Community Center Ballot Issue
Your Vote Counts on or Before May 4, 2021
Over the years, the City has considered building a community center on several occasions. As recreation and community centers succeeded in other communities, the City continued to hear of a desire for such a facility from our residents. The issue resurfaced again through the 2018 Parks & Recreation Comprehensive Plan study process, with 81% of residents in a survey supporting a feasibility study for a multi-generational indoor recreation facility. In response, City Council formed the Community Center Feasibility Task Force (CCFTF) in the summer of 2019 to lead a study on the issue.
The CCFTF was comprised of 16 volunteer residents charged with determining if the community wanted and needed a community center. After confirming that the desire and need existed, the Task Force was charged with drilling into details of location, what should be included, and the costs for construction, operations and ongoing maintenance.
Following an extensive 18-month study process focused on community engagement, transparency and financial analysis, the Task Force shared its findings and recommendations with City Council on December 16, 2020, with its final report following early in the New Year. The CCFTF unanimously concluded that it is feasible for the City to construct a community center without an increase in City income or property taxes.
In response to the Task Force’s conclusion that it is feasible for the City to construct, operate and maintain a community center, City Council approved legislation to bring the proposed Upper Arlington Community Center issue to a vote of the people on May 4, 2021, and to authorize various funding mechanisms that will enable the City to construct a community center without any increase in City income or property taxes.
ZOOM COMMUNITY MEETINGS
The City wants to be sure residents have had plenty of opportunities to learn about the issue before them before casting their vote. A series of Zoom Community Meetings are scheduled in April that will feature presentations from City Manager Steve Schoeny, with an opportunity for residents to share their thoughts and questions with both him and our Parks & Recreation Director, Debbie McLaughlin.
The schedule is as follows:
10 am, Monday, April 5
Click here to join the meeting: //zoom.us/j/92377843376
Join by phone: 1-877-853-5257 | Meeting ID: 923 7784 3376
6:30 pm, Wednesday, April 7
Click here to join the meeting: //zoom.us/j/95589102313
Join by phone: 1-877-853-5257 | Meeting ID: 955 8910 2313
10 am, Saturday, April 17
Click here to join the meeting: //zoom.us/j/98216963807
Join by phone: 1-877-853-5257 | Meeting ID: 982 1696 3807
Noon, Thursday, April 22
Click here to join the meeting: //zoom.us/j/91724810982
Join by phone: 1-877-853-5257 | Meeting ID: 917 2481 0982
With the May 4 election less than three weeks away, we have two Zoom Community Meetings on the community center ballot issue remaining: 10 am, Saturday, April 17 - Join…
Before voting in any election, it’s always a good idea to check your voter registration status online, at www.voteohio.gov, and preparing to vote on the May 4 Community Center Ballot…
Should the City of Upper Arlington build a new community center on the site of the old Lazarus/Macy’s store at Kingsdale Shopping Center, using various City revenue streams but in no case from an increase in City income or property tax, as authorized by legislation of City Council, including Ordinance No. 1-2021, Ordinance No. 2-2021, and Ordinance No. 3-2021?
YES, the City should build the community center
NO, the City should not build the community center
If the Community Center Issue Passes
If the community votes in support of a community center at the Kingsdale site, it would be constructed using existing revenue streams combined with new revenues generated from the mixed-use project. Upon completion of the community center, the UA Schools would receive the land on which the current Senior Center sits, adjacent to Tremont Elementary School, plus $50,000 per year and parking improvements along Brandon Road, next to the High School. Additionally, the Schools would receive in full any new millage approved by voters in future Schools levies.
If the Community Center Issue Does Not Pass
Continental Real Estate would proceed with its alternate plan for the site, for a nine-story building with five stories of multi-family residential and two stories of office space with a two-story parking garage. The UA Schools would receive its share of additional property taxes generated from the new value of the entire development, estimated to represent between $30-$40 per average *UA home value per year.
*$400,000 average home value
Visit the CCFTF website to read their Report to the Community and to learn more about the study process.
The Task Force recommendations include:
- It is feasible for the City to construct, operate and maintain a community center.
- The facility should include program space for seniors and replace the current Senior Center.
- It should be more than a recreational facility, serving as a central gathering place for the whole community.
- The former Macy’s site at Kingsdale is the preferred location.
