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Special Bd. of Aldermen — 5/2/17 Page 5

Again, it has this great presence on Main Street, a nice canopy, glass fagade along Main Street. You turn the
corner, and it already has a secondary entrance on Pearl. The ability of developing a project that has more
than one entrance on the street and is very welcoming and dynamic on the street front is all there waiting to
take advantage of. The site, itself, is well placed. It’s within easy walking distance of the Garden Street
parking garage. There’s a landscaped pedestrian alley from the garage to what we would propose to be the
entrance to the new theatre on Pearl Street. There’s a loading dock towards the back of the furniture store and
that’s essential to the theatre operations and obviously the connection to what’s happening on Main Street and
the pedestrian access to Main Street is all very apparent.

These are broad concept plans. We developed this model program of the different pieces that would probably
be required to support a theatre event space. We applied them to the existing building. What we are proposing
is the front along Main Street, at the street level would be maintained as retail, primarily, with very little change.
That’s leasable, that could be income stream. The street level of the 1910 building, which has smaller spaces,
tighter column spacing could be the entrance to the theatre area where we could develop restrooms,
concessions, ticketing. We have indicated a restaurant or a function space on the ground floor. That’s the
150-seat multi-purpose space that Duncan articulated in his plan.

A new stairway, you come up the elevator, and that’s where you find this new theatre event space. It’s
overlooking Main Street. We developed the support spaces around it. How might this be developed and what
might it look like. First of all, a nice big square room about 97 by almost 180, a nice big footprint for a lot of
different capacity for a formal theatre setting, maybe 500 seats but different events would have different
capacities. On the upper left is a picture of what it looks like today. To the right is a precedent of a
commercial building in Brooklyn, New York, that was recently renovated. What they did to that building is they
basically raised the roof. We would need to create higher ceilings on that second floor to be able to create a
viable theatre and event venue. You need the height for lighting, scenery. Here’s a view of the second floor of
Alec’s Shoe Store before it closed. Again, we would be reframing the roof with some trusses and open up the
floor space to develop it and give ourselves the height that we needed.

Downstairs, minimal changes, but it could be a very open, glassy lobby arts center and/or retail. A little
investment to make that something that would work. In all, 30,000 square feet, on two floors. There would be
interior and exterior renovation. A new theatre, support facilities, entry lobby, event space as | showed you on
the ground floor and then maintaining quite a bit of retail on the street level as well. We worked with a cost
estimator and a local contractor and we came up with a budget of about $15.5 million total project cost to
develop this property for a new venue.

Mr. Webb

With that physical plan developed, we came back and wrote a business plan. |’m referring to it as an arts and
events center because | want to stress that functionality. | want us to think of it as a functional, flexible place
for a much broad range of programming from traditional performing arts program to more contemporary
entertainment to a range of different meeting and events because that’s the thing that’s going to make it very
busy and make it sustainable on an ongoing basis.

To start the business plan, we have written some goals which are about providing high-quality arts and
entertainment for the community. We think it is important to support local businesses, government and
citizens with professional meeting and event facilities. WWe want to stress the importance of affordable access
to good facilities for local arts organizations. Contribute to the economic vitality of Nashua and the wider
region. Each one of those separately is not such a big deal, it’s doing them all together in such a way that you
have a sustainable business model which driven by earned income as opposed to contributing.

We looked at various ways it could be operated, and our recommendation is that the City of Nashua should be
the owner and the operator of this building. At the same time, there are two important groups that should be
brought along. First, a private foundation to represent the interests of the private sector. Secondly, a

Special Bd. of Aldermen — 5/2/17 Page 6

programmer, a professional individual or firm, that is contracted to do some of the riskier part of the building
which is generally about booking arts and entertainment programs and taking the risk associated with that. We
had a couple of discussions with firms based in New Hampshire, Massachusetts, that have expressed interest
in programming and perhaps even operating this.

