A bill for an ordinance approving a proposed Amendatory Lease Agreement between the City and County of Denver and the Colorado Symphony Association, for offices used by the Colorado Symphony Association. (FINANCE & SERVICES) Extends a lease agreement with the Colorado Symphony Association by fifteen months to 12-31-16 to occupy 1245 Champa Street and raises rent from one dollar annually to $5,000 per month plus reimbursement of operating expenses (FINAN-201311017-01). The last regularly scheduled Council meeting within the 30-day review period is on 8-15. The Committee approved filing this bill at its meeting on 7-28-15.
We're going to wait for technology to catch up. It has been moved. Good luck with that move. And secretary also council members are taking the item out of order. Does not require comment. It is just a straight yes or no vote. So, Madam Secretary, roll call. Flynn I Gillmor I Cashman I can each i lopez I knew Ortega I. Susman, I. Brooks Hi, black eye. Clerk Hi. Espinosa. Hi, Mr. President. Hi. Madam Secretary, Councilwoman Ortega's back. Thank you, Ortega. And count up. We got him. Madam Secretary, please close the voting. Announce the results. 3939 522 may be taken out of order. So now, Councilman Flynn, you may offer your motion. New Order published. Thank you. Thank you, Mr. President. I move that council bill 522 be ordered published. It has been moved and seconded. Now time for comments. Councilman Flynn, you're up. Thank you, Mr. President. Last week I moved to hold this in committee until next week for first for publication, because I had some concerns about going from a rental rate of a dollar a year to what I thought was $5,000 a month. But I now see, because it includes the share of utilities, is actually asking the Colorado Symphony to pay monthly about $8,750 a month. I call it back to the floor now because I just want to keep moving it forward. I said that I would vote yes on this if in fact those lease payments could be sent. Two ways to the arts and Venues Special Revenue Fund, which I thought up until about 90 minutes ago, would be the case. I find out now that no, because this is 1245 Tampa and this is not an arts and venues building that the lease would go disappear basically into our general fund. I have a high level of discomfort for the next 15 months before the symphony finally moves out of this building of extracting $75,000 from them for the general fund. I don't think we need that needed that much that we need to ask the struggling cultural organization to do that. And so because it cannot go into a special revenue fund, I put it back on the floor and I will vote. No, thank you. Thank you. Councilman Flynn, in the comments. 522 Councilwoman Ortega. Thank you, Mr. President. We had a lengthy discussion about this issue when it came to committee, and I think some of the frustration, if you will, that's part of what some of us experienced is from knowing that this building has historically been used by arts and venues. Yes, it may not be part of arts and venues, portfolio of properties that they manage, but since it was used as a jail, I can't remember. And I checked in with a couple of my colleagues that served on this dais for many, many years. And their recollection is it was always used by arts and venues. So, you know, the issue is about whether or not we extend the lease for the Colorado Symphony on what has been the third or fourth floor, but now it's only for the fourth floor. And the amount of what they're being asked to pay disturbs me as well, knowing the financial challenges that they have had and the desire that I believe we all have to try to keep them in our arts complex. And I'm concerned about what this does to their ability to, you know, find other space, because they're going to have to be paying everything out at this location. Some of the other tenants that utilize other venues on the site are not there on a consistent basis. They have periodic events and shows at the at the complex. So I'm struggling with this one as to whether or not to support it, because to not support it means that the symphony would be essentially asked to leave even sooner than what this contract extension and increase in payment requires. And it just, you know, begs the question, what is our commitment to the arts in this community? We know that the creative industries in this city generate $1.8 billion, according to the CBC's 2013 study that they did. And I'm just I'm not sure that I actually want to vote for this tonight, but to not vote for it means then that per the communications that we've received from the administration is that they would be essentially out of this facility even sooner. And that doesn't feel good either. So I just and just expressing my frustrations with how we have dealt with what has been a longstanding tenant in our performing arts complex. And as we're doing the, you know, the master plan visioning for our performing arts complex and trying to figure out what it is that we want it to be in the future. In my mind, the symphony is part of that big picture conversation and. This sort of, sort of kind of turns ah turns our ear on that. And so anyway, I'll just stop it that I'm just expressing my frustrations with this whole project and process and how it's going and knowing that this particular building is part of the discussions of the CPA complex. But yet, you know, when it came forward for a lease for the Denver Partnership, which is doing great work there, by the way, the the work they're doing and the investment they made in the building is phenomenal. But as they take over the third floor, if they continue to make greater investment and we decide we need and want that building for the rest of the performing arts complex as it's been used in the past, will then have to buy out the Denver partnership for any additional investment they make into that building. So it just seems like, you know, internally the right arm doesn't know what the left arm is doing. And and that's part of what feels so frustrating here because, you know, we should have had that bigger picture conversation