City of Alexandria, Virginia
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MEMORANDUM
DATE: DECEMBER 7, 2021
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: MARK B. JINKS, CITY MANAGER /s/
DOCKET TITLE:
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Consideration of a Form Lease for Renewing and Issuing Leases to Artists and Arts Organizations through September 30, 2022, at the Torpedo Factory Art Center located at 105 N. Union Street.
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ISSUE: Consideration of the City renewing and issuing leases to artists and arts organizations through September 30, 2022, at the Torpedo Factory Art Center (“Art Center”) located at 105 N. Union Street, Alexandria, VA 22314.
RECOMMENDATION: That City Council schedule a public hearing on December 18, 2022 regarding the form and content of the proposed lease to be used for renewals and new leases at the Torpedo Factory Art Center, and at the conclusion of the public hearing authorize the City Manager, using of the attached form lease, to renew current leases in good standing and issue new leases to artists and arts organizations through September 30, 2022.
BACKGROUND AND DISCUSSION: In 2016, the City decided to have City staff step in to manage day-to-day operations of the Art Center and in 2018, City Council affirmed that the City of Alexandria Office of the Arts would continue as the long-term managing entity responsible for management and operations of the Torpedo Factory Art Center. Since 2016, the City has been leasing studio space directly to the individual artists and organizations throughout the Art Center.
The Torpedo Factory Art Center leases most of its 82 studio spaces and galleries to approximately 110 artists and arts organizations. Studio and gallery rent and private event rentals in the Art Center cover annual operating costs including, but not limited to, staffing, utilities, custodial services, marketing, and programming but does not cover capital costs associated with operating the Art Center.
During the course of a year, the City may execute up to 100 leases with artists, most of whom lease for a year or more, with some 15 artists subleasing for much shorter periods of time. In addition, with many studios shared by multiple artists, the leases are also often amended as the artists within a studio change. The presentation of that many leases for public hearing and Council approval would be burdensome and not add value to the public decision-making process. Therefore, the practice the City has used is to use a standard form lease which did not have to be brought to Council each time the lease was executed. However, periodically it makes sense for the standard form lease to be brought to Council for approval.
Given that all the current leases for studios and galleries in the Art Center expire on March 31, 2022, the lease form is being brought forward at this time for Council consideration and approval. There are no material changes in the proposed lease language compared to the language of the leases currently in place. Rental fees shall not change and remain at $16.39 per square foot per year (which has been in place since the leases were renewed in 2019). All leases would be 6-month leases and run from April 1, 2022 to September 30, 2022 for all tenants in good standing and who are current on their rent. Through the monthly artist “team” meetings, staff has been keeping artists updated about the lease extension as recently as December 1, 2021.
FISCAL IMPACT: The Art Center operates as an enterprise fund within the City government with approximately 75% of earned revenue coming from studio rent. In reflection of the current COVID-19 pandemic caused an economic recession and major tourism decline with a likely multi-year period before full economic and tourism recovery occurs, the current lease rate of $16.39 per square foot a year (or $1.36 per square foot a month) is not proposed to be increased. This lease rate is intended to cover nearly all the costs of staffing, marketing, programming, utilities, and operational costs such as custodial services. It should be noted that the City, unlike some other art facilities and galleries, as a lease requirement does not charge a commission fee to the artists for work sold at the Art Center.
ATTACHMENT: Torpedo Factory Art Center Studio Lease
STAFF:
Emily A. Baker, Deputy City Manager
Debra Collins, Deputy City Manager
James Spengler, Director, Recreation Parks & Cultural Activities
Diane Ruggiero, Deputy Director, Recreation, Parks & Cultural Activities
Brett Johnson, Regional Program Director, Recreation, Parks & Cultural Activities