Failing Parade ice arena will cost Park Board $9.5 million

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February 12, 2013
By: Nick Halter
Nick Halter
Nick Halter
Without new mechanical systems, Park Board commissioners say the arena won't last

Minneapolis Park Board commissioners say failing infrastructure at Parade Ice Garden will require them to borrow nearly $10 million to fix the 40-year-old arena.

Arena Solutions, a Park Board-hired consultant, told the Park Board that the arena —which is just west of downtown near the Sculpture Garden — needs a new refrigeration system, new rink floors, a major fix to the roof and other upgrades.

The upgrades will reduce energy and maintenance costs by $430,000 annually, while also increasing revenue from rented ice time by $150,000 annually, said Bruce Chamberlain, Park Board assistant superintendent of planning. Debt payments on the 20-year bonds for the project will be $650,000 to $690,000 a year.

“I think we’re really talking about this being the end of the arena if we don’t do something,” said Park Board Commissioner Bob Fine (at-large).

Still, some commissioners were concerned about the long-term financial details. Chamberlain acknowledged that long-term operational costs without the upgrades were only estimates, and a previous bonding project to upgrade golf courses years back hasn’t generated the revenue needed to pay off bonds without dipping into the Board’s general fund.

The project’s biggest expense is replacing its R-22 refrigeration system with an ammonia system. That will cost $4.5 million, but it will also save the Park Board $50,000 a year on energy costs and another $233,000 in annual operational savings because of leaks and expensive R-22. R-22 is a greenhouse gas, and Chamberlain said that because it’s being phased out, it’s expensive to buy.

“The bottom line is this: The roof needs fixing, the ice needs fixing, the whole facility needs to be worked on,” said Park Board President John Erwin. “I don’t see any other option other than fixing this thing or making the decision not to do ice skating, and I don’t think that’s an option in this city.”

Chamberlain said building a new ice arena would likely cost $20 million.

Upgrading the facility would allow for year-round hockey and skating at all three of the arena’s rinks. Currently, the Park Board has to close the smaller hockey rink and a studio rink in the summer. Keeping all three rinks open during the summer will increase rental revenue by $150,000 a year, Chamberlain said.

Work would be done in 2013 and 2014, starting as early as this March. The north rink, or the premier rink, would be upgraded in 2013 and the south rink and studio would be done in 2014.

“This project is incredibly important to the kids that we currently have in the program and in the future, said Mike Shogren of the Minneapolis Hockey Association.

Included in the project is nearly $300,000 for new lighting at several Minneapolis golf courses, plus energy efficiency upgrades at Lupient Pool and the Northeast Ice Arena.

The Park Board’s Administrative and Finance Committee approved the project on Feb. 6. It still needs full Park Board approval.