We think this is a good direction to go. The City has the ability to recruit the skills and resources necessary
and your mandate to serve local residents is consistent with the goals that we have established. That
foundation is very important. It is a way for you to bring private sector leaders to the project and get their
support in getting this up and running. The best thing about budgeting this outside programmer is you can use
the completive bid process, a RFP process essentially, to recruit that programmer and partner.

In our written report, we have written extensively on operating policy. A lot of this came out of the charrettes
and meetings we had with local arts organizations. We have written about how access is managed who gets
first dibs on dates, how to set rental rates and fees, the idea of having some resident users, groups that get
preferred cost of access and first crack at the calendar, the importance of ticketing systems and the analytics
that come with them, food and beverage operations, not just for traditional concessions but importantly for
catering support and even daytime food and beverage operations. We believe Nashua has the kind of
community that can provide significant volunteers support for not only leading on boards and advisory groups
but also supporting the day-to-day operations. Finally, we stressed the importance of green operations, being
environmentally sensitive in a way that the building is operating, particularly given that we are starting with an
adaptive reuse opportunity. We set a staffing plan. The blue boxes are fulltime staff, yellow are part-time and
red are event staff. We put the City on top, but this chart works no matter who the operator of the building is.

The most important part of our work in this round was developing a pro-forma operating budget which is
suggesting how the building is sustained over a period of time. This is a live, excel-based model and after
tonight we will be handing this spreadsheet over to you so you can play with it because it is the kind of thing
you can say what if we increase the capacity by 100 seats. What does that do to the bottom line?

The theory of these pro-formaas is it’s all about projecting activity. We can project how many times there will be
rentals at different price points. How many times there will be presented events, meetings, weddings/ We can
get a pretty good handle on sales which then allows us to project expenses. We have developed this budget
on the assumption that you want to hit the ground running and you will spend significant capital dollars. The
operating budget is based on the idea that the day you open, you are fully staffed. You have a full set of
programs ready to go. You have an option to take a slower approach to getting the building going. You can
decide to be a little bit more cautious and conservative and have a smaller staff and gear up in a more
incremental fashion over the first few years. We formed our budgets by looking at a lot of other buildings in the
regions. These are some examples of other buildings in New Hampshire, Vermont, Connecticut to estimate.

We estimated activity, the key step, so in our main theatre, we are being very conservative. We are estimating
in the first year about 172 days of use with about 76 performances. That grows to almost 200 days of use by
year five. | think we’re being very conservative with this and leaving significant capacity for growth. The multi-
purpose space, we’re also being very conservative around the level of utilization. Even with that, you will see
in the first year, there are 25,000 people coming to performances and that grows to almost 30,000 by the fifth
year. That activity then leads to our estimates of rental revenue for the building.

This is a summary of the budget, itself. It shows in the first year earned revenue, rentals and ticket income and
food and beverage, is about $700,000. That grows to $850,000 by year five. The operating expenses that go
with that start at about $900,000 in year one and grow to a little over $1 million by year five. We are basically
cover three-quarters of the operating budget with earned revenue from the beginning and that percentage
increases to 80 percent by that fifth year. What that leaves is contributed income. Some people may look at
that and say we’re coming up short so we have to chip in some more money. The way | would like you to think
of itis this building is delivering value to your community, value that warrants ongoing support. We have
estimated contributed income from individual appropriations, a little bit from foundations, and a little bit from

Special Bd. of Aldermen — 5/2/17 Page 7

non-local government. We've also added a significant chunk of support from an endowment. We are
estimating an endowment of $4 million that is generating about four percent to sustain operations. That
endowment we’re proposing is the private sector role in the financial success of the building. We're looking to
the public sector to provide bonding support for capital and looking to the private sector to raise money from
the outset to endow operations. Endowment is really the most certain way to have a successful building
because it is there. It’s money that is protected and can sustain this building a long time out in the future.

