REPORT TO: HIS WORSHIP THE MAYOR AND MEMBERS OF …

October 25, 2017

REPORT TO:

FROM:

SUBJECT:

PURPOSE:

HIS WORSHIP THE MAYOR AND MEMBERS OF COUNICL

DEBBIE COMIS, CHIEF ADMINISTRATIVE OFFICER

SHELLY ROAD CENTRE OPERATING AGREEMENT

Renewal of the Shelly Road Centre operating agreement with the Bard to Broadway Theatre Society

EXECUTIVE SUMMARY:

Since 2002, the City has had an agreement first with the Kinsmen Club of Parksville and most recently with the Bard to Broadway Theatre Society for the promotion, booking, administration, operation, light repairs and maintenance of the Shelly Road Centre.

The current agreement with the Bard to Broadway Theater Society expires December 31, 2017, and the Society has expressed an interest for the agreement to be renewed for a further five-year period.

RECOMMENDATION:

1. THAT the report from the Chief Administrative Officer dated October 25, 2017, entitled "Shelly Road Centre Operating Agreement" be received.

2. THAT the City enter into an agreement with the Bard to Broadway Theater Society for the promotion, administration, operation, light repairs and maintenance of the Shelly Road Centre for a five-year term commencing January 1, 2018, up to and including December 31, 2022.

3. THAT the Mayor and Corporate Officer be authorized to execute the Shelly Road Centre operating agreement on behalf of the City.

BACKGROUND:

The Shelly Road Centre was renovated to its current condition in 1998-1999 mainly with senior government grants with the purpose of providing additional meeting space for neighbourhood groups, community organizations and individuals.

At the time the centre became operational, Council provided additional funding for direct operating costs of the facilities but no additional funding was provided for marketing, administration and booking of the facility. Accordingly, the facility had been under-utilized and had been running at a $5,000 annual deficit for the two years it was operated by the City.

In 2002, the City of Parksville entered into a five-year agreement for the promotion, administration, operation and light maintenance of the Shelly Road Centre with the Kinsmen Club of Parksville. At that

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time, the agreement was very advantageous to both the Kinsmen and the City. The City did not have the resources to properly promote, administer and operate the facility while the Kinsmen were looking for a new home for their activities as a result of the removal of the old Kin Hut from the Community Park.

Under the terms of the 2002 agreement, the City would provide an annual operating subsidy in the amount of $5,000 and would allow the Kinsmen to use the facility for their meetings. The Kinsmen would be responsible for promotion, booking, other administration, operating, light repairs and maintenance costs for the facility. Any surpluses generated would be shared equally between the City and the Kinsmen up to the amount of the subsidy, anything remaining would go to the Kinsmen for facility improvements. Any deficit would also be shared equally up to $2,000, and any deficit exceeding $2,000 would be split 75% the City's responsibility and 25% the Kinsmen responsibility.

That agreement was renewed with the Kinsmen in 2006 under the same conditions and operated by the Kinsmen until 2008 when, upon the devolution of the Kinsmen Club of Parksville, the agreement was transferred to the Bard to Broadway Theatre Society.

The current agreement with the Bard to Broadway Theatre Society was renewed in 2012 for a five-year term which expires December 31, 2017. The Bard to Broadway Theatre Society has expressed an interest for the agreement to again be renewed under essentially the same terms and conditions with minor changes to section 10, 11, 15 and 34.

Under the proposed renewal agreement, attached for reference, the Centre's hours of operation will changed to 9 am to midnight, 7 days per week with section 11 being modified giving the operator the power to amend the operating hours on any day to accommodate the needs of groups using the centre. Section 15 changes the issuance of the special occasion licence to the user group as opposed to the operator and section 34 adjusted the termination provision from three (3) months' notice to six (6) months' notice.

OPTIONS:

Council may:

1. Enter into a further five year agreement with the Bard to Broadway Theater Society for the promotion, administration, operation and maintenance of the Shelly Road Centre.

