DEPARTMENT: Parks and Recreation
DEPARTMENT HEAD: Xavier D. Urrutia
COUNCIL DISTRICTS IMPACTED: 5
SUBJECT:
Execution of Assignment, Assumption and Amendment of Ground Lease and Sublease Agreement with The Boys and Girls Clubs of San Antonio related to the Lone Star Recreational Facility, a 2012-2017 Bond Project, and approving related documents.
SUMMARY:
This ordinance authorizes execution of Assignment, Assumption and Amendment of Ground Lease and Sublease Agreement with The Boys and Girls Clubs of San Antonio, authorizing the assignment to a newly created affiliated non-profit corporation for purposes of securing New Market Tax Credits financing for the Lone Star Recreational Facility located in Council District 5, a 2012-2017 Bond Project, and approving related documents.
BACKGROUND INFORMATION:
The Boys and Girls Clubs of San Antonio (TBGC-SA) is a non-profit organization which originally opened as the Boys Club in San Antonio in 1939 on Dolorosa Street. The mission of the TBGC-SA is to enhance the educational, social, and moral development of San Antonio’s youth ages 6-18, especially those most disadvantaged by providing a fun, safe place full of age appropriate activities and opportunities. Today, TBGC-SA serves more than 8,300 club members annually and operates six branch locations as well as on-site programs in 46 locations in Harlandale, Judson and San Antonio Independent School Districts.
TBGC-SA is requesting a lease amendment prior to the end of the year to facilitate New Market Tax Credits financing associated with their Lone Star Recreational Center, a 2012-2017 Bond Project, which is under construction on property owned by TBGC-SA and is expected to open to the public by Summer 2017. In March 2015, the new $4.8 Million facility received $1.85 Million in City bond funds through a Funding Agreement approved by City Council. Through the same Council action, the City entered into a Ground Lease Agreement with TBGC-SA to fulfill the bond program’s requirement for securing the City’s long term interest in the project and in turn the City executed a lease-back of the same property to TBGC-SA for construction and operation of the facility for a 20-year term.
This ordinance authorizes execution of Assignment, Assumption and Amendment of Ground Lease and Sublease Agreement with The Boys and Girls Clubs of San Antonio, authorizing the assignment to a newly created affiliated non-profit corporation for purposes of securing New Market Tax Credits financing for the Lone Star Recreational Facility located in Council District 5, a 2012-2017 Bond Project, and approving related documents.
The City will not be obligated for any costs associated with these actions or the New Market Tax Credits Program financing.
ISSUE:
This Ordinance will authorize consent to assignment of TBGC-SA’s Ground Lease and Sublease Agreement to a newly-created non-profit affiliate of TBGC-SA. This action is necessary for TBGC-SA to qualify for New Market Tax Credits financing which will be utilized to complete construction of the Lone Star Recreational Facility. The City has approved similar actions related to New Market Tax Credits financing for the Witte Museum, Briscoe Art Museum and Haven for Hope.
ALTERNATIVES:
The City could decline to take these actions and TBGC-SA would need to identify alternate funding sources to complete planned construction.
FISCAL IMPACT:
There is no General Fund impact associated with this action. Under the current Ground Lease and Sublease Agreement, TBGC-SA and the City will each continue to pay $1.00 per year for the remaining terms which expire in 2035.
RECOMMENDATION:
Staff recommends approval to execute the Assignment, Assumption and Amendment of Ground Lease and Sublease Agreement, and related documents.