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2013-05-13 STMA Ice Arena Board PacketCity of A,lbertville�. Michael SnmU Town EirkiW ft rity UNh STMA STMA ARENA BOARD AGENDA MONDAY, MAY 13, 2013 ALBERTVILLE CITY HALL 6:00 PM 1. CALL TO ORDER — ROLL CALL 2. ADOPT AGENDA 3. APPROVAL OF THE NHNUTES OF APRIL 8, 2013 (pgs 1-3) 4. FINANCE REPORTS a) Approve the April list of claims as presented in the amount of $14,734.11 and April report (pgs 4-7) b) Audit recommendation/requirements (pgs 8-9) 5. MANAGER'S REPORT a) Monthly report - verbal update 6. OLD BUSINESS a) Ballard King Feasibility Report — Revised to Include YHA Comments (pgs 10-25) b) Arena Roof — 292 Design Group (pgs 26-31) c) 2013 budget/rates discussion (pg 32) 7. NEW BUSINESS 8. YOUTH HOCKEY ASSOCIATION UPDATE 9. ADJOURN MAPublic Data\Arena\2013\agendas\05-13-2013\05132013 S'I'MA Agenda.doc ST. MICHAEL-ALBERTVILLE ARENA BOARD MINUTES April 8, 2013 6:00 p.m. Present: Chairman Jeff Lindquist and Members, Dan Wagner, Gayle Weber, Kevin Kasel and Chris Schumm were present. Member Larry Sorensen was absent. Also present: City Administrator/PWD Adam Nafstad, City Finance Director Tina Lannes, Arena Manager Grant Fitch and Youth Hockey Association Representatives, Tammy Tupper, Kurt Sjelin, Scott Berning, Adam Smiglewski and Mike Marhula. The meeting was called to order at 6:04 p.m. by Chairman Lindquist. Set Agenda One addition to the agenda under New Business was requested by Adam Nafstad to discuss the agenda for the STMA Arena Board's presentation and what the Youth Hockey Association plans to add to that for the Joint Meeting on April 29, 2013. Members Schumm/Weber moved to set the agenda as amended. All voted aye. Approval of Minutes Members Schumm/Weber moved to approve the minutes of the March 11, 2013 Board Meeting. All voted aye. Finance Reports Members Schumm/Kasel moved to approve the March 2013 list of claims in the amount of $26,677.37 and the March Financial Report as presented. All voted aye. Arena Manager's Report Hours: Fitch reported that ice hours rented were at 107.25 hours and stated this is the time of the year where ice rental starts to go down and the ice is being removed on April 9, 2013. Roof: Fitch provided a brief update regarding the roof and noted Tom Betti of 292 Design Group came over to the arena and found the insulation on the north side was wet throughout 10-12 inches and the south side was wet on the top 2-4 inches. Fitch stated the problem seems to be a condensation issue between the moisture barrier and the metal roof. Staff is waiting for a report summarizing the findings and proposing next step options. The Board directed staff to check if there is any recourse from contractors and also to go back to the League and see if there is a supplement to the original claim and report back to the Board in May. Franklin: Fitch informed the board that Franklin Outdoor Advertising sold the Olympia spot to AAA Movers and it was installed on Friday, March 22, 2013. Summer Ice: Fitch reported that booked summer ice, as of April 81h, is 219.5 hours. Ice Out: Fitch explained that the ice will be back in and open for use as of June 8, 2013 for the Friendly City Days Men's 4 on 4 tournaments. While the ice is out, there are plans for maintenance such as painting, cleaning and minor repairs. The Board asked if the City receives any community service hours and if the City hears of any the Arena could use hours year round even for cleaning. Old Business Advertising: Lannes reported that the current contract with Franklin Outdoor Advertising expires August 2, 2013. It is an automatically renewing contract for a three year term so if the Board decides that Youth Hockey is going to take over the arena advertising, a letter of termination of the contract must be received by Franklin Outdoor Advertising no later than July 1, 2013. There are currently two options for the Board in regards to advertising. Option one is to continue/renew the contract with Franklin Outdoor or Notify Franklin Outdoor of contract termination and allows Youth Hockey to take over advertising. Adam Smiglewski reported that Youth Hockey is ready to go when the contract expires. The Board directed Lannes and Smiglewski to meet and work with Franklin Outdoor on how STMA Arena Board Meeting 05/13/13 Page 1 STMA Ice Arena April 8, 2013 Minutes Page 2 the transition would take place. Lannes and Nafstad are having the contract reviewed by the City Attorney. 2nd Sheet Feasibility: The Ballard King Feasibility Report was included in the packet. Nafstad stated that the report doesn't prove favorable toward a second sheet of ice. He believed that Mr. King did a good job and listened to all the concerns from different parties including Youth Hockey. Also, Nafstad mentioned that the report does show the need for ice time, but demonstrated with figures that it could not fund the debt service of an expansion. Chairman Lindquist noted that the report shows that operationally, according to the report, a second sheet could be supported, but not debt costs, which leaves the building financing to be paid by the three entities. Chairman Lindquist opened it up to the Board for comments and/or questions on the study. Weber stated that it was no surprise that we couldn't fund the debt service. Kasel noted the downward pressure mentioned in the report on ice rates if we add a second sheet and talked about operations, both revenues and expenses projected for a second sheet, and depreciation funding. Wagner questioned if there could be another revenue stream not factored in from other rentals or associations that were too difficult to project. Schumm had no comments. Chairman Lindquist then opened it up to comments from Youth Hockey Association on the report. Mr. Sjelin reported that we are the largest hockey association in District 5 and largest retention of players in the district. The association is still growing and they are not doing any recruiting because they don't have the ice time and Youth Hockey really needs a second sheet of ice. Youth Hockey stated that they did not get a call back from King to discuss the report and request revisions. Sjelin believes there are some holes in the report that Youth Hockey wants to plug and would like to see some revisions. Sjelin thought this was based on a $4 Million arena and that is not what the association wants or needs, they need just a sheet of ice with a shell. Nafstad mentioned that the $4 Million figure is the bare bones arena; it doesn't include concessions, bleachers, or locker rooms. Sjelin mentioned that the interest rate is high on the bond that Mr. King used. Lannes expressed that was the current rate for a Revenue Bond, however, a G.O. Bond is lower. In addition Lannes mentioned that the report puts the term of the revenue bond at 30 years and the City doesn't use that long of a term so the actual debt service number would go up, but if the project is smaller, the two numbers in the report that would change are debt service and depreciation. The Youth Hockey doesn't feel this report represents their needs. Sjelin mentioned a sprung structure and have the City of Albertville loosen up the restrictions for such a building to be put up for a second sheet of ice. Youth Hockey is looking for direction on how to proceed with a second sheet of ice. Schumm mentioned doing a referendum. Sjelin stated they have thought about it and are working with other associations, different sport activity groups, but they really need someone to head that type of activity and have the cities on board to support the plan and help get direction. Mr. Kasel stated that he would be reluctant to support a referendum in a non -election year. Chairman Lindquist