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2000-23841 Reso Inc.CITY OF MIAMI BEACH MEMORANDUM TO: FROM: LARRY LEVY INTERIM CITY MANAGER NEISEN KASDIN"~ ~'~ MAYOR DATE: JANUARY 21, 2000 CONVENTION CENTER/CULTURAL FACILITIES AND CONVENTION DEVELOPMENT TAX The Convention Development Tax (CDT) is a countywide tax of one percent (1%) on hotel rooms. The proceeds of the tax were originally divided so that a two-thirds portion was dedicated to the expansion of the Miami Beach Convention Center and a one-th/rd portion dedicated to the construction of the Miami Arena. The language of the enabling legislation, a copy of which is attached, allows the tax to be used for other stadiums, halls, exhibition space and arenas. Facilities funded by this tax have included the Homestead Motor Sports Speedway, Performing Arts Center and operating costs for the American Airlines Arena. The funds are essentially available on a first come first serve basis. The growth in this tax has been exceptional, due in large measure to Miami Beach's booming tourism industry. For the fiscal year ending September 30, 1999, two-tl'firds portion of CDT collections totaled $17.6 million. Miami Beach was responsible for $10 million of these collections, with only $1.5 million being used to directly benefit Miami Beach. At the same time there are many facilities needs in Miami Beach, which could and should be funded by the CDT surplus. The Convention Center could use additional parking and physical and technical upgrading to remain a competitive facility in the Intemet age. Agenda Item ~.~.~ Date The brilliant array of cultural activities in Miami Beach has certainly developed as an attraction for tourists and convantioneers and facilities for the arts merits funding by the CDT. The Cultural Arts Council (CAC) is completing a study on improving existing City facilities for the arts. The auditorium for the new regional library could be paid for by the CDT, freeing up other money for books. Major expansions such as are contemplated by the New World Symphony and Art Center South Florida could also be fimded. In the future, by amending the state law that created the CDT, a trust fund for maintenance and improvements to the Beach could be established. Certainly our beaches are more important to visitors than many of.the other projects that have laid claim to the CDT. In addition to viable city projects, which should qualify for these funds, many of the current uses of CDT funds are inconsistent with its intended use. Specifically, many projects are not approved expenditures under the Interlocal between the City and the County,, which governs the use of CDT collections and some of the expenditures may not he authorized under state law. Furthermore, the agreement clearly states that all sUrpluses be returned to the city of Miami Beach. For the ending September 30, 1999, there was a reserve or surplus of approximately $4.3 million. Therefore, the Commission should direct the Administration to formalize a proposal for use of the CDT surplus prior to any other government entity staking a claim to these funds. Certainly, any or all of the projects outlined above greatly benefit tourism and are in keeping with the primary purposes for which this tax was created. Additionally, the issue of surpluses must be addressed so that these monies are not simply carried over to the following year, but are returned to the City of Miami Beach as provided for in the agreement. NOK/st CITY OF MIAMI BEACH CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 http:\\ci.mia mi-beach .fi.us COMMISSION MEMORANDUM NO. '~'.~ TO: FROM: SUBJECT: Mayor Neisen O. Kasdin and Members of the City Commission Lawrence A. Levy City Manager DATE: March 15, 2000 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE ADMINISTRATION TO REFINE A LIST OF PROPOSED PROJECTS AND TO REQUEST AN ALLOCATION AND DISTRIBUTION OF THE TWO THIRDS PORTION OF THE CONVENTION AND DEVELOPMENT TAX SUFFICIENT TO PROVIDE FUNDING FOR SUCH PROJECTS ADMINISTRATION RECOMMENDATION: Adopt the Resolution. This item has been prepared in response to Mayor Kasdin's memorandum dated January 21, 2000 requesting that this item be placed on the agenda. On June 21, 1996 the Mayor and City Commission entered into an interlocal agreement with Metropolitan Dade County regarding the use and disposition of the two thirds (2/3) portion ("Two Thirds Portion") of the tax imposed by the County on the exemise, within its boundaries, of the taxable privilege of leasing or letting transient rental accommodations at the rate of three pement (3%) of the total consideration charged for such accommodations, authorized pm'suant to Section 212.0305(4)(b), Florida Statutes, and imposed pursuant to the County Code and Ordinances (" Convention Development Tax"). As a result of this transaction, the Comity refunded and defeased the City's outstanding Subordinate Special Obligation Bonds, Series 1989 ("the Convention Center Bonds") through the issuance of additional County refunding bonds. The primary purpose of this transaction was to release the pledge o£the Two Thirds Portion of the Convention Development Tax ("CDT") from the Convention Center Bonds issued by the City so that the County could pledge the Two Thirds Portion of the CDT to bonds to fund the Performing Arts Center ("PAC"). it should be noted that for the year ended Soptember 30, 1999 the City's businesses generated $10,176,545 or 58% of the total $17,639,640 o£the Two Thirds Portion of the CDT collected in the County. AGENDA ITEM {~N~'~ G I In exchange for relinquishing a portion of this tax and having the City's Convention Center Bonds defeased the City received the following: 1) an operational subsidy of $1.5 million per year from April 1, 1996 through March 31, 2002 for the operation and maintenance of the Miami Beach Convention Center Complex; 2) capital replacement funds of $1.1 million per year (which may