Project Financing: Use of Non-City Funds

Title: SPMP Private Findraising & Captial Campaign Proposal

Date: March 9, 2004

Author: Northwest Parks Foundation

Number of pages: 20

[NOTE: This document is a chapter from a larger document, "Sand Point Magnuson Park Development Plan: Fundraising, Expenses, Revenue Projections, Maintenance & Operations Proposal" dated March 9, 2004 and published by NorthWest Parks Foundation and Friends of Athletic fields--see an entry below for the complete proposal. This March 9, 2004 proposal is the second draft presented to the Parks Department--the first was presented in October 2003.]

Document outlines how field advocates plan to finance the park. "The Washington National Guard recently committed to undertake all earth-moving and rough grading required for the fields and wetland complex starting Summer, 2005. This in-kin service is estimated to have a value of $20 million. In addition, the Guard has indicated an interest in constructing all trails, bridges, restroom/concession buildings, and parking lots for the project. Thanks to this remarkable contribution estimated at $30 million, the capital campaign funds are now needed only for 1) soil development, planting, and maintenance work in the wetland restoration, and 2) purchase and installation of lights, fencing and synthetic turf for the 11 playing fields. The Capital Campaign for $8 million, the National Guard in-kind service, and the Pro Parks Levy dollars will complete the project in conjunction with bonds paid by revenue generated from field use."

Document continues to outline a $8 million capital campaign including naming rights, major gifts (foundations, corporations, individuals), fundraising events (a "Winter Convention" and a "Summer Festival"), and a sustaining gifts drive (buy a square foot of turf, request a per-user athletic user tax from sports leagues, etc.)

Title: Innovative Readiness Training (IRT) Background

Date: (none indicated)

Author: (none indicated)

Number of pages: 5

Explains the program under which the Washingon National Guard would work on Magnuson Park. IRT is a "dual-benefit" program that "serves American communities in need and provides realistic military training and benefits." [More information about the IRT program—including overview, guidelines, application process, and a description of FY 2004 IRT projects—can be found at www.defenselink.mil/ra/ondemand/irt.html].

Title: Proposal for Non-City Funding of Sand Point Magnuson Park Athletic Fields
Based on criteria dated January 20, 2004

Date: March 2, 2004

Author: Eric Friedli

Number of pages: 4

Overview of how the Northwest Parks Foundation's financing plan meets a set of previously defined criteria including Expansion, Quality, and Diversity of Use; Consistency with City and Department Policies; Budget Considerations; and Community Considerations

The document makes clear that:

• The facility is indeed intended for tournament play: "We will be able to hold events, such as tournaments, that we otherwise would not have the capcity for"
• The Northwest Parks Foundation's financing plan is unrealistic: "The proposal is NOT realistic as proposed... it assumes a 90% use rate including the meadow... the proposal includes an over reliance on the amount of work to be done by the National Guard..."

Title: Memo to Ken Bounds

Date: March 19, 2004

Author: James Kelly, Colonel, Chief of Staff, Washington National Guard

Number of pages: 1

Letter acknowledges the WA National Guard's interest in pursuing the possible involvement of the Guard in the construction of the Magnuson Park project.

"I am writing to acknowledge, your letter of November 25, 2003 [see entry below] regarding the redevelopment of Sand Point Magnuson Park and to reconfirm the Washington National Guard's commitment to provide support. I greatly appreciate your efforts in working with my staff in looking at the feasibility of the Washington Military Department's participation in this project. I encourage you to continue your work with our Innovative Readiness Training Coordinator, Captain Mary Loos, to develop a project plan and budget for submission to the National Guard Bureau for approval by the Department of Defense."

"Please note that the loss of key Army and Air National Guard units to the Global War on Terror may limit the availability of our key engineering units' soldiers, airmen and equipment. Once your project proposal is completed and received by my Department, we will do our best to provide the requested support with our available resources."

Title: Memo to Washington National Guard Adjutant General Lowenberg

Date: November 25, 2003

Author: Ken Bounds

Number of pages: 3

"We are excited about the Washington National Guard's interest in partnering with the City of Seattle for the development of Sand Point Magnuson Park..."

Title: DOD Innovative Readiness Training proposal at Sand Point

Date: January 5, 2004

Author: Eric Friedli

Number of pages: 1

Memo from Friedli to Brian Kristjansson, Federal Liaison Office of Intergovernmental Relations.

Title: Financing Schemes

Date: December 18, 2000

Author: Eric Friedli

Number of pages: 16

Outlines all the different financing options considered for the Magnuson project. The document is most useful for its description of bond options.

Title: Emails

Date: March 12, 2003 and May 23, 2003

Author: Peter Lukevich

Number of pages: 2

Emails where Lukevich talks about meetings with Senators and Congressmen.

Title: Introduction

Number of pages: 8

Lists project authors, Table of Contents, short project history and timeline, and project site map.

