AGENDA #4c

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:            April 10, 2006

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 March 10, 2007.

BACKGROUND

On November 27, 2000, the Council adopted the Report of the Pritchard Park Conceptual Plan Committee. 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 Committee voted unanimously (6-0) to recommend that the Town partner with the Siena Hotel in a manner that would allow the Siena Hotel to address its parking needs.

On November 22, 2004, the Council adopted the Report of the Second Pritchard Park Art Garden Committee and authorized the Town Manager to take a number of actions to begin implementation of the plan including investigation of the process that would be required to allow the Town to sell land to the Siena Hotel with conditions. The Council also directed the Town Manager to include an item in the Town’s capital improvements program budget for FY 2005-06, that, if enacted, would earmark parking lot lease funds on Pritchard Park to the Pritchard Park project.

On March 27, 2006, the Council adopted the recommendations of the Third Pritchard Park Art Garden Committee concerning proposed changes to the plan for development of Pritchard Park and the proposed Pritchard Park Art Garden including:

• Expanded the design process for the Chapel Hill Library expansion to include design of Pritchard Park and the proposed Pritchard Park Art Garden.
• Directed the Chapel Hill Public Arts Commission to recommend an artist for the library expansion project who would also be able to  advise the Town on design elements of Pritchard Park
• Directed the Chapel Hill Public Arts Commission to provide two positions on the Library Artist Selection Committee for representatives of the Parks and Recreation Commission.

DISCUSSION

North Carolina General Statute 160A-272 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 March 10. 2007. 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 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.

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 rate was based on a proportional raise in the fees for downtown, off-street parking rates. Since that time downtown rates have remained stable. 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 March 10, 2007.