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00-826ORiGIS'"` Presented By: Referred To: CouncilFile # QO� g,��. Green Sheet# 104286 _� � 0 — Committee: Date , WHEREAS, upon the approval of the Mayor and Gity Gouncil, the RiverCentre Authority entered into a three and a z half year agreement with the Saint Paul Arena Company; and 4 s WHEREAS, section 7.1, (a) of the agreement requires that the Manager "institute and abide by a cost s allocation and accounting system, subject to approval by the Authority" which would be forv✓arded to � the Mayor and the City Council for review, comment and final approval; and s ,o WHEREAS, if the cost allocation plan for RiverCentre is not approved by the City Council by September „ 1, 2000, the cost allocation plan as proposed will be implemented at that time and remain in effect iz until approved by the City Council; and 13 14 is WHEREAS, any changes to the cost allocation plan required by the action of the City Councif will, to is the extent feasible, be implemented retroactively to September 1, 2000; and n ia ,e WHEREAS, the Mayor recommends approval of the proposed cost allocation plan; and 20 21 z2 THEREFORE BE IT RESOLVED, the Council of the City of Saint Paul approves the attached cost za allocation plan. aa ae Zs 2z za 2s 30 Yeas Nays Absent Benanav B7akey Bostrom � Coleman Hartis � Lantry � R�rer ;/ � L� D Adopted by Council; Date ��_� ��, o a f Adoption Cert�ed by Councii Secretary: � .— �. �... -.. . . ..- J;% ii� /�.��, 1 �/l� fi. �� , �!' ' /. Requested by Department of: �RiverCentr � he BY. � C' Approval Recommended by FSO - Director: By: c ��i J"r `� �--- Form Approved by City Atto ey: By: �� `/ '��-'''� ( Approve�r b\ yo fpr Submission to Council: f /��F �, By: , �� ._._ Sa�M Paul Butlget Office (G1,111231AGREERE5.WK9 � Dp -�'?�+ 2000-2001 Cost Allocation Plan for RiverCentre between Civic Center Authority, an Agency of the City of Saint Paul (also know as RiverCentre Authority) � Saint Paul Arena Company LLC Introduction Effective July 1, 2000 the Civic Center Authority (the "Authority") and the Saint Paul Arena Company, LLC ("Manager"), wlth the consent and approval of the Mayar and City Council of the City of Saint Paul on June 21, 2000, agreed to a three and a half year contract (the "Agreement") for the management of the RiverCentre comglex (the "Comglex") by the Manager. Section 7.1, (a) of the Agreement, requires that the Manaoer "institute and abide by a cost allocation and accounting system, subject to approval by the Authority (which approval sha11 not be unreasonably withheld or delayed). Any changes to such system shall be subject to approval by the Authority (which approval shall not be unreasonably withheld or delayed)." The system for 2000-2001 is detailed in this 2000-2001 Cost Allocation Plan for RiverCentre (the "Plan"). This Plan must be approved by the Authority and then be forwazded to the Mayor and the City Council for review, comment and final approval. The purpose of this document is only to reach agreement on how to fairly allocate expenses between the Authority and the Manager as those expenses occur. It does not address the underlying issues that are covered separately in other documents such as the annual budgets, the mazkering strategy or other policy related matters. The Plan as proposed in this document will be implemented on September 1, 2000. Any changes to the Plan required by the action of the City Council wili be impiemented immediately following approval by the Mayor and, to the extent feasible, be implemented retroacfively to September 1. 60 -t'a� Exuense Allocation Approach In order to ensure that total costs related to Xcel Energy Center (the "Center") are paid by the Saint Paul Arena Company, LLC, in its capacity as manager of the Center and total costs of the Complex are paid by the Authority, the Plan will charge all unique direct costs to the unit that incurred the costs. All shazed costs will be allocated on the most reasonable basis for allocaung those costs. In general, unless governed by some other provision of the Agreement, employee rime as measured by a rime keeping system acceptable to the Authority and described in this document will be the primary method for allocating a11 compensation costs. In general, other shazed expenses, if their use is common to the entire facility, will be allocated as set forth herein. Contract services used at the Center or Complex will be covered under Center or Complex- specific agreements, if appropriate. If services are to be provided across both the Center and Complex, the agreements will specify how those services will be tracked and allocated by the service provider. Compensation Expenses Each employee of the Manager shall keep a time record containing sufficient detail related to the work performed on a daily basis to fairly allocate his or her time to services provided to the Complex or the Center. Manager will shortly be implementing a computerized time tracking system. Computerized time tracking will allow houriy employees to accurately ciock in and out. All hourly staff will use swipe cards (electricians, stage technicians, custodial staff, engineers, security). The swipe cards have a bar code on the back, which will contain the employee's payroll TD number. The cards will also act as an identification card, and as an access cazd in some cases. Time is allocated by each staff person at the end of the day using a bar code gun and pre- established bar codes for each area. The system will require that time be allocated. The system will also facilitate accurate job tracking because each hourly employee will be able to allocate their time based on only the availabie parameters set into the computer. For exampie, employees can only allocate rime to valid events already set up in the system or for generai work codes pre-established for the Center and/or the Complex. Non-hourly employees wili be able to access this system via the computer network and allocate their time on a percentage basis daily. All supervisors will access this system via the computer network, verify correct allocation of time and conect enors as needed before submitting the time for payroll processing. 