- The construction cost of approximately $54 million can be funded without an increase in taxes by using a combination of Tax Increment Financing (TIF) funds, excess City reserves, office lease revenues, hotel/motel taxes and private donations.
- A business model should be pursued based on competitive market rate memberships and usage fees, with a goal of achieving a minimum cost recovery level of 85%.
- Membership and usage fees should be tiered, with options to accommodate senior residents and the operating budget should include a scholarship fund to assist residents facing financial barriers to participation.
- Existing Senior Center and Recreation program funds should be redirected to support the community center.
- The community center business model should include significant annual contributions to a fund for future capital expenditures, such as maintenance and equipment replacement.
The community center program developed through the Task Force process proposes a seven-story building that would be constructed at the site of the former Lazarus/Macy’s property at Kingsdale, as part of a mixed-use redevelopment project. The community center building would be located on the southwest portion of the site, adjacent to Tremont Road.
Floors 1-5 would be dedicated to the community center programming. *Floors 6 & 7 would be set aside for professional office use. While the final programming would be determined as part of a detailed project design process, in general the community center facilities would include:
*See the Financial Details section for more on the proposed office space.
The proposed construction budget for a community center is $54 million.
Built into this budget are a number of safeguard “contingencies” to make sure the final costs fall at or below this estimate:
- 10% design contingency to account for differences between conceptual cost estimates and actual final design costs, which could include some adjustments in programming and project scope
- 3% construction contingency to cover unforeseen issues that often arise with construction projects
- 3% owner’s contingency, providing a cushion for any changes requested by the City during construction
- 5% cost escalation to account for any inflationary increases in materials, etc.
Three different **firms with experience in the design and construction of buildings on this scale have reviewed the construction estimate. All three agreed that the construction estimates fair, reasonable and conservative, allowing the City to move forward with confidence that the budget would allow for a high quality facility while minimizing the risk of cost overruns.
** Williams Architects, Messer Construction, Gilbane Construction
How the City Would Pay For It
A detailed financial plan has been developed that would enable the City to construct a community center without any increase in City income or property taxes. This is made possible in large part through a partnership Development Agreement between the City, Continental Real Estate, Inc., and the Upper Arlington Schools. The resulting ***Tax Increment Financing (TIF) District has created a significant potential funding source for the community center, and the agreement allows the Schools to grow their revenue and expand parking options at both Tremont Elementary School and the UA High School.
***An explanation of TIF can be found in the Kingsdale Mixed-Use Development [link] section.
In order to pay for the construction of a community center, the City would:
- Borrow $40 million in long-term debt through a bond issuance
- Use $8.8 million in existing City reserves
- Solicit and secure a minimum of $5.4 million in private funds – raised through a partnership agreement with the Upper Arlington Community Foundation
The debt service for the bond issuance/community center investment would total approximately $2.3 million per year. The CCFTF and City identified multiple revenue sources to repay the debt, with the bulk generated from the Kingsdale TIF. A full breakdown of how the debt would be repaid is as follows:
- $1.59 million in annual TIF revenues – primarily generated by the Kingsdale development
- $500,000 in annual hotel/motel revenues from the two hotels on Lane Avenue – revenue projections are based on performance, including the last six months of 2020 as Stay at Home orders were lifted and hotel occupancy levels rebounded
- $210,000 to be covered by some combination of new annual revenue sources resulting directly from the community center building – new income tax revenue and lease profits are projected to total approximately $700,000 per year.
The City has additional options for covering the debt service should it prove necessary at any point in the future. These include:
- Upon its completion, the Arlington Gateway project on Lane Avenue will generate $500,000 in new income tax revenue to the City
- Thanks to conservative budgeting practices, the City has been consistently adding an average of $250,000 each year to its fund balance
(this average excludes 2020, which skewed much higher due to COVID-19, as a result of reduced spending and receipt of Federal stimulus funds)
- The community center business model projects full cost recovery, with the potential to substantially reduce or eliminate the current subsidy of $530,000 that supports Parks & Recreation programming.
The Office Space
Plans for the community center building include two floors of rentable office space above the community center, totaling approximately 50,000-60,000 square feet. This space represents several benefits:
- It would generate new income taxes and rental income that could be used to support the construction and operations of a community center, and other vital City services.
- It would generate new jobs and business opportunities for the Kingsdale area and our community as a whole.
