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Home My WebLink About02-21-13 letter from Friends of the Story Mansion to the City regarding Sale Agreement The Sforl. Post Office Box 6767 BOZEMAN MT 59771 FRIENDS o f THE FRIENDS of THE STORY.ORG STORY MANSION friendsoffhestory@ya6oxom r February 21, 2013 Mr. Chris Kukulski City Manager, City of Bozeman P.O. Box 1230 Bozeman, MT 59771 RE: STORY MANSION SALE AGREEMENT Dear Chris: As you know, the Friends of the Story Mansion(FOS) has been advised that Exergy Development Corporation will not be providing the donation necessary to purchase the Story Mansion before the established deadline of February 28, 2013. While disappointed that the terms of the current Sale Agreement won't be satisfied, FOS remains enthusiastically committed to advancing the City's vision of completing the renovations of the Mansion and continuing its use as a vibrant community center. To that end,FOS has prepared the attached"Story Mansion Purchase Status and Proposal" for your consideration. In this document, FOS proposes purchasing the property directly from the City over a six year time period,per the terms of a Contract for Deed. Please also find attached a Financial Statement demonstrating FOS's projected income to make $30,000 annual payments toward purchase of the property. We Iook forward to discussing this proposal further with you and the City Commission in the near future. In the meantime,please let me know if you have any questions or need any additional information. ISinc ` ely, Andy Epple, FOS Board irectors Gordon Brittan, Vice Chair Peter Bogy,Treasurer Kaaren Jacobson, Secretary Jane Klockman Jerry Coffey Elizabeth Darrow Peggy Beltrone Mara-Gai Katz Attachments (2) as noted Story Mansion Purchase Status and Proposal February 21,2013 Current Situation Exergy Friends of the Story Mansion(Friends of the Story) is under contract with the City of Bozeman,Agreement to Sell and Purchase Real Estate, (the Agreement) dated May 31, 2012,to close the sale of the Story Mansion,Carriage House and appurtenant land at 811 Willson Ave, Bozeman,Montana prior to July 1,2012. Said purchase and close is subject to Addendum to the Agreement to Sell and Purchase Real Estate, approved by the City Commission on September 24,2012; extending the closing date until February 28, 2013. Friends of the Story (Friends)has been informed that Exergy Development Group, LLC., a Friends major donor,will be unable to tender at this time the anticipated donation. Without this major donation, Friends is unable to fund the agreed$390,222 balance of the purchase price by, or before,February 28, 2013. Since negotiating the Agreement, Friends of the Story has energetically moved forward with management, property improvements and maintenance: • North and South Well testing and upgrade $ 1,959 • Mansion and City Park irrigation system $17,750 • Landscaping of Mansion and City Park $25,464 • Lawn leveling and sodding $ 3,831 • Management,business and event costs, lawn care $29,933 • Repair, Cleanup, Improvements and Equipment $ 6,878 • Carriage House roof insulation $15,804 $101,619 City Reimbursement of improvements/maintenance $ 23,670 Total Friends of the Story Mansion 2012 expenditures $ 77,949 Friends is highly motivated to continue on the pathway to ownership with the purchase, and proposes to do so with a Contract for Deed instrument by making a payment now,then annually and at six years, or before, satisfying the entire purchase price. Setting During early 2011,the City published a"Request for Proposals"and on July 18, 2011 Exergy Development Group,LLC submitted a proposal to purchase the Mansion through a Montana nonprofit corporation Exergy Friends of the Story Mansion. The City Commission adopted Ordinance No. 1821, effective May 23,2011, authorizing the sale and purchase of the Story Mansion. Proposal for Going Forward Although without the cash in hand to fund the Agreement,the Friends believe it has the desire, ability and community support to pay the City$390,222 over time: • Contract for Deed, $15,000 now,$15,000 with close, $30,000 annual payment, and full purchase price within 6 years,then title would transfer to the Exergy Friends of the Story Mansion, • City begins immediately getting cash with interest and during a period of time without the burden of carrying the operating expenses. • The Friends Board is committed, and has the projected income,to pay$30,000 per year. (See attached Financial Statement) • The existing closing with American Land Title Company would continue with modified escrow instructions to accommodate the change in purchase instrument. • Details of the restoration would be modified to accommodate the new time frame and payment plan. The Plan presented to the Bozeman City Commission on February 7, 2011 by the Friends would have extended the January, 2011, deadline for recovery