The last big piece of analysis was we projected the economic impact of this building on the county economy.
We buy these multipliers from the Bureau of Economic Analysis in Washington. Those multipliers allow us to
say when a dollar is spent in Hillsborough County in a certain industry; it gets re-spent and re-spent and re-
spent and ultimately has a larger impact depending on the industry. That allows us to project direct, indirect
and induced impacts of both building the building and operating the building.

Construction impacts of $12 million generates in Hillsborough County about $20 million in new sales. For
example, a certain amount of money is spent on lumber in a Hillsborough County lumberyard. That
lumberyard operator in turn spends that money on computers and stationery and so on. That money then gets
re-spent. That’s the idea of the multiplier effect. That leads to new sales of $20 million, earnings at $6 million
and 112 person-years of employment in the county as a result of this project.

Then we have the impacts of operation. Every line item in the operating budget, excluding staff, we have
applied the multiplier to. There’s a certain amount of money spent on utilities, on waste removal, on
administrative services, and building services. We apply the multipliers in order to show how $900,000 spent
not on personnel leads to significant impacts beyond that.

The third type of impact, which is often the most important on these projects, is the impacts of audiences.
People coming to performances. We know from American for the Arts, we know how much they spend on
retail and eating and transportation and staying over. We are able to calculate then those expenditures and
the total impacts relating to them. The economists in the room will say you have to be very careful about
economic impacts because we can’t count money that would already be spending in Hillsborough County.
They are just bringing it to another part of the region. The only money we can really count here is the audience
coming from outside the county and the audience that would otherwise gone outside the county. Those two
components, which we estimate at about 50 percent of the total audience, allows us to project the impacts of
audience. If you combine those annual operating impacts with the impacts of audiences, in every year the
operation this building drives $1.4 million in new sales, $300,000 in new earnings in the county and it creates 9
new jobs in addition to the jobs in the theatre, itself. It’s jobs associated with the economic activity that the
theatre brings.

In addition to those quantitative impacts, there are some significant qualitative impacts associated with this
project. We believe this is a catalytic project for the redevelopment of downtown Nashua. The presence of
this building will drive commercial development which will lead to other gains in economic output as well as
those other issues like corporate recruitment. We believe the project will attract companies, workers and
residents to downtown Nashua, and we see this as a key attraction within a district for tourism development in
Nashua.

Finally, we have estimated how you move forward from here. There are three parallel tracks. One is related to
fundraising, one is related to physical planning, and one is related to planning for operations. Physical
planning, if you initiate the work of forming a building committee and thinking about getting more specific costs,
hiring a design team, going through phases of construction, heading into construction in the earlier part of
2019, you’re essentially in a position to open the building in the fourth quarter of 2020. That is a not-rushed but
fairly steady pace. The purple squares is a reminder that you can’t wait until the building is about to open to
start thinking about operating. You have to start setting policy, hiring staff, getting vendors involved. There’s a
lot of work to do to be ready. The third track is related to fundraising. There’s a couple of important elements
as Tim will outline in a minute. The first thing is to come forward with a bonding request to fund the capital

Special Bd. of Aldermen — 5/2/17 Page 8

component of the project fairly soon. Then, equally important, is the effort to form a capital campaign in order
to take on the challenge of raising the endowment to sustain it. That occurs later in 2017. A campaign
consultant is hired, they do their research and then initiate the campaign in the middle part of 2018 so enough
of the chunk of funding is placed so you and the community is comfortable with proceeding with the issuing of
bonds. Knowing that endowment is in place should give you the confidence that the bonds can be supported.
Also as a final step there’s some work being done to get a naming gift, an additional financial benefit.

The element of the financing that | had not included in this budget is | did not put the retail income associated
with the ground floor in the budget. It’s a little premature to do that. That's another arrow in your quiver
potentially available to help service the debt associated with the project.