- It would provide an opportunity for the City to secure a healthcare partner that could expand the health and wellness services available at the community center.
After issuing a request for proposals concentrated on healthcare providers in December of 2020, the City is evaluating proposals and negotiating terms with potential tenants, with the goal of announcing a tenant before the May 4 election. A condition of this selection process is to establish agreement terms that would cover the costs for constructing the office space, as well as ongoing maintenance.
Any remaining leasable space would be highly marketable, since the Kingsdale site is surrounded by amenities – namely two grocery stores, three pharmacies, 12 restaurants, shops, two high schools, large park, a mix of housing options, access to ample parking – with direct access to the community center featuring rentable event/meeting space, and located in a safe, high-income, educated and desirable community.
Proposed Community Center Ballot Issue & Associated Legislation
View the January 11, 2021 Staff Report
In addition to passing legislation placing the community center issue on the May 4 ballot, in January City Council also approved legislation that lays the groundwork for instituting the necessary funding mechanisms for constructing a community center without any increase in City income or property taxes:
- Ordinance 1-2021: Establishment of the Kingsdale Center TIF District and authorization for the City to enter into a compensation agreement with the Upper Arlington School District, which lays out two scenarios: 1) if a community center is built; 2) if no community center is built and the placeholder site is redeveloped as a nine-story building with multi-family housing and two stories of office space.
- Ordinance 2-2021: Authorization for the City to issue income tax revenue bonds in an amount not to exceed $55 million, for the purposes of constructing an Upper Arlington Community Center, effective only upon successful passage of the ballot issue.
- Ordinance 3-2021: Amendments to previous TIF ordinances to include Community Center in their definition of “public infrastructure improvements,” providing uniformity in all City TIF districts and flexibility should excess funds become available from existing TIFs to help pay down the City’s community center debt, effective only upon successful passage of the ballot issue.
The community center business model has been developed based on usage and pricing structures for comparable facilities in other communities. Some of the keys to success include:
- A focus on spaces that can be used for multiple purposes
- Incorporating senior programming as part of a larger community facility
- Achieving staffing and operations efficiencies by bringing programs within one location
- Providing a combination of memberships, drop-in fees, programming and facility rentals.
Some key assumptions in the community center business operations model include:
Community Center Resident Membership Projections
- 3,902 Households – which represents 28% of the number of households in UA
- 5,840 Individuals – which represents 16% of the total population
For comparative purposes:
- 2019 Outdoor Pools Membership – 7,285 Resident Individuals
- 2019 Recreation Programming Participation – 3,498 Resident Households
- Other community resident membership percentages:
Dublin – 14% Westerville – 13% Worthington – 29%
Membership Rate Projections & Comparisons
A Base-case pro-forma model projects full cost recovery, based on the proposed programming, a 3% market capture for memberships and 70% program capacity. Under this model, the current $530,000 subsidy that supports Parks & Recreation programming would be substantially reduced or eliminated. (Click image for larger view)
A Stress Test pro-forma projects a cost recovery model of approximately 75%. This exercise was undertaken to account for potential down years (recession, pandemic, etc.) and assumes reductions of 33% in memberships, 50% reduction in daily admission fees, a 20% reduction in program capacity and @ 50% reduction in rentals. Under this model, the subsidy necessary to support operations would increase the current subsidy by approximately $250,000. (Click image for larger view)
Visit the Kingsdale Mixed-Use Project page for additional details
Continental Real Estate, Inc. has purchased the former Lazarus/Macy’s site at Kingsdale and has plans for a mixed-use redevelopment project that places an emphasis on providing senior and multi-family housing options, reflecting current development trends and complementing the existing mix of retail, restaurant and office uses at Kingsdale. The project includes:
- A seven-story senior housing apartment building, with 142 assisted and independent living units and a ground floor restaurant fronting Tremont Road
- A seven-story building with 325, one- and two-bedroom apartments, two amenity courtyards and a parking garage, fronted by eight, two-story townhomes along Northwest Boulevard
- The site plans also include a third building location that is serving as a placeholder for one of two options, subject to the outcome of the May 4, 2021 community center ballot issue:
- The community center building, with five stories dedicated to the community center and two stories of office use
- A nine-story building with 75 apartments, office space on the first two floors and structured parking
A Preliminary Development Plan for this project was approved by the Board of Zoning and Planning (BZAP) in October of 2019. A Final Development Plan is scheduled for BZAP review and Action on March 3 and 24, 2021 (meetings are currently held virtually on Zoom).
