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13 <br /> THE CITY OF <br /> ® - m -' CITY COUNCIL AGENDA REPORT <br /> pLE ASANTON <br /> November 17, 2020 <br /> Library and Recreation <br /> TITLE: APPROVE THE THIRD AMENDMENT FOR LIFETIME ACTIVITIES, <br /> MODIFYING RENT PAYMENTS TO TWELVE PERCENT (12%) OF ALL <br /> REVENUE IN LIEU OF FIXED RENT FOR CALENDAR YEAR 2021 DUE <br /> TO CURRENT AND FORECASTED FINANCIAL HARDSHIP RELATED <br /> TO COVID-19; AND APPROVE AN ABBREVIATED WINTER <br /> OPERATING SCHEDULE <br /> SUMMARY <br /> On March 16, 2020, the Alameda County Public Health Department (ACPHD) issued a <br /> shelter in place (SIP) order due to the COVID-19 pandemic; and Lifetime Activities <br /> (Lifetime) programs and operations were temporarily halted. Limited operations <br /> resumed on May 28, 2020 in accordance with County guidelines. Lifetime applied for, <br /> received, and distributed the government-sponsored Paycheck Protection Program <br /> allocation to retain key staff members. The federal funds were fully depleted, along with <br /> a significant portion of its reserve accounts. Lifetime expects to face continued <br /> challenges into the fall and winter seasons due to the continued COVID-19 pandemic <br /> and strict County guidelines for tennis operations. Lifetime is seeking to alter its winter <br /> operating hours and amend its current agreement from a fixed rent to a share of <br /> revenue from January 1, 2021 through December 31, 2021. <br /> RECOMMENDATION <br /> Approve the Third Amendment for Lifetime Activities modifying rent payments to twelve <br /> percent (12%) of all revenue in lieu of fixed rent for calendar year 2021 due to current <br /> and forecasted financial hardship related to COVID-19; and approve an abbreviated <br /> winter operating schedule (Attachment 1). <br /> FINANCIAL STATEMENT <br /> Staff is proposing that Lifetime remit 12 percent of total revenue received from January <br /> 1, 2021 through December 31, 2021.This percentage was derived by dividing Lifetime's <br /> 2019 rent to the City of $110,000 by Lifetime's 2019 total gross revenues of$981,472 <br /> which equals 11.21 percent. Lifetime's 2020 operating revenues are 75 percent less <br /> through September 2020 than 2019 revenues were through September 2019. Based on <br /> this percent reduction, the financial impact to the City would be a loss of approximately <br /> $80,000 in rental revenues from the Tennis and Community Park. <br />