before we did a long term lease on this particular building. And and it's unfortunate that that's not the way it's moving. So. Thank you, Mr. President. Councilwoman Ortega, Councilman Brooks up. Thank you, Mr. President. And just for knowledge of the public before we approve any and a tenant agreement, the the lessee agrees to this. And so the symphony has agreed to this arrangement. And I think that's just important to underscore. But I want to call up Kent Rice to the to the microphone. And just to answer a couple of questions, you know, this is I wasn't here last week, but we had a lengthy, lengthy discussion around this and tried to answer some questions. But but can't I guess what I would love for you to answer is some of the conversations you've had with the symphony and their arrangement. I think Councilwoman Ortega underscored that if we vote this down that the symphony will no longer have a place and we'd have to go back to the drawing board. And can you kind of talk about maybe if you if you know a little bit about this symphony's future and and some of the things that we've done as a city to try and sustain them in the city. Good evening. Council Members Kent Rice, Executive Director for Arts and Venues. I'm not sure if I'm the left hand or the right hand, but I'm definitely one of the hands on the old hand, I think. So the symphony has always paid rent to be at that. Your concert hall until two years ago, just as the opera and the ballet have always paid ground to perform at the COC. And so that is the tradition in the history. The not paying rent, the zero rental rate they've had at 1245 for office space is a very recent phenomenon, and it's something that arts and venues helped put together for them for two reasons. One is that they were in financial trouble. And by the way, many symphonies across the country struggle financially from time to time. That's not unusual. But the real issue has to do with that concert hall and the fact that we had planned to close it for renovation. So they were going to have to move their offices out of the hall. When we decided not to do that, I felt a fair thing to do was to provide some accommodation for them. So I lobbied to get them a two year dollar a year rent deal at 1245 Tampa. This was done in the context of knowing that the downtown Denver Partnership was going to be starting its new development program for the building and putting a lot of capital in there. But I persuaded the partnership, the mayor and others that this two year temporary free rent deal was worth doing for the symphony, and also to give the partnership a chance to get the commons, as it's called, up and running. There was a large concern about what would happen at the end of two years and into the lease agreement was written a stipulation that the symphony would have to pay more than $12,000 a month if it failed to move out as of October 1st . So working with the real estate division, we put together a plan to let them stay in 1245 Tampa for 15 or 16 months at the same rate they used to pay for offices in Bettcher. So for years they have paid an amount growing up towards 60,000. I think you've been given some information about that in the past, but they paid kind of 40, 45,000 over a long period of time growing up towards 60,000. So essentially they're currently paying what they have paid all along, except for the past two years. So that's the history. I'll also tell you that years ago, in the past century, the symphony received about a quarter of $1,000,000 in bad debt write off when they were in severe financial trouble. And that was reducing or having the city arts and venues agree to take care of other expenses. I'll also tell you that for the opera in the ballet, when they struggle financially, we make payment arrangements. So we we provide a fair amount of support to our resident companies in the arts complex and on an ongoing basis. Thank you. You probably want to stay close because there are some more people in the queue. I'm going nowhere. Councilman okay. Thank you. Councilman Brooks. Councilwoman Canete. Thank you, Mr. President. Councilman Brooks was with great foresight. I actually only have one question, which is it's not uncommon for us to have mixed feelings about pieces of leases or contracts we don't get to negotiate directly. That's part of the challenge of the the branches of government. And we don't get to sit in the room doing the details of these agreements. But in many cases where there's something that helps us to feel a little better, we tend to find common ground. And when Councilman Flynn proposed the idea that these funds be dedicated back towards better, it seemed like a pretty easy thing to agree to. And I was surprised to hear. I understand that by design, these funds don't flow back to arts and venues because it's not your building. But what I don't understand is why you're not willing to dedicate them to flow towards a voucher and be dedicated in that way to help find some common ground. I was surprised that that was not something that that, you know, and I don't know who, but the administration generally was not willing to. You and Councilman King each. The answer to that is that it never even came up as a topic. We have $17 million set aside for the renovation of Bettcher, which will be used eventually for the next stage of redeveloping the whole complex. The building, as pointed out by Councilman Ortega, is not our sun venue's building, so it's not in our portfolio. We proposed the rental agreement with the real estate division, but the $5,000 a month for 15 or 16 months didn't it didn't seem like it was worth our arguing for. Honestly, this might. Be a left hand, right hand situation. Another piece I am has to. Answer that question. Because it did come up and I believe my colleague actually had a conversation about it. So I guess it did. Sky Stuart Mayor's Office and we had an internal. Conversation about this that as Kent points. Out, there are rental agreements that better and those funds do go into the arts and venues. Special Revenue Fund. There are also multiple sources