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HomeMy WebLinkAboutStory Mansion Proposals_18 Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: Chris Kukulski, City Manager SUBJECT: Story Mansion Proposals MEETING DATE: Monday, May 19, 2014 AGENDA ITEM TYPE: Action RECOMMENDATION: Sell the Story Mansion to The Portal School of Creativity and Innovation (PSCI) for the appraised value of $1,540,000. SUGGESTED MOTION: I move to authorize the City Manager to proceed with the steps necessary to negotiate a purchase agreement with The Portal School of Creativity and Innovation for transfer of ownership of the Story Mansion and associated property located at 811 South Willson Avenue. BACKGROUND: This memo serves as a summary of the steps taken by the City Commission over the past 18 months to “develop a permanent plan for the Story Mansion.” Of the five parties that have responded to the City’s request for proposals during this period only The Portal School of Creativity and Innovation (PSCI) remains interested in purchasing the property at its appraised value of $1.54 million. On February 25, 2013 the City Commission adopted their 2013 - 2014 priorities. One of the identified priorities was to “develop a permanent plan for the Story Mansion.” On April 8, 2013 the City Commission considered options to accomplish that goal and passed the following motion unanimously: Vote on the motion to direct the City Manager to investigate options one and two presented in this memorandum and develop a permanent plan for receiving proposals for the sale of the Story Mansion which could include either a private sale under the selling at no less than 90% of appraised value or proposals consistent with the previous proposal to a nonprofit. (link to minutes) Option One within the April 8th memorandum (which also includes a full history of the Story Mansion since its purchase in 1993) was to sell the Story Mansion by negotiated sale without relying on the historically significant building provisions of Sec. 2.06.870.D, BMC, thus selling at no less than 90% of appraised value. Option Two was to repeat the request for proposals process used in 2011 wherein the City solicited proposals from non-profit organizations and other groups interested in purchasing the Story Mansion. 301 Further Commission direction during the April 8th meeting indicated that proposals would be accepted until a suitable buyer was selected for negotiation, but that initial review would take place on all proposals received no later than 5 p.m. on August 28, 2013. A request for proposals was advertised in the Bozeman Daily Chronicle legal section multiple times and uploaded to the City of Bozeman website in the news section and the Bids/Projects page of the website. Four proposals were received by the preferred August 28th deadline. One additional proposal was received after that deadline. On November 12, 2013, the City Commission heard from each of the proposals submitters to better understand their proposals and determine how the city would move forward. After considering the proposals, the City Commission passed the following motion 4-1 to: Vote on the Main Motion as amended to authorize the City Manager to proceed with the steps necessary to negotiate the sale and/or gifting agreement, of the Story Mansion and associated property within 811 South Willson Avenue, by obtaining one or more appraisals depending upon the City Manager’s judgment, and examining the financial surety of the applicants as indicated in the Clause (as read by Attorney Sullivan). (link to minutes) The City-ordered appraisal was received on March 17, 2014 setting the value of the property at $1.54 million. The appraisal was immediately made available to the public and was sent to the five submitters of proposals for their review. In light of the appraisal, I requested updated status reports on the submitters’ original proposals. A summary of their responses follows: 1) PSCI remains interested in pursuing the purchase of Story Mansion, at the fair market value, in accordance with Option One from April 8, 2013 approved motion. (Proposal attached) 2) The Story Mansion Inn Project has communicated that they are not willing to pay the appraised value for the property due to the $2 million - $2.5 million in renovations that their business plan calls for. 3) The Bozeman Art Museum has communicated that their offer is too low in light of the appraisal and that the residents of Bozeman should get the benefit of higher offers. 4) The Montana Center for Civic Engagement has withdrawn its proposal for lack of foundation support to fund its development, which is due primarily to timing and structural changes within the most probable organization to fund the concept and remaining restoration. 