Director Cummings

Thank you, Duncan. Mr. President, the reason why we are here tonight is | wanted to make sure we had a
very clear understanding in terms of the expectations and commitments that would be needed by both the city
and the private sector to be able to move this project forward. The very elementary next steps is we would
need to have some upfront funding for seed capital which would be money to help us procure a capital
campaign consultant to help us do some elementary design and physical planning. That would ultimately help
us move toward that endowment type of programming in that $4 million range. Ultimately the city needs to
understand that they have to be comfortable to achieve the type of programming that was outline tonight a
$15.5 million bonding request and the debt service should nto be expected to be paid back. If you wanted to
go in the direction of the preferred alternative building, which would be the recommendation of this group, you
are looking at the Alec’s Shoe building. It is privately owned. We had very positive conversations with the
current owner. He is willing to enter into an option. We would need to have that conversation with him sooner
rather than later because he obviously wouldn’t want to hold up his private sector plans indefinitely. We would
need to put some sort of payment to him monthly that would get credited to the final payment to him if we were
to move forward. That’s all be discussed in advance in some sort of understanding so we would have a clear
land acquisition cost in the pro-forma. Those are the immediate issues.

What I’m hoping to gain from you tonight, Mr. President and to the body, is some direction and some

understanding as to what the city would like to do so we can move this conversation forward in terms of
planning for the next steps.

Alderman Siegel

| have quite a few questions and comments. The $15.5 million, | assume this does not include the purchase of
the building. Is that correct?

Director Cummings

It does.

Alderman Siegel

You have an idea then of what the building would cost?

Director Cummings

Correct.

Special Bd. of Aldermen — 5/2/17 Page 9

Alderman Siegel

That’s good to know. The budget! saw there doesn’t seem to be any element that deals with bond debt
service. That’s important because we have $15.5 million that we’re talking about bonding. The implication
would be that the city pays for that out of taxpayer's money but then there’s this endowment fund. Obviously a
$4 million endowment fund can’t carry the bond debt of a $15.5 million bond. | wish | could have an investment
like that but that’s not going to happen. You’ve allocated that money elsewhere. | need some of those
questions answered. The staff expenses that you listed, you have them starting in year one but in fact your
staff expenses happen well before year one because you are staffing in advance of having any revenue or
openings. That's something that probably needs a correction.

Mr. Webb

The staff is in there year minus one. They are hired the year before the building is opened. During the pre-
opening about half of the staff are hired.

President McCarthy

Year one is the first year anything happens but it is not the first year it is running.

Alderman Siegel

My apologies. The assumption with the bond debt is that the city pays the bond debt.

Mr. Aquilina

The reality of these buildings they do not have that capacity to service debt beyond operable.

Alderman Dowd

Does that design cover handicapped access and an elevator to the second floor?

Mr. Aquilina

Absolutely.

Alderman Clemons

Looking at the operating budget that was presented, it seems some of the items under contributed income
seem generous. Even if they were to happen, my question is where would the other 25 percent come from to
operate the theatre every year?

Mr. Webb

Earned income covers % of the budget. The contributing income piece covers the final portion.

Director Cummings

The bulk of that would essentially be the endowment so there wouldn’t be an ongoing cost to the operational
budget of the city in essence is the theory.

Special Bd. of Aldermen — 5/2/17 Page 10
Alderman Clemons

What is non-local government mean, and what are some examples that would be eligible for Nashua?

Mr. Webb

We are presuming state, federal and regional grants. There is a fundraiser on the staff. Their job is to pursue
fundraising in order to sustain the building. We set what | believe very conservative targets for individuals,
corporations, as well as that regional coverage.

Alderman Clemons

Do you have any specific examples of what other theatres in New Hampshire get from non-local governments?
Mr. Webb

Generally more than that. If you look at facilities such as Concord and Manchester, they raise a lot of money.
Because our strategy here was to focus on local government providing the capital financing and look to the

private sector to provide the balance or most of the rest of the support. Inevitably there will be grant
opportunities that will arise that a development director will see. We think those are realistic.

