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396-2001 RDA DRAFT Afteraction September 20, 2001 DRAFT #1 City of Miami Beach 10:49:51 am. B A Resolution Of The Chairman And Members Of The Miami Beach Redevelopment Agency Adopting And Appropriating The Operating Budget For Fiscal Year 2001/02, For The Operation Of The Parking Component Of The Anchor Shops And Parking At South Beach, Said Parking Component To Be Operated By Quik Park Of Florida, Inc., Until Expiration Of The Initial Term On December 14, 2001 (75 Days), In Accordance With The Terms And Conditions Of The Garage Facility Management Agreement Dated July 15, 1998, Between The Agency And Quik Park Of Florida, Inc. For The Operation Of The Anchor Garage; And For The Remaining 290 Days To Be Operated By The City Of Miami Beach Parking Department For The Miami Beach Redevelopment Agency, On A Reimbursement Basis; And Providing An Effective Date, (Budgetlltem) Resolution No. 396-2001 adopted as amended. Motion made by Commissioner Cruz to approve the budget and extend Quik Park's contract for another year; seconded by Commissioner Garcia; Voice vote: 4-2; Opposed Commissioners Smith and Liebman; Absent: Vice-Mayor Bower. Christina Cuervo to handle. Handout: 1. Letter from Rafael L1piz, Vice President, Quik Park, to Mayor and City Commission, dated September 20, 2001, Meeting adjourned at 6:32:46 p.m. End of Aaenda Prepared by the City Clerk's Office Page # 27 F:\CLER\COMMON\200 1 \20010920\092001 d9.doc ~ " '.. MIAMI BEACH REDEVELOPMENT AGENCY CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLoRIDA 33139 www.ci.miamiRbeach.fl.us To: From: Subject: MEMORANDUM Chairman and Members of the Miami Beach Redevelopment Agency Date: September 20, 2001 Jorge M. Gonzalez ~.. AH Executive Director ~v v U A RESOLUTION 0 THE CHAIRMAN AND MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY ADOPTING AND APPROPRIATING THE OPERATING BUDGET FOR FISCAL YEAR 2002, FOR THE OPERATION OF THE PARKING COMPONENT OF THE ANCHOR SHOPS AND PARKING AT SOUTH BEACH, SAID PARKING COMPONENT TO BE OPERATED BY QUIK PARK OF FLORIDA, INC. UNTIL EXPIRATION OF THE INITIAL TERM ON DECEMBER 14, 2001 (75 DAYS), IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE GARAGE FACILITY MANAGEMENT AGREEMENT DATED JULY 15, 1998, BETWEEN THE AGENCY AND QUIK PARK OF FLORIDA, INC. FOR THE OPERATION OF THE ANCHOR GARAGE; AND FOR THE REMAINING 290 DAYS TO BE OPERATED BY THE CITY OF MIAMI BEACH PARKING DEPARTMENT FOR THE MIAMI BEACH REDEVELOPMENT AGENCY, ON A REIMBURSEMENT BASIS; AND PROVIDING AN EFFECTIVE DATE. ADMINISTRATION RECOMMENDATION: Adopt the Resolution. ANALYSIS Pursuant to the terms of the Garage Facility Management Agreement between the Redevelopment Agency (RDA) and Quik Park of Florida, Inc" Quik Park must submit for approval by the RDA, a proposed annual budget for the operation of the Anchor Garage. During FY 2000, the Administration performed an audit of Quik Park's expenses. Subsequent thereto, Quik Park remedied all audit deficiencies noted and Quik Park's FY01 budget was adopted on November 29, 2000. When the RDA Board adopted the FY 2001 budget, the Administration recommended that the City's Parking Department assume operational responsibility of the facility upon expiration of the initial term. This recommendation was deemed advantageous both from an economic perspective, and for operational efficiency. AGENDA ITEM DATE 313 1-20-0 I / ',' September 20, 2001 RDA - Commission Memorandum Qu/k Park Page 2 of 3 The Garage Facility Management Agreement between Quik Park and the RDA was approved for an initial term of 36 months with an extension option, the sole and absolute discretion of the RDA, to extend for one period of 12 months. Since the RDA meeting of November 2000, Quik Park has submitted and the Administration has performed