5) The David Nathan Meyerson Foundation has offered $1 for the property, with the intent to sell the Carriage House to Morton Meyerson for $250,000, with money to be earmarked for Story Mansion with an additional $250,000 from the DNMF to manage, maintain, and enhance Story Mansion for the benefit of citizens of Bozeman under the direction of a hired manager to operate and study the best use of the mansion for the public. (Proposal attached) 302 Only The Portal School of Creativity & Innovation, remains interested in pursuing the purchase of Story Mansion in accordance with Option One from April 8, 2013 approved motion. Therefore, I recommend you authorize me to proceed with the steps necessary to negotiate a purchase agreement with PSCI for transfer of ownership of the Story Mansion and associated property located at 811 South Willson Avenue. I would work to close this transaction in the 2014 calendar year. UNRESOLVED ISSUES: None. ALTERNATIVES: Conduct a request for proposals process to select a local real estate broker who specializes in selling high-end historical properties to sell the Story Mansion. FISCAL EFFECTS: The $1,540,000 in cash should be placed into the general fund reserve. The Story Mansion was purchased in 1993 for $1,300,000 utilizing the City’s general fund. In addition, all ongoing maintenance, operations and grant matching dollars have been paid out of the City’s general fund Attachments: PSCI 2014 Purchase Proposal DNMF 2014 Purchase Proposal Report compiled on: May 15, 2014 303 1 | Page THE PORTAL SCHOOL OF CREATIVITY & INNOVATION Story Mansion Purchase Proposal 2014 April 18, 2014 ENTITY/PURCHASER: The Portal School of Creativity and Innovation (DBA of Tree of Life Ministries, 501(c)3 ) PO Box 339 Bozeman, MT 59771 Matthew L. and Lisa R. Weaver, Directors 209 Accola Drive Bozeman, MT 59715 406.522.0038 (p.) 406.579.4982 (c.) info@theportalschool.com Dear Mayor and City Commissioners— In light of the recent appraisal of the Story Mansion, The Portal School of Creativity and Innovation (a DBA of Tree Of Life Ministries) is resubmitting our proposal for purchase at the fair market value (per our original bid) determined by appraisal to be $1,540,000. OUR QUALIFICATIONS 1. We understand the city’s concern that a non-profit would be able to sustain the on-going expenses of renovating and maintaining a historic building. • An anonymous donor has offered to provide the purchase price as well as a fund for renovations and on-going maintenance. These funds will be available as the purchase of the Story Mansion is underway, under the condition that the anonymity of the donor is protected. • We understand the city’s interest that the sale of the property be contingent upon these funds being verified at the proper time. 2. The city has also expressed concern regarding the qualifications of individuals making bids for the mansion. We are well-qualified, not only to restore, maintain and operate the mansion, but also to do it in a way that is meaningful to the community of Bozeman: • Matt and Lisa Weaver have 11 years Business Experience in Property Management: o These services are rendered under long-term arrangements with the owners. o Each of these homes is maintained in pristine condition. o We have extensive knowledge of systems, resources and contractors in the community. o Good working relationships with established contractors in the community to provide excellent service, repairs and maintenance of these properties. 304 2 | Page • Matt and Lisa Weaver have 30 years experience running successful non-profit organizations. o Each of these organizations has grown under their supervision. o They have always operated their non-profit entities in the black. o Out of their surplus, these non-profits have always invested in the community— financially and otherwise—giving to groups like the food bank, Love INC, churches, Haven, Special Olympics, REACH and many other groups. o We have 7 years experience operating a public benefits educational organization equipping individuals and organizations for effective conflict resolution and personal development. • Matt and Lisa Weaver have a personal investment in community o They have lived in the community for 22 years (Since August 1992). o They have raised their daughters in the community. o They have volunteered in the community through: the public schools, the Chamber of Commerce, THRIVE, Bridger Alternative School, serving in numerous religious organizations including churches and Love INC, as well as providing programs for the local jail, and Adult Education. In addition we have provided mentoring, occasional housing as well as employment training for at-risk youth. • Operating a school o In our first year of operating a post-secondary school, the school is operating in the black due to a combination of tuition, class fees and donations from the community o The school has enjoyed both full-time and part-time students aging from 18 to 73 with a roster of 