directed staff look into why Mr. King did not call back the Youth Hockey Association. The board continued the discussion with Youth Hockey about financing, referendums, support, and the need for a second sheet of ice. Youth Hockey asked if they could add their funds to the thermometer. The Board mentioned the funds need to be given to the Board and deposited into a separate account that is interest bearing. The thermometers are what the STMA Arena Board put in each City to show the funds received toward the second sheet of ice and due to public perception, the thermometers cannot be changed until the funds STMA Arena Board Meeting 05/13/13 Page 2 STMA Ice Arena April 8, 2013 Minutes Page 3 are deposited into the STMA Arena Second Sheet of Ice Money Market Account. The funds represented on the thermometer need to be inclusive, dedicated and audited. The Board directed staff to coordinate with Ballard King and Youth Hockey and bring back suggested report revisions for Board review and further discussion. New Business It was determined after the discussion of the Ballard King Report that the study will not be discussed at the joint meeting on April 29, 2013. Youth Hockey Association Update No additional updates Adiourn Members Schumm/Lindquist moved to adjourn at 7:26 p.m. All voted aye. Attest: Tina Lannes, City Finance Director STMA Arena Board Meeting 05/13/13 Page 3 City of Ibertvi £ ST MIA t. Michael Small Town Living. ®ig Ci1 sy+ U a. STMA Budget to Actual April 2013 (Cash Basis) 2013 Proposed Budget rate 2013 Actual increase no April 2013 YTD % asst. mgr Actual 4/30/13 Annual Income Ice Rental $262,000.00 $100.00 $132,555.00 50.59% Concessions $32,000.00 $937.25 $17,415.50 54.42% Other Revenues (Advertising/LMC/ins claims) $12,000.00 $989.00 $8,913.00 74.28% Vending $1,300.00 $57.83 $620.91 47.76% Open Skate/Hockey, etc $10,000.00 $33.00 $822.95 8.23% Interest $1,200.00 $0.00 $0.00 0.00% Misc Revenue $1,200.00 $1,290.00 $2,550.05 Total Income $319,700.00 $3,407.08 $162,877.41 50.95% Expenses Salaries, wages, taxes & Benefits $112,547.61 $7,318.56 $41,892.88 37.22% Supplies (Office, misc) $1,100.00 $0.00 $918.49 83.50% Supplies (Concession) $13,750.00 $22.12 $4,474.47 32.54% Fuel, Misc $2,000.00 $187.01 $672.17 33.61 % Professional Services $8,800.00 $2,805.42 $8,692.89 98.78% Sales Tax $3,200.00 $0.00 $1,502.88 46.97% Telephone $1,100.00 $75.70 $303.59 27.60% Electric $75,000.00 $6,021.87 $11,879.48 15.84% Gas $8,000.00 $957.82 $3,517.33 43.97% Water $15,000.00 $1,919.81 $10,006.49 66.71 % Refuse $2,200.00 $0.00 $358.16 16.28% Insurance $15,000.00 $0.00 $23.00 0.15% Administration $11,350.00 $945.84 $3,783.36 33.33% Misc. $3,000.00 $0.00 $15.07 0.50% Depreciation $43,000.00 $0.00 $0.00 0.00% Repair Maintenance - Machinery $10,000.00 $0.00 $1,414.84 14.15% Repair Maintenance - Building $25,000.00 $931.08 $10,921.16 43.68% Total Operating Expenses $350,047.61 $21,185.23 $100,376.26 28.68% Net Income/Loss ($30,347.61) ($17,778.15) $62,501.15 STMA Arena Board Meeting 05/13/13 Page 4 STMA CASH BALANCES AND RECEIVABLES April 30, 2013 Cash Balance Operations Cash Balance 1 /1 /13 $ 131,405 Add Revenues $ 162,877 Less Expenses $ 100,376 Add in Depreciation $ - Less payables booked 2012 Pd 2013 $ 10,672 Cash Balance 4/30/13 $ 183,234 Restricted Cash (depreciation) $78,457 Cash for operations $104,776 Total Cash Balance 4/30/13 $183,234 Accounts Receivable April 30, 2013 - $1,100 Cash Balance Dedicated Capital Improvement Fund Arena Owner Dedicated Cap. Imp. Fund Beginning Balance 1/1/13 $20,000 2013 contribution rec. by St. Michael $0 2013 contribution rec. by Albertville $0 2013 contribution rec. by STMA Schools $0 Balance 4/30/13 $20,000 STMA Arena Board Meeting 05/13/13 Page 5 STMA Vendor Check Detail Register April 2013 Check Amt Invoice Comment 10100 Premier Bank Paid Chk# 001899E 4/15/2013 WRIGHT-HENNEPIN COOP ELECTRIC E 810-00000-381 Electric Utilities $29.87 05014270100-05 STMA Arena Fire Panel Paid Chk# 001905E 4/15/2013 FERRELLGAS E 810-00000-212 Motor Fuels $112.74 1075383167 STMA Arena Fuel E 810-00000-212 Motor Fuels $61.44 1075626796 STMA Arena Fuel E 810-00000-212 Motor Fuels $12.83 RNT4931966 STMA Arena Cylinder Rack Rental 3-1-13 to 2-28-14 Paid Chk# 001951E 4/15/2013 CITY OF ALBERTVILLE E 810-00000-382 Water Utilities $1,919.81 wtr bill Paid Chk# 001952E 4/15/2013 CITY OF ALBERTVILLE E 810-00000-412 Building Rentals/Admin Fee $945.84 0413 admin Paid Chk# 031920 4/1/2013 ARAMARK UNIFORM SERVICES E 810-00000-405 Repair/Maint - Buildings $10.69 629-7702114 STMA Arena Mops, Mats, Laundry Bag E 810-00000-405 Repair/Maint - Buildings $10.69 629-7706914 STMA Arena Mops, Mats, Laundry Bag Paid Chk# 031940 4/1/2013 METLIFE (VISION) E 810-00000-130 Employer Paid Ins (GENERAL) $22.61 4884458 Emp Vision Paid Chk# 031941 4/1/2013 METLIFE-GROUP BENEFITS E 810-00000-130 Employer Paid Ins (GENERAL) $127.50 April 2013 Emp Life, Dental Stdis Paid Chk# 031950 4/1/2013 SCR, INC - ST. CLOUD E 810-00000-405 Repair/Maint - Buildings Paid Chk# 031954 4/1/2013 XCEL ENERGY E 810-00000-381 Electric Utilities $583.33 262777 STMA Arena April 2013 Maintenance $5,992.00 360895465 STMA Arena Feb 2013 Paid Chk# 031961 4/15/2013 ARAMARK UNIFORM SERVICES E 810-00000-405 Repair/Maint - Buildings $10.69 629-7711764 STMA Arena Mats, Mops, Laundry Bag Paid Chk# 031962 4/15/2013 BALLARD KING & ASSOCIATES LTD E 810-00000-300 Professional Srvs (GENERAL) $2,125.00 4253 STMA Arena Expansion Paid Chk# 031963 4/15/2013 BCBS OF MINNESOTA E 810-00000-130 Employer Paid Ins (GENERAL) $776.75 CI261-10 0 May Emp Health Ins Paid Chk# 031965 4/15/2013 CARD SERVICES(ARENA) E 810-00000-252 Food/Consessions For Resale $22.12 CB951 STMA Arena Concessions Paid Chk# 031967 4/15/2013 CENTERPOINT ENERGY E 810-00000-383 Gas Utilities $957.82 53901310-Mar STMA Arena 5898 Lachman Ave NE Paid Chk# 031969 4/15/2013 CHARTER COMMUNICATIONS E 810-00000-321 Telephone $75.70 0131702-April STMA Arena Telephone STMA Arena Board Meeting 05/13/13 Page 6 Check Amt Invoice Comment Paid Chk# 031974 4/15/2013 DJS TOTAL HOME CARE CTR-ARENA E 810-00000-405 Repair/Maint - Buildings $15.98 67802 STMA Arena Kickdown Doorn Hold 4" E 810-00000-405 Repair/Maint - Buildings $9.99 67822 STMA Arena Shovel E 810-00000-405 Repair/Maint - Buildings $1.20 67992 STMA Arena Hardware Paid Chk# 031980 4/15/2013 KULLY SUPPLY E 810-00000-405 Repair/Maint - Buildings $71.99 SI-254226 STMA Arena Front Pushbar for Drinking Fountain Total KULLY SUPPLY $71.99 Paid Chk# 031987 4/15/2013 NEWMAN TRAFFIC SIGNS E 810-00000-405 Repair/Maint - Buildings $44.39 TI-0259902 STMA Arena (2) EC Film - Flat Paid Chk# 031993 4/15/2013 STEP SAVER INC E 810-00000-405 Repair/Maint - Buildings $172.13 68697 STMA Arena Bulk Salt & Resin Cleaner Paid Chk# 032002 4/15/2013 WEST SUBURBAN OFFICIALS ASSN E 810-00000-300 Professional Srvs (GENERAL) $621.00 153 Fund Summary 10100 Premier Bank 810 STMA ARENA $14,734.11 STMA Arena Spring Break Away League Officials Service STMA Arena Board Meeting 05/13/13 Page 7 of AIbcrtvillc t. Michael lmod 7oum U&MIk. Mg My W4. SSTMIA City MEMORANDUM Date: Monday, May 13, 2013 To: STMA Arena Board From: Tina Lannes, City of Albertville Finance Director Re: Audit recommendations/requirements The City of Albertville has completed its annual audit for 2012. With the annual audit, Kern, DeWenter, Viere (KDV) had a recommendation for management regarding the STMA Arena in regards to reporting. In discussion with the Office of the State Auditor they indicated that the Arena should be recognized as a special governmental district and should begin annual reporting to the State in accordance with Minnesota Statue 6.756. If revenues exceed $202,000 the STMA Arena must provide an annual audit and