5. Ottawa Stadium Preliminary Report – 300 Coventry Road

stadE d’Ottawa RAPPORT PRELIMINAIRE - 300 chemin coventry

COMMITTEE RECOMMENDATIONS AS AMENDED

That Council:

1. Approve the methodology to produce the long-term strategy outlined in this report for a highest and best use analysis of the Ottawa Stadium;

2. Approve the short-term strategy for the interim use of the Ottawa Stadium as outlined in this report; and

3. Direct staff to solicit “best offers to lease” to utilize the Ottawa Stadium facility in the short term, based on the minimum conditions to lease described in the short-term strategy as outlined in this report; and

4. That staff be delegated the authority to make a decision by 1 February 2010.

Recommandation modifÉe DU Comité

Que le Conseil :

1. approuve la méthodologie utilisée pour établir la stratégie à long terme énoncée dans le présent rapport pour une analyse de l’utilisation optimale du Stade d’Ottawa;

2. approuve la stratégie à cour terme pour l’utilisation intérimaire du Stade d’Ottawa telle qu’elle est énoncée dans le présent rapport;

3. demande au personnel de solliciter des propositions de location en vue d’utiliser le Stade d’Ottawa à court terme, dans le respect des conditions minimales de location énoncées dans la stratégie à court terme décrite dans le rapport;

4. veille à ce que le personnel soit officiellement habilité à prendre une décision au plus tard le 1^er février 2010.

Documentation

1. City Manager’s report dated 1 December 2009 (ACS2009-CMR-REP-0050)

2. Extract of Draft Minute, 1 December 2009 (Immediately follows the report).

Report to/Rapport au :

Corporate Services and Economic Development Committee

Comité des services organisationnels et du développement économique

and Council / et au Conseil

1 December 2009 / le 1 décembre 2009

Submitted by/Soumis par: Kent Kirkpatrick, City Manager / Directeur municipal

Contact Person/Personne ressource : Gordon MacNair, Director, Real Estate Partnerships and Development Office/Directeur, Partenariats et Développement en immobilier

(613) 580-2424 x 21217, Gordon.MacNair@Ottawa.ca

13 – Rideau-Rockcliffe

Ref N°: ACS2009-CMR-REP-0050

SUBJECT:	Ottawa Stadium Preliminary Report – 300 Coventry Road
OBJET :	stadE d’Ottawa RAPPORT PRELIMINAIRE - 300 chemin coventry

REPORT RECOMMENDATIONS

That the Corporate Services and Economic Development Committee recommend that Council:

1. Approve the methodology to produce the long-term strategy outlined in this report for a highest and best use analysis of the Ottawa Stadium;

2. Approve the short-term strategy for the interim use of the Ottawa Stadium as outlined in this report; and

3. Direct staff to solicit “best offers to lease” from the two proponents, who have approached the City on an unsolicited basis to utilize the Ottawa Stadium facility in the short term, based on the minimum conditions to lease described in the short-term strategy as outlined in this report.

RECOMMANDATION DU RAPPORT

Que le Comité des services organisationnels et du développement économique recommande au Conseil :

1. d’approuver la méthodologie utilisée pour établir la stratégie à long terme énoncée dans le présent rapport pour une analyse de l’utilisation optimale du Stade d’Ottawa;

2. d’approuver la stratégie à cour terme pour l’utilisation intérimaire du Stade d’Ottawa telle qu’elle est énoncée dans le présent rapport;

3. de demander au personnel de solliciter les « meilleures offres de bail » des deux promoteurs, qui ont proposé de façon spontanée à la Ville d’utiliser l’installation du Stade d’Ottawa à court terme, selon les conditions minimales de la cession à bail décrites dans la stratégie à court terme telle qu’elle est énoncée dans le présent rapport.

BACKGROUND

Stadium History

The Ottawa Stadium, located at 300 Coventry Road, was built in 1993 at a cost of approximately $17M. The building is approximately 133,000 square feet with four floors and has 10,332 seats including 32 private suites. Furthermore, the Stadium is on a site of 13.79 acres with approximately 845 parking spaces.

Since 13 August 1992, the City of Ottawa has had an “Operations and Maintenance (O & M) Agreement” with Ottawa Triple “A” Management Limited for the operation of a Triple “A” baseball franchise from the Stadium. This Agreement expired on 31 October 2009.

In June 2000, Ottawa Triple “A” Management assigned the O & M Agreement to the Ottawa Lynx. In March 2008, the Lynx and the City executed a partial assignment of the Agreement to Ottawa Pro Baseball (Ottawa Pro). This enabled the new organization to play their home baseball games at the Stadium for the 2008 and 2009 seasons of the Can-Am Baseball League at a base annual rent of $108,000.

During the 2008 baseball season, the Ottawa Rapidz played baseball at the Stadium under a management arrangement between the Rapidz Baseball Club and Ottawa Pro. On 19 September 2008, the Rapidz filed for bankruptcy and subsequently sued the City of Ottawa and others for $3M.

In November 2008, the Can-Am League announced it would undertake the financial backing of the baseball team and would continue to seek new ownership to play the 2009 season at the Stadium. However, in March 2009, the Can-Am League advised that the Ottawa Voyageurs, the new baseball team would not be able to operate in 2009. Despite these events, Ottawa Pro did remain liable for the operation and maintenance of the Stadium until 31 October 2009 and honoured their obligation with respect to payment of the rent for 2008 and 2009.

Council Motion

At its meeting on 8 April 2009, City Council enacted Motion Number 64/10 (attached as Document 1), which directed staff to review options for a go forward strategy for the Ottawa Stadium including an analysis of the merits of all options.

Interim Use Proposals

Subsequent to the Council Motion, the City has received two (2) unsolicited proposals with respect to continuing to have the stadium used for professional baseball until such time as the City decides on the long-term future of the stadium property.

A third party contacted the City with respect to submitting an unsolicited proposal for use of the stadium for professional soccer.

(a) Ottawa Pro Baseball

In early October 2009, Ottawa Pro made an unsolicited proposal, with the intent of having Can-Am Baseball return to the City in 2010 and 2011. Briefly, the proposal asked the City to renew the assignment of the O & M Agreement for a two (2) year period on the basis of Section 6 (ii) of the Partial Assignment Agreement dated the 4 March 2008. Under that provision, the City reserved the right to assign to Ottawa Pro the renewal rights contained in the original O & M Agreement.

The specifics of the Ottawa Pro proposal are as follows:

1. Renewal Term - 2 years;
2. Rental rate to remain at $108,000;
3. Letter of credit in the amount of $370,000 to be posted to cover one year's rent and estimated maintenance and utility costs for one year;
4. If letter of credit is called in year 1, letter of credit must be replenished prior to commencement of year 2;
5. Ottawa Pro will assume current parking service to RCMP staff and will retain the parking fees; and
6. If the Can-Am team, in any year does not play a minimum of 5 home games in the stadium, the rent under the O & M Agreement is accelerated, the City can immediately call on the letter of credit and retain the full amount as liquidated damages and the renewal will be terminated. The City will be entitled to full use of the stadium after the termination.

(b) Ottawa Stadium Group

In addition to the Ottawa Pro request for a renewal of the O & M Agreement, on 30 October 2009 the City received an unsolicited proposal from the Ottawa Stadium Group (OSG) for use of the stadium in the short-term by their group. OSG proposes that the stadium be used for professional baseball and other commercial events together with a number of other community use activities and events.

It proposes to lease and operate the stadium facility on a year round basis with an initial term of two (2) years and then for OSG to continue on a year-to-year basis until such time as the City develops a Request for Proposals (RFP) for the disposition of the property.

OSG also proposes that the rent be based on the City receiving a base rent related to the number of professional baseball games and other events together with a surcharge of $1 per ticket for non-baseball events. The proposal is silent on the matter of payment of operating and maintenance costs for the facility.

The OSG proposal is attached as Document 2 and, unlike the Ottawa Pro proposal is not based on the previous O & M Agreement arrangements. As such, it cannot be easily assessed against the Ottawa Pro baseball proposal in the absence of basic conditions established by the City.