41 students our first year taking anywhere from 1 to 8 classes. Most of these returning each block to follow one or two particular tracks throughout the school year. o Our students have expressed that the classes are not only enjoyable but meaningful and even transformational. Those that have followed particular tracks through the school year have seen marked growth in their personal development. o We have employed (part-time) a total of 11 instructors, all of whom are professionals in their field. Classes include business, painting, dance, photography, theater, writing, and our popular Creative Genius series as well as our highest attended Keys series (Keys to Becoming a Powerful Person, Keys to Powerful Relationships, Keys to Unlocking Your Future, etc.) One recent example of how The Portal School intends to use the Story Mansion to impact the community in meaningful ways: 305 3 | Page The Portal School held a fund-raiser for Haven Shelter for Domestic Abuse Victims at the Story Mansion. We provided a festive art show with live music and hors d’ouvres. This event was free to the public. Through generous donations of local businesses we provided gift-card drawing for those who made donations. We estimate 300-400 community members participated. The majority of these people had never been in the Story Mansion. Not only did this provide a festive and free event for the community, scores of people were able to enjoy the beauty of the Story Mansion, many for the first time, and we were able to raise over $1,000.00 for Haven. OUR COMMITMENT 1. We recognize that extensive repairs and renovation will be required to make the property useable in its entirety. We are committed to seeing the Story Mansion restored and fully usable for our own purposes as well as for increased public use: • We will restore and maintain the property to maximize preservation of the historic integrity of the property while making it suitable for contemporary use. • At the purchase of the property, a fund in excess of $2million will be established from which to make the renovations and to provide for ongoing maintenance. • Matt and Lisa Weaver, founders of The Portal School of Creativity, have been in business managing multi-million-dollar homes for 11 years. They have maintained these homes in pristine condition with great integrity. They currently manage or maintain 10 homes, most of these under long-term arrangements with the owners. 2. We understand that the city is interested in proceeding with the sale of the property in a timely manner. • We have travel obligations for the month of May, but hope to begin the process of negotiations in June of 2014 if the commission is ready to proceed at that time. OUR VISION FOR THE STORY MANSION: Training Center In September 2013, The Portal School of Creativity and Innovation was launched. The Portal School of Creativity and Innovation exists to empower and train a new breed of innovators in business, art, education and many other fields of occupation. In our first year we offered 16 affordable classes to the general public with a total of 41 students and 11 teachers. 306 4 | Page Our intent is to acquire the T. B. Story Mansion as the centerpiece of The Portal School of Creativity and Innovation. The facilities and grounds are well-suited to become a training center for local, national, and international students. The environment is brilliant for the quality of professionals we have attracted in acting, music, fine arts, film, business, etc. The Portal School is a subsidiary of Tree of Life Ministries, a Public Benefits educational organization now in its 8th year. Tree of Life has developed a strong history of bringing effective, meaningful and transformational programs to the community of Bozeman. These include relationship and conflict coaching, parenting classes, an employment preparation course for teenagers, and our popular class “Becoming a Powerful Person” taught in the jail and in LOVE INC. Training in creativity and innovation complement the DNA of our city and will enhance both the private and public sectors. We will continue to offer meaningful learning opportunities to the community in the years to come. Community Center The facility and grounds of the Story Mansion will continue to be available as a premier Community Center for Bozeman. The mansion and carriage house will be renovated to provide affordable and varied opportunities for community access. Our commitment to this community is to steward the Story Mansion with excellence providing increased community access to the Mansion, Carriage House and grounds • Through on-going facility use for parties, weddings, reunions, business and non-profit meetings, etc. Rental agreements would be handled privately, through our administration. • Further access for the community will be possible throughout the year through affordable