HomeMy WebLinkAboutCS 04-11
cLi o~ Report To
Executive Committee
PICKERING Report Number: CS 04-11
Date: January 10, 2011
30
From: Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject: Horizon House Lease Agreement
Green River Community Centre
Recommendation:
1. That Report CS 04-11 of the Director, Corporate Services & Treasurer be
received;
2. That the agreement approved by Council under Resolution #113/09 providing for
a monthly payment of $800 to the City by Horizon House be reduced to $250 per
month effective January 1, 2011, all other terms and conditions to remain
unchanged;
3. That the Director, Corporate Services & Treasurer be authorized to write off the
outstanding balance owing of approximately $9,550 for the period September 1,
2009 to December 31, 2010; and,
4. That the appropriate officials of the City of Pickering be authorized to take the
necessary action to give effect hereto.
Executive Summary: In May, 2009 under Report OES 21-09, Council authorized a
renewal of the lease for the Green River Community Centre between the City, and
Horizon House at a rate of $800 per month. This was an extension of the existing lease
which had been in effect, in one form or another, since 2006.
Horizon House' financial situation has prompted them to review their revenues and
expenditures to bring them in line. This has led to a financial restructuring of sorts and
a request to the City to reduce their monthly lease payments from $800 to $250. At the
same time,they are reducing other costs and trying to increase memberships.
Report CS 04-11 Date: January 10, 2011
Subject: Horizon House Lease Agreement Page 2
Green River Community Centre
3
Financial Implications: While the reduction in monthly lease payments of $550
represents an annual reduction of $6,600 in revenue to the City, it is felt that is more
important to have a responsible tenant occupying this property to protect the City's
asset.
Future lease payments of $250 per month or $3,000 per year should offset, to the
greater degree, annual maintenance costs.
Sustainability Implications: . This report does not contain any sustainability
.implications.
Background: Horizon House has leased the Green River Community Centre since
April 1, 2006 at $800 per month. They have been able to pay this amount up to August
1, 2009 for a total of $6,400 but were unable to make any payments for the balance of
the year leaving $3,200 owing for 2009. For 2010, they were able to pay $500 in
January, but only $250 per month since, leaving $6,350 owing for the year ended
December 31, 2010.
Their current financial situation cannot provide sufficient funds to continue paying this
amount. They are reducing expenditures elsewhere and attempting to increase
memberships. The City has the option of reducing the monthly lease cost and retaining
what to date has been a desirable tenant or not.
In conclusion, it would appear to be in the best interests of the City to continue with the
existing tenant at a reduced rate in order to keep the property occupied and looked
after. The alternative would most likely be an unused facility that the City would have to
maintain and manage.
Attachments: Not applicable
Report CS 04-11 Date: January 10, 2011
Subject: Horizon House Lease Agreement Page 3
Green River Community Centre
32
Approved By: Approved / En rsed By:
Gillis A. Paterson Everett Bu tsma
Director, Corporate Services & Treasurer Director, Operations & Emergency Services
GAP:vw
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering City until
/012-010
Tony Prevedel, P.Eng.
Chief Administrative Officer