(c) Other Interested Party

On 21 October 2009, the Real Estate Partnerships and Development Office (REPDO) also received an enquiry from a third party with respect to submitting an unsolicited proposal.

REPDO replied to this enquiry on 23 October 2009 as follows:

“On 9 April 2009 City Council directed the Real Estate Partnerships & Development Office to look at options for the future of the Stadium site and to bring a Report back to Council before the end of this year. Council directed staff to take a broad approach in looking at the programming and redevelopment options for the Stadium with a view to assisting Council in setting the direction for further, more detailed consultation and discussion on the matter. Accordingly, City staff currently has no mandate to enter into discussions with parties who are interested in submitting an unsolicited proposal for the future programming or potential redevelopment of the Stadium. The staff report is currently scheduled for 1 December, Corporate Services & Economic Development Committee”

In subsequent discussions with this party, it has become apparent that the interest in this case is to use the Ottawa stadium facility for professional soccer.

DISCUSSION

The purpose of the discussion below is to provide Council with a preliminary review of the possible “go forward” options for the Stadium, including Council’s approval of a process to develop a long-term strategy for the Stadium, as well as a transitional strategy in the short-term.

Long-term Strategy

Original Vision

When the Ottawa Stadium was constructed, the vision for the use of the facility was that it would be a multi-purpose recreational complex that included a baseball stadium suitable for Triple “A” baseball. The O & M Agreement provided that the Stadium is available for community-based events or not-for-profit use on a direct cost recovery basis. The City did, however, prohibit the use of the Stadium for loud, stand-alone rock concerts and any other events that contravened City policies regarding the types of events that may be held on City-owned property.

Initially, the Stadium hosted as many as 71 home games in addition to exhibition games. Although some community-based events were held at the Stadium in the early years, the requirement to pay for the use of the Stadium on a direct cost-recovery basis appears to have deterred the use by others. In this same regard, as each of the Lynx and Ottawa Pro were fully responsible for the operation and maintenance of the Stadium, they retained exclusive use of the Stadium subject to the same provisions in respect of the community based events or not-for-profit events. By way of comparison, a recent community-based baseball tournament was held at the Stadium in September at a daily cost of approximately $900.

Options for Future Use

City Staff are reviewing a wide range of options for consideration by Council specific to different development scenarios for the Ottawa Stadium property such as:

· Maintaining the status quo (e.g. merely having a seasonal baseball facility);

· Constructing a renovated, year-round facility that would have other sports (soccer, tennis, etc.) and forms of entertainment (e.g. concerts, car shows, etc.) taking place; and

· Selling the land outright - with or without the Stadium on it - by either the City or its Community Lands Corporation.

In options that provide for maintaining a stadium facility, those options would encompass alternative uses of the facility in addition to baseball based on an analysis of the highest and best use of this facility for the long-term and different operational scenarios to ensure the use of the stadium is optimized from both commercial and community use standpoints.

The 300 Coventry Road property is designated as General Urban Area in the City’s Official Plan (OP) and as Major Leisure Facility Zone (L2) in the City’s Zoning-By-law. The adjacent properties are designated for the most part as Employment area in the OP and as General Mixed Use Zone (GM6) in the Zoning By-law.

Staff recalls that when the Ottawa Stadium was in the planning stages by the former City of Ottawa, the then adjacent property owner, the Canada Life Assurance Company as represented by its real estate subsidiary Adason Properties Limited (Canada Life), strongly advocated that the stadium and the adjacent properties be developed as a mixed-use employment area with centralized/shared parking facilities and a pedestrian bridge connecting this area to the Train Transitway Station.

Canada Life also believed the concourse of the stadium facility could be designed to provide grade level retail that could serve as a convenient all weather connection between potential office development on the east and west sides of the stadium.

The former City of Ottawa did not act at that time on the Canada Life proposal due to budget constraints and ultimately Canada Life and the adjacent property owner to the east sold their properties and the new owner developed large format (big box) retail stores.

To maximize the value of this property to the City both financially and municipally, staff believe that any development planning for the future use and/or potential disposition of this property should, therefore, consider both a direct connection to the City’s transitway and its designation in the City’s OP and Zoning By-law for mixed use development, whether or not a stadium facility remains.

Transit Oriented Development

As indicated above, whether or not the long-term development on the Ottawa Stadium property ultimately includes a stadium facility as part of the development, the viability of any development in that location will be dependent on direct and convenient access to the City’s rapid transit system.

In that regard, Council has approved the initiation of two separate Environmental Assessment (EA) processes for projects that will have a direct affect on the development potential and value of the City’s 300 Coventry Road property as follows:

• The Downtown Ottawa Transit Tunnel (DOTT) Project; and
• A Pedestrian Overpass across Highway 417 to link the Coventry Road Area to the rapid transit station at the Ottawa Train Station, (Train Station).

Downtown Ottawa Transit Tunnel (DOTT) Project

The City’s Transit Plan Implementation Critical Path, as approved by Council on 9 September 2009 Ref. # ACS2009-ICS-TRA-0010), provides for a Functional Design Recommendation for the DOTT project to be presented to Transit Committee on 16 December 2009 and to Council on 27 January 2010. Approval of that Recommendation will initiate the formal EA process (final consultation and documentation).

The Critical Path also anticipates the DOTT project will proceed as follows:

• Approval of the EA by the Ontario Ministry of Environment (MOE) by the end of Q2 2010;
• Completion of the preliminary design and specifications by Q3 2011;
• The issuance of a Request for Proposals (RFP) for project construction and vehicles by Q3 2011; and
• Completion of the RFP process by Q1 2013.

On the basis of the above it is anticipated that construction on the DOTT project will commence in 2013 and be completed in 2018.

Future Pathway (Pedestrian Overpass)

As part of the City’s Official Plan and its Transportation Master Plan, a multi-use pathway connection is planned for over the Queensway between Coventry Road and the Transit Station (Pedestrian Overpass) at the Ottawa Train Station. This pathway was deemed necessary to improve future access to rapid transit and to encourage transit-oriented development along Coventry Road. On 21 October 2009, the City’s Transit Committee approved the Statement of Work for this pathway’s environmental assessment.

Proposals for this EA have now been received and it is anticipated that the EA study contract will be awarded and work will commence in Q1 2010 and be completed by Q2 2011.

Outline of Methodology

At its meeting of 27 May 2009, City Council approved the recommended corridor alignment and station options for the Downtown Ottawa Transit Tunnel (DOTT) Planning and interim Environmental Assessment Study and directed staff to release a Request for Information (RFI) to property owners within, and adjacent to, the recommended corridor alignment to solicit ideas on station access, development, and design. The aim of the RFI was to identify potential development opportunities and synergies with businesses located along the transit plan corridor with the objective of improving ridership, ridership experience and lowering City costs in implementing the plan.

On 21 October 2009, a report “Request For Information (RFI) Stakeholder Development Input” (Ref N°: ACS2009-CMR-REP-0047) was received by Transit Committee. The report included, a summary of the information submitted in response to the RFI. It also provided an overview of the staff understanding of the results and how staff intends to utilize these as part of the information base in developing a Business Development Strategy at and around the proposed LRT stations in keeping with the Transit Plan Implementation Critical Path.

The objective of the Business Development Strategy is to build on the private sector interest by creating competitive development opportunities for landowners/developers to make connections to LRT stations, including those at Train Stations and to assist in enhancing these stations as the City moves forward with the Functional Design and Investment Strategy for the LRT project. Competitive situations will provide incentives for the private sector to explore connection/development opportunities concurrent with the formal EA process and property acquisition process for the project.

Staff will, therefore, be outlining a Business Development Strategy with respect to connection and development opportunities at stations, including Train Station, along the DOTT project corridor in conjunction with the Investment Strategy for the DOTT project when Committee and Council consider that strategy in Q1 2010. Upon approval of the Strategy by Council, staff of the Realty Initiatives and Development Branch will be working with staff of the Policy Development and Urban Design Branch, Transportation Planning Branch and Rail Implementation Office to implement the strategy while the EA and preliminary design work for DOTT is carried out in 2010 and 2011 and while the EA for the Pedestrian Overpass between the Coventry Road area and Train Station is also in progress.

