUNCIL APPROVAL, YOU’VE GOT THE FAIR BOARD ACT, YOU HAVE THREE PIECES OF LEGISLATION THAT WILL BE FILED WITH THE COUNCIL FOR CONSIDERATION IN AUGUST AND SEPTEMBER. THE FIRST WILL BE A TICKET TAX ORDINANCE IMPOSING THE TICKET TAX, AND AUTHORIZING THE DEMOLITION OF THE EXISTING FAIRGROUNDS STRUCTURES NECESSARY TO BUILD THE STADIUM. SO THAT, BY CHARTER THAT REQUIRES 27 COUNCIL VOTES. THERE WILL BE ALSO BE A ZONING ORDINANCE FOR THE REZONING OF THE TEN ACRE PRIVATE DEVELOPMENT PORTION THAT WILL BE SEPARATE LEGISLATION THAT IS NOW GOING THROUGH THE PLANNING PROCESS. IT HAS BEEN FILED WITH THE PLANNING COMMISSION, AND THEY WILL BE CONSIDERING IT, AND THEN IT WILL GO TO COUNCIL FOR PUBLIC HEARING, AND FINAL ACTION. THERE WILL BE AN ORDINANCE APPROVING THE GROUND LEASE FOR THE PRIVATE DEVELOPMENT BETWEEN THE FAIR BOARD AND THE PRIVATE DEVELOPER WHICH IS A PARTNER OF THE TEAM, MARKET STREET. SO THAT’S NOT A SPORTS AUTHORITY AGREEMENT, THAT WILL BE WITH THE FAIR BOARD. SO IT’S AND THE US TICIPATED TT READING OF IT, YOU WILL THE RESOLUTION BOND, AND THE 25 MILLION CAPITAL IMPROVEMENT BOND FOR STADIUM INFRASTRUCTURE, AND FOR FAIR GROUND STRUCTURESES SO FOR THE ORDINANCES YOU’LL HAVE FIRST READING AUGUST 7TH, AND SECOND READING AUGUST 21ST, AND THIRD READING SEPTEMBER 4TH FOR THE THAT’S FOR THE TICKET TAX AND THE DEMOLITION ORDINANCE.>>I WOULD LIKE TO MAKE MENTION OF THE DBE, PARTICIPATION, YOU SAID 30 PERCENT.>>30 PERCENT.>>IT JUST SAYS NOT AGREED, BUT TO BE ESTABLISHED. BUT THE LIKELY HAD OF THEM BEING ABLE TO MEET THAT GOAL, I KNOW THAT IN VENT PROJECTS THERE’S BEEN SOME CONVERSATION ABOUT NOT HAVING ENOUGH LOCAL DBE, AND [ INAUDIBLE ] OUT OF STATE, AND I WOULD HOPE THAT WE WOULD FOCUS ON LOCAL I FIRST, AND TRY TO [ INAUDIBLE ] SOUTH, AND I WOULD LIKE FOR US TO BE SUCCESSFUL IN MEETING THAT 30 PERCENT.>>NOT JUST [ INAUDIBLE ], BUT [ INAUDIBLE ] BUSINESS AS WELL.>>AND THAT IS ALSO AN INTEREST AND CONSIDER OF THE COUNCIL. SO A GREAT DEAL OF ATTENTION AND EFFORT WILL GO INTO SATISFYING THAT GOAL.>>IN THIS AGREEMENT THAT YOU’RE ASKING US TO APPROVE, DO THEY REFER TO THE PRIVATE DEVELOPMENT GROUND LEASE?>>NOT AT ALL. THAT’S TOTALLY SEPARATE.>>IN THIS AGREEMENT, THERE OBVIOUSLY HAS TO BE A LOT HAPPENING IN COUNCIL FOR THAT TO BE EFFECTIVE — WE’RE JUST APPROVING THIS, AND TELLING THE COUNCIL THAT WE’VE APPROVED IT.>>CORRECT. AND THEN IF THE COUNCIL DOESN’T APPROVE IT, THE AGREEMENT NEVER GETS EXECUTED AND THE DEBT NEVER GETS ISSUED. SO THE COUNCIL IS THE –>>THANK YOU, JOHN.>>YOU’RE WELCOME, THANK YOU.>>CAN I SAY A COUPLE OF THINGS REAL QUICKLY BEFORE YOU LEAVE, SO YOU CAN HEAR ME TO CATHY’S POINT, AND THE DBE, AND THE 30 PERCENT PARTICIPATION GOAL THAT HAS BEEN SET, AND THAT IS SOMETHING THAT WE’RE VERY SERIOUS ABOUT. I’VE HAD MULTIPLE CONVERSATION WAS GOBBLE HAYES, AND AS WE TALK ABOUT THEIR ROLE, WILL BE MANAGING THE DBE, COMPONENT, AND HELPING WITH REPORTS, AND MAKING SURE THAT THERE’S A WAY THAT IT NEEDS TO GO, BECAUSE I THINK THAT WE ALL RECOGNIZE THE IMPORTANCE OF THAT, AND I WOULD ALSO LIKE TO REALLY JUST ECHO WHAT JOHN AND MARGARET AND A COUPLE OF YOU HAVE SAID. I HAVE AFTER BEEN HERE A LONG TIME TOO AND HAVE SEEN A LOT OF THESE DEALS, AND YES, WE HAVE SOME THINGS THAT WE’RE GOING TO WORK THROUGH ESPECIALLY WITH THE CONSTRUCTION ADMINISTRATION AGREEMENT, AND NAIL THAT PIECE DOWN, AND WALKING OUT THAT PROCESS. BUT I THINK THAT WE HAVE, AS A CITY, LEARNED A LOT OVER THE LAST 20 PLUS YEARS. I THINK THAT WHEN WE LOOK AT THE TICKET TAX AND THE PROTOVISION FOR FUTURE CAPITAL COMMENT TOURS, AND WHEN WE LOOK AT THIS CAPITAL ASSET MANAGEMENT PLAN, AND WE LOOK AT THE REIMBURSEMENT FOR SALES TAX, AND TICKET TAX, IT WOULD BE LOST WHEN THE TEAM PLAYS SOMEWHERE ELSE. I THINK THAT THOSE ARE ALSO VERY POSITIVE THINGS, AND I APPRECIATE ALL OF THE WORK THAT HAS GONE INTO THIS, THANK YOU. . IS THERE ANYTHING THAT YOU WOULD LIKE TO ADD FROM THE FAIR BOARD.>>JUST THANK YOU JOHN FOR THE OPPORTUNITY TO DO THESE INFORMATIONAL SESSIONS, TO [ INAUDIBLE ] VERY IMPORTANT.>>THANK YOU FR BEING HERE AS WELL. SEEING NO FURTHER CONVERSATION ON THESE DOCUMENTS, WE WILL COME BACK TO THIS SAME ROOM AND SAME WONDERFUL FACILITY NEXT WEEK ON THE-.>>THURSDAY AT 10:30.>>SO SEEING NO OTHER BUSINESS, WE WOULD MOVE TO ADJOURN.>>SO MOVED.>>THANK YOU.>>[ MUSIC PLAYING ]. THIS HAS BEEN A SERVICE OF THE METRO NASHVILLE NETWORK. IF YOU WOULD LIKE TO SEE THIS PRESENTATION AGAIN OR FOR MORE INFORMATION ABOUT THIS AND OTHER PROGRAMS, VISIT

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