classes, workshops, concerts, shows as well as professional level conferences associated with the Portal School. • Regular access to the community through free or affordable events such as tours, teas, balls, art shows, etc • We welcome use of the Story Greens public park area and look forward to a partnership with the city in making those grounds inviting to the community. Fiscally Responsible Our proposal benefits the people of the City of Bozeman financially as well. We are not asking for a gift from the city. With the purchase of the mansion at fair market value, the city will be able to allocate the funds to enhance the quality of life in Bozeman. Long-term economic benefit will result as we achieve our long-term goals, attracting world-class instructors, staff and students to our school and providing events for the community that will make our city attractive to those looking to relocate. We are confident that under our stewardship, the Story Mansion will become an economic asset to the community 307 5 | Page An On-going Legacy For A Stronger City The Story Mansion has historical significance to this community. We are committed to seeing it restored and preserved. Our vision extends beyond maintaining a monument to the past. The Portal School of Creativity and Innovation desires to elevate this jewel of Bozeman’s history into a forward- looking legacy that will extend its significance far into the future. Our experience in business has proven valuable in the stewardship of pristine, multi-million dollar homes. The mansion and carriage house interiors will be restored and equipped with state-of-the-art equipment to facilitate a creative learning experience while maintaining the historic charm and beauty. Our dream for the mansion is bigger than the Portal School. We love our city. We have personally lived in Bozeman 22 years demonstrating a long-term commitment to this community. We are invested in empowering people to see their dreams fulfilled through discovering their identity, strengthening their character, growing in creative skills, and flourishing in bold innovations. Our intent is to partner with others in leaving a legacy of a thriving community. Respectfully, (Signatures on file) Matt and Lisa Weaver, for The Portal School Of Creativity and Innovation/Tree of Life Ministries 209 Accola Drive Bozeman, MT 59715 308 From:Morton Meyerson To:Ashley Flynn Cc:Foundation: David Nathan Meyerson Foundation; Marti Meyerson; Leslie Meyerson Gordon; Ian Trumpower Subject:Re: Story Mansion proposal status Date:Thursday, May 08, 2014 2:52:12 PM The David Nathan Meyerson Foundation is prepared to buy Story Manion for $1.00. If this is done it will then cleave off the Carriage House and sell it to me for $250,000 and these monies will be earmarked for Story Mansion only. The foundation will add $250,000 so there will be $500.000 available to manage, maintain and enhance Story Mansion for the benefit of citizens of Bozeman. The DMNF will search for and hire a leader to manage the Mansion operations and undertake a study to find the highest and best use of the Mansion for the public. This should take a few years to come up with a plan and funding ideas. This person would work with the city, MSU, the Friends of SM and others to try to come up the best plan. We have had informal conversations with a leading Bozeman businessman about partnering with us on this project. He indicated interest. If I were younger I would head up the study myself, but I can't at my age. If the City were to accept our proposal there were be money to manage, maintain, improve the site and ultimately come up with the best possible plan for it future use. Morton Meyerson On Thu, May 8, 2014 at 1:59 PM, Ashley Flynn <aflynn@bozeman.net> wrote: Hi there, Morton, Can you please respond by Tuesday, May 12th so that I can prepare the update for the City Commission? The update is on the agenda for the May 19th meeting. Hope you had awonderful trip! Thanks again, Ashley 309 From: Morton Meyerson [mailto:morton.meyerson@2m.com] Sent: Friday, May 02, 2014 12:07 AMTo: Ashley FlynnSubject: Re: Story Mansion proposal status Thanks for the email. I am in Jerusalem so I will respond next week after I get back and review things with my CFO COO at 2M. Have a nice weekend Morton On Fri, May 2, 2014 at 12:16 AM, Ashley Flynn <aflynn@bozeman.net> wrote: Good afternoon, Morton, Chris Kukulski will be updating the City Commission on the current status of the Story Mansion at a Commission meeting in the next 60-90 days. Based on your review of the property appraisal, is 2M going to submit a proposal to the City Commission? I look forward to your response and please do not hesitate to contact our office with any questions. Thank you, Ashley Flynn Executive Assistant City Manager's Office City of Bozeman 121 N. Rouse P.O. 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