2 po -tac. The time record will be approved by the employee's supervisor who, by signing the record, indicates his or her approval of how the rime is distributed. Time that is not specifically allocable to either the Compiex or the Center shall be prorated to each on the basis of each employee's hours that are ailocated. This may be done on a pay period basis or some other period of time acceptable to the Authority and the Manager to ensure that unallocated fime is distributed fairly. Fringe benefits will be allocated in accardance with related compensation cost. Administrative Services and Expenses All telephone, prinring, uavel, lodging, parking, dues, memberships, registrations and like expenses will either be charged directly to the Complex ar the Center, or allocated on the basis used to charge compensation costs for the employee who reports the expense for the pay period in which the expense occurs. General Operating Expenses The Complex and the Center will each maintain a listing of equipment and its purchase price in place at July 1, 2000 and subsequently purchased for use at the Complex, the Center or both. Each listing will note items dedicated solely for use at the Complex or the Center. Each listing will also note those items of si�ificant dollar value that are expected to be used in both the Center and the Complex. Depreciation on equipment used exclusively in one facility or the other will be charged in full to the Complex ar the Center, as applicable. Equipment that is used at both the Compiex and the Center will either have usage tracked by locauon, or usage will be allocated using the most relevant applicable basis (as approved by the Authority Representative). Cost of maintenance and repairs of such equipment will be similarly allocated. Potential bases for allocation include: ■ Time spent by personnel urilizing the equipment • Number of events • Square footage Each year, the Manager will include in the proposed Capital Budget for the Complex provision for purchasing new or replacement equipment, along with a proposed allocation for funding equipment used at both the Complex and the Center. Such jointly-funded purchases will be noted as such in the Complex and Center equipment inventories along with the estimated useful life of each piece of equipment. Depreciafion expense of joinfly-funded equipment will be allocated based on percent funded by the Complex and the Center. Should the Manager be ternunated or choose not to renew its contract, the remaining useful life of the equipment will be ofl -a�ae computed as of the end of the Manager's contract. The new entity selected to provide management services will reimburse Manager for Manager's unamortized balance of funding provided by Manager for shared equipment left with the Complex, unless Manager continues to be able to use such shazed equipment on an ongoing basis. The Manager will prepare a map which defines all spaces in the Center and the Complex that have shared usage and spaces in the Center that aze used exclusively by the Complex and vice versa. The relarive amount of space in each facility made available for the other facility's use, or shared use, will be compared. If one facility is contributing significantly more space to the joint operations, an appropriate adjustment to the cost allocation methodology wlll be considered. Before August 1, 2001, the Authority Representarive and the D'uector of the Office of Flnancial Services (OFS) will review the level of services provided by OFS to the Authority during the first yeaz of the Agreement and agree on the doliar value of those services. The Authority will include the payment for those services in the Authority's 2002 budget. All other exgense items in this category that cannot be identified with a particular venue could be allocated as per "Compensation Bxpenses." Finance Expenses Cost of routine finance and information technology support provided by Manager for Complex acrivities will be covered by Manager as lump-sum charge for administrative overhead (as agreed in negotiation of Management Agreement). Box Office Expenses As agreed in negotiation of the Management Agreement, the box office will be operated by Manager for Complex events at no cost to the Complex. The Complex will also not receive any box office fees or income from operation for Complex events. Building Power Expenses All energy expenses should be metered separately and charged to the Complex or the Center. Building Maintenance Eltpenses Costs for ushers, security services, police, fire inspector, and Red Cross can most likely be attributed to the event held and the venue in which it is held. � Oo -�aG Costs for elevator and escalator repair and maintenance should be allocated to the venue associated with the specific equipment maintained. All other costs items not otherwise identified above should generaily be allocated to the Compiex and the Center as per "Compensation Expenses" for relevant personnel. Marketing Espenses Marketing expenses will be reported by the specific event or venue to which the cost relates. Costs associated with Center events and venue will be charged to the Center and costs associated with the Complex and Complex venues will be charged to the Complex. Cost associated with shared events will be allocated in proportion to the shazed event expenses between the Complex and the Center. Remaining costs will be allocated according to the allocation of markering personnel compensation and expenses. Parking Management Operating/Parking Facilities Expenses The Manager and City Lease Represetttarive will negotiate an agreed-upon net revenue amount to be paid to the Minnesota Wild Hockey Club for parking revenue due the Ciub on hockey event nights. Supplies Supplies will be inventoried in specific locations in the Complex and the Center. Usage from each inventory will be monitored and charged accordingly. 5 �p-d'�� Revenue Allocation Approach In order to ensure that total revenues related to the Center aze receipted by the Manager of the Center and total revenues of the Complex are receipted by the Authority, the Plan will allocate all unique direct receipts to the unit that produced the revenue. All shazed revenues will be allocated on the most reasonable basis for allocating those revenues. The Authority Representative will receive copies of ali rate cards in use when the Center opens and will be notified of any proposed changes to the rate cards. If it is necessary to discount the rates in order to book an event that uses a combination of the Center and the Complex, the discount will be applied evenly to the Center and the Complex. The discount must be approved by the Authority Representafive." Building Rentals Article 7 of the Arena L,ease covers the City's use of and access to the Center. All terms regarding the City's use are covered by the Arena Lease. The Center's building rental revenue accrues to the Wild. Building rental revenue of the Compiex accrues to the Authority. If a single event uses a combination of the Center and the Complex, the building rental revenue should be allocated based on published, approved rate cazds established for the Center and the Complex. Equipment Rentals There should be an ability to make a direct association between most items of equipment available for rent and the venue where the equipment is being set up and used e.g., stages, tables, chairs, A!V