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Thursday, November 6, 2014

Huge Spending Increases For Roosevelt Island Infrastructure Improvements To Seawall, Helix Bridge Ramp, Lighthouse Park, Blackwell House & Sportspark Included In RIOC's Proposed 2015 -16 Budget Among Items To Be Presented At Board Of Directors Meeting Today


The Roosevelt Island Operating Corp (RIOC) Board Of Directors meet today. Among the items on the Agenda is the presentation of the Proposed Budget for Fiscal Year 2015 -16 (Proposed Budget).

According to RIOC's Proposed Budget (Page 1)
Revenues

RIOC Proposed Budget FY 2015‐16 projects revenues of $25,365,000, an increase of $2,225,000 or 9.62% over the Approved Budget FY 2014‐15 amount of $23,140,000. RIOC generates most of its revenues from long‐term ground leases to developers of housing projects on the Island. These leases specify the manner in which the ground lease revenues are derived, including amounts, timing, and escalation of ground lease payments, specifically ground rents, residential fees and public safety fees. In addition, RIOC generates revenues from its Tramway transportation system, Motorgate parking garage, metered street parking, commercial leases, interest income, and additional revenues ("Other Revenues") comprised mostly of fees collected in connection with permitting for activities in the Sportspark sports facility, as well as field permitting and FEMA reimbursement.

There is an aggregate increase of $652,000 in ground rent primarily comprised of three components. First, there is a $400,000 ground rent payment (escalating 2% every 10 years) for the surrender of a 2.62 acre parcel of land to the City of New York (“City”) in connection with the Cornell Technion Applied Sciences Graduate School (“Cornell”). As part of this transaction, and in conformance with State budgetary procedure, RIOC projects to receive a 55‐year $1,000,000 annual payment (escalating 2.5% every 10 years) beginning in the 16‐17 FY with the net present value fully made by December 31, 2018. Secondly, RIOC projects that the construction of Southtown Building 7, which is currently in progress, will be completed in June 2015 resulting in additional ground rent of $241,000. Thirdly, there is an aggregate of $11,000 in ground rent escalations as specified in relevant ground leases.

Furthermore, RIOC expects to receive a lump‐sum net present value (“NPV”) of $10,080,000 for part of the future ground rents due from the completion of Southtown Building 7. This amount will be amortized over the term of the lease and the revenues recognized accordingly. Most of the projected increase of $291,000 in residential fees is due to the recognition of this revenue.

Tramway revenues are projected to increase by $840,000 due to increased activities on the Island primarily as a result of the Southtown 7 and Cornell developments; and increased visitorship to the Four Freedom State Park (“FFSP”).

Motorgate and metered parking revenues are projected to increase due to increase in parking rates. And commercial rents are projected to increase due to escalations in the terms of the commercial leases.

Most of the projected increase of $356,000 in Other Revenues is attributed to the projected increase of $325,000 in FEMA reimbursement for damages stemming from Hurricane Irene as well as increases in Sportspark and field permit fees.

Interest income is projected to decline due to a smaller corpus as a result of the substantial increase in expenditures for capital projects as discussed below in the section titled Capital Projects....
and Page 5 -6:
Capital Projects

The Proposed Budget FY 15‐16 projects capital improvements in the amount of $37,646,000, an increase of $18,673,000 over the Approved Budget FY 14‐15 amount of $18,973,000. The proposed amount primarily consists of capital projects in the projected amount of $32,970,000, but also includes the capitalized purchase of equipment and vehicles in the amount of $1,321,000, as well as capital reserve and contingency in the amount of $3,355,000. Categories of projects include sports fields and parks, historic and landmark structures, infrastructure improvements, facilities and offices, special projects, and the Tram.

For sports fields and parks, the Proposed Budget FY 15‐16 projects improvements in the amount of $2,117,000, an increase of $1,016,000 over the Approved Budget FY 14‐15 amount of $1,101,000. The increase is primarily for improvements to the parking lot, entrance, and landscaping of Lighthouse Park. These projects will significantly improve or increase public access to the sites.

For historic and landmark structures, the Proposed Budget FY 15‐16 projects improvements in the amount of $1,806,000, an increase of $1,596,000 over the Approved Budget FY 14‐15 amount of $210,000. The two projects in this category include rehabilitation of the Blackwell House at an estimated cost of $885,000 and the Roosevelt Island Lighthouse at a projected cost of $700,000.