of$392,000 to 2018. The Friends current proposal would achieve the recovery not later than 2019. Most importantly, consistent with the Commission and Community's original vision, upon close with the Contract for Deed,the Friends of the Story would assume the risk, management and maintenance and begin the restoration process of Bozeman's iconic landmark. ht iM ZU13 Buciget pb_U2 2U 13.xlsx Pagel of 3 Exergy Friends of the Story Mansion 2012 Actual (Jan-Dec'12) 2013 Budget(Jan-Dec'13) 212012013 EFSM EFSM EFSM QB# IREVENUE 2010 2011 2012 2012 2013 2013 Actual Actual Actual Actual Budget Act.YTD Non-Production Revenue Individual Membership(new and renewals) 800 12,000 Individual Donations 750 51000 Major Gifts 32,800 25,000 Board Donations 17,200 5,000 3,000 Business Donations 50 Grants&Foundations 10,000 Restricted donations 1,202 2,100 605 Interest Income g 24 Matching Gifts 1,584 1,000 City Park Reimburse(capital improvements) 16,728 2,510 City Park Reimbursement(lawn care,well use) 805 9,000 3,627 City Park Reimburse(snow removal) EFSM Event Income(tour donations) 188 City Event Rental Income 29,344 14,993 23,855 45,000 Miscellaneous Revenue(City R&M,jazz,City) 369 100 Non-Production Revenue Total 29,344 14,993 23,855 72,484 114,124 9,842 Fund Raisers Revenue Fund Raiser#1:Ice Sculpture(2013) 3,000 Fund Raiser#2:Sweet Pea(concession) 307 600 Fund Raiser#3:Victorian Holiday Tea 2,350 3,000 Fund Raiser#4:Mansion Clue(2013) 3,000 Fund Raiser#5:Title Celebration(2013) Fund Raisers Revenue Total - - - 2,657 9,600 Production Revenue Story Under the Stars(donations) 3,824 10,000 Story Under the Stars(concesstions) 264 300 Program Advertisements Production Revenue Total - - - 4,088 10,300 - TOTAL BUDGET REVENUE $ 29,344 $14,993F $23,9551 $79,229 $134,024 $ 9,842 QB# JEXPENSES 2010 2011 2012 2012 2012 2013 2012 2013 Actual Actual Actual Actual Budget Act.YTD Administrative Staff Executive Director Bookkeeping 2,366 3,000 480 Benefits Package Administrative Staff Sub-Total - - 2,366 3,000 480 Payroll Taxes FICA - - - 147 186 30 Medicare - - - 33 42 7 SUTA - - - 2 3 0 Workman's Compensation - - - 33 42 7 Payroll Taxes Sub-Total 215 273 44 https://col-excel.offi.ceapps.live.com/x/ Iayouts/Xlprintview.aspx?&sessionld=l2.27acbd7... 2/20/2013 EFSM 2013 Budget_pb_02 20_13.xlsx Page 2 of 3 Administration Consultant/Administrator 4,000 20,000 2,000 Propery Mgr 9,100 25,200 2,600 Accounting 76 1,000 Office Space 251 2,100 350 Office Equip.Lease&Maintenance 170 300 Finance Charges(Credit Card&Bank Charges) 179 180 Fees and Dues(Sec State&Membership) 140 Gifts,Awards,&Education 240 Insurance 3281 8,904 Internet Service 931 1,022 1,020 780 Postage 281 200 Supplies and Materials 1,405 786 612 75 650 Receptions&Hospitality 1,000 Telephone(inc.alarm) 1,271 1,274 1,302 1,200 Utilities(electricity) 2,157 1,973 2,508 2,300 Utilities(natural gas) 5,408 3,999 2,784 2,500 Utilities(Refuse Disposal) 992 7611 752 750 Utilities(Sewer) 184 216 5881 300 Utilities(inc.water) 375 387 608 400 Alarm Mon itoring/Inspections 440 486 500 Repairs/Maintenance 1,566 379 18 2,337 750 Cleaning 430 2,460 2,100 Lawn Care(fertilization,weed control and cleanup) 1,389 1,400 Snow Removal 201 - Travel/Meetings(education) 232 290 City Assessments(property,streets,lights) 770 2,181 2,228 2,000 Uncatergotized Expenses 906 1,142 Total City Expenses/Operating Activity 18,524 17,230 17,371 Administration Expenses Total 15,360 13,2571 12,778 19,464 72,944 6,092 Marketing Graphic Artist 600 Web Designer 465 Advertising/Print 804 4,000 Advertising/Electronic Media Photography 400 Posters,Banners,&Billboards 1,600 Printing 135 1,200 Public Relations Marketing Expenses Total I - - - 1,404 7,800 - Fundraising Expenses Fund Raiser#1:Ice Sculpture(2013) 1,500 Fund Raiser#2:Sweet Pea(concession) 781 750 Fund Raiser#3:Victorian Holiday Tea 1,021 1,000 Fund Raiser#4:Mansion Clue(2013) 1,000 Fund Raiser#5:Title Celebration(2013) Fundraising Expenses Total - - - 1,802 4,250 - Production Expenses Story under the Stars 6,568 7,000 Production Expenses Total - - 6,568 7,000 - https://col-excel.officeapps.live.com/x/ layouts/xlprintview.aspx?&sessionld=12.27acbd7... 2/20/2013 EFSM 2013 Budget_pb_02 2O_l3.xlsx Page 3 of 3 TOTAL BUDGET EXPENSES $ 15,360 $13,257 $12,778 $ 31,814 $ 95,267 $ 6,616 SUMMARY 2010 2011 2012 2012 2013 2013 Budget Ad.YTD TOTAL REVENUE $ 29,344 $14,993 $23,855 $ 79,229 $134,024 $ 9,842 TOTAL EXPENSES $ 15,360 $13,257 $12,778 $ 31,819 $ 95,267 $ 6,616 DIFFERENCE $ 13,984 $ 1,736 $11,077 $ 47,410 $ 38,757 $ 3,226 Capital Expenses 2012 Irrigation/Parking 17,838 Landscaping and Lawn Repair 25,338 Building Carriage House 15,804 Equipment,Chairs,Tables,Systems 6,878 Capital Expenses Total 65,858 - - i'City has paid in 2013$6,137 for 2012 capital and operating expense reimbursements https://col-excel.officeapps.live.com/x/ layouts/xlprintview.aspx?&sessionId=I2.27acbd7... 2/20/2013