In that regard, the Realty Initiatives and Development Branch will work with the Policy Development and Urban Design Branch to undertake a visioning exercise and public consultation process in 2010 to create urban development concept options for the 300 Coventry Road property and surrounding area as a pre-requisite to initiating appropriate changes to the OP and Zoning By-law to provide for mixed use development, with or without a stadium, on this property.

By the end of Q1 2011, it is intended that the Real Estate Partnerships and Development Office will carry out a “highest and best use” and cost analyses regarding these options and together with the Supply Branch, also develop a proposed RFP process and criteria to implement those options and will then forward a report in that regard for consideration by Committee and Council (RFP Report).

Upon approval of the RFP Report, the Realty Initiatives and Development Branch together with the Supply Branch will finalize the documents for the RFP and the Supply Branch will then issue and oversee the RFP in Q2 and Q3 2011.

Short-term Strategy

Assessment of Existing Situation

When the stadium was being used for baseball under the previous O & M Agreement arrangements with Ottawa Pro, the City received a base rent of $108,000 and Ottawa Pro covered all annual operating and maintenance cost and was entitled to all stadium revenue including parking revenue.

With the bankruptcy of the Rapidz, the City was forced to undertake the “mothballing” of the stadium for the period 1 November to 30 April, in order to protect the asset, but generally speaking the Lynx mothballed the stadium annually. The “mothballing” of the stadium facility by the City has an annual estimated cost of $90,500 resulting in annual net revenue to the City of $17,500 ($108,000 rent less $90,500 cost).

At present, the Ottawa Stadium facility has no tenant and is being “mothballed” year round by the City at a cost of approximately $155,000, except for use of the parking resulting in an estimated annual net cost of $11,000 ($155,000 cost less $144,000 parking revenue).

If the City operates and maintains the Ottawa Stadium facility year round it is estimated that the annual cost would be $378,500. As the City currently receives annual parking revenues of approximately $144,000 the annual net cost to the City would be $234,500 less any facility revenues but this does not include the cost to run programs or administer community use.

If the City operates and maintains the stadium only for the period from 1 May to 31 October each year and “mothballs” it for the remainder of the year, it is estimated that the annual cost would be $280,000. As the City currently receives annual parking revenues of approximately $144,000 the annual net cost to the City would be $136,000 less any facility revenues but this does not include the cost to run programs or administer community use.

If the stadium building is “mothballed” for the entire year but the City operates and maintains only the ball diamond/sports field for community use from 1 May to 31 October each year then the estimated annual cost would be $215,000 and, with parking revenues estimated at $144,000, the net cost to the City would be $71,000 less any field rental revenue but this does not include the cost to run programs or administer community use.

Even when the Ottawa Stadium facility was operated under the O & M Agreement arrangements, the City was not receiving best value relative to its investment with respect to community use of the facility as noted previously in the background section of this report.

The rental costs for stadium and/or sports field/ball diamond use far exceeded those charged at City operated facilities.

In that regard, the current rental rates for use of City sports fields/ball diamonds are set out in Document 3 attached and it is also noted that the rental rate to use the field at Lansdowne Park is $150 per hour and the rental rate for using the stands and the field is based on the block of time required for each use at the field rental rate plus a surcharge of $1.50 per spectator admission and the rental group paying for security as required.

Since the City has received two unsolicited proposals for the interim use of the stadium facility and from business groups that wish to utilize the stadium for professional or semi-professional baseball games and other events and pay rent accordingly, it appears that there is opportunity for the community use to be accommodated, when the stadium is not used for those games and events, at rental rates which are consistent with those for City operated facilities as described above.

Best Offers to Lease Process

The Ottawa Stadium is a facility built for the primary purpose of accommodating professional baseball. It has been determined by staff that the field area is not capable of accommodating a Canadian Football League size playing field but it does have limited potential to accommodate a full size professional soccer field.

Document 4, attached to this report, shows an overlay of the Carleton University soccer field on the stadium property, which indicates that there are only two very tight options for accommodating a full size soccer field within the existing baseball field area and both of these encroach on the infield for baseball.

In addition, while the parties who have submitted proposals for the baseball use of the Ottawa Stadium have indicated that they have teams ready to play in 2010 as an interim location for those teams, the party that is apparently interested in using the stadium for professional soccer would need to obtain a soccer franchise and this would seem to create some potential expectation of long-term use of the stadium.

Although Ottawa Pro submitted its unsolicited request in early October 2009 for a renewal of the O & M Agreement prior to its expiry on 31 October 2009, Ottawa Pro did not have a right of renewal and, given the timing of the request, staff believed it was the best interest of the City to allow the O & M Agreement to expire and to move forward with any interim use of the stadium facility on an offer to lease basis.

As a result, staff is proposing that the City move forward with a best offer to lease process for the short-term use of Ottawa Stadium based upon the primary use of the facility being professional or semi-professional baseball.

Since the two proposals received to date for baseball use were unsolicited and cannot be easily assessed against each other in the absence of basic conditions established by the City and as a third group has expressed interest in submitting a proposal, staff believe the City should proceed with an open and transparent process to receive “best offers to lease” the Ottawa Stadium facility based on meeting minimum conditions set by the City as follows:

1. One year term with a option for a one-year renewal subject to the status of the City’s long-term development plan;

2. Annual base rent of $108K (minimum);

3. Payment of all operating and maintenance expenses by the tenant for its proposed use of the stadium;

4. Entitlement by the tenant to all facility revenues including advertising revenues;

5. Letter of credit, or other financial security acceptable to the City from the tenant to cover rent and estimate operating, maintenance, and utility costs for one year;

6. Tenant using the stadium facility to accommodate a professional or semi-professional baseball team playing in a bon-a-fide professional or semi-professional baseball with a minimum of twenty (20) games being played by the team in 2010 at the Ottawa Stadium;

7. Prohibition on the use of the Stadium for loud, stand-alone rock concerts and any other events that contravene City policies regarding the types of events that may be held on City-owned property;

8. No alterations to the stadium facility including being permitted unless otherwise authorized by the City;

9. Tenant acknowledgement and agreement that the tenant’s proposed use and leasehold interest in the stadium for the short-term is not based on acquiring or having any rights to the long-term use of the Ottawa Stadium property; and

10. Tenant acknowledgement and agreement that the offer to lease submitted is its best and final offer.

In addition the prospective tenants will be required to identify in their offer the extent to which the tenant is prepared to make the stadium available for community use, when it is not used for tenant initiated games and events, and to also indicate any related terms and conditions including rental rates relative to the City’s rental rates for similar facilities as follows:

· For the use of the ball diamond/field area alone, rental rates relative to those set out for Minto Field and the Terry Fox Fields in Document 3 attached; and

· For use of ball diamond/field area and stadium stands, a rental rate relative to that at Lansdowne Park where the rate is based on the block of time required for each use at a rental rate of $150 per hour plus a surcharge of $1.50 per spectator admission and with the rental group paying for security as required.

In terms of soliciting best offers to lease, two options have been considered as follows:

1. Prepare and place public advertisement/notices regarding this short-term lease opportunity for Ottawa Stadium; or
2. Solicit best offers from Ottawa Pro and OSG only.

The minimum conditions of the best offer to lease proposed above are dependent on the tenant using the stadium for professional or semi-professional baseball in 2010 without a guarantee that the facility will be available for this use in the long-term.

If the City proceeds with Option 1 above, it is estimated that it will take approximately two months to prepare and place the advertisement plus provide a long enough offer period for other prospective tenants to investigate the potential to have an operating professional baseball team in place for the 2010 season.

Since it is unlikely that any other proponent would have a professional baseball team ready to play at the Ottawa Stadium in 2010, staff believes that Option 2 described above is the best way to proceed in order to minimize the time frame to complete the best offers to lease process and maximize the amount of time for a preferred tenant to make arrangements for the 2010 baseball season.