equipmenC, piano, etc.: If the equipment rented is set up and used in the Center, the rental revenue accrues to the Wild. ■ If the equipment rented is set up and used in the Complex, the rental revenue accrues to the Authority. ■ If a single event uses a combination of the Center and the Complex, the equipment (e.g., forklift truck) rental revenue should be allocated based on the relative usage of this equipment, chazged in accordance with published, approved rate cards established for the C oa -�'a� Center and the Complex. Building and Event Services There should be a direct associauon between event and most items of building and event services provided i.e., these services would not have been provided if not for the event taking place: � If the service provided is rendered in the Center, tite service revenue accrues to the Wild. If the service provided is rendered the Complex, the rental revenue accrues to the Authority. If a single event uses a combination of the Center and the Complex, the revenue from the services rendered should be ailocated based on the relarive time spent by personnel rendering the service, chazged in accordance with published, approved rate cards established for the Center and the Complex. Concessions and Novelties Concessions and novelties sellers shouid record all revenue at the point of sale for purposes of aliocating revenues Under management fee structure proposed in RiverCentre RFP on concessions and catering, revenues and expenses far these acuvities will be recorded gross. Commissions The event generating the cammissions from the e�ibition booths or the events for which television rights are granted are "knowns." Special mention should be made for the "Facility Chazge" commission i.e., seat rent fee for the event. The locations of "fixed" items like pay telephones, sign age, etc., are also "knowns": • If the evendlocation is in the Center, the commission revenue accrues to the Wild. � If the eventJlocation is in the Complex, the commission revenue accrues to the Authority. If there is an event using a combination of the Center and the Complex, the commission revenue should be allocated based on the relative time spent by personnel rendering the 7 no-t'�y servace, chazged in accordance with published approved rate cards established for the Center and the Complex. Parking Ramp Revenue See discussion under "Parking Management Operating/Facilities Expenses." Parking Lot Revenue See discussion under "Parking Management OperatinglFaciliries Expenses." Other Revenue Best done on a case-by-case basis. The Authority must approve the use of any public revenue such as the RiverCentre's shaze of HoteUMotel ta;ces. Typically this has been used by the Authority to provide "rent subsidies" to market the facility. It is anticipated that such "subsidies" will be made only for Complex events. G:�Shared�BudgeHDEPTS\CIVCII2\WPFII,ES�2000-2001 COST AI.I.00AITON PLAN (Revised 8-30).doc C'7 RiverCen�e � 09-01-2000 � GREEN �� JNTACfPER40NRPHONE OI DCPARTM1ffiJiDIRACTO �5 CRYCAUNCQ. ErichMische ��„ � crrvnrrox��- ��, 0 caYC�t�uc USiBEONCAUNCQ.AGHJDABV(DA9E) � O2 FAIANCLV.SERNCESDIR O FIN.&MGI.SPRV[CESDIR �6 MAYOA(OAASSISiAM) � �ACCOiRTIANf TOTAL # OF SIGNAT[JRE PAGES . (CLIP ALL LOCATIONS FOIi Sl Approvai of the cost allocarion sys[em for the RiverCentre complex. zECOD�NDAIIONS: Appmve(A) wRcjxt(R) PERSONAi. SERVICE CONIRACLS MOST AIVSWERTfIE FOLLOWINV (jUM:S71U1 _PLANNWGCOFPf65ION 1. Has rhis person/fimi ever worked imder a contract for this departrpent? cmCOmm�rree �S NO crva socviceco��sslox Z. Has Uils paaon/fum ever been a city employee? YES NO _ 3. Dces tltis persoNSm possess a slall not normally possessedby any cuaent city employee? YES NO _ 4. Is tfiis petson/ fum a targetedvendor? YES NO � (azpiaw au yes answers on separa�e suee[ aua aaacu �o green sneec� JI'11ATINGPROBLEM.ISSUO.OPPOR'1'UNPI'Y(W6q Whaf, Wha. Where, WhY). The management ageement beriveen the River Cenh�e Authority and the Saint Paul Arena Company requires that the Authority and danager appzove a cost allocation system for the shazed use of the facility. The River Centre Authority and the Saint Paul Arena Company would have an equitable system for distributing shazed costs and revenues. APPAOVED. None. The River Centre Authority and the Saint Paul Arena Company would not be in fiill compliance of the agreement for the management of the River Centre complex. � a : � AMO[INTOFiRANSACISON � U COST/{tEVEN[I6BllDCETED(CIRCLEOttE) VES NO WFOAMATION. (6XPLAP� �->i••y_.c _„_ SaintPauBOOgetOfflce�G4��13MGREERES.WK4) / ORiGIS'"` Presented By: Referred To: CouncilFile # QO� g,��. Green Sheet# 104286 _� � 0 — Committee: Date , WHEREAS, upon the approval of the Mayor and Gity Gouncil, the RiverCentre Authority entered into a three and a z half year agreement with the Saint Paul Arena Company; and 4 s WHEREAS, section 7.1, (a) of the agreement requires that the Manager "institute and abide by a cost s allocation and accounting system, subject to approval by the Authority" which would be forv✓arded to � the Mayor and the City Council for review, comment and final approval; and s ,o WHEREAS, if the cost allocation plan for RiverCentre is not approved by the City Council by September „ 1, 2000, the cost allocation plan as proposed will be implemented at that time and remain in effect iz until approved by the City Council; and 13 14 is WHEREAS, any changes to the cost allocation plan required by the action of the City Councif will, to is the extent feasible, be implemented retroactively to September 1, 2000; and n ia ,e WHEREAS, the Mayor recommends approval of the proposed cost allocation plan; and 20 21 z2 THEREFORE BE IT RESOLVED, the Council of the City of Saint Paul approves the attached cost za allocation plan. aa ae Zs 2z za 2s 30 Yeas Nays Absent Benanav B7akey Bostrom � Coleman Hartis � Lantry � R�rer ;/ � L� D Adopted by Council; Date ��_� ��, o a f Adoption Cert�ed by Councii Secretary: � .— �. �... -.. . . ..- J;% ii� /�.��, 1 �/l� fi. �� , �!' ' /. Requested by Department of: �RiverCentr � he BY. � C' Approval Recommended by FSO - Director: By: c ��i J"r `� �--- Form Approved by City Atto ey: By: �� `/ '��-'''� ( Approve�r b\ yo fpr Submission to Council: f /��F �, By: , �� ._._ Sa�M Paul Butlget Office (G1,111231AGREERE5.WK9 � Dp -�'?