for capital maintenance dollars on arts and venues facilities. The 1245 Tampa building is maintained by general services. And so to have the lease revenues. Go into the general fund where they can match up with the facility, that's the. Agency that's responsible for maintaining that facility. Makes more sense to us that. We have a source, multiple sources. For capital maintenance at the arts complex for those facilities. Councilman Kennedy, it didn't come up before the lease was signed. I know the idea came up. It was raised by several council members, but not before the symphony had already agreed to the terms. Yeah. I'm going to go out and vote for this because I do think it's important to allow the symphony to continue their occupancy. But I will point out that no one bettcher is not fully paid for the lowest estimate to renovate that year or to make it whatever it is. 17 million doesn't cover it yet. And so the idea of dedicating these resources in my mind would have been an appropriate way to kind of bridge the gap. And I'm disappointed we didn't do that. I get the theory about general services, but the truth is none of the sources that you've identified completely pay for bettcher there's still a gap. So any dollars we could put towards that seems prudent. But it makes sense to me to keep the symphony there that this was, you know, something that they agreed to. And so not loving this lease, I'm going to vote for it tonight to keep things moving forward with the understanding that we will have a conversation about the future of that building at a later date. So thank you, Mr. President. Thank you, Councilwoman. Councilman Espinosa. Thank you for the information about the stipulated rate helps immensely because unfortunately, we get this after, you know, we're new council, many of us are we get this and it's presented in one way with and we're missing an important context on how the how this agreement how you got the symphony to agree to sort of what seemed like drastic shift in position when downtown Denver partnership has such a a you know, a sweet deal in some regards. And so having more background, at least for me, really helps in understanding how it is that a party that's not present at that discussion could arrive at some sort of decision where now this seems like a compromise rather than sort of the heavy handed move to sort of either move in, pay more or ease your stay and pay more, you know, so that helps. Thank you. Councilman Espinosa, I'll just respond to that by saying the symphony president was thrilled with this. When I talked to him after the real estate chief and I met, they had no place to move their offices. And he said, this is a great solution for us. So I'm not saying there couldn't have been a different one or a better one, but he called me twice to thank me. So I feel like at least at the front end of the discussion, the symphony was quite happy with what the proposal was. And unfortunately that part wasn't conveyed to the new council members and those of us who weren't privy to that, that level of discussion really benefited from it. Apologize for that. Thank you. Thank you. Councilman Espinosa. Councilman Flynn. Just real quickly. Thank you, Mr. President. Just a few follow ups compared to the alternatives, of course, it was a much better deal because the alternative was to go out on the market and pay probably a lot more. I'm just curious about why there was perceived to be a need to extract rent from them for the final 15 months when they'd already just had a dollar a year deal. It's not I you know, I've covered a lot of city council activities in this room for a quarter century. And if if October 1st came up and if the administration were agreeable, I'm sure the sheriff wouldn't be there to put them out on the street if another if another path forward were to be found. The rent in the 2010 lease agreement, the symphony paid rent on a 4% annual escalator. But they did not pay for maintenance. They didn't pay. A share of the utility costs. We're asking them not only to pay $5,000, but also to pay 3750 on average a month toward the utilities, which they have not been asked to pay, even when they were at better haul for their office space. And of course, they pay they pay rent when they perform in there, as do any other, as does any other institution. So I'm not sure that the deal. I don't know that Luca Brasi was in the room as well when you were negotiating this, but I'm sure that there were not many favorable choices for the symphony to go forward. The the last point I had and that was the last point. So thank you. I'm ready. I'm ready to go forward and spread unless someone else has something. Got you. We got one more councilman. Councilman Brooks. Yeah. You know, just because it's in my district, I just want to say a couple more things, because there's some been some things that were thrown out. And I just want to bring some context to the public. A couple of things that were thrown out were about the comments and the downturn of our partnership. This is actually a three way partnership with obviously Economic Development, Colorado Technology Institute and the downtown Denver Partnership, and they put over $1,000,000 into the tie to tenant improvements. And so that's why that was adjusted for the rent. And this is the only low, bare tech startup opportunity that we have in the city where anyone can come off the street and learn about the technology institute and tech startups in a way where they don't have to be a part of a company. And so it's a great opportunity for us. And the second thing I want to say is I met a lot with Jerry Kern. I met with the symphony. And I just want to encourage I've heard a couple of times on the dais that we you know, we want to save the symphony. We want to do. Councilman Lopez is on the board. I'm sure he'd encourage this as well for us individually as council members to go and meet with Jerry Kern, go look at the financials and go talk about some of the ideas that we have to keep the symphony alive in Denver, because I'm sure he'd welcome the help . Thank you. Council Councilman. Council president, please, if I could just respond. And I think for the new council members, it's quite important. Why did we not recommend a free rent deal to continue? I was very adamant about that and I remain adamant. The reason is we have many other people who pay rent. The CPA pays rent, the opera pays rent, the ballet pays rent. The period in which the symphony got free rent was because the city would have inconvenienced them had they had to move out once their future was clear and they knew they had a couple of years to perform and better for the city to give them free rent would have immediately caused other cultural groups to come in and ask for free rent. So I think that's important historical context about why it's not a free rent deal any longer. All right. Any other comments or questions? 