be reduced to $1 million per year commencing April 1, 2013) plus the actual cash operating deficit for the operation of the Convention Center Complex provided that these funds in the aggregate shall not exceed $4.5 million per year commencing on April 1, 2002 through March 31, 2026; 3) $46.5 million dollars to fund capital improvements to the Convention Center Complex and to fired, construct and equip a Regional Library after receiving $11.5 million of Convention Center Funds ficom the City; 4) a Certificate of Transportation for the City's electric shuttle for a "park and ride" program in the entertainment district of South Beach; an extension of the life of the South Pointe Redevelopment District for twelve years until 2016 and the fight to receive all tax increment revenue growth in the South Pointe Redevelopment District for the life of the District, including the twelve year extension; and 6) the right to receive all tax increment revenue growth in the City Center Redevelopment District for the life of the District, the County's approval of the amended City Center Redevelopment Plan and of the Tax Increment Bonds for the District. The County was to use the portion of the Two Thirds Portion of the CDT relinquished by the City as the pledge of revenues to issue the Bonds for the development of a new Performing Arts Center ("PAC") in the vicinity of Biscayne Boulevard and NE 13th Street. In this regard, the County has issued two series of bonds totaling $478.9 million which are payable through 2037. The interlocal agreement directs that the Two Thirds Portion shall be collected by the County Tax Collector and paid to the County. These funds shall be disbursed first for the annual debt service on the Refunding Bonds, Improvement Bonds and PAC Bonds; then to the City as described above; and finally "for the purposes permitted by Section 212.0305, Florida Statutes, as amended". In addition to paying the debt service on these bonds and making the required payments to the City, the County has also made a number of other disbursements since the 1996 agreement. It has made substantial grants ($4.6 million) to cultural programs, created a construction trust for the PAC ($6.75 million), funded a subsidy to the new arena ($5 million), funded other expenses of $2 million, reserved $7.295 million for future CDT obligations and shortfalls. Further, the County's own forecast reflects an annual subsidy for the new arena in excess of $6 million annually through 2028, an annual operating subsidy for the PAC of approximately $2 million through 2038, cultural affairs grants orS1 million mmually through 2038 and funds available for other eligible projects ranging from $330,000 up to $83.6 million (averaging $2 - 5 million) on an aimual basis through 2038. The Administration has reviewed the needs of the City and has prepared a preliminary list of possible projects that would be eligible for CDT funding. These projects encompass the expansion and improvement of the Convention Center Complex exhibition halls and related facilities, including parking and staging areas, as well the acquisition, renovation and improvement of a number of performing arts venues throughout the City. These projects are briefly outlined in the attached schedule. It is recommended that the Mayor and Connnission direct the Administration to take the following actions: 1 - refine the definition, estimated costs and financing strategy of the proposed projects; and 2 - submit a list of potential projects to the County to request an allocation and distribution of funds from the Two Thirds Portion of the CDT. LAL:PDW:odp C:\MYL~U~I\WPDOCS\CM031500\CDTPROJ.WPD PRELIMINARY PROJECTS ELIGIBLE FOR CDT FUNDING Miami Beach Convention Center Complex 1 - Expansion and improvement of the Convention Center Complex exhibition hails and related facilities including parking and staging areas The Miami Beach Convention Center Capital Expenditure Plan prepared by Thompson, Ventulett, Stainback & Associates in September 1997 proposed an additional expansion of the exhibit hall into the west parking lot, with a new banquet/meeting addition in the parking area behind the Jackie Gleason Theater. The construction cost of this expansion was estimated in 1997 dollars at $67,500,000 with an additional requirement of $5,500,000 for furniture, fixtures and equipment. In year 2000 dollars this project is estimated to cost $79,769,000. 2 - Convention Center Complex Parking The Miami Beach Convention Center Capital Expenditure Plan prepared by Thompson, Ventulett, Stainback & Associates in September 1997 proposed an alternative to a full building expansion Which is described as a parking deck expansion that would be designed to accommodate exhibit space on the lower level. This kind of expansion is in response to both parking issues and the Miami Beach climate that makes exterior exhibit space a viable option. It is estimated that a 2000 car garage with a 35 foot clear first floor and 60' x 60' structural bays would cost approximately $35,000,000 in 1997 dollars or $38,245,000 in year 2000 dollars. 3 - Convention Center Complex Staging Area The Miami Beach Convention Center Capital Expenditure Plan prepared by Thompson, Ventulett, Stainback & Associates in September 1997 proposed that the City acquire a site of approximately 2 acres in the vichfity of the Convention Center Complex to provide an area for truck staging. The consultants estimated a cost of $2,265,000 in 1997. This amount adjusted to year 2000 dollars is $2, 475,000, however, the cost of the land in the area has significantly increased and should be based on the appraised value of specific parcels under consideration. 