Council gives preliminary OK to lease terms for Ultimate Sports at clubhouse; staff to bring final lease for vote

City staff presented proposed lease terms with Ultimate Sports for the Little Falls clubhouse and sought council guidance on several financial and build-out items before returning with a formal lease for approval.

Alex, the city administrator, told council that staff and representatives met with Tom from Ultimate Sports and that Tom had indicated he was “95% in” on the deal. The proposal under discussion would let Tom operate the clubhouse, with a first-year rent of $2,000 (reduced from a previously suggested $3,000), then $3,000 in year two followed by annual 3% increases. Staff said the private operator estimates the build-out could cost up to $250,000.

Under the proposed terms, Ultimate Sports would pay 70% of clubhouse utility bills (water and sewer excluded) and the city would pay 30%; Ultimate would also pay taxes on the leased portion. Tom requested that the city install a walk-in cooler, install 10 tap lines and have an electrician add outlets the operator would use; staff said they were still working to obtain cost estimates for those items.

Council members raised questions about responsibility for routine repairs and wear-and-tear, whether the city should share electrician costs, and whether the city should pursue future revenue-sharing if the business becomes highly profitable. One councilmember suggested an option to renegotiate after the first year, and others said they favored keeping golf course and clubhouse finances separate for budgeting clarity.

Council consensus and next steps: At the end of the discussion, the city administrator recapped that council was “good moving forward with the terms that are presented today” and staff said it would return with a draft lease for a future formal vote. No formal vote occurred at the work session.