Published May 13. 2014 4:22PM Updated May 13. 2014 11:49PM
Norwich — All three ice rink management proposals received by the city Tuesday offered to take on the expense of installing an entire new cooling system and possibly other renovations in exchange for long leases and paying the city a percentage of revenues.
The bid proposals could make moot a City Council review Monday of an ordinance to have the city pay $680,000 to replace the failed cooling system and related equipment in the rink. The Ice Arena Authority will review the bids at its 7 p.m. meeting Thursday at the rink.
The request for proposals for rink management firms contained an alternative proposal to allow longer lease periods if the firm took on the capital costs of replacing the cooling system.
A proposal from Wonderland of Ice of Bridgeport — which would operate under the name Norwich Rose Ice Associates — called for a 10-year lease followed by two 10-year extensions at the discretion of the firm. Wonderland would pay the city 2.5 percent of all hourly rental revenues for the first year, 3 percent in the second year, and increasing to 5 percent in the fifth year. In later years, the payments would be based on gross revenues, ranging from 3 to 10 percent of revenues.
The firm would invest $900,000 to replace the cooling system, overhaul the Zamboni and perhaps purchase a second ice resurfacing machine.
FMC Ice Sports of Pembroke, Mass., proposed a 25-year lease and did not specify payments to the city. The initial RFP called for the city to receive at least $75,000 per year or 10 percent of gross revenues, whichever was greater. FMC estimated revenues ranging from $510,000 in the first year to $820,000 by the fifth year. The rink’s total revenues thus far this year totaled $629,000 from October, when the rink reopened with a rented temporary chiller, through April.
FMC would invest $1.4 million in capital improvements into the rink over the 25-year period, including replacing the chiller at the start.
The third proposal from Champions Skating Center of Cromwell, run by former Hartford Whaler Robert Crawford, also called for paying the city either 10 percent or $75,000 per year for a 25-year lease. The proposal did not specify the cost of the capital improvements, except to say the firm would replace the cooling system with a mechanical system mutually agreed upon by the firm and the city.
Champions estimated annual revenues at the rink ranging from $865,000 to $1.3 million from the first to the fifth year.
Champions also included the option of having the city pay for the new cooling system and leasing the rink for five years, as originally stated in the RFP.
Alderman and rink authority member Mark Bettencourt attended Tuesday’s bid opening, along with current rink Director Doug Roberts.
Bettencourt said the authority’s review of the bid proposals has to include consideration of the authority’s “contractual obligations.” Roberts has a three-year contract dating back to September 2013.
Champions’ proposal stated the firm would consider retaining Roberts as Norwich rink director, while Wonderland’s proposal included Roberts and Assistant Director Shannon Fitzgerald in its management chart.
Bettencourt said he was pleased with the responses to the RFP and said the city likely could find an acceptable proposal among the three if the city chooses to turn over all operations of the rink to an outside firm.
Bettencourt was criticized by other members of the authority for proposing that the city seek outside firms to take over all daily management of the rink. Other members felt the plan to have the city pay to replace the chiller and continue with the management structure that already has improved revenues since the rink reopened last October.
Bettencourt said his goal all along was to make sure the rink can remain open and be viewed as a regional asset that attracts visitors to Norwich.
The rink has lost money since it opened nearly 20 years ago, and catastrophic failures of the chiller cooling system last year forced the rink to close from May 6 to Oct. 8. The city paid for a rented chiller that has ended up costing about $1,000 per day to operate, erasing any profits that would have been realized through the increased revenues.
The rented chiller will be removed June 30 regardless of whether the city agrees to pay for a new cooling system or selects a management firm.