Once the offers are received, City staff consisting of representation from REPDO, Parks and Recreation, and Public Works will review all three proposals and recommend the best offer to the City Manager for approval under his delegated authority from Council.

If no offer is received that meet the minimum conditions set out above, then staff will report back to Committee and Council on a City option for operating the stadium to maximize community access and minimize the City’s operating and maintenance costs in the short term.

CONSULTATION

As this report arose from a Council direction, no formal consultation was undertaken prior to Council’s consideration of this preliminary report. However, it should also be noted that the City has received an unsolicited proposal for the future use of Ottawa Stadium and enquiries from several groups who have expressed various levels of interest in using the Stadium for baseball.

Councillor’s Comments:

Two different leagues have experienced difficulties in operating a sustainable baseball franchise in Ottawa.

The City has already invested close to $ 20 Million on a stadium and a state-of-the-art field. The report makes it abundantly clear that the City never received “ … best value relative to its investment with respect to community use of the facility…”. In fact that assessment also applies to the situation with a professional team in place (at a base rent of $ 108,000 per year) the annual net revenue to the City was a paltry $ 17,500!

Other near term options:

· A “mothballed” stadium currently costs the City $11,000 per year;

· Stadium operated for ‘community use’ from May to October (“mothballed” at other times) – net cost $136,000 less any rental revenues;

· City operates only the sports field for ‘community use’ from May to October (stadium “mothballed” year round) – net cost $71,000 less any rental revenues.

None of these numbers should cause Council to take hasty or precipitate (i.e. risky) action.

The stadium is very much a purpose-built facility, ideally tuned for baseball. Its use for other sports (e.g. soccer) would require further investment.

The best way forward is to strategically seek a credible partner willing to operate the stadium for professional or semi-professional baseball on a long-term basis. Affordable community access should be provided on condition that it not interfere with the normally scheduled baseball activities. The City of Ottawa should so structure any future lease agreement in such a way that it (the City) remains responsible for leasing the stadium to community groups on non-baseball days. Experience has shown that such use is a distraction to operators of professional sports franchises.

I am concerned that the report recommendations will lead the City into disputes that it is once again entering into something very similar to sole sourcing. This one could be called restricted-sourcing. Proceeding in this manner would be based on staff’s assessment on the likelihood of there being other potential proponents. I believe that we should ascertain that state of things by asking through the Option 1 process. The advertisement process could be crafted to take the same time as the “solicit best offers” (Option 2) approach.

It is very much part of my concern that, in seeking a partner or lease-holder for a one or two year lease, we will be in a situation where it will be very difficult to remove a tenant ‘with a foot-in-the-door’. This scenario has already played out in recent years in another contract in a different field. In any case, I don’t believe that a credible tenant can be found able to operate a team for the 2010 season at this late date. We certainly should not prejudice our future options in any case.

LEGAL / RISK MANAGEMENT IMPLICATIONS

There are no legal / risk management impediments to implementing the recommendations in this report.

FINANCIAL IMPLICATIONS

At present, the stadium facility has been closed for use and the City is incurring a net annual operating and maintenance costs of approximately $11,000 ($155,000 costs less $144,000 parking revenue).

Based on the minimum offer conditions set by the City as described in this report, the City will receive net annual revenue of approximately $17,500 ($108,000 revenue less $90,500 costs) with the actual amount dependent on the results of the best offer to lease process.

SUPPORTING DOCUMENTATION

Document 1 - Motion Number 64/10 dated 8 April 2009

Document 2 - Unsolicited Proposal from Ottawa Stadium Group

Document 3 - Rental rates for City Sports Fields/ Ball Diamonds

Document 4 - Soccer Field Overlay

DISPOSITION

Upon approval of the recommendations of this report by Council, REPDO will initiate the actions to implement both the short-term and long-term strategies in the manner detailed in the Discussion Section of this report.

DOCUMENT 1

Motion Number 64/10 dated 08 April 2009

ADDITIONAL ITEMS

1. PRESENTATION BY THE CITY CLERK AND SOLICITOR - OTTAWA BASEBALL STADIUM

MOTION NO. 64/10

Moved by Councillor B. Monette

Seconded by Councillor S. Qadri

WHEREAS on March 30, 2009, City staff were advised that the Ottawa Voyageurs will not operate for the 2009 season; and

WHEREAS the City asset should be appropriately maintained while a ‘go-forward’ strategy is being determined;

THEREFORE BE IT RESOLVED that the City temporarily suspend operations at the Ottawa Baseball Stadium, maintaining only those services that are required for the protection of the asset; and

BE IT FURTHER RESOLVED that City staff be directed to prepare a report outlining all options for a ‘go-forward’ strategy for the Ottawa Baseball Stadium, including an analysis of the relative merits of all options and incorporating any additional considerations that may arise from City Council’s discussions on the other stadium proposals on April 22, 2009.

CARRIED

DOCUMENT 2

OTTAWA STADIUM GROUP

SHORT TERM PROPOSAL ITEMS

Background / Overview

OSG had submitted a comprehensive proposal in July of 2009 to the City of Ottawa relating to the long term lease of the Ottawa Stadium, which would include Pro-Baseball, Community Events and other related activity.

OSG has been advised by city staff that; although the current lease with the Lynx is expiring October 31^st 2009, the city is prohibited from creating another lease with any parties for that property until the results of a Councillor commissioned inquiry has been finalized.

Since the inquiry report may not be completed and available for review by council and staff well in to the 2010 year, and then would require further public inquiry; the city is interested in receiving an offer to lease the stadium on a shorter term as to have the facility not sit vacant into the next couple of years.

The following dossier represents OSG’s revised business plan and programming for the short-term occupation of the Ottawa Stadium:

1. Lease and Term

a) ODG will commit to executing a formal lease / management agreement for the full time occupation of the Ottawa stadium facility.

b) OSG will agree to conduct its programming and activity as outline in section 2 of this dossier, and will attempt to the best of our abilities, accommodate third-party any additional city requests for the same.

c) OSG would agree to a 2-year term, specifically defined as; from January 1^st 2010 to March 31^st 2012. OSG requests access to facility ASAP to evaluate building for setup and prepare to move in.

d) OSG requires the ability to accommodate office-leasing opportunities that present themselves, with the understanding all ‘lease for space’ agreements will expire within the exact leasing timelines outlined in the OSG lease.

e) OSG has access and the ability to use all kitchen equipment, office furniture, suite appliances, concession equipment, and all other equipment that is readily available in the Stadium in order to continue normal event operations.

f) OSG has the ability to manage, run and operate all food and beverage concessions.

g) In the event that the city had not finalized its long-term direction with the stadium, OSG agrees to continue to extend its activity on a year-by-year basis until such time as the city develops an RFP for the disposition of the property.

2. Programming

OSG intends to utilize the stadium facility in favour of the community in the following ways:

a) Professional men’s baseball in a recognized, professional baseball association or league.

b) Semi-professional women’s baseball.

c) Amateur baseball, specifically Little League (Districts 2 & 6); the National Capital Baseball League (NCBL); and area elite baseball club teams.

d) Rental of space for meetings and trade shows.

e) Rental of the parking lot to adjacent businesses, (i.e. RCMP).

f) In and outdoor soccer, Ultimate Frisbee activities.

g) Live entertainment events (See Schedule ‘A’).

h) Corporate and community rentals (family picnics, fun days).

i) Rental of available office space to local businesses on a short-term basis.

3. OSG Financial Commitments

In compensation for the right to lease the facility, OSG offers to pay the following:

a) Base Rent – Total of $116,500, derived from:

i) Baseball $ 67,500 (45 games X $1,500)

ii) Events $ 49,000**

b) Incremental Revenue back to the City

i) Ticket Fee $105,000** to offset life cycle costs

($1.00 per ticket for non-baseball events - estimated at an average 7,500 tickets sold per event.)

Total Revenues - $116,500 lease payments per year

$105,000 event ticket incremental revenue

$221,500***

** Estimate based on planned number of events

***Includes all lease and incremental revenue)

Schedule ‘A’

The following programming has been derived from consultations with the local Community Association’s Executive Committee.