financial statements (see attached recommendation from KDV). Upon review of the KDV recommendation and statues, the Albertville City Attorney has advised the City that the audit is a state requirement, not just a recommendation. The increased cost of the change, for outside services, is an estimated $7,000-$9,000. This amount has been added to the 2013 proposed budget. Kern, DeWenter, Viere will be attending the July STMA Arena Board Meeting to discuss this item in more detail and answer any questions. WPublic Data\Arena\2013\agendas\05-13-2013\audit.doc STMA Arena Board Meeting 05/13/13 Page 8 CITY OF ALBERTVILLE RECOMMENDATION FOR MANAGEMENT December 31, 2012 5 ST. MICHAEL-ALBERTVILLE ICE ARENA The City participates in a joint venture (the "Organization") with the City of St. Michael and Independent School District No. 885 for construction, maintenance and operation of the St. Michael - Albertville Ice Arena. The City of Albertville acts as a fiscal host for the Organization, but because the joint venture is a separate legal entity and ownership is shared with the two other parties, it is not considered to be an operation of the City. As a result, the activity of the arena is not shown in the City's financial statements; only the year end assets and liabilities held by the City in its capacity as a fiscal agent are shown. The City prepares operating statements on a monthly basis for internal use and presentation to the Arena Board, however, external financial statements are not prepared or available for general distribution nor is anything submitted to the State of Minnesota. Discussion with the Office of the State Auditor (OSA), which has oversight responsibility for all local governments in the State of Minnesota, indicated that the Arena should be recognized as a special governmental district and begin annual reporting to the State in accordance with Minnesota Statute 6.756. The provisions of the Statute require that the Organization should initially file governance documents with OSA including articles of incorporation, by-laws and other agreements. Once the initial filling of the special district is complete, it annual revenues exceed $ 202,000, the organization must provide for an annual audit of the Organization's financial statement prepared in accordance with the minimum reporting requirements established by OSA. If annual revenues do not exceed $ 202,000, the Statute requires the Organization to provide for an audit once every five years and for those years not audited, financial statements prepared in accordance with the minimum reporting requirements referenced above must be filed with OSA. These financial statements whether audited or unaudited, must be presented to the Organization's governing body and filed with the OSA within 180 days after the Organization's fiscal year end. We recommend the City work with the Arena Board to clarify their external financial reporting responsibilities and to clarify the City's role in assisting the Organization in the process. City's Response: The City recognizes the recommendation for external financial reporting for the STMA Arena and will bring forward the recommendation to the STMA Arena Board, which is the governing party. STMA Arena Board Meeting 05/13/13 Page 9 4 a BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants [�I Executive Summar Background: W Ballard*King and Associates was contracted by the City of Albertville to provide an assessment of the feasibility to add a second sheet of ice to the STMA Arena. Ballard*King and Associates (BKA) is a recreation facility planning and operations consulting firm based out of Denver Colorado. It should be noted that BKA has nothing vested in the outcome of a decision to expand the STMA Arena other than providing useful tools to help with the decision making process. Market Analysis: �-i Although the primary focus of this project is to assess the feasibility of adding a second sheet of ice to the STMA Arena the study reviewed the market conditions of the general service h+�l/ area. The STMA Arena primary service area population saw rapid growth during the early to mid-2000's until the recession slowed growth. The St Michael's/Albertville area growth seems to be driven by people moving from the inner rings of the Twin Cities metro area. The demographic profile of the community indicates that the age group distribution is somewhat mixed. There is a significantly higher concentration of under 5, 5-17, and 25-44 age groups than the national level. At the same time the percent of the 18-24 and over 45 age groups is �I lower than the national level. This information coupled with the higher percentage of young children validates there are a larger number of families with young children in the service area than found on a national level. The median age of the service area is significantly younger than the national level and the median household income is significantly higher than the than the national level. Age and income are two determining factors that influence people's participation in recreation activities, especially ice hockey. The demographic profile of the service area also suggests a generally ability to pay for a relatively expensive sport like ice hockey. There are other ice skating facilities in the general area that will be impacted by adding a second sheet of ice to the STMA Arena. The youth hockey association currently buys an additional 490 hours of ice time on a seasonal basis beyond their use of STMA Arena. It will be a challenge for the other rink operators in the area to overcome and make up the 490 hours the STMA arena will be removing form the market place. This all adds up to a general condition that reflects a buyer's market. The primary reason for the buyer's market is that there Pa STMA Arena Board Meeting 05/13/13 Page eO 1 of 16 BALLARD*KiNG l� & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants are a significant number of ice rinks in the area. Our research discovered 35 sheets of ice within a 45-minute drive. Service Area Map Kn n-. . —`. & 169 �t,nrr''0.1 :opnly- I�~' b ugo �,: LiIII�J � A no I. 5i 15. I 44r� fi i O J rl jp cou 1? ' • I.. � yo 51 Ci I J3 o i7 r - ;r Fn Cal.1aJ Ll a: Cr— y Sc11! :5Ibltt' C 56: 4aUrp Black dots indicate single rinks Red dots indicate multiple sheets of ice STMA Arena Board Meeting 05/13/13 Page`11 2 of 16 a BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants When an over saturation or supply exceeds the demand you have a buyer's market. Simply stated, the customers can effectively have rinks compete against one another based on ice time schedule and price. This is occurring in the Albertville area. Generally it is more difficult to sell non -prime time during a buyer's market. The presence of other service providers in service area will not impact the usage of the STMA Arena during the prime hockey season since the population served by the STMA Arena is concentrated in St. Michael and Albertville area. However, the demand for ice time does not appear large enough on a year around basis to support the operation of two sheets. The manager of the Rogers Ice Arena indicated that the impact of another sheet of ice in the general area would reduce/shrink the amount of non -prime ice time sold and suggests that another rink will shrink the secondary market area for all the area providers. The youth hockey program is in a slight growth mode although the total number of players is �j about the same as last year. The youth hockey association reports that the ice hockey program has grown to around 400 participants from a level of about 150 participants in 2001. The W growth in youth hockey corresponds to the growth in population of the