�+ 2000-2001 Cost Allocation Plan for RiverCentre between Civic Center Authority, an Agency of the City of Saint Paul (also know as RiverCentre Authority) � Saint Paul Arena Company LLC Introduction Effective July 1, 2000 the Civic Center Authority (the "Authority") and the Saint Paul Arena Company, LLC ("Manager"), wlth the consent and approval of the Mayar and City Council of the City of Saint Paul on June 21, 2000, agreed to a three and a half year contract (the "Agreement") for the management of the RiverCentre comglex (the "Comglex") by the Manager. Section 7.1, (a) of the Agreement, requires that the Manaoer "institute and abide by a cost allocation and accounting system, subject to approval by the Authority (which approval sha11 not be unreasonably withheld or delayed). Any changes to such system shall be subject to approval by the Authority (which approval shall not be unreasonably withheld or delayed)." The system for 2000-2001 is detailed in this 2000-2001 Cost Allocation Plan for RiverCentre (the "Plan"). This Plan must be approved by the Authority and then be forwazded to the Mayor and the City Council for review, comment and final approval. The purpose of this document is only to reach agreement on how to fairly allocate expenses between the Authority and the Manager as those expenses occur. It does not address the underlying issues that are covered separately in other documents such as the annual budgets, the mazkering strategy or other policy related matters. The Plan as proposed in this document will be implemented on September 1, 2000. Any changes to the Plan required by the action of the City Council wili be impiemented immediately following approval by the Mayor and, to the extent feasible, be implemented retroacfively to September 1. 60 -t'a� Exuense Allocation Approach In order to ensure that total costs related to Xcel Energy Center (the "Center") are paid by the Saint Paul Arena Company, LLC, in its capacity as manager of the Center and total costs of the Complex are paid by the Authority, the Plan will charge all unique direct costs to the unit that incurred the costs. All shazed costs will be allocated on the most reasonable basis for allocaung those costs. In general, unless governed by some other provision of the Agreement, employee rime as measured by a rime keeping system acceptable to the Authority and described in this document will be the primary method for allocating a11 compensation costs. In general, other shazed expenses, if their use is common to the entire facility, will be allocated as set forth herein. Contract services used at the Center or Complex will be covered under Center or Complex- specific agreements, if appropriate. If services are to be provided across both the Center and Complex, the agreements will specify how those services will be tracked and allocated by the service provider. Compensation Expenses Each employee of the Manager shall keep a time record containing sufficient detail related to the work performed on a daily basis to fairly allocate his or her time to services provided to the Complex or the Center. Manager will shortly be implementing a computerized time tracking system. Computerized time tracking will allow houriy employees to accurately ciock in and out. All hourly staff will use swipe cards (electricians, stage technicians, custodial staff, engineers, security). The swipe cards have a bar code on the back, which will contain the employee's payroll TD number. The cards will also act as an identification card, and as an access cazd in some cases. Time is allocated by each staff person at the end of the day using a bar code gun and pre- established bar codes for each area. The system will require that time be allocated. The system will also facilitate accurate job tracking because each hourly employee will be able to allocate their time based on only the availabie parameters set into the computer. For exampie, employees can only allocate rime to valid events already set up in the system or for generai work codes pre-established for the Center and/or the Complex. Non-hourly employees wili be able to access this system via the computer network and allocate their time on a percentage basis daily. All supervisors will access this system via the computer network, verify correct allocation of time and conect enors as needed before submitting the time for payroll processing. 2 po -tac. The time record will be approved by the employee's supervisor who, by signing the record, indicates his or her approval of how the rime is distributed. Time that is not specifically allocable to either the Compiex or the Center shall be prorated to each on the basis of each employee's hours that are ailocated. This may be done on a pay period basis or some other period of time acceptable to the Authority and the Manager to ensure that unallocated fime is distributed fairly. Fringe benefits will be allocated in accardance with related compensation cost. Administrative Services and Expenses All telephone, prinring, uavel, lodging, parking, dues, memberships, registrations and like expenses will either be charged directly to the Complex ar the Center, or allocated on the basis used to charge compensation costs for the employee who reports the expense for the pay period in which the expense occurs. General Operating Expenses The Complex and the Center will each maintain a listing of equipment and its purchase price in place at July 1, 2000 and subsequently purchased for use at the Complex, the Center or both. Each listing will note items dedicated solely for use at the Complex or the Center. Each listing will also note those items of si�ificant dollar value that are expected to be used in both the Center and the Complex. Depreciation on equipment used exclusively in one facility or the other will be charged in full to the Complex ar the Center, as applicable. Equipment that is used at both the Compiex and the Center will either have usage tracked by locauon, or usage will be allocated using the most relevant applicable basis (as approved by the Authority Representative). Cost of maintenance and repairs of such equipment will be similarly allocated. Potential bases for allocation include: ■ Time spent by personnel urilizing the equipment • Number of events • Square footage Each year, the Manager will include in the proposed Capital Budget for the Complex provision for purchasing new or replacement equipment, along with a proposed allocation for funding equipment used at both the Complex and the Center. Such jointly-funded purchases will be noted as such in the Complex and Center equipment inventories along with the estimated useful life of each piece of equipment. Depreciafion expense of joinfly-funded equipment will be allocated based on percent funded by the Complex and the Center. Should the Manager be ternunated or choose not to renew its contract, the remaining useful life of the equipment will be ofl -a�ae computed as of the end of the Manager's contract. The new entity selected to provide management services will reimburse Manager for Manager's unamortized balance of funding provided by Manager for shared equipment left with the Complex, unless Manager continues to be able to use such shazed equipment on an ongoing basis. The