Resident/Targeted Audience Profile

Children Aged 1-6 Play/Theatre (family event)

Pre-Teens Aged 7-12 Concert (family event)

Teens Aged 13-18 Concert (family event)

Adults Aged 19-34 Concerts

Adults Aged 35-54 Concerts

Adults Aged 55+ Concerts

Community Fundraiser Concerts (Food-Bank, Youth Treatment Centre)

Community Festival Highland Games

Community Festival Oktoberfest

Note: In an effort to accommodate the City’s need to host consumer or commercial tradeshows or exhibitions at the stadium facility, OSG will approach these requirements on a case-by-case basis and are not factored in the event totals

DOCUMENT 3

Hourly Sport Field and Ball Diamond Rental Rates

Rates are effective as of May 1, 2009
All rates include GST

Facility Category	Rental Rate	Rental Rate With Lighting	Rental Rate	Rental Rate With Lighting	Rental Rate	Rental Rate With Lighting
	Minor		Adult		Commercial
Neighbourhood Level - 3A, 3B	$5.17	$16.72	$27.64	$39.19	$27.64	$39.19
Community Level - 2A, 2B	$6.28	$17.83	$31.17	$42.72	$31.17	$42.72
City Level - 1A, 1B	$7.73	$19.28	$41.16	$52.71	$41.16	$52.71
Premium - Minto	$34.19	$53.09	$102.66	$121.56	$102.66	$121.56
Premium - Terry Fox - Main and North	$34.19	$53.09	$102.66	$121.56	$102.66	$121.56
Premium - Terry Fox - West	$27.36	$46.26	$73.31	$92.21	$73.31	$92.21
Premium - Terry Fox - Track and Field	$47.87	$66.77	$103.71	$122.61	$103.71	$122.61

Sport Field and Ball Diamond Rental Definitions

Sport Field and Ball Diamond Rental Definitions
Minor	18 years of age and younger
Adult	19 years of age and older
Commercial	An activity that has the intent of generating a profit. This activity may involve the sale of goods or services or may require a registration fee prior to participation.

DOCUMENT 4

Ottawa Stadium Preliminary Report - 300 Coventry Road

stadE d’Ottawa RAPPORT PRELIMINAIRE - 300 chemin coventry

Gordon MacNair, Director, Real Estate Partnerships and Development Office spoke to a PowerPoint presentation, which is held on file with the City Clerk. Dave Donaldson, Manager, Realty Initiatives and Development accompanied him and assisted in answering questions from Committee Members. The pertinent points he raised are noted below:

· The stadium, which was built in 1993 cost approximately $17 m. The building is approximately 133,000 square feet, has over 10,000 seats with 32 private suites. The site is less than 14 acres with 845 parking spaces.

· Since August 1992, the City of Ottawa has an operations and maintenance agreement with the Ottawa Triple “A” Management (O & M). This agreement expired on 31 October 2009. In June 2000, the Ottawa Triple “A” assigned O & M agreement to Ottawa Lynx and March 2008, the Lynx and the City assigned an agreement to Ottawa Pro baseball for 2008 and 2009 at a base annual rent of $180,000.

· In 2008, the Ottawa Rapids played baseball under a management agreement with the Ottawa Pro. In September of that year, the Rapids filed for bankruptcy and the Can-Am League undertook financial backing of the team and sought new ownership for the 2009 season. In March 2009, Can-Am advised the new team Ottawa Voyageurs that it would not operate in 2009. Ottawa Pro honoured this obligation regarding the payment of rent for 2008 and 2009. In April 2009, Council directed staff to review options for a go-forward strategy for the Ottawa Stadium, including an analysis of merits of all options.

· The City of Ottawa received two unsolicited proposals.

o The Ottawa Pro Baseball would use the stadium for Can-Am Baseball on a two-year renewal period. The rental rate would remain at $108,000 and then provide a letter of credit to cover the one-year rent and expenses and Ottawa Pro to manage parking and retain fees.

o The Ottawa Stadium Group (OSG), is proposing the use of the stadium for professional baseball, other commercial events and community use activities and lease and operate the stadium on a year-round basis with initial terms of two years, then year to year. The rent was based on a number of professional baseball games and other events with a surcharge of one dollar per ticket for non-baseball events. The proposal was silent on the operating and maintenance cost.

· There was another interested party that contacted staff in October 2009. Their interest was related to professional soccer.

· The report defines the long-term strategy, options for future use, the methodology relating to the long-term strategy and the assessment of the existing situation for the short-term strategy.

The next steps, with respect to the business strategy, staff are proposing to come forward with this in Q1 2010. The visioning exercise and public consultation for the long-term strategy would be in 2010. The highest and best use and the cost analysis would be completed in Q1 2011. Moving forward with an RFP process would be after that, then finalizing the RFP would be in Q2 and Q3 2011.

Mr. MacNair concluded with the financial aspects, noting that the stadium has been closed for use with city incurring costs for the annual operating maintenance of approximately $11,000. Currently, the City is obtaining revenue for parking of $144,000 and annual cost are $155,000. Based on minimum offer conditions, the City would receive net revenue of $17,500 with actual amount, depending on results of best offer to lease process. The three report recommendations before committee are:

· To approve the methodology to produce long term strategy for highest and best use analysis for the Ottawa Stadium;

· To approve short-term strategy for interim use of the Ottawa Stadium;

· To direct staff to solicit best offers to lease from the two proponents who approach the City on an unsolicited basis to utilize the Ottawa Stadium facility in the short term.

Neil Maholtra, Claridge Homes advised that they are the third party noted in the report that is interested in bringing professional soccer to Ottawa. He clarified that he made several inquiries since May/June on multiple occasions, receiving responses that staff were directed not to look at any unsolicited proposals, and they would bring forward a report that would address how the City wished to proceed with the stadium. He clarified that their interest is in sports, not in redevelopment of the current site. He provided copies of a study that was prepared by Novatek Engineering on the current playing field and how professional soccer could be accommodated. He noted that within the staff report is an overlay of Carleton’s multi-use facility, which actually represents the length more in line with the Canadian football field than a soccer field. He explained the standard soccer field according to FIFA, is 110 yards with a five-yard buffer. They studied the site to indicate how it could be accommodated, potential works that would be required. Any proposals they plan to put forward would have had them pay for the work. The magnitude of the work is in the neighbourhood of $100,000, not a significant cost to build upon the playing field. The playing field would still allow baseball to be played. He spoke of the four conditions in North America, similar to the one that they are proposing and elaborated on the different areas that share facilities between baseball and soccer.

Mr. Maholtra claimed that staff did not have all the correct information at this stage, noting the process currently outlined is not one that is going to be successful. He believed it to be an unreasonable expectation to think that someone would invest in a sports franchise on a one-year basis, regardless of the sport. He did not think the right approach was to begin making development plans for the site before a RFP is put in the community realm. The timing of the report for the 2010 season for any sport is tight at this stage and suggested an RFP process to begin immediately in the new year. The City should consider four questions, being, can the proponent bring a professional sports team to the facility; what is the financial strength and the ability of that group to perform its obligations; how can the community be engaged in making best use of the facility, in off-days; and how can a proposal be contemplated that does not require significant changes to the project.

Mr. Maholtra was concerned that he was not given an indication that short-term proposals would be considered until the week prior to this meeting. He concluded that the best approach is for the City to go forward with a RFP in 2010 for a tenant in 2011.

In response to a question by Councillor Legendre, Mr. Maholtra reiterated that the fourth point he raised was the need to search for people to take the facility in its current state. He felt that the staff report was bias in either tearing it down, sell it, or maintaining the stadium but sell off the parking lot. Clear statements allude to the scenarios being as the best uses for a financial return basis. Replying to a follow up question by the Councillor, Mr. Maholtra felt that the community should be allowed to comment before a decision is made.

Mr. Maholtra added that some examples he provided previously are cases with artificial turf and others with natural grass, being brought in and out, on the clay, even in periods as short as 24 hours, to accommodate both uses. The pitcher’s mound is dealt with the same way that it would be in Rogers Centre, which is pre-built, that would be brought in and out, depending on the event.

