Blaine sports field lease takes new turn

by Tim Hennagir
Life Editor

The Metropolitan Airports Commission (MAC) is ready to drop a long-standing athletic field lease with the city of Blaine that’s tied to Airport Park and the Blaine Soccer Complex.

The MAC’s proposed lease partner, the Minnesota Amateur Sports Commission (MASC), is willing to pay more to lease the 49 acres of recreational land.

This map shows the 49-acre Airport Park and Blaine Soccer Complex. City officials, the Metropolitan Airports Commission (MAC) and the the Minnesota Amateur Sports Commission (MASC) are currently involved in a complex discussion over athletic field leasing for the property. Click on the map to see a larger image. Map graphic courtesy of Blaine GIS

Earlier this week, a MAC management and operations subcommittee met and recommended that airport commissioners consider a lease amendment.

The MAC owns and operates the nearby Anoka County-Blaine Airport, one of its six smaller relievers. The leased park land is MAC-owned property.

Gary Schmidt, director of reliever airports, presented the proposed lease agreement during the Jan. 3 management and operations committee meeting.

Schmidt’s detailed Dec. 27 background memo that explained the agreement as well as its presentation this week surprised Blaine City Manager Clark Arneson.

Arneson; Robert Therres, Blaine’s public services manager; and Jim Kappelhoff, park and recreation director, attended Tuesday’s subcommittee meeting.

“I wasn’t opposed to the concept of the NSC and MAC entering into an agreement, but I made it clear to commissioners there’s a third party to this, and that’s the city of Blaine,” Arneson said. “We haven’t had any meetings on this.”

Arneson said the proposed lease was approved as presented by Schmidt.

According to Schmidt, in 1982 the city and the MAC entered into a license agreement that allowed the city to occupy and use MAC property at the corner of Radisson Road and 105th Avenue for recreational use.

That agreement was modified in 1985, adding 10 acres, and in 2002 the agreement was renewed at an annual fee of $600.

In 2006, MAC commissioners determined its reliever airports should strive to be more self-sufficient, in part by being more aggressive in pursuing non-aeronautical revenue.

One opportunity to increase revenues was to charge more for recreational property near MAC’s six smaller metro airports.

According to Schmidt, to help establish a fair value for the athletic fields leased to the city, the MAC had a Plymouth-based company do a market rental rate appraisal.

A February 2009 report established a short-term rental rate (without a recapture clause) for the 49-acre parcel at $2,448 per acre, or about $120,000 in total.

Schmidt said it was the MAC’s intent to maintain control of the northeast section of this parcel at the corner of 95th and Radisson Road for commercial development which reduced the value of leased property to approximately $100,000.

Given the economic decline since February 2009, the market rental rate today is likely less than $100,000, he said.

In 2010, MAC staff offered a lease to Blaine for $70,000 per year. The offer at “less than fair market value” was consistent with Federal Aviation Administration (FAA) regulations which allows exceptions to fair market value for non-aeronautical use of property for community purposes provided certain conditions are met.

According to Schmidt, the city’s payment to the MAC would have come from three sources: approximately $39,000 in cash from $5 fees paid by each soccer player, a credit for $12,000 for annual sewer and water systems maintenance performed by Blaine on behalf of MAC and the balance from either Blaine’s parks fund or its general fund.

As part of this agreement, Blaine would have covered the public portions of the airport in a service agreement with the Blaine-Spring Lake Park-Mounds View (SBM) Fire Department.

The Blaine City Council rejected this offer and a subsequent offer to the city in early 2011 for a short-term agreement at $39,000 per year, allowing time to further negotiate on other issues, was also not accepted, Schmidt’s memo stated.

Last fall, the MAC was approached by the MASC regarding a lease agreement.

The MAC-owned fields are adjacent to the National Sports Center (NSC).

The MAC already has a lease agreement with the MASC for MAC property used for the Victory Links Golf Course.

Schmidt said the MASC runs the golf course and the MAC shares the profits.

The MASC has offered to pay the MAC $50,000 per year for the athletic field property use for the first two years of a 25-year contract.

In years three through five of the lease, the fee would be escalated at 2 percent then 3 percent.

Additionally, Schmidt said the MAC would retain the right to develop a five-acre corner parcel at 105th Avenue and Radisson Road for commercial development should the opportunity arise.

Barclay Kruse, the NSC’s chief communications officer and a MASC associate director, confirmed the MASC’s interest in a proposed leasing agreement.

“Our motivation is pretty simple,” Kruse said. “We want to make sure this land is used for youth and community sports and not be commercially developed.”

Arneson said the city has a similar goal, but four related issues involving agreements with the MAC have made the athletic fields discussion more complex.

“My prior direction from the council was to address Xylite Street road reconstruction issues, sewer and water, airport fire service and ball field use,” he said.

Last month, the MAC and SBM Fire Chief Nyle Zikmund worked out a one-year airport fire services agreement.

However, the 11th-hour solution didn’t address key points of contention that keep the parties from inking a long-term agreement that’s tied to the recent developments with the athletic field leasing discussion.

Also left in limbo is city access to the blue concession building that sits on MAC property.

According to Arneson, parking for the Victory Links Golf Course, soccer fields and the soccer building and access to a softball field maintenance shed would have to be covered in a separate MAC ground lease with the city.

Arneson said he spoke with MAC Executive Director Jeffrey Hamiel after Tuesday’s management and operations committee meeting about the proposed athletic field lease agreement.

“I don’t think this will go to the full commission anytime soon,” Arneson said Tuesday. “Basically, there needs to be another document that spells out how these fields will be used.”

Arneson said he had a meeting scheduled for Friday, Jan. 6 with NSC representatives to discuss the recent field leasing proposal.

Tim Hennagir is at [email protected]