Manager will prepare a map which defines all spaces in the Center and the Complex that have shared usage and spaces in the Center that aze used exclusively by the Complex and vice versa. The relarive amount of space in each facility made available for the other facility's use, or shared use, will be compared. If one facility is contributing significantly more space to the joint operations, an appropriate adjustment to the cost allocation methodology wlll be considered. Before August 1, 2001, the Authority Representarive and the D'uector of the Office of Flnancial Services (OFS) will review the level of services provided by OFS to the Authority during the first yeaz of the Agreement and agree on the doliar value of those services. The Authority will include the payment for those services in the Authority's 2002 budget. All other exgense items in this category that cannot be identified with a particular venue could be allocated as per "Compensation Bxpenses." Finance Expenses Cost of routine finance and information technology support provided by Manager for Complex acrivities will be covered by Manager as lump-sum charge for administrative overhead (as agreed in negotiation of Management Agreement). Box Office Expenses As agreed in negotiation of the Management Agreement, the box office will be operated by Manager for Complex events at no cost to the Complex. The Complex will also not receive any box office fees or income from operation for Complex events. Building Power Expenses All energy expenses should be metered separately and charged to the Complex or the Center. Building Maintenance Eltpenses Costs for ushers, security services, police, fire inspector, and Red Cross can most likely be attributed to the event held and the venue in which it is held. � Oo -�aG Costs for elevator and escalator repair and maintenance should be allocated to the venue associated with the specific equipment maintained. All other costs items not otherwise identified above should generaily be allocated to the Compiex and the Center as per "Compensation Expenses" for relevant personnel. Marketing Espenses Marketing expenses will be reported by the specific event or venue to which the cost relates. Costs associated with Center events and venue will be charged to the Center and costs associated with the Complex and Complex venues will be charged to the Complex. Cost associated with shared events will be allocated in proportion to the shazed event expenses between the Complex and the Center. Remaining costs will be allocated according to the allocation of markering personnel compensation and expenses. Parking Management Operating/Parking Facilities Expenses The Manager and City Lease Represetttarive will negotiate an agreed-upon net revenue amount to be paid to the Minnesota Wild Hockey Club for parking revenue due the Ciub on hockey event nights. Supplies Supplies will be inventoried in specific locations in the Complex and the Center. Usage from each inventory will be monitored and charged accordingly. 5 �p-d'�� Revenue Allocation Approach In order to ensure that total revenues related to the Center aze receipted by the Manager of the Center and total revenues of the Complex are receipted by the Authority, the Plan will allocate all unique direct receipts to the unit that produced the revenue. All shazed revenues will be allocated on the most reasonable basis for allocating those revenues. The Authority Representative will receive copies of ali rate cards in use when the Center opens and will be notified of any proposed changes to the rate cards. If it is necessary to discount the rates in order to book an event that uses a combination of the Center and the Complex, the discount will be applied evenly to the Center and the Complex. The discount must be approved by the Authority Representafive." Building Rentals Article 7 of the Arena L,ease covers the City's use of and access to the Center. All terms regarding the City's use are covered by the Arena Lease. The Center's building rental revenue accrues to the Wild. Building rental revenue of the Compiex accrues to the Authority. If a single event uses a combination of the Center and the Complex, the building rental revenue should be allocated based on published, approved rate cazds established for the Center and the Complex. Equipment Rentals There should be an ability to make a direct association between most items of equipment available for rent and the venue where the equipment is being set up and used e.g., stages, tables, chairs, A!V equipmenC, piano, etc.: If the equipment rented is set up and used in the Center, the rental revenue accrues to the Wild. ■ If the equipment rented is set up and used in the Complex, the rental revenue accrues to the Authority. ■ If a single event uses a combination of the Center and the Complex, the equipment (e.g., forklift truck) rental revenue should be allocated based on the relative usage of this equipment, chazged in accordance with published, approved rate cards established for the C oa -�'a� Center and the Complex. Building and Event Services There should be a direct associauon between event and most items of building and event services provided i.e., these services would not have been provided if not for the event taking place: � If the service provided is rendered in the Center, tite service revenue accrues to the Wild. If the service provided is rendered the Complex, the rental revenue accrues to the Authority. If a single event uses a combination of the Center and the Complex, the revenue from the services rendered should be ailocated based on the relarive time spent by personnel rendering the service, chazged in accordance with published, approved rate cards established for the Center and the Complex. Concessions and Novelties Concessions and novelties sellers shouid record all revenue at the point of sale for purposes of aliocating revenues Under management fee structure proposed in RiverCentre RFP on concessions and catering, revenues and expenses far these acuvities will be recorded gross. Commissions The event generating the cammissions from the e�ibition booths or the events for which television rights are granted are "knowns." Special mention should be made for the "Facility Chazge" commission i.e., seat rent fee for the event. The locations of "fixed" items like pay telephones, sign age, etc., are also "knowns": • If the evendlocation is in the Center, the commission revenue accrues to the Wild. � If the eventJlocation is in the Complex, the commission revenue accrues to the Authority. If there is an event using a combination of the Center and the Complex, the commission revenue should be allocated based on the relative time spent by personnel rendering the 7 no-t'�y servace, chazged in accordance with published approved rate cards established for the Center and the Complex. Parking Ramp Revenue See discussion under "Parking Management Operating/Facilities Expenses." Parking Lot Revenue See discussion under "Parking Management OperatinglFaciliries Expenses." Other Revenue Best done on a case-by-case basis. The Authority must approve the use of any public revenue such as the RiverCentre's shaze of HoteUMotel ta;ces. Typically this has been used by the Authority to provide "rent subsidies" to market the facility. It is anticipated that such "subsidies" will be made only for Complex events. G:�Shared�BudgeHDEPTS\CIVCII2\WPFII,ES�2000-2001 COST AI.I.00AITON PLAN (Revised 8-30).doc C'7 RiverCen�e � 09-01-2000 � GREEN �� JNTACfPER40NRPHONE OI DCPARTM1ffiJiDIRACTO �5 CRYCAUNCQ. ErichMische ��„ � crrvnrrox��- ��, 0 caYC�t�uc USiBEONCAUNCQ.AGHJDABV(DA9E) � O2 FAIANCLV.SERNCESDIR O FIN.