several analyses to determine the benefit, if any, of having the City's Parking Department assume responsibility for the operation of the Anchor Garage. A copy of the latest analysis is included with this memorandum as Exhibit 1 A. While earlier comparisons yielded larger operating cost savings if the City were operating the facility, Quik Park's latest budget submission reflects significant reductions in administrative costs that Quik Park is willing to absorb, without a commensurate reduction in operating service levels, in order to remain competitive with the City. The analysis reflected in Exhibit "1 A" reflects estimated savings of $24,109 in the City's proposed budget, exclusive of the $40,000 Management Fee which would revert to the City's Parking Enterprise Fund instead of being paid to Quik Park. The analysis reflects the primary savings is attributed to the City's lower personnel costs resulting from our use of contract labor and an allocation for insurance as a result of the facility being self-insured. While the City's operating cost savings have decreased as a result of Quik Park's reduced overhead, it is still deemed beneficial from an operational efficiency perspective for the City to assume responsibility for the 16th Street Garage. At the same time, Loews is also re- evaluating its use of Quik Park as the valet operator for the Hotel. Contrary to initial assumptions, it has been determined that operationally, it is not detrimental to have a different operator in the garage vs. as the valet operator at the Hotel. In fact, it provides for enhanced internal controls. FY01102 Budget Compared to last year's budget, Quik Park's revenue projections for FY 01/02, are projected to decrease slightly to $2,009,822 from $2,012,814.90. On annualized basis, year-to-date gross revenues for FY 2001 are projected to exceed $2,040,000. Quik Park's FY02 budget estimates are based on actual operating results for the first two years of the facility's operations and the RDA's ability to dedicate under-utilized spaces by Loews for additional monthly accounts. In analyzing the revenue projections, the largest increase in revenue is anticipated to be derived from the anticipated valet usage by the Royal Palm Crowne Plaza, opening in October 2001 and estimated to generate $50,026. Quik Park is cautiously projecting a decrease in valet operations for Loews, since Loews is anticipated to continue using its on- site compliment of parking spaces before utilizing its allocation in the Anchor Garage. Since the Royal Palm also has on-site parking, it is assumed that (as in the case of the Loews), they will only use 30 percent of their allocation of 174 spaces in the Anchor September 20, 2001 RDA - Commission Memorandum Qu/k Park Page 3 of 3 Garage. The transient base, comprising construction, weekend and retail-related business is forecasted to increase by 7.5%, or $72,877.72 over FY 2001. Quik Park's proposed budget for the operation of the Anchor Garage for FY 01/02, reflects a total operating expense budget of $552,705 compared with $602,444.45 approved in November 2000. The decrease in the budget is primarily attributed to a $21,442 reduction in personnel costs, a $16,447 decrease to the professional services line item and a $11,458 reduction in liability insurance. Combined, these reductions result in approximately a $50,000 in cost savings in the budget when compared to FY01. Quik Park has essentially reduced overhead costs to remain competitive with the City's Parking Department. As Quik Park's contract terminates on December 14, 2001, the budget approval is requested for the first 75 days of the 365 days of the year. Quik Park's operating expenses are projected to decrease by approximately 8 percent over budgeted expenses for FY 00/01 , reflecting a decrease in professional services