Councillor Legendre questioned if he would contemplate replacing the field with artificial turf. Mr. Maholtra noted that the benefit of this stadium is to play soccer on natural grass and added that the City of Toronto is spending millions of dollars to replace their artificial turf with natural grass.

For the benefit of his colleagues, Councillor Legendre informed Committee that there was a significant part of the cost that went into the underground and the field, describing it as high-tech due to the drainage system. Mr. Maholtra agreed and advised that they have consulted with the people who built the stadium.

With respect to the additional seating arrangements, Councillor Legendre observed that there was no mention of this in his drawings or the letter from Novatech. In order to allow baseball to continue, Mr. Maholtra explained that temporary metal seating would be brought in and out of the stadium as needed.

Councillor Cullen asked staff if the process could be adjusted to an RFP. Mr. MacNair advised that he and the City Manager met with Mr. Maholtra regarding his proposed use for soccer. Currently, staff’s position is looking at a short-term solution in order to reach a long-term strategy. He clarified that the long-term strategy does not recommend the demolition of the stadium. Mr. Donaldson agreed with Mr. Maholtra that the stadium could accommodate the two but the concern is, that in order for Mr. Maholtra to respond, he has to get a franchise in place, and that would require for a longer term than one year. The direction that staff were provided with in April related to looking at the use of the stadium for a variety of options, including whether or not the stadium stays, and the report reflects that accordingly. Staff are of the opinion that the existing stadium can fit within a mixed-use complex, with other developments on the site, provided it is connected to transit in the future, such as the proposal that Canada Life Assurance made in the early 1990’s, when the stadium was under construction. Ultimately, their plans for bringing that into a mixed-use center did not materialize, and they ended up selling the site for big box stores, which is unfortunate.

At this juncture, Chair Jellett suggested holding any further questions of staff until the end.

Councillor Monette asked Mr. Maholtra his chances of acquiring a franchise and how this affected the Lansdowne Live proposal given it is the same type of franchise. Mr. Maholtra advised that there have been a number of issues at that level of soccer given the previous league lost its ownership groups. But he met with the new league and there have been productive discussions to this point. He believed that once this process is set forth, he could likely comment further. He added that he could not comment of how it affects Lansdowne Live.

Mr. David Butler explained that the Ottawa Stadium Group (OSG) is a collection of local senior community and business leaders, who share a dream of breathing fresh life back into the stadium to give back to the community. He recalled his past work in bringing various programs to the City, i.e., Ottawa’s official “blue bike rack” Bicycle Parking Program of the 1990s, still in use today, and now expanded to 18 other Canadian cities. He noted the past 2.5 years had been spent consulting with the community to try and develop programming to not only meet but exceed community expectations, and he added that OSG is well-capitalized, and can satisfy every concern the City may have. Mr. Butler characterized the OSG proposal as foolproof, and one that would cost the City nothing by having OSG operate the stadium for the next few years.

In response to a question from Councillor Monette, Mr. Butler advised that they met with OC Transpo on several occasions discussing a prospective program, for example, when purchasing a ticket online, it would be free with a ticket from OC Transpo. They are trying to lessen the number of cars going into the area by supporting the local transit system and increasing ridership. They also have a good relationship with the adjoining property owners at Hampton Hilton and they offered their extra parking in their buildings. Regarding a follow up question from the Councillor, Mr. Butler noted that they are intending to charter buses on game day. In addition, their intent is to discuss specifics regarding Park and Rides in outlining areas with strategists at OC Transpo.

Councillor Monette referred to the media release and confirmed that Mr. Butler acquired a franchise that would be ready in 2010. The delegate responded affirmatively, noting that Duncan MacDonald would be elaborating on that shortly, but confirmed that they are ready to begin the planning process, which includes, purchasing equipment, doing drafts of players, website design, etc.

Duncan MacDonald spoke on behalf of Peter Tilley, Chief Executive Officer, Ottawa Food Bank, and Wyatt McWilliams of Navan, known for Hay West. He advised that Mr. Tilley was very enthusiastic that the Ottawa Stadium Group (OSG) approached the Food Bank to incorporate them into the overall business plan. Having the opportunity to support the community in a number of ways, the OSG dedicated 200 seats of the stadium to the Food Bank. Rather than take money to purchase a ticket, there will be 200 cardholders or members who will sit in those seats and be asked to donate two non-perishable items for each home game. Mr. Tilley agreed to set a stage in the concourse area so that those items of four hundred non-perishable items times the 45 home game-schedule would help stock the Food Bank. Mr. McWilliams, in asking them how they would support the farmers, was invited to attend the first fundraising concert called the Peanut Butter and Jamboree.

Bill Beelen, Commissioner, National Capital Baseball League (NCBL) represents 34 amateur local baseball teams, with approximately 500 players, the majority of which are 20-35 years old. Their league is one of the largest adult baseball leagues in Canada, and they operate four tiers, accommodating all skill levels from very competitive to more recreational. As a league, they strongly support the view that the Ottawa Stadium is used for professional and local baseball. In the past, the majority of the players never had the opportunity to play at the stadium. In their opinion, the stadium is a jewel that must be preserved as a baseball asset for future generations. In his opinion, the OSG offers the best chance of bringing back professional baseball to Ottawa, while at the same time, giving the local baseball community much better access to open field times at the stadium. The NCBL is eager to use as much playing time as is made available in the stadium, provided that the fees charged are similar to fees at other baseball facilities. More information on NCBL is available at www.nationalcapitalbaseball.com

In response to a question from Councillor Monette, Mr. Beelen confirmed the leagues interest in playing at the stadium and paying for the rates. He noted that they already negotiated an agreement with OSG.

Sheila Perry, President, Community Council of Overbrook (CCO) advised that the OSG approached her to support the reactivation of the city’s baseball stadium. She submitted a letter to Kent Kirkpatrick, City Manager noting their support of OSG. The Community Council of Overbrook recognizes the need to make best use of this valuable asset in Overbrook. They also support community partnership activities and their initiatives, the growing need for a multi-use year round sports facilities and fields that support the growth of soccer and various other activities in sports in Ottawa. The CCO members expressed their dismay that the baseball stadium has been unused for over a year. And that no significant progress has been made to reactivate this facility. To their dismay, they have heard rumours of selling it to developers for future retail and office space. She concluded that CCO encourages the City of Ottawa to move forward on this issue so the facility would be reactivated in 2010.

Councillor Monette said he was pleased to see the community is supportive of baseball and the facility being used again. In response to his question relating to using the facility in 2010, Ms. Perry noted her support in having the facility used immediately, adding that it would help with area businesses and promoting not just baseball but other events that involves the community. When asked her opinion with having outdoor concerts, Ms. Perry did not have concerns given the City’s noise by-law.

Peter MacFarlane, Executive Member, Overbrook Community Association spoke of his career as a teacher in urban studies and how he made several field trips with his students to the stadium before, during and after construction. In 1992, he moved in Overbrook since his long term plans for retirement included going to baseball games within walking distance from his home. He advised that baseball provides unlimited opportunities to bring many together and the Overbrook community is an excellent example of this with its multi-cultural diversity and immigrant population. He concluded that the City has a policy of no community left behind, and respectfully submitted that there is an opportunity and a duty to not leave this baseball community behind.

Jonathon Trottier, student at Algonquin College and former employee of the Ottawa Voyageurs, noted his angst at seeing the stadium empty and unused all this time. He has had the privilege of working with Mr. MacDonald and the Ottawa Stadium Group during the past two months when they acquired the franchise. He spoke of this involvement in the community, throughout high school and college, working with baseball leagues and the food bank.

Sam Holman, Ottawa Bat Company reminded Committee that the stadium had Fernando Saginal hit the first baseball with a maple bat in the Lynx stadium. He noted that Ottawa is a City with a surplus infrastructure and not enough population to use it all and share in the dilemma on how to keep it going. He stopped by the stadium that morning and it occurred to him that there is a concourse there that needs to be enclosed. He believed it would help the group across the street as an overflow for events because it is a sizeable space with a large hotel next door and often they never have enough space. He encouraged the City to rethink the restriction of modifying the building, as he believes it would be a missed opportunity.

