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City approves Odyssey agreements

City Commissioners Tuesday approved agreements with Odyssey Theaters for construction of a new eight-screen theater on Second Street. Odyssey's three-screen theater at Prairie Hills Mall will close after its final evening shows this Sunday. The n...

City Commissioners Tuesday approved agreements with Odyssey Theaters for construction of a new eight-screen theater on Second Street.

Odyssey's three-screen theater at Prairie Hills Mall will close after its final evening shows this Sunday. The new theater expected to open in Summer 2019.

Commissioners approved the final plat for the project.

The plat consists of four lots. The site is between Sims Street and First Avenue East, along the south boundary of Second Street East.

"It's been heard by the planning commission, worked through by staff, and I believe we've met all the requirements for a final plat," Walter Hadley, city planner, said.

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An easement with neighboring Century Link that was not on the plat was addressed.

"Odyssey has been in communications with Century Link and they've agreed to give up their easement that would otherwise be in the area of construction," Jan Murtha, city attorney said. "It won't be vacated until construction is complete, but the plat needs to be filed prior to that construction."

Official documentation from Century Link will be provided to the city indicating that they are going to be giving up the easement at the closing of the property, Murtha said.

Bryan Sieve, Odyssey president, attending Tuesday's meeting, called it a "chicken and the egg scenario."

"They have a pretty big line running through their property right now, which is actually not in the alley right-of-way, it's actually part of the city property," Sieve said. "I thought I've seen it all. I guess I haven't."

Replatting the land while it has an easement that will be built over would create a problem for the title company, Sieve said, that would impact the theater's ability to get insurance for the land and affect lendability, among other problems.

A development agreement with Odyssey was also approved.

Per the agreement, Odyssey will plant new trees along Second Street.

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"The owner will give the city notice when they start construction...so the city can retrieve the existing trees, which unfortunately don't line up with how the building is going to be laid out, and replant them later," Murtha said.

Decorative street lights will be installed along Second Street. Odyssey will be responsible for the cost of two, and the city responsible for one.

A parking and no-build easement agreement was approved, as well, which is required as part of the purchase agreement.

Parking will remain city property, with Odyssey promising the area will be available for both theater patrons and members of the public.

Overnight and 24-hour parking will remain prohibited.

Per the no-build easement, the city agrees no vertical structures will be placed on the parking areas.

"Neither of these will be going into effect until construction is done," Murtha said. "During the period of construction, the city will agree to provide these areas for Odyssey's use for the staging of construction."

A sidewalk maintenance agreement with Odyssey was also approved. The sidewalk will be city-property and maintained by Odyssey.

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"They will keep it clear of debris and shovel snow," she said. "This agreement will remain attached so long as this building is operated as a theater."

Sieve thanked the city's staff, saying they did "a great job."

"It was a lot of hard work, a lot of technical details that had to be worked out," he said. "On behalf of Odyssey...we've enjoyed working with you folks and look forward to construction starting here very shortly."

He added, "It's going to be a great facility."

In other business:

The city approved its 2019 general fund budget.

A balanced budget was submitted to city commissioners at their Sept. 11 meeting.

The general fund is balanced at $19.2 million for revenue and expenses, which is 14 percent higher than 2018, Linda Carlson, interim city administrator, explained.

The general fund tax levy is $4.7 million with no city property tax increase.

The oil impact revenue subsidy to the general fund in 2019 will be $4.48 million, compared to $3.5 million in 2018.

The budget includes a salary increase for commissioners, a step increase for all non-exempt employees, and 2 percent increase for exempt and stepped-out employees.

Proposed sales tax allocations include $15,000 for a wage compensation study, $50,000 for an event center feasibility study, $250,000 to the downtown square project, and $400,000 for the airport runway expansion project.

"Those were items we had put down for allocations with the funding we have coming in for the one percent sales tax," Carlson said.

The capital projects fund for 2019 is proposed at $6.75 million.

From revenue interest earned in 2018, $200,000 will go to the city defined benefit liability, $75,000 for Fire Station 1 renovations, $25,000 to general fund forestry, $50,000 to subsidize capital leases, and $217,000 to fund the new state pension plan.

Carlson thanked commissioners and staff for their effort during the budget process.

"What we learned in that process is that we thought it was going to be a long time," she said, "and we can get it down to almost a day now."

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