AGENDA #4b

MEMORANDUM

TO: Mayor and Town Council

FROM: W. Calvin Horton, Town Manager

SUBJECT: Extension of the Siena Hotel’s Lease of Town-Owned Parking Spaces

DATE: May 10, 2004

The attached resolution would authorize the Manager to extend the short-term lease of Town-owned parking spaces to the Siena Hotel on a month-to-month basis until April 1, 2005.

BACKGROUND

In 1996, the Town began the planning process to develop the Pritchard Park program. The process was halted in April 1996, when the owner of the Siena Hotel petitioned the Council to consider leasing or selling a portion of the park property to the Hotel. In 1997, the Council decided to postpone a decision until after completion of a concept plan for the park.

A Pritchard Park Conceptual Plan Committee was formed. On November 27, 2000, the Council adopted the Report of the Pritchard Park Conceptual Plan Committee. At that time the Council authorized the Manager to complete a plan for development of an art garden and to involve the Chapel Hill Public Arts Commission, the Library Board, and the Parks and Recreation Commission. At the same time the Council authorized the Manager to execute a lease agreement with the Siena Hotel to lease parking spaces on Town property to the hotel.

On May 29, 2002, the Council authorized the Manager to extend the lease of parking spaces on Pritchard Park on a month to month basis.

On November 25, 2002, the Council adopted the Report of the Pritchard Park Art Garden Committee. The Pritchard Park Art Garden Committee recommended that the Town partner with the Siena Hotel in a manner that would allow a seamless transition between the designs of the two properties, provide funding for the Town’s park and art project, and allow the Siena Hotel to address its parking needs.

On April 14, 2004, the Council authorized the Manager to continue discussions with the Siena Hotel management and form a second Pritchard Park Art Garden Committee that would consist of 2 members each of the Public Arts Commission, the Library Board, and the Parks and Recreation Commission.

DISCUSSION

North Carolina General Statute 160A-372 states that property may be rented or leased by a municipality pursuant to a resolution of the Council authorizing the execution of the lease, adopted at a regular meeting.

The month-to-month lease has expired and requires Council reauthorization if we are to continue to allow the Siena Hotel to use Town property. We believe that the arrangement has worked well for both parties. If the Council agrees we would renegotiate a lease on the following terms:

The lease would continue on a month-to-month basis until April 1, 2005. The lease would have to be reauthorized by the Council after that date.
The lease amount would be $65 per space per month. If the Council raises the fees for lease of downtown off-street parking spaces the fee for the Pritchard Park spaces would rise by a proportional amount.
The Siena Hotel would continue to be responsible for all costs associated with insurance, maintenance, security, and lighting of the parking area.

This extension would address the hotel’s parking needs in the short term until such time as the Council can act on a public/private development proposal involving the Siena Hotel and Pritchard Park. We anticipate that the Pritchard Park Art Garden Committee will be ready to report to the Council some time in 2005.

Proposed Rates: We propose no increases in fees at this time. The initial cost to the Siena Hotel was $55 per month for each space which totaled $1,375 per month. In 2002, the fee was raised to $65 per space or $1,625 per month. This raise was based on a proportional raise in the fees for downtown, off-street parking rates. Since that time downtown rates have not changed. However, we propose that the lease contain language that would require a fee increase if the rates for downtown, off-street parking spaces are increased by the Council.

RECOMMENDATION

Manager’s Recommendation: That the Council adopt the attached resolution that would authorize the Manager to execute a short-term lease of Town-owned parking spaces at the rate of $65 per space per month to the Siena Hotel until April 1, 2005.

A RESOLUTION AUTHORIZING THE MANAGER TO EXTEND THE LEASE OF TOWN PARKING SPACES ON THE PRITCHARD PARK PROPERTY TO THE SIENA HOTEL (2004-05-10/R-3)

WHEREAS, on November 27, 2000, the Council authorized the Manager to lease parking spaces to the Siena Hotel; and

WHEREAS, on May 29, 2002, the Council reauthorized the lease of parking spaces to the Siena Hotel; and

WHEREAS, on April 14, 2004, the Council authorized the Manager to continue discussions with the management of the Siena Hotel concerning a public/private partnership proposal;

NOW, THEREFORE, BE IT RESOLVED by the Council of the Town of Chapel Hill that the Council authorizes the Manager execute an agreement for the lease of parking spaces on the Pritchard Park property to the Siena Hotel at the rate of $65 per parking space per month until April 1, 2005.

This the 10^th day of May, 2004.