A. J. Plant, former President of Gloucester Chamber of Commerce and current member of the Ottawa Chamber. He noted his working career has involved working with community groups in the Vanier area, which allows his to go door to door and talk to residents. He advised that the main topic raised during these conversations is the stadium. The Ottawa Stadium Group approached him to discuss their vision, which he supports fully from a personal as well as a professional aspect. He spoke of the importance of inexpensive, good entertainment for the community. He believes that the stadium has changed the face of Vanier and Overbrook from a real estate perspective for instance.

Brian Carolan, Ottawa Stadium Group (OSG) thanked Committee Members for the opportunity to speak on this important issue and to show their passion that they have as Ottawa Stadium Group, to bring life and entertainment and family values back to the stadium. His personal involvement has been approximately one year on this potential project. He met Dave Butler and immediately bought in to his passion for involving the community into the Ottawa stadium. Mr. Carolan observed that after having been given an opportunity to share Mr. Butler’s vision and meeting with various community groups, he too, was excited with the prospect of becoming involved with the stadium project. He then provided the following highlights of what OSG can offer:

· OSG will deliver a financial plan to the City, its residents and various charities for the stadium at no cost to the City or the City’s taxpayers;

· OSG will increase the tax revenue base and create new employment opportunities for both younger workers and seniors;

· OSG has expertise in the local marketplace and a track record of local business success;

· OSG will deliver a vibrant, 12-month operation with baseball offices, tenants, and other year-round activities, to include sports training/recreation and other family-oriented opportunities;

· OSG will provide affordable, family entertainment;

· OSG will use the existing transit system, in tandem with its ticket sales, to employ a ticket bar-code system, which will allow fans to use their baseball tickets to ride OC Transpo, thereby helping with “green” initiatives and allowing baseball fans to use the transit system at no additional cost;

· OSG will provide benefits to the local area businesses;

· OSG has partnerships in place with the local hotelier sharing the stadium parking lot that are expected to increase commerce in the area, to the benefit of both partners;

· OSG has pulled together an advisory committee made up of local business people, community leaders and community associations to help fine-tune programs that will be of benefit the community at large;

· OSG will have ticketing programs targeted to all aspects of the community, including the military, military veterans, seniors and mature adults, along with programs geared to community support, i.e., Ottawa Food Bank drives and other initiatives to raise much-needed capital.

Councillor Monette inquired, like the NCBL buy-in, if the same offer has been put forward to the little leagues. Mr. Carolan confirmed that they have their buy-in to their programs at a reasonable rate. In response to a final question from the Councillor, Mr. Carolan referred to Mr. Duncan to advise as to how many businesses were approached, but noted the corporate revenue opportunities were remarkable.

Councillor Legendre confirmed with the delegate that they were comfortable with the parameters of the cost reflected within the staff report. Mr. Carolan determined that there was nothing in the cost structure or the rental fees that surprised them. The fee level is in line with what we expected.

The other aspect that the Councillor touched on was the 12-month operation and questioned the ability to consider doing this in the stadium. Mr. Carolan confirmed that this was part of their detailed plan in looking at tying the stadium with winter activities and events in the City, such as Winterlude. In response to a follow up question, Mr. Carolan claimed that the dome is an option, although a lot more discussion has to occur before considering it. Due to the short time period in reviewing the staff report, they need to assess their plan. It was confirmed at the end of the questions that the dome is not part of their current proposal.

Duncan MacDonald is with the Ottawa Stadium Group, and other than playing professionally; he has held every position in baseball from scouting to technical director for Baseball Canada. He was before to market the sport of baseball to the community at large for both men and women teams. He believes that has been in this City before and it can happen again. He spoke of the mascot “Grape” that will be hired as the first draft pick.

The OSG assembled an experienced, winning team to implement a creative solution for this stadium puzzle. The baseball marketing plan contains fresh, creative ideas never seen in this marketplace before, many that are loaded with double-play value; from guarantees on sunshine to family-affordable entertainment that will bring people together. The OSG proposal to City Council, if chosen, will be based on the main principles of what is required for the success of a baseball operation, which is innovation and creative marketing. In closing, the proponent noted that with even two strikes, a home run hit was still possible.

Councillor Monette asked what the average attendance would be for breaking even for the new league. Mr. MacDonald advised that it is difficult to calculate the figure until the costs are known. In response to a follow up question regarding the Golden League, Mr. MacDonald said that the Golden League is expanding eastward across Canada; they want Montreal, Toronto and Ottawa. They currently have Calgary, Edmonton and Victoria, with NHL owners as backers, thus the reason for their interest with them seeing that it is a growth opportunity and the best fit for Ottawa.

When the Councillor noted his concern with travel costs, Mr. MacDonald advised that the budget for travelling by bus would be $65,000 for the Can-Am league. They also compared the cost of flights and noted that they have an airline sponsor.

In relation to the Nine of Diamonds and the idea of not paying for a ticket if you buy a season ticket to the Golden League, Councillor Monette suggested that as an alternative, guests could donate one or two cans or non-perishable foods at the game.

In terms of other entertainment such as concerts, Mr. MacDonald advised that they are currently speaking with two promoters that are well known in this City. They are looking at holding the Highland Games and the clogging event. Lastly, the Councillor asked the delegate’s thoughts on the one-dollar surcharge that is mentioned is the staff report. Mr. MacDonald said that if they sell the events that are planned and only half-successful on selling tickets, keeping in mind that the rent would be higher than last year, he believes there will be an opportunity of $227,000 to $230,000 on a fifty per cent of entertainment sales.

In response to a question from Councillor Legendre, Mr. MacDonald advised that Can-Am approached them but after careful consideration, they decided to keep searching for another league. They secured the Golden League with conditions such as securing the stadium.

After discussing details of the Golden League, Mr. MacDonald explained that the opportunity to participate in this league had arisen from Edmonton Oilers’ management contacting other major Canadian cities currently possessing National Hockey League franchises to offer a co-promoted product of baseball, similar to the Edmonton Oilers’ Edmonton Capitals baseball franchise as a summer product to complement winter’s offering of hockey. Responding to a query from Councillor Legendre regarding the stadium’s multi-sports use potential, Mr. MacDonald acknowledged that many stadiums offered this possibility, i.e., soccer and baseball. He said the current stadium might also take advantage of such potential, if the fit was appropriate, but not at the expense of baseball.

Bruce Murdock and Carl Kiiffner, Can-Am Baseball League, spoke from a written submission that is held on file with the City Clerk. Mr. Murdock spoke of his time volunteering to assist Miles Wolff who is the Commissioner of the Can-Am Baseball League and American Association of Baseball. He provided a brief synopsis of Mr. Wolff professional experience with baseball in the United States and Canada and felt that the stadium could not afford to have a future owner without baseball experience. Mr. Murdock outlined six points that Mr. Wolff offers on the future of the Ottawa Stadium that are:

· Long term lease would be in the best interest of the City;

· Ensures that Can-Am would make every effort that the stadium does not sit dormant;

· Secure other sources of revenue with nearby businesses and the RCMP;

· Have more than one tenant in order to bring stability and revenue to the stadium;

· Community involvement by local leagues should be a priority;

· Careful consideration in converting the stadium is crucial as it is considered the best baseball facility in the country.

In response to a question from Councillor Monette, Mr. Murdock advised that Mr. Wolff is currently working on securing a franchise. He added that under the lease arrangement that exists, $108,000 a year for the lease and the cost of heat and hydro is very expensive for a baseball team to operate. He advised that the Can-Am league would like to operate and work with the City to get a long term lease arrangement, in order to get stability for a baseball team and other tenants like Baseball Canada.

Councillor Legendre questioned if the delegate was speaking on behalf of Mr. Wolff’s behalf. Mr. Murdock clarified that his presentation represents Mr. Wolff’s views but offered to respond to any questions the Councillor had. Councillor Legendre then asked if Can-Am had a team in place for next year. Mr. Murdock advised that Mr. Wolff was currently making every effort to do so.

