EDA - Joe Huss, Finance Director/Asst. City Manager and Erik Thorvig, Community Development Director
Title
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Approve Payment to the National Sports Center for the Purchase and Installation of Turf Fields
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Executive Summary
Staff is requesting EDA to authorize execution of a $2 million loan to the National Sports Center (NSC) to assist in funding the purchase and installation of two multi-purpose turf fields at the NSC. Staff and the City Attorney are working in conjunction with the NSC, as well as the Minnesota Amateur Sports Commission (MASC) to develop a loan agreement for execution.
Background
During discussions earlier in 2022, the City Council identified up to $3.93 million of assistance to the NSC for the development of 262,800 Sq/ft of artificial turf, three recreational sized fields or two professional sized fields, LED lights, lines, and the City of Blaine logo/NSC logo. The plan includes $2.5 million of funding from the American Rescue Plan (ARP) proceeds. In exchange for this financial assistance for the construction of turf fields, MASC would provide the City with rights to construct, operate and maintain the primary lake feature of the 105th Avenue redevelopment plan on MASC-owned property at 10600 Nassau Street, and deed this property to the Blaine EDA as part of the redevelopment area.
The primary funding source for such capital improvements at the NSC is typically through the Minnesota State Legislature, which is problematic as the NSC is constantly competing with projects throughout the entire State of Minnesota.
Turf fields are becoming increasingly important to the NSC as it allows them to compete for larger tournaments as turf fields have more playability than grass fields that are stressed during high activity. Turf fields can be utilized earlier and later in the season and do not require “rest” like typical grass fields. Lighting of the fields also allows for use in the evening.
The viability of the NSC is extremely important to the local Blaine economy and assisting in the construction of infrastructure that assists the NSC to be more successful is important for the long-term viability of the facility and local Blaine economy.
Staff has been working with NSC staff to finalize and overall financing and land exchange package per the letter of intent that was approved by the EDA in July. The general perimeters of this transaction would have the EDA provide funding for turf fields in exchange for property on Nassau St. and rights to the certain MASC property for the park/water feature. Unfortunately, there are timing complications to complete the overall package ahead of when the NSC needs money for a down payment for the fields.
Providing the NSC with funds at this point is critical as the supply of turf available for immediate installation is nearly depleted. Additionally, the turf supplier through which the NSC will be making the purchase is willing to hold the price only for turf that is currently in inventory. Missing this opportunity would result in a substantial cost increase.
In order to provide money to the NSC to meet the timeline described above, the EDA and NSC Foundation would enter into a loan agreement, which would be forgivable once the overall transaction is finalized. The transaction can’t be finalized until various actions by the State and a master developer being selected so the design of the park/water feature is more definitive. If for some reason the overall transaction cannot be accomplished, the foundation would be responsible for repaying the money and the remaining funds to finish the fields would not be provided.
Strategic Plan Relationship
Successful redevelopment of the 105th Avenue corridor has been identified as a desired outcome in the Growth Management section of the strategic plan. This package advances the desired outcome.
Board/Commission Review
Funding of turf fields was discussed at the July 6, 2022 City Council workshop as well as at the July 18, 2022 EDA meeting.
Financial Impact
A portion, $2.5 million, will come from the city’s allocation of ARP funds. The remaining funding will come from EDA fund balances and/or strategic priority fund. The value of the land asset that the EDA will be obtaining is unknown at this time and will be identified once negotiations occur with the selected master developer.
Public Outreach/Input
None required
Staff Recommendation
Authorize the Blaine EDA President, Executive Director, and Blaine Community Development Director to execute a $2 million loan to the National Sports Center (NSC) to assist in funding the purchase and installation of two multi-purpose turf fields at the NSC.
Attachment List