&MGI.SPRV[CESDIR �6 MAYOA(OAASSISiAM) � �ACCOiRTIANf TOTAL # OF SIGNAT[JRE PAGES . (CLIP ALL LOCATIONS FOIi Sl Approvai of the cost allocarion sys[em for the RiverCentre complex. zECOD�NDAIIONS: Appmve(A) wRcjxt(R) PERSONAi. SERVICE CONIRACLS MOST AIVSWERTfIE FOLLOWINV (jUM:S71U1 _PLANNWGCOFPf65ION 1. Has rhis person/fimi ever worked imder a contract for this departrpent? cmCOmm�rree �S NO crva socviceco��sslox Z. Has Uils paaon/fum ever been a city employee? YES NO _ 3. Dces tltis persoNSm possess a slall not normally possessedby any cuaent city employee? YES NO _ 4. Is tfiis petson/ fum a targetedvendor? YES NO � (azpiaw au yes answers on separa�e suee[ aua aaacu �o green sneec� JI'11ATINGPROBLEM.ISSUO.OPPOR'1'UNPI'Y(W6q Whaf, Wha. Where, WhY). The management ageement beriveen the River Cenh�e Authority and the Saint Paul Arena Company requires that the Authority and danager appzove a cost allocation system for the shazed use of the facility. The River Centre Authority and the Saint Paul Arena Company would have an equitable system for distributing shazed costs and revenues. APPAOVED. None. The River Centre Authority and the Saint Paul Arena Company would not be in fiill compliance of the agreement for the management of the River Centre complex. � a : � AMO[INTOFiRANSACISON � U COST/{tEVEN[I6BllDCETED(CIRCLEOttE) VES NO WFOAMATION. (6XPLAP� �->i••y_.c _„_ SaintPauBOOgetOfflce�G4��13MGREERES.WK4) / ORiGIS'"` Presented By: Referred To: CouncilFile # QO� g,��. Green Sheet# 104286 _� � 0 — Committee: Date , WHEREAS, upon the approval of the Mayor and Gity Gouncil, the RiverCentre Authority entered into a three and a z half year agreement with the Saint Paul Arena Company; and 4 s WHEREAS, section 7.1, (a) of the agreement requires that the Manager "institute and abide by a cost s allocation and accounting system, subject to approval by the Authority" which would be forv✓arded to � the Mayor and the City Council for review, comment and final approval; and s ,o WHEREAS, if the cost allocation plan for RiverCentre is not approved by the City Council by September „ 1, 2000, the cost allocation plan as proposed will be implemented at that time and remain in effect iz until approved by the City Council; and 13 14 is WHEREAS, any changes to the cost allocation plan required by the action of the City Councif will, to is the extent feasible, be implemented retroactively to September 1, 2000; and n ia ,e WHEREAS, the Mayor recommends approval of the proposed cost allocation plan; and 20 21 z2 THEREFORE BE IT RESOLVED, the Council of the City of Saint Paul approves the attached cost za allocation plan. aa ae Zs 2z za 2s 30 Yeas Nays Absent Benanav B7akey Bostrom � Coleman Hartis � Lantry � R�rer ;/ � L� D Adopted by Council; Date ��_� ��, o a f Adoption Cert�ed by Councii Secretary: � .— �. �... -.. . . ..- J;% ii� /�.��, 1 �/l� fi. �� , �!' ' /. Requested by Department of: �RiverCentr � he BY. � C' Approval Recommended by FSO - Director: By: c ��i J"r `� �--- Form Approved by City Atto ey: By: �� `/ '��-'''� ( Approve�r b\ yo fpr Submission to Council: f /��F �, By: , �� ._._ Sa�M Paul Butlget Office (G1,111231AGREERE5.WK9 � Dp -�'?�+ 2000-2001 Cost Allocation Plan for RiverCentre between Civic Center Authority, an Agency of the City of Saint Paul (also know as RiverCentre Authority) � Saint Paul Arena Company LLC Introduction Effective July 1, 2000 the Civic Center Authority (the "Authority") and the Saint Paul Arena Company, LLC ("Manager"), wlth the consent and approval of the Mayar and City Council of the City of Saint Paul on June 21, 2000, agreed to a three and a half year contract (the "Agreement") for the management of the RiverCentre comglex (the "Comglex") by the Manager. Section 7.1, (a) of the Agreement, requires that the Manaoer "institute and abide by a cost allocation and accounting system, subject to approval by the Authority (which approval sha11 not be unreasonably withheld or delayed). Any changes to such system shall be subject to approval by the Authority (which approval shall not be unreasonably withheld or delayed)." The system for 2000-2001 is detailed in this 2000-2001 Cost Allocation Plan for RiverCentre (the "Plan"). This Plan must be approved by the Authority and then be forwazded to the Mayor and the City Council for review, comment and final approval. The purpose of this document is only to reach agreement on how to fairly allocate expenses between the Authority and the Manager as those expenses occur. It does not address the underlying issues that are covered separately in other documents such as the annual budgets, the mazkering strategy or other policy related matters. The Plan as proposed in this document will be implemented on September 1, 2000. Any changes to the Plan required by the action of the City Council wili be impiemented immediately following approval by the Mayor and, to the extent feasible, be implemented retroacfively to September 1. 