2. Provide alternate direction to staff.

ANALYSIS:

1. The current arrangement with the Bard to Broadway Theatre Society has worked very well for the City, the Society and their general users. From the City's perspective, the cost has not changed in 10 years and the facility seems to be well used with a number of weekly and monthly ongoing users.

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The Bard to Broadway Theatre Society has proven itself to be reliable and effective in operating the Centre and providing a community facility for various user groups.

2. Should Council choose not to renew the existing operating agreement with the Bard to Broadway Theatre Society, staff would require alternate direction regarding the future operation of the facility. Resuming administration of the facility by City staff would be difficult as the City does not have the proper resources for promotion, booking and policing the users of the facility. If the City were to resume administration, additional resources would be required.

Providing an opportunity for groups to bid on the use and administration of the facility is an option; however, to the best of staff's knowledge, no other groups have expressed an interest and in 2002 and 2008, and there were challenges in attracting the two groups who have and are currently operating the facility.

FINANCIAL IMPACT:

Funding has been included in the Five Year Financial Plan for the $5,000 annual subsidy.

STRATEGIC PLAN IMPLICATIONS:

Maintain or Enhance Quality of Life - The proposed renewal operating agreement would ensure continued operation of the Shelly Road Centre for community user groups.

Renewal and Maintenance of Infrastructure -

Maintain or Enhance Levels of Service -

Maintain or Reduce Actual Property Tax Burden -

Environmentally Sustainable -

Economic Development -

REFERENCES:

Proposed Shelly Road Centre Operating Agreement (attached for reference)

Respectfully submitted,

DEBBIE COMIS Chief Administrative Officer

SHELLY ROAD CENTRE OPERATING AGREEMENT

THIS AGREEMENT made the

BETWEEN:

AND:

WHEREAS:

CITY OF PARKSVILLE PO Box 1390 100 Jensen Avenue East Parksville, BC V9P 2H3

BARD TO BROADWAY THEATRE SOCIETY PO Box427 Qualicum Beach, BC V9K 159

(the "City")

(the "Operator")

A. The City owns a community building known as the Shelly Road Centre.

B. The Operator is incorporated as a non-profit society whose objects include the provision of community services.

C. The City and the Operator have agreed that the Shelly Road Centre shall be managed and maintained by the Operator in accordance with this agreement.

THEREFORE the City and the Operator, in consideration of the terms and conditions in this agreement, agree as follows:

Definitions

1. In this agreement:

(a) "Centre" means the building located on the Land.

(b) "Grounds" means all of the Land and the improvements on the Land, other than the Centre.

(c) "Land" means the parcel of land located at 186 Shelly Road, Parksville, BC, and legally described as PIO 005-608-589, Lot 3, District Lot 3, Nanoose District, Plan 7935.

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Operator's Responsibilities

2. The Operator shall be responsible for the management of the Centre and the Grounds, including the administration, operation, maintenance and repair of the Centre and the Grounds.

3. Without limiting Section 2, the Operator's responsibilities shall include: (a) gardening, landscaping, maintenance, lawn mowing and fertilizing; (b) litter removal; (c) snow and ice removal; (d) waste disposal; (e) window cleaning; (f) janitorial services; (g) provision of heating, cooling and hot and cold water; (h) provision of electricity and lighting, including the cost of replacing electrical fixtures,

ballasts, tubes and bulbs; (i) provision of water, sanitary sewer, storm drainage services, and irrigation including any

related plumbing maintenance; (j) provision of telephone and cable services; (k) provision of any other utilities required by the Operator; (I) obtaining security services; (m) obtaining any permits, licences and approvals required for operation of the Centre; (n) completion of minor repairs to the Centre and the Grounds; (o) provision of any other administration, maintenance, operation and repair services

required for the Centre and the Grounds; and (p) Vandalism repairs.

4. In meeting its obligations under Section 3, the Operator shall carry out its responsibilities and provide services in a timely manner and in accordance with the standards that would be followed by a prudent owner of the Land, acting reasonably.