Alderman Siegel

Would this bond debt be under the Cap or subject to the Cap or outside of the Cap?

Attorney Bolton

Debt service would be incorporated yearly and count toward the limitation that the Cap provides. The bond,
itself, is not.

Alderman Siegel

An estimate of that amount of money, anybody?

Mayor Donchess

A little over a million. $750,000 a year on principal; 3.5 percent, $600,000.

Alderman Siegel

That’s $1 million that we have to have with our existing Spending Cap.

Mayor Donchess

If you were to finance it with an even payment so the principal at the beginning is lower, it would reduce it to
some degree but you would not have a declining principal requirement as you went along.

President McCarthy

It is also replacing the existing debt that is being paid off. There is some offset in the way the budget changes
from year to year.

Special Bd. of Aldermen — 5/2/17 Page 11

Alderman O’Brien

For our investment of $15 million, what do you think is the life expectancy of this facility?

Mr. Aquilina

The kind of construction that would be incorporated into renovating it typically has a 25-30 year life expectancy.
What | am talking about is the mechanical systems. When | talked about Court Street outliving its lifespan it
really has to do with mechanical systems installed probably 40 years ago. Then certain areas of the roof and
the masonry that requires maintenance. There’s a lot of Court Street that was built in the 80s that is still very
viable. It just need an investment to renew some of those pieces. The building at Main Street would probably
have require some investment in its system replacements within 20-35 years.

Mr. Webb

On the bottom of the budget here, there’s a line called “allocation of capital reserve” Every year the bottom line
improves a little bit with contributing income basically staying flat. A little bit of inflation escalation. Every year,
we get a little bit busier, attendance gets a little higher. The bottom line improves. Starting in year four, we are
grabbing money and putting it into a capital reserve in order to fund the capital replacements that are required
over time. If that reserve is allocated and used properly, the building has a very significant lifespan.

Alderman Deane

That’s wishful thinking, but we don’t do that in this city. Our school district is a perfect example of that. We go
in to replace HVAC systems and 15 to 20 million dollars later, we renovate the entire school. | find your
economic impact, your quantitate/qualitative interesting. We just spent about $80 million on a roadway out
here that was supposed to generate all this economic impact down in the Millyard. All sorts of things were
supposed to happen. | believe that road is receiving maybe 15 percent of the traffic. It’s not doing much of
anything. It is costing us. We bonded about $40 million to build this roadway, but it really hasn’t delivered any
goods. Unless the economic development director wants to correct me on that, there’s been little or no spur of
economic growth down there.

Director Cummings

Alderman Deane, you are absolutely correct. | would just caution that the parkway just opened and these
types of infrastructure improvements takes time. | believe the Millyard will increase in value as well as other
opportunities closer to Broad Street. As of today, you are correct. The roadway is not used to the projection
level or to capacity.

Alderman Deane

Nowhere near. Let’s be honest about it. It was years in the making. It’s not as though that roadway popped
up. People knew about it. That’s another issue. I’m really leery of these economic impacts, although this is
different. We're talking about business and industry and these incubators, | think that was a little key word
used during the last election, about all the incubators that were going to be down there. This is different. This
draws a different crowd of people. It has a different interest. I’m just leery of these economic impacts.

Mr. Webb

It’s certainly not a guaranteed thing. The one suggestion | would make is when you are able to do so, | would
encourage individually or as a group you go and visit some theatres in towns like this in the northeast, whether

Special Bd. of Aldermen — 5/2/17 Page 12

that’s in Portsmouth or Rutland or Keene or other communities where we’ve seen investment in cultural
facilities drive significant economic development. And learn from them what they did in order to achieve those.