St. Michael and Albertville area over the same time period. The cost to play youth hockey is about $1,500 per season for a Bantam age player. This fee does not include equipment, tournaments or travel costs. The fact that the youth hockey association has managed to grow slightly during the recession speaks to the strength and overall household income levels. When the economy came to grinding halt the participation in youth hockey remained strong. The population of the service area has grown over 110% since 2000. A closer look at the demographic profile suggests that a good portion of the growth is people moving further away from the Twin Cities, in particular white middle to upper middleclass families. This demographic population is positioned financially to participate in ice hockey. The cost to play youth hockey ranges from $1,400 to $1,600 (excluding U8 age group). This fee does not include equipment, extra tournaments or travel costs. STMA Arena Board Meeting 05/13/13 Page2 3 of 16 `1 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Operations: �j Assembling the operation plan presented a challenge in balancing the need to be conservative to protect the governmental agencies involved while at the same time recognizing the enthusiasm from the youth hockey and acknowledging the potential for significantly increasing the volume of ice rentals from a second sheet of ice. As a result, the operation pro - forma reflects a compromise position, especially with revenue projections. Specifically, ice arena rental have been calculated based on a schedule that reflects current usage and the volume of ice time being rented by the Youth Hockey Association from other ice rinks in the area. There is some inherent cost savings associated with operating two sheets of ice, especially from a staffing perspective. In addition to staff efficiencies the operating pro -forma assumes that the expanded ice sheet will be a seasonal operation. There is nothing occurring in the �j general area that leads us to believe there is enough demand to justify keeping two sheets open �W on a year around basis. Some budgetary line items doubled, like insurance and propane, while other line items increase on an incremental basis, like water treatment (cooling tower), gas, water/sewer, telephone, building maintenance. One recommendation is for the STMA Arena to enter into a long term agreement with the youth hockey association to commit to a specific number of hours during the peak season. This will provide a strong level of assurance that the ice time and cash flow will be guaranteed. The operating pro -forma for the additional sheet of ice reflects and incorporates the efficient method in which the STMA is managed and operated. It is clear from benchmarking with other community skating facilities that the STMA is operated much more efficient that most other ice skating facilities in the area. However, the STMA cannot functionally operate a second sheet of ice without additional staff to accommodate the increase volume of business and adequately cover the hours of operation for a two -sheet facility. Summer Operation: The STMA Arena will be closing for an extended period this spring to provide some relief and mitigation of the permafrost build up that has occurred over the years. Closer examination into normal summer operation indicates that the primary user of summer ice is the high school hockey coach that operates a hockey camp for a two -month period. Typically coach Johnson rents about 12 hours per week. There are other miscellaneous rentals that occur but the demand STMA Arena Board Meeting 05/13/13 Page`134 of 16 a BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants for ice time drops off significantly during the summer months. To illustrate, STMA has about 336 hours of useable ice available per month in the summer (reasonable hours). Based on 2012 statistics, STMA recorded a range from 80-99 hours per month of rentals during that period of time which equates to a 24% to 29% occupancy rate. In contrast, the occupancy rate for ice time during the hockey season is 85%-96%. One group, Transitional Development Hockey (TDH), operates an elite level program that uses about 70-80 hours of ice time in the spring/summer period. This group did not rent ice from the STMA Ice Arena in 2012 because TDH shops area rinks to find the lowest ice time rate and found a lower ice rental rate at another rink. Strictly from a business model perspective keeping the ice rink open in the summer (April - August) should be examined. Without question this period of time is the most expensive time of the year to operate the ice arena. It is not uncommon to have monthly electric cost exceed $8,000 in the summer months. The time of the year that is most expensive to operate also happens to be the time of year with the least demand for ice time. Ice rental rates from prime r , time drop from $185 per hour during the hockey season to $145 per hour during the summer W months. The lower demand for ice time in the summer has created a market condition that requires ice arena operators in the area to reduce summer ice rental rates in an effort to generate sales. Operating the STMA Arena in the summer, with operating costs at their highest and the rental rates discounts the deepest, is a formula for losing money. However, it should be noted that the availability of summer ice for hockey camps and player development is critical for the STMA program and High School team to stay competitive with other area schools. It seems many of the successful high school programs in the area have summer development programs in place. Unfortunately for the STMA operation providing this opportunity requires subsidizing the program to keep the ice available in the summer. Closer analysis that examines a comparison of the 2012 fiscal year without ice from April through the end of August concludes that the STMA Arena would have increase their cost recovery rate to 112% and generated an operating surplus of $30,632 if summer ice was not offered. STMA Arena Board Meeting 05/13/13 Page`14 5 Of I6 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Youth Hockey: It should be noted that the STMA Youth Hockey Association is forced to go to some of these area rinks to supplement their need for ice time. It was reported by the hockey association that 40% of the ice time rented by the club annually comes from other rinks in the general area, primarily Monticello, Princeton, Blaine, Buffalo and St. Cloud. The youth hockey association submitted the following commitment for ice time if a second sheet of ice were added to the STMA Arena. It should be noted that the youth hockey ice time request for the second sheet of ice is about 1,106 hours, or about 42.5 hours per week based on a 26 week season. However, closer examination of the ice time request from the youth hockey association appears to exceed the ice time available. The mock-up schedule (page 13 below) indicates that there are only 36 hours of acceptable ice available with a second sheet of ice for youth hockey hours. If the youth hockey association truly needs an additional 42.5 hours per week they will still have to �j go outside the immediate area to acquire the 6.5 hours per week that goes beyond the 36 hours per week that are available to reserve with the second sheet of ice. W Representation from the youth hockey association reported that the association rents about 492 hours outside of the STMA (see page 14 below). The historical use of outside ice purchased by youth hockey association compared to the request for ice time for the second sheet of ice is significantly different. A correspondence from the current President of the STMAYHA