For infrastructure improvements, the Proposed Budget FY 15‐16 projected amount is $22,147,000, an increase of $10,827,000 over the Approved Budget FY 14‐15 amount of $11,320,000. This significant increase is primarily due to the proposed improvement of the seawall at Southpoint Park ("SPP"). The capital plan as proposed includes a scheduled corresponding expenditure for seawall and railing work at SPP in FY 16‐17. The critical shoring of this infrastructure will stem further deterioration of the affected seawall sections and increase the longevity of RIOC's capital investments in the area. In addition, the capital plan includes improvements to the Roosevelt Island Helix Bridge Ramp at an estimated cost of $1,900,000 that are needed to withstand the burden of increased traffic the Island will experience as a direct result of ongoing and future development.

Facilities and office improvements in the projected amount of $7,283,000 are included in the the Proposed Budget FY 15‐16, an increase of $3,723,000 from the Approved Budget FY 14‐15 amount of $3,561,000. At an aggregate estimated cost of $5,840,000, the various projects to rehabilitate the 36‐year old Sportspark facility comprise the majority of the proposed increase. The capital plan as proposed includes a corresponding expenditure of $4,145,000 in FY 16‐17. The extent of the proposed rehabilitative work is significant, including but not limited to complete replacement of the upper and lower roofs, as well as the skylights. Moreover, it will stem further deterioration to the facility, including masonry units that will worsen if not addressed.

For equipment and vehicles, the Proposed Budget FY 15‐16 projects expenditures of $1,321,000 an increase of $892,000 from the Approved Budget FY 14‐15 amount of $429,000. The primary reason for the proposed increase is the purchase of a replacement hybrid bus for RIOC's Red Bus service. Over the next six fiscal years, the proposed capital plan includes a purchase of one additional bus each year at a 5% inflation rate. As noted above under OTPS, fleet maintenance costs for those vehicles currently in service are rising. Purchase of new buses will decrease costs associated with maintaining a state of good repair and offer better fuel economy.

For special projects, the Proposed Budget FY 15‐16 projects expenditures of $355,000, an increase of $302,000 over the Approved Budget FY 14‐15 amount of $53,000. The increase is primarily due to the proposed improvements to the ongoing wireless security camera system installation, including purchase and installation of cameras for areas currently without coverage and system maintenance. The proposed improvements will supplement the security provided by the RIOC Public Safety Department.

For the Tram, the Proposed Budget FY 15‐16 projects expenditures of $1,775,000, an increase of $275,000 over the Approved Budget FY 14‐15 amount of $1,500,000. The proposed increase is for the installation of an additional ADA‐compliant elevator and replacement of the roof of the Manhattan Station. The proposed improvement will reduce downtime and ensures continuous access for the handicapped.
Click here for the full RIOC Proposed Budget.

Here's the Agenda for RIOC Board meeting today.
AGENDA

NOVEMBER 6, 2014 MEETING OF

THE ROOSEVELT ISLAND OPERATING CORPORATION BOARD OF DIRECTORS

THE MANHATTAN PARK COMMUNITY CENTER,

8 RIVER ROAD, ROOSEVELT ISLAND, NEW YORK

5:30 P.M.[1]

I. Call to Order

II. Roll Call

III. Approval of Minutes

1. September 11, 2014 Board Meeting (Board Action Required)

IV. Old Business

V. New Business

1. Presentation of the Proposed Budget FY 2015-2016

2. Approval of Procedures for Implementing Reasonable Accommodation for: (1) Applicants and Employees with Disabilities; (2) Religious Observance or Practices for Applicants and Employees; and (3) Programs and Services for Individuals with Disabilities (Board Action Required)

3. Authorization to Amend Contract with Boilermatic Welding Industries, Inc. for Temporary Heating at Sportspark (Board Action Required)

4. Authorization to Amend Contract with Shawn Construction, Inc. for Roosevelt Island Cultural Center Renovation Project (Board Action Required)

5. Authorization to Create the Inspector General Report Review Advisory Committee (Board Action Required)

6. President’s Report

7. Committee Reports

a. Audit Committee

b. Governance Committee

c. Operations Advisory Committee

d. Real Estate Development Advisory Committee

8. Public Safety Report

VI. Adjournment

[1] The RIOC Board Meeting will commence following a public comment period. The public comment period is not part of the meeting.
A web cast of the RIOC Board meeting will be available soon thereafter.

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