Alderman Deane
But you seem to be a believe because you’ve used the “we believe” numerous times on numerous slides.
Mr. Webb

Well, 30 years and basically 400 projects around the country, | have seen what these facilities can do to
communities. In my experience the mistake some communities make is they put all their eggs in let’s fix up the
old theatre and hope that in and of itself will drive revitalization or economic development. The truth is adding
a venue like this needs to be thought as one element or a larger plan. Your economic development team
recognizes that. This is an anchor of a larger plan. | think if you approach it that way, you have a high
probability of success.

Alderman Deane

The Court Street building that you mentioned, did you walk through that building and provide information out of
the goodness of your heart or did you charge the city some money for performing that evaluation?

Mr. Webb

Tim used the word, beyond the scope. It wasn’t really beyond the scope because we looked at Court Street
initially to see if Court Street could be the primary solution. We recognized that that was difficult, but in talking
with lots of people in the community, we came to the conclusion that it is important. It is a community asset,
and there is a relatively efficient way to sustain the life of that building that becomes one of the pieces of the
puzzle. We've identified it as the longer term solution to be a good 300-seat plus or minus venue that is
available and accessible to the community and arts organizations as and when you are able to fund that.

Alderman Deane

Are you familiar with the history behind that building?
Mr. Webb

We struggled with it when | was here 12 years ago.
Alderman Deane

The one thing about that building is the communication lines that run to fire alarm. Fire Alarm used to be in the
front of that building. That’s an old hose tower out front. That building will always be there because if we
would have to borrow money to move all of that, that would be an absolute nightmare. That building, | don’t
know when it was built, maybe the 60s. It is not a functional building outside of a theatre. When you look at
the space in there, it’s a white elephant.

The other thing that we talked about that President McCarthy mentioned is we will be retiring debt, but we are
also letting debt as well. We have a number of competing projects that we are looking at. There’s the paving
project that we just approved. We have a building on Burke Street that we are looking at. There’s school
projects. There are a number of projects that are coming through. It will be interesting seeing what happens
with this moving forward.

Special Bd. of Aldermen — 5/2/17 Page 13

Director Cummings

To clarify my earlier comment, the Court Street business plan pro forma and excel spreadsheet that was
included was above what was originally anticipated to help explain how you would make that building solid.
Additionally, | want to circle back to some comments made to further illustrate the point that we are looking to
help redevelop Main Street and help revitalize Main Street. Study upon study and from an urban planning
perspective, we know that Main Street as a corridor is changing from a retail district to more of a cultural and
arts type of community district. To develop an anchor to be a critical component to contribute to that type of
economic activity will only help with stabilizing the neighborhood. This would just be one piece, one ingredient.
We would need to continue on other efforts as well, whether that’s introducing more market-rate housing into
the downtown, introducing other types of uses. We need to continue to make these investments if we are
going to enhance our community. | think what you will hear is some of our smaller businesses, our merchants
are looking for assistance in trying to help stabilize Main Street, and this is just one way of doing that.

Alderman Siegel

Philosophically, I’m in favor of this type of project. | think it would make sense. Unfortunately | sit here and |
understand the constraints that we’re under. We may be retiring some bond debt. Is that bond debt we’re
retiring, is it under the Cap, over the Cap, what’s the timing? Now you're taking a big chunk of money and we
already have this problem. Strategically, | say that’s great and it makes sense. It’s a powerful driver of
development. |’ve been talking with Director Cummings, and | think he has some very good ideas and overall
strategy. But | just want to understand in the City of Nashua, given our financial constraints that we have, and
the mechanism that do constrain us, how do we make that happen? | need that explained. None of that is up
here because that is very, very specific to Nashua. | do appreciate the studies that you have done. It is very
clear that you’ve been diligent. But somebody somehow has to explain to me how we get from here to there
given that we have a situation where we’re looking at whether or not we can fully staff the police and fire
department given our Spending Cap issues. Now we're talking about potentially a million dollars. Where does
that come from? That's my open question.