indicates they will commit to 1,106 hours of ice time per season for the second sheet of ice. This request is 614 hours greater than what the youth hockey association is currently renting from other ice rinks. It should be noted that the additional 614 hours of ice time request represents about another $113,590 (based on $185/hr) in ice time costs above and beyond what the youth hockey association currently rents per year. Without a major fundraising campaign the increase usage of ice will increase youth hockey fees about $284 per player. High School Hockey: Ballard*King and Associates met with the Activities Director from the school district. Currently the boy's varsity and junior varsity share ice time. An additional sheet of ice will provide the opportunity for the high school to split the varsity and junior varsity ice time. The girl's team is a co-op program and the cost for the program is shared with Monticello High School. The Activity Director reported that the high school would like to increase their ice time from the current level of 270 hours per season to 450 hours. Currently the cost for ice time is paid through funding the School District receives from the State of Minnesota. The STMA Arena Board Meeting 05/13/13 Pageapg 6 of 16 `15 a BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants amount of funding the School District receives from the State is not likely going to increase and the probability of increasing the allocation or distribution of the funding that the School District does receive does not look promising based on other school district needs for the State funding it receives. This is an important factor because increasing the high school ice time usage by 180 hours per season will result in an increase of about $26,000 per year. This will require significant higher activity fees per player ($435), increased share of State funding the School District receives, or significantly more fundraising by the booster club, or some combination of the options that covers the increased cost. A more realistic scenario is that the high school will reduce the number of hours rented because the hours requested extend beyond the school's budgetary allocation. STMA Arena Board Meeting 05/13/13 Page`16 Of 16 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Operating Pro -Forma The operations analysis represents a conservative approach to estimating expenses and revenues and was completed based on the best information available and a basic understanding of the project. Fees and charges, ice time usage and operating costs utilized for this study were based on the 2012 operation of the STMA Arena. There is no guarantee that the expense and revenue projections outlined in the operations analysis will be met as there are many variables that affect such estimates that either cannot be accurately measured or are subject to change during the actual budgetary process. Revenues The following revenue projections were formulated from information on the specifics of the project and the demographics of the service area as well as comparing them to a potential ice rink schedule for a second sheet of ice and the competition for ice time during the summer months in the area. Actual figures will vary based on the size and make-up of the components selected during final design, market stratification, philosophy of operation, fees and charges policy, and priority of use. All revenues were calculated conservatively as a result. Category 2012 Actual Second Sheet Income Ice Rental $273,779 $472,489 Concessions $ 33,631 $ 57,500 Other Rev (Advertising) $ 8,657 $ 20,657 Vending $ 1,365 $ 2,750 Open Skating $ 9,002 $ 27,500 Interest $ 1,227 $ 1,227 Misc $ 1,373 $ 1,650 Total $329,034 $583,773 STMA Arena Board Meeting 05/13/13 Page`g Of I6 17 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Expenditures Expenditures have been formulated on the costs that were designated by Ballard*King and Associates to be included in the operating budget for the facility. The pro -forma below does not reflect a partnership agreement. All expenses were calculated to the high side and the actual cost may be less based on the final design, operational philosophy, and programming considerations adopted by staff. Category 2012 Actual Second Sheet Expenses Salaries, wages, taxes & benefits $108,827 $162,685 Supplies Office $ 1,057 $ 1,525 Supplies Concessions $ 13,245 $ 22,500 Fuel $ 1,931 $ 3,200 Professional Services $ 5,742 $ 7,742 Sales Tax $ 3,162 $ 4,200 Telephone $ 1,048 $ 1,200 Electric $ 73,796 $129,1501 Gas $ 45683 $ 9,350 Water $ 13,797 $ 27,600 Refuse $ 2,066 $ 3,250 Insurance $ 10,302 $ 36,8002 Administration $ 11,124 $ 11,500 Misc $ 2,202 $ 4,000 Depreciation $ 42,952 $ 122,952' Repair Maintenance - Machines $ 7,351 $ 10,000 Repair Maintenance - Building $ 18,913 $ 23,500 Debt Service $ 0 $260,000' Total $322,198 $841,154 ' Represents 75% of the existing cost because of more energy efficient equipment. 2 Insurance increased based on the value of the asset being insured by $4M. s Increase based on straight line depreciation of $4M asset over a 50-year period 4 Based on $4M debt retired over 30 years with a 5% interest rate STMA Arena Board Meeting 05/13/13 Page`9 of 16 18 .PA T,T,ARD*KKiNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Expenditure — Revenue Comparison Category 2012 Actual Second Sheet Expenditures $322,198 $841,154 Revenue $329,034 $583,773 Difference $ 6,302 ($257,381) Recovery percentage 102% 69% This operational pro -forma was completed based on the best information available and a basic understanding of the project. However, there is no guarantee that the expense and revenue projections outlined above will be met as there are many variables that affect such estimates that either cannot be accurately measured or are not consistent in their influence on the budgetary process. STMA Arena Board Meeting 05/13/13 pa 1 9 0 of 16 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Staffing levels: Positions Facilityge Full-Time Assistant Manager $ 35,000 Benefits (30% of salaries) $ 16,843 Total Full -Time Personnel $ 51,843 Note: Pay rates were determined based on the pay scale for the City of Albertville. The positions listed are necessary to ensure adequate staffing and provide for full-time staff support to the operation. The wage scales for both the full-time and part-time staff positions reflect estimated wages for 2013. Positions Hours/Wk Facility Budget Part -Time Concessions (26 wks) 8 hrs/wk $ 1,872 ($9.00/hr) Salaries Benefits (7.65% of part-time wages) Total Part -Time Salaries $ 1,182 $ 143 $ 2,015 STMA Arena Board Meeting 05/13/13 Page 201 of 16 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Revenue Worksheet The calculations for ice time revenue (new) was derived by the following Youth Hockey 832 hrs@$185/hr5 $168,350 High School Hockey 80 hrs@$1656 $ 13,200 Private Rentals 104 hrs@$165/hr $ 17,160 Total New Ice Rental Revenue $198,710 Conclusion: BKA included debt service estimation into the operation calculation. At the time of developing the operation plan there was still some discussion occurring on the program, size and materials for the expansion and a specific project budget has not been developed. There are several factors that play into calculating debt service, including the length of time, amount of debt, bond rating and bonding capacity. It is the opinion of Ballard*King and Associates that the market size and demand for ice time is not large enough in St. Michael/Albertville to operate as a true enterprise fund that covers the cost of operation plus debt service given the current market conditions, ice rental rates and capacity of the user groups to pay higher rental fees. The summary of probable operating costs and revenues below indicate that the STMA Arena will generate a net loss of $257,381. City Council must decide if the need for expanding the ice program justifies the need for increasing general fund support for the operations. 