TRANSMITTAL LETTER FOR BOARD MEETING OF APRIL 5, 2012
COMMITTEE ON REAL ESTATE
Mr. David St. Pierre, Executive Director
Title
Authority to enter into a 39-year lease agreement with the Village of Mount Prospect for the continued use of approximately 70 acres of improved District real estate located at 1326 West Central Road in Mount Prospect, Illinois, and known as Melas Park for public recreational purposes. Consideration shall be a nominal fee of $10.00 plus 25% of net profits derived from the site.
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Dear Sir:
The Village of Mount Prospect ("Village") leases approximately 70 acres of District land under a lease agreement between the District and the Village that commenced June 1, 1981 and as amended expires May 31, 2012. The leasehold is known as Melas Park. The Mount Prospect Retention Reservoir is located within the leasehold. The original permitted use under the lease is for public recreational purposes and other purposes incidental thereto. The initial lease term was for 10 years. Subsequent amendments to the lease extended the term for an additional 21-years from June 1, 1991 to May 31, 2012, allowed for the sale of alcoholic beverages and allowed for the construction of parking areas. In 1991, the Village entered into an agreement with the Mount Prospect Park District and the Arlington Heights Park District (collectively "the Park Districts") whereby each entity was granted a license by the Village for the use of one-half (½) of Melas Park for recreational use and activities throughout the term of the lease. The rent under the lease was a one-time fee of $500.00.
The Park Districts have improved the leasehold with an open air shelter, 6 recreational athletic fields, a 2.5 mile asphalt walking/bike path, 2 concessions stands with rest room facilities and 3 asphalt parking areas.
The Village has request a new 39-year lease upon expiration of its current lease to continue to use the leasehold for the same permitted use as is allowed under its current lease including the continued permitted use of selling alcoholic beverages five times a year. A proposed improvement is a golf-driving range and it is recommended that the new lease allow for such use. Green Infrastructure will be required to be implemented on any new or re-development during the term of the new lease.
The District's technical departments have reviewed the subject request and have reported that there is no foreseeable corporate use for the property and that there are no objections to the request for a new 39-year lease to continue to use Melas Park.
It is recommended that the rent under the recreational areas of the leasehold be a nominal fee of $10.00, unless such recreational use or parts thereof derive revenue (i.e., fees generated by Lessee's use of or activities on the leasehold), then the rent would be 25% of the profits derived therefrom. The "annual revenue" will allow for deductions such as certain operating expenses, capital improvement expenditures, and bond repayment.
Under 70 Illinois Compiled Statutes 2605/8c(11), said lease is terminable upon the service of a 1-year notice if the property becomes essential to the District's corporate needs.
It is requested that the Executive Director recommend to the Board of Commissioners that it authorize
and approve the issuance of a 39-year lease agreement with the Village of Mount Prospect for the continued use of approximately 70 acres of improved District real estate located at 1326 West Central Road in Mount Prospect, Illinois, and known as Melas Park for public recreational purposes. Consideration shall be a nominal fee of $10.00 plus 25% of net profits derived from recreational use of the site.
It is further requested that the Executive Director recommend to the Board of Commissioners that the Chairman of the Committee on Finance and the Clerk be authorized and directed to execute said lease agreement after it is approved by the General Counsel as to form and legality.
Requested, Ronald M. Hill, General Counsel, RMH:STM:NPE:rg
Recommended, David St. Pierre, Executive Director
Respectfully Submitted, Terrence J. O'Brien, Chairman Committee on Real Estate Development
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for April 5, 2012
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