President McCarthy

| think that’s the discussion we’re going to have to have after this meeting.

Alderman Siegel

But not tonight.

Alderman Lopez

When we do a large scale development project without necessarily making the links necessary to make it a
comprehensive plan, you have issues like a road that people are under-utilizing that doesn’t have a destination
attraction. My understanding of the Broad Street Parkway was it was supposed to reduce the traffic load on
Main Street by giving the drivers another route out of the downtown area. But we also have to look at the
connecting roads and rehabilitate how they work now that there’s a presence of a new incoming and
outcooking roadway. When we come up with an isolated plan without integrating it into larger city priorities, it
doesn’t necessarily payoff.

| would also say as someone who grew up in Concord and watched how the performing arts center there
really, really, really revitalized their downtown, the impact that is being suggested here as likely is not really
rocket science. It has been proven to be viable in communities similar and near in location to ours. | think the
concept of a Main Street Performing Arts Center with a corner of it is certainly a good one. Personally, I’m very
much in favor of making sure that the existing theatre is taken care of and that our smaller local groups, as
they have been referred to, are getting the attention they deserve. We also have to make sure that the artists

Special Bd. of Aldermen — 5/2/17 Page 14

that are emerging in our local community are getting the support that they need. While not the ideal, | was
definitely appreciative of the work that was put into looking at that building even though it is a little bit of a
quagmire.

The real question | have is looking at the Alec’s building and not necessarily turning the whole thing into a
theatre, but turning it into that holistic building that has multiple support structures to it, I’m in favor of that. But
earlier in the review process, we were talking about creating an arts district based on a smaller scale
investment, trying to cultivate the local artists in the downtown population with things like festivals. It seemed
like when Alec’s came onto the market, we revamped that plan entirely. | don’t think Alec’s is in the performing
arts district that was identified. If | remember, it was closer to the river over by where the river walk is,
Peddler’s Daughter. How would this create that arts district or would it move it?

President McCarthy

The proposal for the district went from the Elm Street Junior High to Court Street when it was in the original
recommendation.

Alderman Lopez

As | remember, the Elm Street Junior High was actually considered a pseudopod. It was specifically stated in
at least one meeting that it shouldn't try to extend all the way. It should be more concentrated.

Director Cummings

We don’t technically have an “arts district.” One of the ways we could look to address that issue is we could
look to do a zoning overlay and articulate that we want to encourage performing arts and other types of artists
within a certain land use area within the city. Ultimately in the downtown area, you’re going to need some
critical assets to achieve that goal. The example that was given is you could use a performing arts center as
one of the couple of anchors. | would suggest that we have a budgeting arts district coming together from the
river radiating out, whether that’s at Riverwalk or Court Street Theatre. We definitely have a strong component
of different artists and artist type uses.

One of the elements that | am hoping to take away from this evening is a clear direction that there is an
ambition by this body for me to put togheter a proposal that can be presented to you that will ultimately be a
bonding request of $15.5 million, understanding that it would have to be accommodated by the city. You then
during that discussion can do what | would very much expect you to do as you are obligated to, which is to
make sure that this request kept a stable residential tax rate within your current financial picture. You would
want to make sure that this capital request, whatever dollar figure it may be, can be accommodated and you
can then compare it accurately against the other needs that may be coming before you. That is ultimately what
| would think would be a good next step. To be able to do that, | want to make sure that this body has an
understanding that debt service, in particular, would need to be covered by the city.

Alderman O’Brien

| see we’re going to acquire the 1910 building, the first two floors will be used for the theatre. What about the
additional two? Would that be office space and an income generator to this particular project? Also, the first
floor street level is going to include a restaurant and retail area. Would that not be an economic generator to
this particular project? If that is the case, | did not see any numbers for the potential. | did not see how much
we would be getting per square foot of retail space, but | would like to know that number so we can forecast
that as we deal with the bond issue.