'Represents 90% of total ice time available for the 26 week prime season 6 Represents a transfer of non-STMA hours and allows for moderate growth of activity hours. Hours that go beyond the school's budgetary allocation will require fundraising efforts to support ice time beyond 80 hours per season. STMA Arena Board Meeting 05/13/13 P2 of 16 Page BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Potential Ice Schedule (26 wks) STMAYHA Mock Schedule for a Second Sheet of Ice? Start Time Monday Tuesday Wed. Thursday Friday 7:00 AM 8:15 AM 9:30 AM 10:45 AM 12:OOPM 1:15pm 2:30pm 3:45pm NWC -Vars NWC -Vars NWC -Vars NWC -Vars NWC -Vars 5:30pm NWC — JV NWC - JV NWC - JV NWC - JV NWC - JV 6:45pm PWA/PWB MITE SQB2/SQC 10UA/10UB 12UA/12UB 8:OOpm PWB2/PWC SQA/SQB PWA/PWB PWB2/PWC 14UA/14UB 9:15pm BA/BB1 12UA/12UB BA/BB1 14UA/14UB PWB2/PWC Start Time Saturday Sunday 8:00 AM M ITE M ITE 9:15 AM M ITE M ITE 10:30 AM LTS LTS 11:45PM Youth Game Youth Game 1:OOpm Youth Game Youth Game 2:15pm Youth Game Youth Game 3:30pm Youth Game Youth Game 4:45 PM Youth Game Youth Game 6:00 PM Game/Scrim Game/Scrim 7:15 PM OH SQ/10U OH PW/12U 8:45 PM Open Open Schedule was developed by representatives from the STMAYHA. STMA Arena Board Meeting 05/13/13 Page 223 of 16 a BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Ice Request for Second Sheet of Ice r� Sheet 2 - Projected ice usage by STMAYH ( draft)$ Description Estimated hours Current usage on others ice Initiation level - outside ice moved to 192 sheet 2 U8 & U10 girls - outside ice moved to 84 sheet 2 Boys youth hockey - practice ice time 67 rented at other arenas Boys youth hockey - scrimmages at other 62 arenas �j Girls youth hockey - practice ice time 87 rented at other arenas 492 W Total current usage on others ice shifted to sheet 2 Additional usage Tourneys Might - 1 30 Squirt - 1 30 Peewee - 1 30 Bantam - 1 30 Girls U8 - 1 30 Girls U10 - 1 30 Girls U12 - 1 30 Girls U14 - 1 30 Assume YH only holds 4 of the potential 8 per year 120 Initiation and U8 ( 15 teams ) each taking on average 1/4 hour 98 per week. ( 15 x 26 weeks x 1/4) 18 teams other than initiation and U8 each taking one more hour 396 per week for 22 of 26 weeks = 396 ( 18 X22 weeks) Total potential demand by YH 1106 s Preliminary draft was developed by representatives of STMAYHA. STMA Arena Board Meeting 05/13/13 Page 234 of 16 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Addendum This addendum to the Ballard*King report was assembled to identify some pending issues for Council's consideration during deliberation on the direction for the STMA Arena expansion. Debt Service: The debt service for funding the ice arena expansion represents a significant portion of the estimated expenses for the second sheet of ice. The $260,000 estimated debt service accounts for over 30% of the pro -forma budget. Most municipalities do not assign debt service to the operating budget, especially Parks and Recreation facilities because there is usually a dedicated funding source identified to retire debt before project construction begins. Consequently debt service is not usually included in the operating budget for municipal recreation facility. Depreciation: Depreciation is another line item that typically does not show up in a Parks and Recreation facility budgets even though the current STMA budget includes depreciation. One criticism that could be raised by showing depreciation expense in the pro -forma is the consistency in which depreciation is applied to other City Departments. Is depreciation charged against the Police Department, Public Works, HR, Accounting and Administration in a similar fashion to the Ice Arena? If depreciation is removed from the pro -forma one alternative might be to designate any revenue surplus from operations into a depreciation or capital replacement account and allowed to build over time. Staffing levels: There may be some difference of opinion within the hockey interest over the pro -forma with the addition of a full-time staff position to the budget. In the opinion of BKA the STMA Arena is one of the most cost efficient budget models for an ice arena operation. Without question the staffing cost to operate STMA is lower than most other comparable facilities. It is inconceivable and unreasonable to think that the existing staffing level is adequate to operate a second sheet of ice. As a result an additional full-time position was added to bring the budget more in line with other ice rinks and most importantly, provide the staff resources necessary to assure adequate service levels. STMA Arena Board Meeting 05/13/13 Page 245 of 16 BALLARD*KrNG & ASSOCIATES LTD Recreation Facility Planning and Operation Consultants Non -Ice Events: One element not shown in the operating pro -forma is non -ice revenues. Although there is potential to generate revenue from non -ice events it has been our experience that these event revenues tend to be inconsistent. To error on the side of conservatism BKA did not include any non -ice revenue in the pro -forma. Another influencing factor for not including non -ice revenues is the fact there are 35 rinks within a 45-minute drive, many which are also trying to sell non -ice events and activities in the summer. At this point without a MOU or contracts for non -ice commitments are too speculative to be included any non -ice revenue in the pro -forma. The following table illustrates the impact if debt service and depreciation were removed from the pro -forma for comparison purposes. Category Pro -forma for Pro -forma less Second Sheet Debt and Depreciation Expenditures $841,154 $458,202 Revenue $583,773 $583,773 Difference ($257,381) $125,571 Recovery percentage 69% 127% STMA Arena Board Meeting 05/13/13 Page 256 of 16 29ZDesignGroup minneapolis Consulting Firms: 292 Design Group 9100 49t" Avenue North Minneapolis, MN 55428 P. 763.533.3813 F. 763.367.7601 Tom Betti, AIA tbetti@292designgroup.com Nelson Rudie & Associates 9100 49t" Avenue North Minneapolis, MN 55428 P. 763.367.7600 F. 763.367.7601 Michael D. Woehrle, P.E. Michael.Woehrle@nelsonrudie.com PROJECT OVERVIEW Background St. Michael Albertville Ice Arena (STMA) has a long standing tradition of providing ice -related activities in the northwestern suburbs of the Twin Cities. STMA Ice Arena is home to St. Michael Albertville Youth Hockey Association, St. Michael Albertville High School Teams, and The Riverhawks Hockey Program. The facility also hosts open skating, hockey training and camps, along with a variety of youth and adult hockey events. Purpose The arena ceiling is leaking and it is not known whether the water is from condensation or a leaky roof. 292 and NRA were retained by the City of Albertville to investigate the existing ceiling system and determine the source of the water and to provide some possible solutions to the problem. This is not meant to be a thorough investigation, but to provide some preliminary investigative work to help establish a course of action for STMA. Investigation Methods and Documents Two methods were used to evaluate the existing facility including: Visual Observations: Site visits were conducted on March 20t" and April 3rd, 2013 to observe the facility and its dehumidification system. Interviews: During the on -site visits, discussions were conducted with the facility's staff to document existing issues with the facility and discuss historical problems with its systems. 