and liability insurance costs. Quik Park reflects those positions involved in the administrative/audit manpower dedicated to the operation of the facility under the Professional Services expense category. This allocation has been deemed acceptable in the Expense Audit performed by the City. The Professional Services has been reduced significantly from $20,995 to $4,548 in an effort to be more competitive with the City's Parking Department. Quik Park asserts that they will essentially "eat" this cost. Liability insurance costs are decreasing as a result of Quik Park's re-negotiation of its policy, maintaining the same coverage based on revenue rather than number of parking spaces. Comparable with FY01, it is projected that the combined net operating revenue from the garage and retail operations at the Anchor Shops and Parking will cover the debt service of the facility, as reflected in the attached analysis of combined operations for FY 2002. It is recommended that the budget FY 01/02 as presented in Exhibits 1 Band 1 C representing 75 days of operations by Quik Park and 290 days of operations by the City of Miami Beach Parking Department, respectively, be approved and adopted. Furthermore, the Administration recommends that upon expiration of the Management Agreement with Quik Park, in December 2001, that the City's Parking Department assume the responsibility for operating the Anchor Garage for the RDA, on a reimbursement basis. JMG/cMlrar T:\AGENDA\2001\sep2001\ROA\Qulk Park Budget MEMO 00 01.doc . attachments RESOLUTION NO. A RESOLUTION OF THE CHAIRMAN AND MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY ADOPTING AND APPROPRIATING THE OPERATING BUDGET FOR FISCAL YEAR 2002, FOR THE OPERATION OF THE PARKING COMPONENT OF THE ANCHOR SHOPS AND PARKING AT SOUTH BEACH, SAID PARKING COMPONENT TO BE OPERATED BY QUIK PARK OF FLORIDA, INC. UNTIL EXPIRATION OF THE INITIAL TERM ON DECEMBER 14, 2001 (75 DAYS), IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE GARAGE FACILITY MANAGEMENT AGREEMENT DATED JULY 15,1998, BETWEEN THE AGENCY AND QUIK PARK OF FLORIDA, INC. FOR THE OPERATION OF THE ANCHOR GARAGE; AND FOR THE REMAINING 290 DAYS TO BE OPERATED BY THE CITY OF MIAMI BEACH PARKING DEPARTMENT FOR THE MIAMI BEACH REDEVELOPMENT AGENCY, ON A REIMBURSEMENT BASIS; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, pursuant to the terms of the Garage Facility Management Agreement between the Redevelopment Agency (RDA) and Quik Park of Florida, Inc., Quik Park must submit for approval by the RDA, a proposed annual budget for the operation of the Anchor Garage; and WHEREAS, during FY 2000, the Administration performed an audit of Quik Park's expenses and subsequent thereto, Quik Park remedied all audit deficiencies noted and the FY 2001 budget was adopted on November 29, 2000; and WHEREAS, when the RDA Board adopted the FY 2001 budget, the Administration recommended that the City's Parking Department assume operational responsibility of the facility upon expiration of the initial term of the Management Agreement, and this recommendation was deemed advantageous both from an economic perspective and for operational efficiency; and WHEREAS, the Garage Facility Management Agreement between Quik Park and the RDA was approved for an initial term of 36 months with an extension option, in the sole and absolute discretion of the RDA, to extend for one period of 12 months; and WHEREAS, the analysis reflected in Exhibit "1A" projects estimated savings of $24,109 in the City's proposed budget for operation of the Anchor Garage by the City, exclusive of the $40,000 Management Fee which would revert to the City's Parking Enterprise Fund instead of being paid to Quik Park; and WHEREAS, the analysis reflects the primary savings is attributed to the City's lower personnel costs resulting