In November of 2020, City Council authorized a Development Agreement with Continental that has received the support of the Upper Arlington School Board. Under this agreement, the use of Tax Increment Financing (TIF) will enable the City to issue bonds for public improvements that will be repaid by the new property taxes generated from the site’s increased value once the development has been completed. The Schools’ participation in the TIF means that 100% of the increased property taxes generated by the site will be dedicated to these public improvements – representing a critical component of the funding for a community center, along with other necessary improvements such as addressing access, traffic considerations and parking needs
Community Center Ballot Issue FAQs
Why are you looking into a community center? Hasn’t this failed before?
When the City surveyed the community about our parks in 2018, over 80% of respondents told us they wanted the City to explore the feasibility of an indoor community center. In response, City Council formed a task force of residents and asked them to study the feasibility of a community center and to recommend if, how, and where a community center should be built. The Task Force process included two additional surveys – in both cases, resident support for a community center – if it could be built without increasing taxes – remained close to 80%.
Residents last voted on a community center issue in 2002, voting against a proposal for a facility on a portion of the Kingsdale Shopping Center. It has been nearly 20 years since a community task force last studied and discussed this issue in depth, and we estimate that well over half of current voters in Upper Arlington were not voters here in 2001.
How are you going to pay to build it?
A detailed financial plan has been developed that would enable the City to construct a community center without any increase in City income or property taxes, using a combination of long-term debt that would be repaid primarily using revenues generated by the Kingsdale Mixed-Use District TIF, as well as existing City reserves and privately raised donations coordinated through the Upper Arlington Community Foundation. View the Financial Details.
How are you going to pay to operate it?
A detailed community center business model has been developed based on memberships and pricing structures for comparable facilities in other communities. A Base-case pro-forma model projects full cost recovery, based on the proposed programming, a 3% market capture for memberships and 70% program capacity. Under this model, the current $530,000 subsidy that supports Parks & Recreation programming would be greatly reduced or eliminated.
A second, “Stress Test” pro-forma was developed to account for potential down years (recession, pandemic, etc.). This model projects 75% cost recovery, resulting from reductions of 33% in memberships, 50% reduction in daily admission fees, 20% reduction in program capacity and 50% reduction in rentals. Under this model, the subsidy needed to support operations would increase by approximately $250,000.
Will it be affordable to everyone who lives in UA?
Membership and usage fees would be comparable to market rate membership and usage fees, and would be tiered – single adult, family, senior, etc. Additionally, the business model would include a dedicated scholarship fund to assist residents facing financial barriers to participation.
Will non-residents be able to use it?
We believe that in addition to residents, non-residents who work in UA and pay income taxes here should have access to the community center. This would also help make the community center a job attraction and retention tool for the City. Beyond that, we don’t know yet. By allowing non-residents/taxpayers to join at a higher cost, we may be able to help ease the financial burden on residents. However, we want to be sure that priority is placed on resident access.
If approved by voters, when would the City start construction and when would the community open?
If the voters approve a community center in May of 2021, it would likely start construction in 2022 and open in 2024. In essence, we anticipate a year for final design and two years for construction.
What would happen to the Senior Center if a community center is built?
The Senior Center would be incorporated into the new community center. This would not only provide its members with the programming they enjoy today it would also give them access to the additional facilities and programming a community center would offer, such as an indoor pool, indoor walking track and expanded health and wellness facilities. We have heard from many seniors who don’t use the current Senior Center that the facilities are unappealing and keep them from getting involved. We think that this could be a great opportunity to build the high-quality facilities that Upper Arlington seniors expect and deserve.
The existing Senior Center facilities are tired and were not built for the purpose they currently serve. If a community center is approved by voters, upon its completion, the buildings on the current Senior Center site would be razed and the Schools would assume ownership of the property, as part of a Development Agreement between the City, the Schools and the Kingsdale Mixed-Use Project developer that has been put in place to help fund the community center.
The City encourages residents to become informed on this important community issue, so that when you complete your absentee ballot or head to the voting booth on May 4, your questions have been answered in full. Please let us know if you have any comments or questions by completing this form.