763.533.3$13 9 1 0,T1161 -� rena, Board Meeting 05/13/13, Page-:2p 29ZDesignGroup minneapolis Existing Building General The existing ice arena is a pre-engineered steel building structure. The roof system was replaced in 2012 and consists of new exterior light gauge metal roof panels installed over the existing steel purlin and bent frame roof structure. The roof was then insulated with 10" of fiberglass insulation and the insulation is covered with a perforated Low-E ceiling barrier. The following field observations were noted: • The facility is visually in good condition and is very well maintained. • The exterior walls are showing signs of efflorescence, which is typically a sign of moisture migrating into the walls. • The ice rink surface has multiple bumps of ice forming on the surface due to water dripping from the ceiling and then freezing on the ice surface. It should be noted that the bumps are yellowish brown in color and staining the ice surface. • The rink roof seems to drip more when it is humid or misting outside. • During rain events there doesn't seem to be any more "leaks" than when it is humid outside. • According to staff, roof leaks or dripping have been an ongoing problem since the original construction of the ice arena. Ceiling Investigation On April 3rd 292 and NRA performed a visual ceiling investigation which consisted of taking a lift up to the ceiling in 3 different locations. A hole was cut through the Low-E barrier to approximately 12"x12" to access the insulation and the underside of the exterior metal roof panels. The following observations were made: • First location: Located at the west end of the rink towards the center and in line with the hash marks of the face of circles — essentially in the "slot". When the initial cut of the barrier was made, water droplets came running out from the top side of the barrier. The insulation was wet but not completely saturated. The insulation turned from being wet on the arena side to gradually becoming frozen the closer it was in contact with the metal roof panels. A very thin layer of ice was on the underside of the metal roof panel along with condensation, it was a 763.533.3$13 9 1 0,T116 -� ,rena, Board Meeting 05/13/13, Page-:27 29ZDesignGroup minneapolis mixture of ice and moisture droplets. The insulation was replaced and the barrier taped with aluminum tape. • Second location: Located above the northwest faceoff circle of the rink. When the initial cutting of the vapor barrier was made, no visible water was present. There were some ice crystals on and within the insulation. The ice crystals were more prevalent the closer the insulation was to the underside of the metal roof panels. The insulation when removed had a layer of the insulation frozen to the underside of the metal roof panels. A layer of ice approximately 1/8" to 1/4" thick was on the underside of the metal roof panels. The insulation was replaced and the barrier taped with aluminum tape. Third location: Located above the northeast faceoff circle of the rink. When the initial cutting of the vapor barrier was made, a significant amount of water was present. The water ran from the underside of the Low-E barrier, and the fiberglass insulation had a significant amount of moisture within it. The insulation when removed, had a significant amount of condensation on the underside of the metal roof panels. In this no ice crystals were present it was all moisture droplets. The insulation was replaced and the barrier taped with aluminum tape. Observation Conclusion: What was discovered during this visual investigation was what was expected in an ice arena environment utilizing this type of roof and insulation system. In our professional judgment this is a condensation issue and not a leaky roof system. To eliminate the possibility of a leaky roof system, 292 and NRA recommend that a water test be performed on the roof system this spring to check the water tightness of the roof assembly. The three test locations were purposely selected to provide a good cross section of the roof system that is exposed to different sun and weather exposures. The first location essentially centered on the ridge of the roof; this explains the combination of ice crystals and moisture droplets in this location. There are two issues present at this location. First, the south side of the ridge is exposed to the southern sun and also lacks snow coverage on the roof explaining the reason for more moisture than ice crystals. Second, the north side of the ridge is still covered in snow and does not have the direct southern sun exposure, therefore more ice crystals are present than moisture droplets. The same is true for the two other locations one on the north side of the ridge and one on the south. The north location had more ice than the south location, which had more water droplets. In other words, as the outside temperatures increase, the ice and frost changes to moisture droplets and increases the dripping within the arena. Analysis of Existing Roof System We have sketched a cross section of the existing roofing system and included it as attachment "A". The sketch shows that the existing roof consists of a metal deck, 10" of fiberglass insulation, and a low emissivity ceiling. The low emissivity ceiling is installed tight to the bottom of the existing girts and tight to the bottom of the fiberglass insulation. The total R-Value of the roofing system including inside and outside air films is 31.49. This is a code compliant roof for the building. 763.533.3$13 9 1 0,T1161 -� rena, Board Meeting 05/13/13, Page-:2§ 29ZDesignGroup minneapolis Attachment "B" shows the temperature profile through the roofing system using an outside temperature of -20°F and an inside temperature of 402F. The temperature profile through the different components is profile to the R-value of the building component. The sketch shows the following: • Outside air temperature is -20°F (winter design temperature in Minnesota) • Top of deck temperature is -19.68 °F • Bottom of deck temperature is -19.68 °F (R-value of metal deck is negligible) • Top of fiberglass insulation temperature is -19.68 °F • Bottom of fiberglass insulation temperature is 37.48 °F • Arena temperature is 40 °F The only vapor barrier in the roofing system is the metal deck. This means that whatever moisture conditions that exist in the arena, will travel up through the insulation system until they hit the metal deck. Condensation will occur on the bottom of the metal deck whenever the dew point temperature of the air in the arena is lower than bottom surface temperature of the metal deck. Our calculations show that on a -20 °F outside air condition the bottom of the metal deck is -19.68 °F. The dew point of the arena will almost certainly be higher than this and condensation will occur on the bottom surface of the deck. The temperature gradient through the insulation will be linear from the top surface temperature of the insulation to the bottom surface temperature of the insulation. In this example the top surface is at -19.68 and the bottom surface is at 37.48. Since the insulation system does not contain a vapor barrier, moisture will travel up through the insulation until the temperature of the insulation matches the dew point temperature of the air and moisture will be begin to condense somewhere in the middle of the insulation system. This condition was noticed in all three areas we examined. The design dew point temperature of the arena is approximately 35 °F. There are many hours of the year when condensation will occur in the building in the form of both water and ice. We examined several possible remedies for the condensation issue. Attachment "C" shows a section of the roof if we