from our use of contract labor and an allocation for insurance as a result of the facility being self-insured; and WHEREAS, while the City's operating cost savings have decreased as a result of Quik Park's reduction in its costs, it is still deemed beneficial from an operational efficiency perspective for the City to assume responsibility for the 16'h Street Garage; and WHEREAS, contrary to initial assumptions, it has been determined that operationally, it is not detrimental to have a different operator in the garage from the valet operator at each of the convention center hotels; and WHEREAS, Quik Park's proposed budget for the operation of the Anchor Garage for FY 2002, reflects a total operating expense budget of $552,705 compared with $602,444.45 approved in November 2000 for FY 2001; and WHEREAS, the decrease in the budget is primarily attributed to a $21,442 reduction in personnel costs, a $16,447 decrease to the professional services line item and a $11,458 reduction in liability insurance; and WHEREAS, as Quik Park's contract terminates on December 14, 2001, the budget approval is requested with Quik Park as the operator of the 16'h Street Garage for the first 75 days of the year and the City's Parking Department for the other 290 days of the year. BE IT DULY RESOLVED BY THE CHAIRMAN AND MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY, that the Board hereby adopts the operating budget for Fiscal Year 2002, as submitted by Quik Park of Florida, Inc., for the operation of the parking component of the Anchor Shops and Parking at South Beach. PASSED AND ADOPTED this day of ,2001. CHAIRMAN ATTEST: SECRETARY ~ ~ 'tl/J/of 1:flV Da. GemnI CounIel " JMG/CMC/rar T:\AGENDA\2001\sep2001\RDAIQulk Park Budget Res 00 01.doc ... "EXHIBIT 1A" CITY OF MIAMI BEACH PARKING DEPARTMENT 16TH STREET GARAGE BUDGET. FY 200/2002 13-Sep-2001 CMB QUIKPARK VARIANCE TOTAL TOTAL TOTAL 52 52 0 REVENUE TRANSIENT $1,032,885,00 $1,032,885.00 $0,00 MONTHLY $542,500.00 $542,500.00 $0,00 LOEW HOTEL $284,411.00 $284,411.00 $0.00 ROYAL PALM $150,026.00 $150,026,00 $0.00 GROSS REVENUE $2,009,822.00 $2,009,822,00 $0.00 NET REVENUE $1,887,156.81 $1,887,156.81 $0.00 PERSONNEL COSTS $249,371,52 $257,879,00 ($8,507.48) TICKETS $2,880,00 $2,880.00 $0.00 SIGNAGE $1,000.00 $1,000.00 $0,00 TELEPHONE $1,980.00 $1,980.00 $0.00 UTILITIES $45,600.00 $45,600.00 $0.00 R&M $1,200'.00 $1,200.00 $0.00 CONTRACTS $44,304,00 $44,304.00 $0.00 PROF, SERVICES $0.00 $4,548,00 ($4,548.00) LICENSE $400.00 $400,00 $0.00 SECURITY $125.944,00 $125,944,00 $0.00 SANITATION $2,100,00 $2,100.00 $0.00 LIABILITY INSURANCE $0,00 $11,054.00 ($11,054,00) COURIER SERVICE $6,716.00 $6,716.00 $0.00 WATER $700,00 $700.00 $0.00 SEWER $1,200.00 $1,200.00 $0.00 STORM WATER $1,000,00 $1,000,00 $0.00 SUPPLIES $4,200,00 $4,200,00 $0.00 MANAGEMENT FEE $40,000,00 $40,000.00 $0,00 MISCELLANEOUS $600.00 $600.00 $0.00 TOTAL EXPENSES $528,595.52 $552,705.00 /$24,109.481 PROFIT CLOSS) $1,358,561.29 $1,334,451.81 $24,109.48 F:\plngl$alllchuck~oewsbud.wb2 "EXHIBIT 1 B" CITY OF MIAMI BEACH PARKING DEPARTMENT 16TH STREET GARAGE BUDGET - FY 200/2002 QUIKPARK QUIKPARK (365 DAYS) (75 DAYS) 52 52 REVENUE TRANSIENT $1,032,885,00 $212,236.64 MONTHLY $542,500.00 $111,472.60 LOEW HOTEL $284,411,00 $58,440,62 ROYAL PALM $150,026.00 $30,827.26 GROSS REVENUE $2,009,822.00 $412,977.12 NET REVENUE $1,887,156.81 $387,771.95 PERSONNEL COSTS $257,879,00 $52,988,84 TICKETS $2,880.00 $591.78 SIGNAGE $1,000.00 $205.48 TELEPHONE $1,980.00 $406.85 UTILITIES $45,600.00 $9,369.86 R&M $1,200.00 $246,58 CONTRACTS $44,304.00 $9,103.56 PROF. SERVICES $4,548.00 $934.52 LICENSE $400,00 $82,19 SECURITY $125,944.00 $25,878.90 SANITATION $2.100.00 $431.51 LIABILITY INSURANCE $11,054,00 $2,271,37 COURIER SERVICE $6,716.00 $1,380.00 WATER $700.00 $143.84 SEWER $1,200.00 $246.58 STORM