4 - Convention Center Complex Related Facilities The Mian~i Beach Convention Center Complex may be expanded to include additional facilities in the inm~ediate vicinity that complement and enhance the variety of venues available for exhibitions and meetings. Expansion of and improvements to these facilities including an allowance for furniture, fixtures and equipment are estimated at $1,500,000 to $2,500,000. Performing Arts Facilities 1 - New World Symphony Soundspace Soundspace is envisioned as a unique musical laboratory incorporating state of the art commm~ications technology and media capabilities with performance, classroom and rehearsal PRELIMINARY PROJECTS ELIGIBLE FOR CDT FUNDING - PAGE 2 space. This facility estimated at 87,465 squm'e feet will provide flexible, modular stage and seating areas, sophisticated theatrical lighting, audio and video-projection systems, and equipment for radio, television and Interact broadcast. The Intemet and other broadcast media will extend the roach of live performance to encompass multi-site interactive musical events. The teleconferencing capabilities of the facility will increase the number of coaching opportunities and enable members of the New World Symphony to establish relationships with members of outstanding ensembles worldwide. The recording and broadcast capabilities will permit all forms of master classes and coaching, theathcally-enhanced perfom~ance events, lectures, seminars and forums to be broadcast live via the Internet. This facility is considered as an expansion of the Lincoln Theater and could be constructed on a site contiguous to the existing facility. The cost for this facility is estimated at a range of $12,000,000 to $15,000,000. 2 - The Colony Theater The Colony theater is a 465 seat auditorium, equipped with a stage, modest stage equipment and limited support space. It is currently used for both local and national performing arts organizations. The proj eot would include improvements and more extensive renovations additional support space, stage and other related equipment A portion of the renovation has been funded with a state grant. The cost of the remaining improvements are estimated to range between $1,000,000 and $1,250,000. 3 - The Acorn Theater The Acorn Theater is a 99 seat auditorium equipped with a simple end stage, minimal stage equipment and limited support space. This is well suited for spoken word dramatic performances and is used by some of the community's smaller performing arts organizations. Improvements would include enlarging the backstage facilities to include dressing rooms, improvements to the theater to provide noise isolation and installation of enhanced lighting and sound systems. The cost of these improvements is estimated to range between $200,000 and $300,000. 4 - The Rotunda The Rotunda at the existing Miami Beach Library has been used primarily by not-for-profit groups for simply staged performances. It is planned that the Rotunda will be preserved when the existing library is demolished and the new Regional Library is constructed across the street. An improved facility could be well suited for small musical or dramatic groups. The improvements would include reconfiguration of the room and ceiling geometry, a new HVAC system, dressing rooms, public restrooms and other minor renovations. The cost is estimated to range between $750,000 - $1,000,000. 5 - The Proposed Black Box Theater Component of the Point Project at 72nd Street and Collins Ave. The developer of The Point project has proposed the inclusion of a black box theater within the development of the complex. The space would be given to the City of Miami Beach as a performing PRELIMINARY PROJECTS ELIGIBLE FOR CDT FUNDING - PAGE 3 arts venue. The improvements required encompass complete interior build out and finishes including carpeting, seating, lighting and HVAC. Additionally, the project would include all equipment required for staging performances includh~g stage lighting and sound systems and other miscellaneous equipment. The estimated cost to complete and equip this facility ranges between $1,000,000 and $1,500,000. 6 - Acquisition and Improvements to the Byron-Carlyle Theater The City has become aware of an opportunity to acquire and renovate the Byron-Carlyle Theater to use as an additional performing arts venue. This facility could potentially be used as aJ~ incubator for performing arts organizations and in addition could provide a stimulus to encourage additional economic development in the North Beach area. It is estimated that the cost of the acquisition and renovation of this facility ranges between $4,750,000 and $5,250,000. 7 - The 10th Street Beachfront Auditorium The 10th Street Beachfront Auditorium is a historic facility located at 1001 Ocean Drive, in the center of historic Lummus Park and the heart of the Art Deco District. It was constructed in 1953. The improvemants envisioned consist of restoration and possible expansion of the auditorium to better serve as a venue for special events, new acoustical sound proofing, a sound system for recorded music, removable dance floor, interior/exterior lighting, A/C, roofing, interior and exterior renovation, parking, other related items and site improvements. The estimated cost to complete and equip this facility ranges between $900,000 and $1,300,000. 8 - The 21st Street Community Center The 21st Street Community Center is located in the immediate vicinity of the Miami Beach Convention Center Complex and is a facility that cam complement and enhance the variety of venues available for exttibitions and meetings. Expansion, renovation and improvements to these facilities ~vould include new acoustical sound proofing, a sound system for recorded music, removable dance floor, interior/exterior lighting, A/C, roofing, interior and exterior renovation, parking, other related items and site improvements. The estimated cost to complete and equip this facility including an allowance for furniture, fixtures and equipment are estimated at $1,500,000 to $2,000,000. C:\MYDOCU- 1 \WPDOCS\CM031500\CDTPROJ.VffPD RESOLUTION TO BE SUBMITTED THIS PAGE INTENTIONALLY LEFT BLANK