60 -t'a� Exuense Allocation Approach In order to ensure that total costs related to Xcel Energy Center (the "Center") are paid by the Saint Paul Arena Company, LLC, in its capacity as manager of the Center and total costs of the Complex are paid by the Authority, the Plan will charge all unique direct costs to the unit that incurred the costs. All shazed costs will be allocated on the most reasonable basis for allocaung those costs. In general, unless governed by some other provision of the Agreement, employee rime as measured by a rime keeping system acceptable to the Authority and described in this document will be the primary method for allocating a11 compensation costs. In general, other shazed expenses, if their use is common to the entire facility, will be allocated as set forth herein. Contract services used at the Center or Complex will be covered under Center or Complex- specific agreements, if appropriate. If services are to be provided across both the Center and Complex, the agreements will specify how those services will be tracked and allocated by the service provider. Compensation Expenses Each employee of the Manager shall keep a time record containing sufficient detail related to the work performed on a daily basis to fairly allocate his or her time to services provided to the Complex or the Center. Manager will shortly be implementing a computerized time tracking system. Computerized time tracking will allow houriy employees to accurately ciock in and out. All hourly staff will use swipe cards (electricians, stage technicians, custodial staff, engineers, security). The swipe cards have a bar code on the back, which will contain the employee's payroll TD number. The cards will also act as an identification card, and as an access cazd in some cases. Time is allocated by each staff person at the end of the day using a bar code gun and pre- established bar codes for each area. The system will require that time be allocated. The system will also facilitate accurate job tracking because each hourly employee will be able to allocate their time based on only the availabie parameters set into the computer. For exampie, employees can only allocate rime to valid events already set up in the system or for generai work codes pre-established for the Center and/or the Complex. Non-hourly employees wili be able to access this system via the computer network and allocate their time on a percentage basis daily. All supervisors will access this system via the computer network, verify correct allocation of time and conect enors as needed before submitting the time for payroll processing. 2 po -tac. The time record will be approved by the employee's supervisor who, by signing the record, indicates his or her approval of how the rime is distributed. Time that is not specifically allocable to either the Compiex or the Center shall be prorated to each on the basis of each employee's hours that are ailocated. This may be done on a pay period basis or some other period of time acceptable to the Authority and the Manager to ensure that unallocated fime is distributed fairly. Fringe benefits will be allocated in accardance with related compensation cost. Administrative Services and Expenses All telephone, prinring, uavel, lodging, parking, dues, memberships, registrations and like expenses will either be charged directly to the Complex ar the Center, or allocated on the basis used to charge compensation costs for the employee who reports the expense for the pay period in which the expense occurs. General Operating Expenses The Complex and the Center will each maintain a listing of equipment and its purchase price in place at July 1, 2000 and subsequently purchased for use at the Complex, the Center or both. Each listing will note items dedicated solely for use at the Complex or the Center. Each listing will also note those items of si�ificant dollar value that are expected to be used in both the Center and the Complex. Depreciation on equipment used exclusively in one facility or the other will be charged in full to the Complex ar the Center, as applicable. Equipment that is used at both the Compiex and the Center will either have usage tracked by locauon, or usage will be allocated using the most relevant applicable basis (as approved by the Authority Representative). Cost of maintenance and repairs of such equipment will be similarly allocated. Potential bases for allocation include: ■ Time spent by personnel urilizing the equipment • Number of events • Square footage Each year, the Manager will include in the proposed Capital Budget for the Complex provision for purchasing new or replacement equipment, along with a proposed allocation for funding equipment used at both the Complex and the Center. Such jointly-funded purchases will be noted as such in the Complex and Center equipment inventories along with the estimated useful life of each piece of equipment. Depreciafion expense of joinfly-funded equipment will be allocated based on percent funded by the Complex and the Center. Should the Manager be ternunated or choose not to renew its contract, the remaining useful life of the equipment will be ofl -a�ae computed as of the end of the Manager's contract. The new entity selected to provide management services will reimburse Manager for Manager's unamortized balance of funding provided by Manager for shared equipment left with the Complex, unless Manager continues to be able to use such shazed equipment on an ongoing basis. The Manager will prepare a map which defines all spaces in the Center and the Complex that have shared usage and spaces in the Center that aze used exclusively by the Complex and vice versa. The relarive amount of space in each facility made available for the other facility's use, or shared use, will be compared. If one facility is contributing significantly more space to the joint operations, an appropriate adjustment to the cost allocation methodology wlll be considered. Before August 1, 2001, the Authority Representarive and the D'uector of the Office of Flnancial Services (OFS) will review the level of services provided by OFS to the Authority during the first yeaz of the Agreement and agree on the doliar value of those services. The Authority will include the payment for those services in the Authority's 2002 budget. All other exgense items in this category that cannot be identified with a particular venue could be allocated as per "Compensation Bxpenses." Finance Expenses Cost of routine finance and information technology support provided by Manager for Complex acrivities will be covered by Manager as lump-sum charge for administrative overhead (as agreed in negotiation of Management Agreement). Box Office Expenses As agreed in negotiation of the Management Agreement, the box office will be operated by Manager for Complex events at no cost to the Complex. The Complex will also not receive any box office fees or income from operation for Complex events. Building Power Expenses All energy expenses should be metered separately and charged to the Complex or the Center. Building Maintenance Eltpenses Costs for ushers, security services, police, fire inspector, and Red Cross can most likely be attributed to the event held and the venue in which it is held. � Oo -�aG Costs for elevator and escalator repair and maintenance should be allocated to the venue associated with the specific equipment maintained. All other costs items not otherwise identified above should generaily be allocated to the Compiex and the Center as per "Compensation Expenses" for relevant personnel. Marketing Espenses Marketing expenses will be reported by the specific event or venue to which the cost relates. Costs associated with Center events and venue will be charged to the Center and costs associated with the Complex and Complex venues will be charged to the Complex. Cost associated with shared events will be allocated in proportion to the shazed event expenses between the Complex and the Center. Remaining costs will be allocated according to the allocation of markering personnel compensation and expenses. Parking Management Operating/Parking Facilities Expenses The Manager and City Lease Represetttarive will negotiate an agreed-upon net revenue amount to be paid to the Minnesota Wild Hockey Club for parking revenue due the Ciub on hockey event nights. Supplies Supplies will be inventoried in specific locations in the Complex and the Center. Usage from each inventory will be monitored and charged accordingly. 