add two layers of rigid insulation on top of the existing metal deck and leave the existing fiberglass insulation system in place. Rigid insulation is preferred because it is a natural vapor barrier and water vapor cannot penetrate into the insulation product and condense inside the insulation system like the previous fiberglass insulation example. The sketch shows that the total R-value of the roof increases to an R-value of 61.49. While this seems great, it will not fix the problem. Using the same outside air condition of -20 °F and an inside arena condition of 402F temperature profiles were again determined through the revised roof system. The following conditions would occur: • Outside air temperature is -20°F • Top of new deck temperature is-19.832F • Bottom of new deck temperature is-19.832F (R-value of metal deck is negligible) • Top of new rigid insulation system is-19.832F • Bottom of new rigid insulation system is 9.42F • Top of existing metal deck is 9.42F • Bottom of existing metal deck is 9.42F (R-value of metal deck is negligible) • Top of existing fiberglass insulation temperature is 9.42F • Bottom of fiberglass insulation temperature is 38.72F • Arena temperature is 40 °F 763.533.3$13 9 10qT1161y4� 9rena,"rd Meeting 05/13/13, Page-:2q 29ZDesignGroup minneapolis This demonstrates that the bottom of the existing would still be at 9.42F even if we add R-30 of new insulation on top of the existing roof. Condensation will continue to be a problem because arena dew point temperatures will nearly always be higher than 9.42F. The third example we sketched was adding the same R-30 rigid insulation system on top of existing roof but removing the existing R-30 fiberglass insulation system and re -installing the low emissivity ceiling, this is shown as attachment "D". The overall R-value of the roof system drops down to 32.49 and the temperature profile through the new roofing becomes as follows: • Outside air temperature is -20°F • Top of new deck temperature is-19.682F • Bottom of new deck temperature is-19.682F (R-value of metal deck is negligible) • Top of new rigid insulation system is-19.682F • Bottom of new rigid insulation system is 35.72F • Top of existing metal deck is 35.72F • Bottom of existing metal deck is 35.72F (R-value of metal deck is negligible) • Bottom of low emissivity ceiling 37.562F • Arena temperature is 40 °F This example shows that 92.7% of the temperature between the inside arena and the outdoors occurs inside the rigid insulation system. The bottom surface of the insulation never drops below 35.71F and condensation should not be a problem. Preliminary Recommendations: Based on this limited investigation, 292 and NRA has established three options that can be considered to help manage, minimize, or potentially eliminate the moisture problem. First, operate as is and utilize extra maintenance to maintain a quality ice rink. The moisture will continue to accumulate especially during the swing seasons and specifically when it is humid outside. The ice bumps can be shaved off and managed, but this requires a significant amount of labor. The benefit to this option is there is capital cost today and the extra labor has been accounted for in the operation of the arena to this point. So essentially it maintains the status quo. The drawback to this option is the structure will eventually start to show signs of stress from the moisture, the purlins and steel structure will start to rust and over time significant damage will result from the excess moisture. Also, because the insulation becomes saturated it loses its insulating properties, and puts more stress on the dehumidification and ice systems. Also, over time the water freezing on the ice surface will become more unsightly as the moisture picks up dyes and dirt from the insulation and steel structure. We have two serious concerns with this approach: 1. The insulation system is likely to be wet for a large portion of the year and is a possible location for mold to grow. The city should consider hiring an environmental specialist to review the existing fiberglass insulation system and confirm that the discoloration is not caused from mold. 2. We also have a concern about the structural capacity of the roof system. We were informed by the arena managers that the roofing company that replaced the roof in 2012 determined that the roof could not support the addition of new insulation and metal roofing on top of the existing roof. Our inspection of the insulation system indicates that that it is holding a 763.533.3$13 9 1 0,T116 -� ,rena, Board Meeting 05/13/13, Page-30 29ZDesignGroup minneapolis considerable amount of water and ice. This will add dead load to the roof. We strongly recommend that the metal building manufacturer review the roof structure and determine if they have any concerns with the structural integrity of the existing roof. Second, manage the excess moisture by increasing the dehumidification system in the building. This will help minimize condensation but will not eliminate it. The benefit of this system is it will manage the moisture and help minimize labor costs to maintain the ice sheet. The negative of this approach is it does not eliminate the problem, it manages it. Also, there are significant costs associated with installing and operating dehumidification systems. We would recommend that a desiccant based dehumidification system be added to the facility. The desiccant technology would allow the dew point in the arena to be lowered. It would not be feasible to lower the arena dew point temperature down to the point that condensation would never occur because we need to have dew point temperatures in the arena of -192F on design winter days. This is very uncomfortable and would create poor ice conditions. It would be feasible to drop the arena air dew point low enough that water would evaporate back into the air with minimal dripping on the ice. This approach would require some trial and error to find the optimal arena dew point that minimizes dripping without creating ice problems or uncomfortable conditions in the arena. Third, provide new insulation system for the roof. This would entail a complete retrofit of the existing roof system. The preliminary thought is to re -insulate the roof with a rigid foam insulation system. This could include board insulation over the existing metal roof panels and then installing a new metal roof panel over the insulation. This would also include the removal of the existing fiberglass roof insulation; the Low-E barrier would remain. Another possibility is to apply spray foam to the underside of the existing metal roof panels and reinstall the Low-E barrier. Both of these options will require significant analysis and design detailing to ensure they are designed and installed correctly. The benefit of this approach is it will eliminate the condensation issue and will eliminate the need for additional labor to maintain the ice sheet. Thereby protecting the steel structure and creating a more energy efficient building envelope. The negative to this approach is it is expensive and will take some time to install. Also, the structure will need to be analyzed to see if it can support the additional weight of the new roof and insulation system. Based on the site investigation and preliminary analysis, 292 and NRA would recommend option three as the best solution. But given the unknowns with the structural capacity of the existing roof structure and given the potential cost of this system, 292 and NRA would recommend a more thorough analysis and cost model be developed to help in determining the most appropriate solution for the arena. 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