Given this was the end of the public delegation portion for this item, Chair Jellett preceded to asked for questions to staff.

Councillor Cullen followed up with staff on the report recommendation and the notion of an RFP, as opposed to solicit the best offer to lease from the two proponents that approached the City on an unsolicited basis. He asked if the same criteria could still be used if an RFP approach was considered. Mr. MacNair advised that in terms of operating in 2010 and potentially in 2011 under the minimum conditions, staff outlined in the report an interim arrangement, which is not based on people making long term arrangements to obtain franchises. If an RFP process were considered, then it would suggest the stadium would be there for the longer term.

Mr. MacNair continued, reflecting on Mr. Maholtra’s idea that the City should go with an RFP, giving him the opportunity to bid on the stadium for the long term. If Committee wants to commit the stadium, then an RFP is possible. He reiterated the options before Committee and the direction that was provided to staff in April.

Councillor Cullen voiced his concerns with narrowing the choices to the two current proponents. Should Committee decide to go through an RFP, he suggested that the wording be changed to reflect both the short and the long-term elements. Afterwards, should the only two proposals received are from the current proponents, he would be more comfortable with that process. He suggested that staff prepare a motion to amend Recommendation 3 to have an RFP process but still reflect the short and long-term strategy reflected in the report.

In the same line of questioning of Councillor Cullen, Chair Jellett inquired if an RFP can be done that quickly in order to take proposals and make a decision in time to operate in 2010. Mr. MacNair advised that when combining the short and long-term processes through an RFP, it would require a framework on the city’s strategy. In light of Councillor Cullen’s suggestion, he added that staff’s opinion would be to choose the first option in terms placing an advertisement, expedite that process to allow these groups who want to put teams in can be mobilized as quickly as possible. He concluded that it could be done within a month or two.

In regards to a question from Councillor Wilkinson regarding opening the RFP to others, Mr. MacNair suggested advertising for people to submit their best offers to purchase based on the minimum and other conditions outlined in the report and not go with a RFP. The two proponents can submit their proposals as well as any other group. The Councillor asked if the stadium could be used for things other than baseball in its present configuration. Mr. MacNair responded affirmatively, noting that they do not want the main basis be that proponents secure some other kind of franchise for other events and then advise that they spent a lot of money, which could lead to binding the City in long term arrangements.

In response to a question from the Councillor regarding timing, Mr. MacNair advised that the basic terms could be put together, post an advertisement in newspapers and other notices on a best offer, within a two or three week period. He advised that typically, there is a 30-day period to allow proponents to respond and felt that the City would be in a position to be ready for February 2010. He asked for Council direction in terms of turn around time, if Option 1 was chosen.

Councillor Wilkinson was pleased with this change and felt it was a better procedure to use. She offered to move a motion, since Councillor Cullen was not a member, to amend Recommendation 3, if staff could provide the wording. Mr. MacNair suggested that the wording to Recommendation 3 be as follows:

“Direct staff to solicit “best offers to lease” to utilize the Ottawa Stadium facility in the short term, based on the minimum conditions to lease described in the short-term strategy as outlined in this report.

Councillor Legendre thanked those who had come forward to present their proposals, as well as staff who had provided an opportunity to provide input into the report. However, he pointed out that Ottawa currently possessed an empty state-of-the-art stadium with no tenant, and which costs a great deal to maintain. He noted that two professional franchises had tried to make it a success and had both failed. Despite the foregoing, he believed another attempt should be made to use the facility for its intended use, failing which, the City could then consider other multi-use sports options.

The Councillor noted that various options might work if only they could make greater use of the stadium than perhaps one league could sustain. He pointed out that with no tenant at present, the empty stadium was costing the City $11,000 a year to maintain, adding that such costs might likely rise if the stadium were to be used for only one season, due to additional maintenance costs.

Councillor Legendre felt the City was not in a desperate situation, and said he approved of Councillor Wilkinson’s motion, as he did not like Recommendation 3 for having named only two proponents. The Councillor acknowledged the proponents’ proposal offered one potential solution, but suggested it would be prudent to be open to the possibility of other offers. He also cautioned about entering into short-term lease arrangements. In conclusion, Councillor Legendre said he was pleased to see the recommendation coming forward and reiterated his support for trying again with professional baseball and community use. However, he reminded the Committee that if professional baseball were to fail again, the City would be left with a facility that is too costly to operate for amateur leagues, which have alternate options available to them in terms of other sports fields in and around the City.

Councillor Monette questioned if the one-dollar for each ticket sold was from one group or if it was a condition by the City. Mr. Donaldson that it was part of the proposal from the OSG group. He added that staff are not suggesting any gate-related revenue in the minimum conditions, on a base rent of $108,000. The Councillor wondered if, for instance, the public said they like the vision of a soccer stadium in 2011/12, Mr. Maholtra could still come forward with a proposal. Mr. Donaldson confirmed that in terms in terms of the RFP that would proceed after Council set the direction from the vision exercise, and all the work done for the business development strategy around the transit tunnel, there could be a whole range of options, including multi-use sports facility. There is always a bit of a compromise and a bit of switch over between baseball and soccer but it is not impossible to do. He confirmed that a partnership could be made during the process.

By way of response to the Councillor, Mr. Donaldson confirmed that the awarding of the contract could be done in February, if staff are delegated the authority. Councillor Monette wondered if the two proponents would be in a position to submit a proposal within that time frame. Given that both Ottawa Pro baseball and OSG were ready at the latest by 1 January 2010, Mr. Donaldson assumed that these time frames would work for them.

Councillor Monette felt that the final consideration of awarding the contracts should be at the first Council meeting in February to allow for the groups market their product and build excitement in the community. The City Solicitor confirmed that the first Councillor meeting in February would fall on the second Wednesday of the month.

Given the timeframe, the Chair inquired if Council could give staff delegated authority in order to not delay the project even further. Mr. O’Connor confirmed that this could be done.

Chair Jellett and Councillor Monette suggested adding a friendly amendment to the motion, giving delegated authority to staff to make a decision by 1 February 2010.

Councillor Desroches – thank staff for their presentation I do want to see a viable tenant here and it is great that we have some interest and I think we need to consider all our options but I want to hear from staff and this first step it is to identify a short term tenant the focus will be on the viability of the group that we are prepared to partner with I am not seeing request I don’t think we will be considering making a lot of investment for a short term lease arrangement and confirm that the focus of the first phase will be to look at a viable reliable tenant for the short term

In responding to Councillor Desroches, Mr. Donaldson advised that staff are currently looking for financial feasibility to move forward in the short term process. Councillor Desroches asked about the different scenarios relating to the DOTT opportunities that are listed in the long-term strategy within the report. Mr. Donaldson clarified that the DOTT and the pedestrian bridge are two separate projects. If the DOTT does not proceed, there is still the possibility of the pedestrian bridge. More will be known within the next year and staff will have a better idea on how to plan for the kind of development that could be either connected or not to a Pedestrian bridge and/or a transit station. Both would require an Official Plan direction. Councillor Desroches concluded that he supports the motion by opening up the process to multi groups that are interested in using the facility.

Moved by Councillor Wilkinson,

Direct staff to solicit “best offers to lease” to utilize the Ottawa Stadium facility in the short term, based on the minimum conditions to lease described in the short-term strategy as outlined in this report and further, that staff be delegated the authority to make a decision by February 1^st.

CARRIED

That the Corporate Services and Economic Development Committee recommend that Council:

1. Approve the methodology to produce the long-term strategy outlined in this report for a highest and best use analysis of the Ottawa Stadium;

2. Approve the short-term strategy for the interim use of the Ottawa Stadium as outlined in this report; and

3. Direct staff to solicit “best offers to lease” to utilize the Ottawa Stadium facility in the short term, based on the minimum conditions to lease described in the short-term strategy as outlined in this report; and

4. That staff be delegated the authority to make a decision by 1 February 2010.

CARRIED as amended

DIRECTION TO STAFF:

That Real Estate Partnership and Development staff revise the wording to Recommendation 2 of the report in light of the amendment that was made to Recommendation 3.