5. The Operator's responsibility to carry out repairs to the Centre and the other improvements on the Grounds shall be limited to repair projects costing less than $2,000.00, including labour and materials. Repair projects costing in excess of $2,000.00 and any structural alterations or improvements to the Centre shall be provided by the City, in its discretion.

Furniture and Equipment

6. The Operator shall have the use of the furniture and equipment located in the Centre as of the date of this agreement. The provision of any additional or replacement furniture and equipment shall be the sole responsibility of the Operator.

Operator's Authority

7. Subject to this agreement, the Operator shall have authority to determine the usage of the Centre and the Grounds.

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8. Without limiting Section 7, the Operator shall have discretion to: (a) authorize use ofthe Centre and the Grounds, or portions of them; (b) set and collect all fees, rents, charges, security deposits and any other amounts relating

to the use of the Centre and the Grounds; (c) hold fundraising activities and special events in the Centre for its own purposes; (d) establish schedules and priorities for maintenance and repairs; (e) paint and decorate the interior of the Centre and make minor changes to the building,

landscaping and appearance of the Grounds.

Use of Centre

9. The Centre and the Grounds shall be used only as a community centre for public and private meetings, exhibitions, parties and similar events.

Hours of Operation

10. The regular hours of operation of the Centre shall be 9 am to midnight, 7 days a week.

11. Despite Section 10, the Operator may amend the operating hours on any day without the consent of the City to accommodate the needs of those groups or individuals using the centre.

Days of Operation

12. The Centre shall be open on all days as determined by the Operator, in its sole discretion.

Booking Priority

13. In booking usage of the Centre, the Operator shall apply the following policies: (a) requests for bookings by the City will be given priority over requests by all other users,

provided that the City shall give the Operator reasonable notice of the City's requirements;

(b) the remaining order of priority for bookings shall be as follows: (i) non-profit community groups; (ii) private individuals; and (iii) commercial events;

(c) preference shall be given to bookings of a regular long-term nature, provided that no bookings shall be guaranteed beyond a term of one year.

14. The rate paid by the City for usage of the Centre shall be the same rate as is charged to non­profit community groups.

Alcohol Consumption

15. Consumption of alcohol shall be allowed in the Centre and on the Grounds only under special occasion licences, issued to and controlled by members of the user group booking the centre and holding valid "Serving It Right" certificate.

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16. The term of this agreement shall be five years, from January 1, 2018 to December 31, 2022.

Insurance

17. The Operator shall maintain public liability insurance in an amount of not less than $2,000,000 per occurrence, with a maximum deductible amount per occurrence of $10,000.00. The City shall be named as an additional insured in the policy and the policy shall include a provision that it will not be revoked or amended without 30 days written notice to the City. The Operator shall provide the City with a certificate confirming issuance of the insurance required by this section, within seven days of the date of this agreement.

18. The Operator shall be responsible for obtaining any tenant's contents insurance for the Operator's equipment, materials and furnishings, in its discretion.

19. The City shall be responsible for obtaining any property insurance on the Centre, and any insurance on the City's equipment, materials and chattels in its discretion.

Operating Subsidy

20. All revenue obtained from rentals and other usage of the Centre shall be applied by the Operator towards the costs of operating and maintaining the Centre in accordance with this agreement.

21. The City shall provide the Operator with an annual subsidy of $5,000.00 towards the operating costs of the Centre and the Grounds. Fifty percent of the subsidy will be paid on January 2. The remaining fifty percent shall be provided within 14 days after receipt of the financial statements required by Section 26 of this agreement.

22. If any operating surplus is reported for the previous year after all revenues and expenditures have been finalized, the surplus shall be shared equally between the City and the Operator, provided that the City's share of the surplus shall not exceed $5,000.00.

23. If a deficit is incurred in the previous year, after taking into account the subsidy provided under Section 21, the amount of any deficit up to $2,000.00 shall be shared equally between the City and the Operator and the amount of any deficit beyond $2,000.00 shall be shared with seventy­five percent to be borne by the City and twenty-five percent to be borne by the Operator.