Chapter 1 Title: National Guard Contribution

Number of pages: 4

Chapter consists of a October 14, 2003 letter from Seattle Parks Department Superintendent Ken Bounds to the head of the Washington National Guard. In the letter, Bounds outlines the type of work requested of the WA National Guard:

• Regrading the entire 153 acres site; raise field areas 3-5 feet above existing conditions (for drainage purposes) by moving 340,000 cubic yards of fill material generated by the cutting of the wetland areas.
• Building pedestrian foot bridges within the wetland complex
• Building numerous path networks around the site, as well as parking lots and roadways
• Constructing restroom and other structures
• Demolition of Commissary and other building structures, as well as the parking lot adjacent to the Commissary

Chapter 2 Title: Pro Parks Levy

Number of pages: 2

Provides a very rough (1 page) overview of what aspects of the project are expected to be accomplished using Pro Park Levy funding.

Chapter 3 Title: Sand Point Magnuson Park Public Authority

Number of pages: 100+

"Public Authority Benefits and Maintenance & Operations" section outlines the formation of a non-profit "Public Authority" to develop, operate, and maintain the facility. The text makes clear that:

• Field advocates will be firmly in control of the facility: "A separate and independent subcommittee of Friends of Athletic Fields (FAF) comprised of Peter Lukevich, Geoff Clayton, and Scott Freeman will serve as interim Directors of the new Authority"
• Tournaments are a major focus for the facility: "Expected advantages from this partnership will include: ... Strong leadership focused on bringing significant tournament play to the complex"
• Only hollow assurances are offered to the surrounding community: The Authority will supposedly provide "an open, transparent, and accountable forum for managing and resolving the user/neighborhood issues that will arise during the life of the complex"

Pages and pages of spreadsheets follow that detail the revenue—over $1.2 million per year—that would be raised by charging field usage fees. As outlined in Chapter 5, this revenue would be used to finance construction bonds. The revenue projections indicate that:

• The fields are exclusively for pay-for-play use by organized leagues; there appears to be miniscule, if any accommodation for unscheduled community time. (Both kid and adult users would pay fees, but different rates.)
• The facility will be beholden to adult leagues. Follow the money trail—revenue will be primarily from adult leagues. For example, 97% of the revenue from the four full size soccer fields in March and September of each year will be from adults and the majority of field use time is allocated to adults. With such a dependency on adult leagues, how can it be that kids will ever be a priority?
• The phased construction plan is out the window. The financial projections assume that the entire facility is built and operational in 2007—so much for the decade long phased approach outlined in the Environmental Impact Statement, which could conceivably allow for mid-course monitoring and assessment (i.e., compliance with Seattle noise ordinances, studying of impacts on adjacent wildlife habitat), as promised by the Parks Department.
• It is in fact economically viable to shut off lights at 10pm. All lighted field revenue projections assume a 10pm shut off—even though field advocates have claimed time and time again that a 10pm shut off time makes lighted fields economically unfeasible.
• The revenue projections are overly optimistic. For example, an extremely high utilization rate is assumed—it appears that the revenue numbers assume the fields are scheduled virtual every possible hour. Furthermore, the plan assumes a 100% collection rate, and 4% increase in fees annually. What happens when there is a revenue shortfall—who picks up the tab for the outstanding bonds? The taxpayers?
• The 15 acre grass meadow is in fact intended for sports-only use. The plan doesn't allot for other uses of the grass sports meadow besides for scheduled sports, rendering bogus the claims by the Parks Department and field advocates that this grass portion of the project is "multi-use".

Chapter 4 Title: Financing Options: City Financed Alternative and Non-Profit/Private Alternative

Number of pages: 6

15 year cash flow projections for project, assuming only 25% of construction costs need be financed through bonds.

Chapter 5 Title: Private Fundraising & Capital Campaign Proposal

Number of pages: 10

Outlines how field advocates plan to finance the park. "The Washington National Guard recently committed to undertake all earth-moving and rough grading required for the fields and wetland complex starting Summer, 2005. This in-kin service is estimated to have a value of $20 million. In addition, the Guard has indicated an interest in constructing all trails, bridges, restroom/concession buildings, and parking lots for the project. Thanks to this remarkable contribution estimaqted at $30 million, the capital campaign funds are now needed only for 1) soil development, planting, and maintenance work in the wetland restoration, and 2) purchase and installation of lights, fencing and synthetic turf for the 11 playing fields. The Capital Campaign for $8 million, the National Guard in-kind service, and the Pro Parks Levy dollars will complete the project in conjunction with bonds paid by revenue generated from field use."

Chapter continues to outline a $8 million capital campaign including naming rights, major gifts (foundations, corporations, individuals), fundraising events (a "Winter Convention" and a "Summer Festival"), and a sustaining gifts drive (buy a square foot of turf, request a per-user athletic user tax from sports leagues, etc.)

Attachments:

Number of pages: 10

Attachments:

• Seattle Sports Field User Fees (Current)
• Proposed Draft Ordinance (appears to be the same as the Mayor's)
• Park Department Facility Naming Policy and Procedure
• Donor Bill of Rights