WATER $1.000,00 $205.48 SUPPLIES $4,200,00 $863.01 MANAGEMENT FEE $40,000.00 $8,219.18 MISCELLANEOUS $600.00 $123,29 TOTAL EXPENSES $552,705.00 $113,569.52 PROFIT (LOSS) $1,334,451.81 $274,202.43 F:lpingl$alllchucklloewsbud.wb2 "EXHIBIT 1C" CITY OF MIAMI BEACH PARKING DEPARTMENT 16TH STREET GARAGE BUDGET. FY 200/2002 CMB CMB (365 DAYS) (290 DAYS) 52 52 REVENUE TRANSIENT $1,032,885.00 $820,648.36 MONTHLY $542,500.00 $431,027.40 LOEW HOTEL $284,411.00 $225,970,38 ROYAL PALM $150,026.00 $119,198.74 GROSS REVENUE $2,009,822.00 $1,596,844.88 NET REVENUE $1,887,156.81 $1,499,384.86 PERSONNEL COSTS $249,371.52 $198,130.80 TICKETS $2,880.00 $2,288.22 SIGNAGE $1,000.00 $794,52 TELEPHONE $1,980,00 $1,573,15 UTILITIES $45,600,00 $36.230.14 R&M $1,200,00 $953.42 CONTRACTS $44,304.00 $35,200.44 PROF, SERVICES $0,00 $0.00 LICENSE $400.00 $317,81 SECURITY $125,944.00 $100,065,10 SANITATION $2,100.00 $1,668.49 LIABILITY INSURANCE $0,00 $0.00 COURIER SERVICE $6.716.00 $5.336.00 WATER $700,00 $556.16 SEWER $1,200,00 $953.42 STORM WATER $1,000.00 $794.52 SUPPLIES $4,200.00 $3,336,99 MANAGEMENT FEE $40,000,00 $31.780.82 MISCELLANEOUS $600,00 $476.71 TOTAL EXPENSES $528,595.52 $419,980.00 PROFIT (LOSS) $1,358,561.29 $1,079,404.86 F:\pingl$alllchucklloewsbud,wb2 " .... ;c ;c (JI (JI (JI :e " r (JI (JI r " " '" c: .... 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'" '" W -l o .... > r " '" , 0 .2, 0 m 0 " 0> m n a. - c 0> v; ;1]< . 0 < - . c , 3 c . . > Sctledule5 Revised 8/13101 FY02 Transient Royal Palm Oct-DO Budget $ 58,376 $ 14,107 Actual $ 65,028 $ Variance $ 6,652 $ % +/- 11% Nov-OO Budget 52,667 50,568 $ 11,463 Actual $ 62,642 $ 53,091 $ Variance $ 9,755 $ 2,504 $ % +/- 18% 5% Dec-OO ;,.", Budget $ 57,648 $ 50,566 $ 17,192 Actual $ 68,513 $ 56,539 $ Variance $ 10,665 $ 5,951 $ % +/- 19% 12% Jan-01 Budget 104,862 $ 50,566 $ 10,237 Actual $ 64,391 $ 40,963 $ Variance $ (20,471) $ (9,624) $ % +/- -20% -19% Feb-01 Budget $ 129,576 $ 50,566 $ 14,769 Actual $ 110,453 $ 90,609 $ Variance $ (19,123) $ 40,021 $ % +/~ -15% 79% Mar-01 j;~i"'!;!J'IlllIi~': , Budget $ 141,262 $ 50,568 $ 21,675 Actual $ 149,463 $ 25,972 $ Variance $ 6,201 $ (24,616) $ %+/- 6% ~49% Apr-01 Budget $ 50,568 $ 13,076 Actual $ $ 55,606 $ Variance $ $ 5,219 $ % +/- 10% May-01 Budget 50,588 $ $ $ 6,407 Actual $ $ 70,147 $ 15,936 $ $ Variance $ $ 19,559 $ (6,078) $ (12,896) $ %+/- 39% -28% -100% Jun-01 Budget $ 50,170 $ 47,925 $ 38,802 $ 12,460 $ 8,902 Actual $ 76,333 $ 39,542 $ 16,878 $ $ Variance $ 26,163 $ (8,383) $ (21,926) $ (12,480) $ %+/- 52% -17% -57% -100% Jul-01 :..i'JIIL Ii :--I'ill'- ~ -'" - ..~. ---.,' Budget $ 58,505 $ 47,925 $ 39,579 $ 12,896 $ 18,506 Actual $ 81,948 $ 48,254 $ 35,086 $ $ Variance $ 23,443 $ 329 $ (4,493) $ (12,696) $ % +/- 40% 1% -11% -100% Aug-01 ..L ,:.1" '_UllWA:~. .... 111...4. Budget $ 70,359 $ 47,925 $ 42,458 $ 12,696 $ 9,881 p Actual $ 86,224 $ 53,250 $ 18,731 $ $ Variance $ 15,865 $ 5,325 $ (23,727) $ (12,896) $ % +/- 23% 11% -56% -100% Sep-01 ~1!!l'.t"t'~__4\1H- ,- 'ii, Budget $ 73,912 $ 50,588 $ 22,750 $ 12,480 $ 8,407 p Actual $ 90,758 $ 55,912 $ 15,936 $ 8,406 $ Variance $ 16,846 $ 5,325 $ (6,812) $ (4,074) $ %+/- 23% 11% -30% ~33% '[-'-lit::.' TII Budget $ 961,007 $ 602,364 $ 395,302 $ 63,646 $ 2,022,321 $ 156,645 Ttl Actual $ 1,078,454 $ 643,360 $ 296,958 $ 8,406 $ 2,027,176 Tt! Variance $ 117,447 $ 40,996 $ (98,344) $ (55,242) $ 4,656 Tt! % +/- 12% 7% -25% -87% 0% P Projected 0 U) N .., 0 '" '" :; :;; '" N ~ Sl .. '" " a: '" '" '" ~ 0 ~ U- > Z . :::> '" '" '" '" '" '" .. "' .., ;l; ;X ;;; W "' I a: "' "' '" I-<t -'u. <t-' wW I;': .. .. '" '" '" .. .. U) 0 0 0 0 .... ;l. 0 "' --,I- 0 .... '" ~u:: N N '" OW ....aJ en '" '" '" '" '" "' 0 ;;; .... '" "' "' 0 '" -' .... .... "' .., ~ .... .., '" -,-' .., 0 "' "' .... "! 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