24. Any amount that is payable in respect of a surplus or a deficit shall be paid within 30 days of delivery of the financial statements for the preceding year.

Financial Statements

25. The Operator shall provide the City with:

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(a) annual financial statements detailing the revenues and expenditures incurred in connection with the management of the Centre and the Grounds, not later than March 30, following each calendar year;

(b) quarterly reports summarizing revenues and expenditures, including total hours of Centre usage, within 30 days after the end of each calendar quarter as required by the City.

26. The annual financial statements shall be prepared by a qualified accountant in accordance with generally accepted accounting principles.

Indemnity

27. The Operator shall indemnify the City in respect of any claims, actions or other proceedings brought by any person in connection with the performance or non-performance of the Operator's responsibilities under this agreement, except to the extent that the City is at fault. In this section, "City" includes the City of Parksville and its council members, officers, employees, agents and contractors.

Assignment

28. This agreement shall not be assigned without the prior written consent of the City, which may be withheld in the City's sole discretion.

Licence Only

29. This agreement confers a licence to occupy the Centre and the Grounds on the Operator, but does not create any lease or other interest in the Land.

Dispute Resolution and Termination

30. In the event of any alleged breach of this agreement, the party alleging the breach shall give the other party written notice setting out the particulars of the alleged breach. Within 10 days after delivery of such notice, the parties' representatives shall meet and shall attempt to resolve the dispute.

31. If a dispute has not been resolved within 21 days of delivery of notice under Section 31, if there is a fundamental breach of this agreement the party who is not in default may give the party in default not less than 30 days notice of termination of this agreement.

32. If the Centre is destroyed or damaged, or if it is determined that the Centre requires capital repairs, in either case to an extent greater than twenty-five (25) percent of its value above its foundation as determined by the City's Building Inspector or facilities manager, this agreement shall be terminated.

33. Prior to any termination or expiry of this agreement, the Operator shall remove all of its materials, furnishings and equipment from the Centre. Any materials, furnishings or equipment which are not removed on the date of termination shall become the property of the City.

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34. The Operator or the City may terminate this agreement at any time upon the provision of six (6) months written notice to the Operator or the City as the case may be.

The annual subsidy outlined in Section 22 will be prorated to the date of termination.

No Agency

35. Nothing in this agreement constitutes the Operator as the agent of the City or constitutes any joint venture or partnership between the parties.

Compliance with Laws

36. The Operator shall comply with all federal, provincial and municipal laws in relation to the management of the Centre and the Grounds.

Notices

37. Any notice required or contemplated by this agreement shall be given in writing and, if addressed to the City, shall either be delivered to the Director of Administrative Services of the City or delivered or mailed (by prepaid registered mail) to the City at the address set out in this agreement, or if the City has given the Operator notice of another address in Parksville to which notices to the City under this agreement are to be given, then to the last such address of which the Operator has been given notice; and if to the Operator, either delivered to the Operator or delivered or mailed (by prepaid registered mail) to the Operator at the Centre.

38. Every notice shall be deemed to have been given when delivered or, if mailed, upon the third business day after the day of mailing provided that if mailed there is a mail strike, slowdown, or other labour dispute which might affect delivery of a mailed notice between the time of mailing and the actual receipt of notice, then such notice shall only be effective when actually delivered.

Other Agreements

39. There are no representations, warranties, agreements or conditions relating to the Land or the Centre except as expressly set out in this agreement.

Time of Essence

40. Time shall be of the essence of this agreement.

Governing Law

41. This agreement shall be governed by and construed in accordance with the laws in force in the province of British Columbia.

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Severability

42. If any provision of this agreement is not enforceable, it shall be considered separate and severable from the balance of the agreement and the remaining provisions shall remain in force and be binding upon the parties.

The Corporate Seal of the CITY OF PARKSVILLE was hereunto affixed in the presence of:

Mayor

Corporate Officer

Signed, Sealed and Delivered by an authorized signatory of the BARD TO

BROADWAY THEATRE SOCIETY in the presence of:

Witness:

Address:

Occupation

C/S

Authorized Signatory