5 �p-d'�� Revenue Allocation Approach In order to ensure that total revenues related to the Center aze receipted by the Manager of the Center and total revenues of the Complex are receipted by the Authority, the Plan will allocate all unique direct receipts to the unit that produced the revenue. All shazed revenues will be allocated on the most reasonable basis for allocating those revenues. The Authority Representative will receive copies of ali rate cards in use when the Center opens and will be notified of any proposed changes to the rate cards. If it is necessary to discount the rates in order to book an event that uses a combination of the Center and the Complex, the discount will be applied evenly to the Center and the Complex. The discount must be approved by the Authority Representafive." Building Rentals Article 7 of the Arena L,ease covers the City's use of and access to the Center. All terms regarding the City's use are covered by the Arena Lease. The Center's building rental revenue accrues to the Wild. Building rental revenue of the Compiex accrues to the Authority. If a single event uses a combination of the Center and the Complex, the building rental revenue should be allocated based on published, approved rate cazds established for the Center and the Complex. Equipment Rentals There should be an ability to make a direct association between most items of equipment available for rent and the venue where the equipment is being set up and used e.g., stages, tables, chairs, A!V equipmenC, piano, etc.: If the equipment rented is set up and used in the Center, the rental revenue accrues to the Wild. ■ If the equipment rented is set up and used in the Complex, the rental revenue accrues to the Authority. ■ If a single event uses a combination of the Center and the Complex, the equipment (e.g., forklift truck) rental revenue should be allocated based on the relative usage of this equipment, chazged in accordance with published, approved rate cards established for the C oa -�'a� Center and the Complex. Building and Event Services There should be a direct associauon between event and most items of building and event services provided i.e., these services would not have been provided if not for the event taking place: � If the service provided is rendered in the Center, tite service revenue accrues to the Wild. If the service provided is rendered the Complex, the rental revenue accrues to the Authority. If a single event uses a combination of the Center and the Complex, the revenue from the services rendered should be ailocated based on the relarive time spent by personnel rendering the service, chazged in accordance with published, approved rate cards established for the Center and the Complex. Concessions and Novelties Concessions and novelties sellers shouid record all revenue at the point of sale for purposes of aliocating revenues Under management fee structure proposed in RiverCentre RFP on concessions and catering, revenues and expenses far these acuvities will be recorded gross. Commissions The event generating the cammissions from the e�ibition booths or the events for which television rights are granted are "knowns." Special mention should be made for the "Facility Chazge" commission i.e., seat rent fee for the event. The locations of "fixed" items like pay telephones, sign age, etc., are also "knowns": • If the evendlocation is in the Center, the commission revenue accrues to the Wild. � If the eventJlocation is in the Complex, the commission revenue accrues to the Authority. If there is an event using a combination of the Center and the Complex, the commission revenue should be allocated based on the relative time spent by personnel rendering the 7 no-t'�y servace, chazged in accordance with published approved rate cards established for the Center and the Complex. Parking Ramp Revenue See discussion under "Parking Management Operating/Facilities Expenses." Parking Lot Revenue See discussion under "Parking Management OperatinglFaciliries Expenses." Other Revenue Best done on a case-by-case basis. The Authority must approve the use of any public revenue such as the RiverCentre's shaze of HoteUMotel ta;ces. Typically this has been used by the Authority to provide "rent subsidies" to market the facility. It is anticipated that such "subsidies" will be made only for Complex events. G:�Shared�BudgeHDEPTS\CIVCII2\WPFII,ES�2000-2001 COST AI.I.00AITON PLAN (Revised 8-30).doc C'7 RiverCen�e � 09-01-2000 � GREEN �� JNTACfPER40NRPHONE OI DCPARTM1ffiJiDIRACTO �5 CRYCAUNCQ. ErichMische ��„ � crrvnrrox��- ��, 0 caYC�t�uc USiBEONCAUNCQ.AGHJDABV(DA9E) � O2 FAIANCLV.SERNCESDIR O FIN.&MGI.SPRV[CESDIR �6 MAYOA(OAASSISiAM) � �ACCOiRTIANf TOTAL # OF SIGNAT[JRE PAGES . (CLIP ALL LOCATIONS FOIi Sl Approvai of the cost allocarion sys[em for the RiverCentre complex. zECOD�NDAIIONS: Appmve(A) wRcjxt(R) PERSONAi. SERVICE CONIRACLS MOST AIVSWERTfIE FOLLOWINV (jUM:S71U1 _PLANNWGCOFPf65ION 1. Has rhis person/fimi ever worked imder a contract for this departrpent? cmCOmm�rree �S NO crva socviceco��sslox Z. Has Uils paaon/fum ever been a city employee? YES NO _ 3. Dces tltis persoNSm possess a slall not normally possessedby any cuaent city employee? YES NO _ 4. Is tfiis petson/ fum a targetedvendor? YES NO � (azpiaw au yes answers on separa�e suee[ aua aaacu �o green sneec� JI'11ATINGPROBLEM.ISSUO.OPPOR'1'UNPI'Y(W6q Whaf, Wha. Where, WhY). The management ageement beriveen the River Cenh�e Authority and the Saint Paul Arena Company requires that the Authority and danager appzove a cost allocation system for the shazed use of the facility. The River Centre Authority and the Saint Paul Arena Company would have an equitable system for distributing shazed costs and revenues. APPAOVED. None. The River Centre Authority and the Saint Paul Arena Company would not be in fiill compliance of the agreement for the management of the River Centre complex. � a : � AMO[INTOFiRANSACISON � U COST/{tEVEN[I6BllDCETED(CIRCLEOttE) VES NO WFOAMATION. (6XPLAP� �->i••y_.c _„_ SaintPauBOOgetOfflce�G4��13MGREERES.WK4) /