HomeMy WebLinkAboutMinutes - 8/15/2005 - Finance and Personnel Committee FINANCE AND PERSONNEL COMMITTEE MEETING
� Monday,Aagust 15,2005
Aldermen's Conference Room,7:00 p.m.
In Attendance: Committee Members: Chairman Alderman Murgatroyd, Alderman
Peterson and Alderman Schaefer. Absent: None. Also in Attendance: Mayor Low, City
Administrator Maxeiner, Assistant to the City Administrator Martin and City Clerk Jones.
Also in Attendance: Trey Cavalt Main Street Station
Chairman Aldernnan Mwgatroyd called the meeting to order at 6:35 p.m.
Discussion Regarding Ren�gotiation of Trev and Tom�.ease Agreement
for M�►in Street Station
City Administrator Maxeiner informed the Committee that at the August 16, 2004
Finance and Personnel Committee meeting Mr. Covalt, owner and operator of Main Street
Station located at 4A05 West Main Street, requested the Committee reconsider the terms of the
current lease agreement for Main Street Station between the City and Tom and Trey Corporation.
At the August 16, 2004 meeting following Mr. Covalt's presentation, the Committee
rec�uested that Mr. Covalt provide written justification for his request regarding reduction of the
current rent. Following receipt of the information from Mr. Covalt, Staff was directed to place
� the item on a future agenda of a Finance and Personnel Committee meeting.
City Administrator Maxeiner informed the Committee that in October 2004 Staff
received a letter fram Mr. Covalt outlining the following issues:
• Numerous inquiries have been made regarding re-opening negotiation, which until
recently have not been acknowledged;
• Rent escalated from $350 per month to $800 per month, and is currently $1,025 per
month;
• Mr. Covalt indicated he was assured by members of the former administration that the
lease amount was based upon the expansion of Main Street Station and utilizing more
space in the Metra buildin�, which has not occurred;
• A portion of the building continues to be occupied by employees of Metra, which has
precipitated Mr. Covalt calling in a plumber, on at least thirty different occasions, to
remove unacceptable material from the sewer lines deposited by the Metra employees;
o Mr. Covalt noted the City has not incurred any cost associated with repairs
• Metra employees use as many as five parking spaces in the restaurant parking lat during
busine ss hours. Additionally, Metra commuters often use the restawant parking lot rather
than the commuter parking lot across the tracks.
• Mr. C�valt informed the Committee that, at his expense, he expanded the parking lot and
installed concrete pads for Metra's and Main Street Station's garbage dumpsters.
• Mr. C�valt suggested the following amounts are equitable:
o September 1, 2004 to September 1, 2005 $800/month
� o September 1, 2005 to September 1, 2006 $850/month
Finance and Personnel Committee Meeting
August 15, 2005
Page 2
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Chairman Murgatroyd and Mayor Low acknowledged that on numerous occasions they
have noted commuters utilizing the restaurant parking spaces during the restaurant business
hours. In particular the Mayor noted vehicles picking up commuters arriving on the evening
train utilize parking spaces during the dinner hour. City Administrator Maxeiner informed the
Committee there are no restrictions regarding use of the parking lot. He stated the City leases the
property from Union Pacific Railroad, and, in turn, Mr. Covalt leases a portion of the parking lot.
Addressing an inquiry, City Administrator Maxeiner stated on occasion the City receives
grants from M��tra to maintain the property, which is actually owned by Union Pacific R.ailroad.
Chairman Murgatroyd opined he is amenable to negotiating with Mr. Covalt regarding
reduction of the rent. He acknowledged the current rent seems somewhat high in view of the
issues brought forth by Mr. Covalt. However, he suggested that rather than consider the terms of
the lease through only 2006, it might be more practical for the Committee to consider a longer
term. Mr. Covalt informed the Committee that since September 2004 he has been paying$1,025
per month in rent on the structure.
Responding to an inquiry regarding future plans, Mr. Covait indicated he intends to
remain in the restaurant business and stated, should Metra relinquish space in the north section of
the structure, he would expand the dining area and/or the kitchen facilities.
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City Administrator Maxeiner indicated the increase in the reirtal amount in the original
tease was based on assurances made to Mr. Covalt that he would expand his space in the
structure_ He opined that when the original lease was negotiated, the City had more risk due to
the condition of the structure. Extemal and internal repairs have been made to the structure, and
the City's exposure is now not as geat.
City Administrator Maxeiner informed the Committee that competitive rates in the area
are appro�mately $6.00 per square foot, or $950 per moirth for the structure, clase to Mr.
Covalt's suggested amount of $$50 per month. Chairman Murgatroyd opined he does not
foresee property in the area altering to such an exterrt that values would increase significantly
precipitating an adjustment to the lease amount. A brief discussion ensued.
Alderman Peterson opined Main Street Station has been a good tenant to the City for
nearly nineteen years and is entitled to some consideration by the Committee. Responding to
Alderman Peterson's inquiry, Mr. Covalt presented documentation indicating he ha.s called a
plumber for seivice at the building eight times in 2005, at a cost of$6S to $100 per occurrence,
to rod out the sewer line.
City Ad ministrator Maxeiner informed the Committee that Staff is working with Metra
regarding removal of the chain link fence, which separates the commuter parking lot from the
Main Street Station parking lot, making the commuter parking lot more convenient to commuters
� and vehicles dr��pping off commuters.
Finance and Personnel Committee Meeting
August 15, 2005
Page 3
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Motion by Schaefer, seconded by Peterson, to direct Staff to address Main Street
Station's paxking issues with Union Pacific, and to direct Staff to draft a lease between the City
of McHenry and tenant Tom and Trey Corp. dJb/a Main Street Station, at the rate of$950 per
month through 2008, with the option to extend the lease after 2008 on a year-to-year basis at the
rate vf$950 per month, to be recommended to full Council.
Aye: Murgatroyd, Peterson, Schaefer.
Nay: None
Absent: None
Motion carried.
Chairman Murgatroyd informed Mr. Covalt that Staff would work on the lease and
provided a copy to him for review prior to presentation to full Council. Mr. Covalt thanked the
Committee for their time and consideration.
New Business
No ne��business was discussed.
Adiournment
Motion by Peterson, seconded by Schaefer, to adjourn the meeting at 7:15 p.m.
� Aye: Mur�atroyd, Peterson, Schaefer.
Nay: None.
Absent: None.
Motion carried.
Respectfully submitted,
C-
Steven C. Murgatroyd, haii n
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