522. Mr. President, just a quick question. Do the ballet and the opera have office space at Deepak? They do not. Like. That's why they're not paying your rent. They don't have an office space there. The free rent. I should have just I shouldn't have gone down this path. The rent had to do with the rent paid overall for two years for the concert hall and the office space. The symphony used to pay rent for the concert hall and the office space. When we agreed to not charge them rent at all, it was for the office space and the performance hall. So that's a very good question. Obviously the the rental for the hall is much, much greater than the office space. And the other thing we did for your information is couch this and imagine 2020 cultural accessibility. So we gave away the equivalent of tickets with the symphony in exchange for what the rent was that they would have paid us. But I conflated two things. There's office rent and hall rent and they got both free for the two years. Thank you. Kathryn Lopez, Europe. Thank you, Mr. President. I just had a comment and this just, I think, was one of the questions that I that I wanted to ask was answered and is clarified in terms of how does that compare with some of the other folks who were there, too, including the ballet and the opera? On a symphony level, yes, it's struggling. And I think, you know, this definitely needs to move forward. We're kind of in a tight conundrum here, but I think at the end of the day, this is something that I hope we are included on and make sure that we back home, we don't forget this and the thousand bills that we pass every year. We should have this conversation, strategically speaking, in committee. I understand this is going to move forward, but I agree. And being a board member of the symphony, it is not intended like it used to be. We struggle to be able to get folks there, especially millennials. You know, when you have acts like Los Lobos, also Motley or Boyz II Men, you get us there. And so it's a matter it's a matter of strategy. But here's here's here's the thing. An organization that is barely covering the costs. The last thing you want and saying, oh, by the way, here's another hundred, $200,000. You got to come up with. Mm hmm. We as a city have to do a values check and to see what is it that we want in our city? What are the things that are sacred? And what are we willing to do for those things that are sacred? I think a symphony is one of those things that are sacred. A big city, a great city should have a symphony in our midst. We should be able to foster that. We should be able to fix this out if we can figure out how to pay for half a billion dollars to build a stadium. And we should figure out how we can actually do this to keep the symphony, to keep the fine arts in Denver. And I think there's a different way. There's a lot of different ways we can go about it. But I hope I get my comments as I hope can. I hope our colleagues that we can bring this discussion back into council so we can talk about the future of what we intend to have at the EPA, not just an was built there or what's being offered, but the organizations that actually give it the the the reason to go. Thank you, Mr. President. Thank you, Kathryn Lopez. All right. Any other comments? 522 C None, Madam Secretary. Rubio? Flynn. No. Gilmore, I Cashman know. Can each Lopez. Pass. New Ortega? A reluctant AI. Sussman. AI Black AI Brooks. AI Clerk AI Espinosa. AI Lopez. AI. Mr. President. I got him. Madam Secretary, please, cause very nice results. 11 eyes, two face. Nice to face. 522 has been ordered published. All right, we are on to the next one. Should be the first bill for introduction, Madam Secretary. Should be 553, if I'm not mistaken. You got it. All right. Flynn Sussman anew, I imagine. What do you want to call this off? Your vote is that I look left. Is this for a vote? Comment or question? Yes. Vote. That's what I thought. All right, Councilman Flynn, we will order 553 ordered published. Thank you, Mr. President. I move that constable 553 be ordered. Published. It has been moved and seconded. Just about everybody wants to speak. All right, Councilman Flynn. Thank you, Mr. President. As we've said in the various committee meetings we've had on this, I believe that this program, that the way it's been structured, it's really well structured. I like how it works. The only thing that I do not like about it is I believe it's pulling up to the wrong fuel pump. I don't believe that municipal sales tax is the proper vehicle for fighting for funding this system. I believe that other avenues could have been looked at or should have been looked at or ought to be preferred over over municipal sales tax, which is the most regressive form of tax. And and it also is, I believe, beyond the role of of the municipal government, if I could put .08 percent sales tax on the ballot right now, I have sidewalks and streets in my district and I have other needs in my district. We need we have long police response times in my district that need to be brought down. There are a lot of other municipal needs in our core mission that I would put ahead of this, and I would encourage that perhaps DPS to look again at the funding this through through a mill levy, through DPS rather than through