October 23, 1998
(Executive Council)

MEMORANDUM OF UNDERSTANDING

Between:

The Government of Newfoundland and Labrador
and
The City of St. John's
and
The Avalon Convention and Visitor's Bureau

Whereas: The Government of Newfoundland and Labrador has committed $12 Million;

Whereas: The City of St. John's has committed $8 Million;

Whereas: The Avalon Convention and Visitor's Bureau has committed $4 million;

and in recognition that, while $4 million will be sourced by the Federal Government from the Canada/Newfoundland Agreement on Economic Renewal, the remaining $8 million is not available at this time, the Province and the City have agreed with respect to the remaining $8 million dollars outstanding for the completion of this project as follows:

1.    That the City and the Province cost share the remaining $8 million dollars towards capital costs required for the facility at          $4 million dollars each, as follows:

(a) The remaining $8 million will flow to the project, as required, after the expenditure of the first $28 million;

(b) Cash flow will be shared equally between the Province and the City, as required,

(c) Each party shall be responsible for financing its share of the $8 million.

2. (a)    That a Construction Board be established for the purposes of managing the construction project, with the following                representation:

- A Chairperson jointly appointed by the Premier and Mayor of St. John's
- 4 Representatives from the Province
- 4 Representatives from the City
- 2 Representatives from the Avalon Convention and Visitors Bureau (ACVB)

(b)    This Board is separate from the present Civic Centre Corporation Board; with the Civic Centre   
        Corporation Board remaining in existence to administer all other functions pertaining to the Civic Centre 
        Corporation.

(c) The Board shall be established and incorporated immediately.

3.    That any Federal funding above the $4 million currently available from the Federal Government will be shared equally          between the Province and the City.

4.    That City staff will continue to play the same role as currently played with respect to the Civic Centre Corporation, but that          they will report directly to the Interim Project Construction Board.

5.     (a)    That upon full completion of the construction of the Civic Centre (convention centre and multi-purpose facility) this                    Interim Project Construction Board will cease to exist.

(b) Both facilities will be completed at the same time.

6.     The room levy will be legislated effective January 1, 1999, based upon the following conditions:

(a).    In order to assist with the funding of the project, a three (3) percent room levy will be applied to all fixed            roof accommodations in the City of St. John's including Memorial University and Littledale Conference            Centre. The levy will be assessed on a per room per night basis.

(b). All revenues from the levy will be deposited into a separate City account.

(c). The account to be established will make the following disbursements as per a negotiated schedule:

(i)    $500,000 per annum to the Civic Centre Corporation to finance the capital costs of $4 million          amortized over 20 years

(ii) $250,000 per annum to the Avalon Convention & Visitors Bureau

(iii)    50/50 split per annum of all remaining funds

(d).    An independent auditor engaged by the City will audit the account annually. The ACVB will participate in            defining the audit engagement guidelines. In addition, the Department of Finance will have the right to audit            all aspects of the room levy for compliance with the terms and conditions of this agreement.

(e).    The room levy will continue at 3% until the initial capital debt of the Civic Centre is retired. With the           
          expiration of the initial capital debt or twenty years (whichever comes first), the ACVB and the Civic             Centre Corporation will renegotiate the terms of levy and its disbursement schedule.

(f).    All accommodations in the downtown core subject to the room levy will be exempt from any additional tax           related to the capital commitment of the Downtown Development Corporation.

(g).    The ACVB will be allocated two voting positions on the Civic Centre Corporation.

7.     The results of the architectural Design Competition as selected will be maintained.

As agreed on the date of October 23, 1998, in St. John's by:

______________________________________
Honourable Brian Tobin
Premier of Newfoundland and Labrador

______________________________________
His Worship Andy Wells
Mayor of St. John's

______________________________________
Armand A. Agabab
Chairman,
Avalon Convention and Visitors Bureau

1998 10 23 6:10 p.m.

Photo -  Signing of Memorandum of Understanding