97-22335 RESO
RESOLUTION NO. 97-22335
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING SMG,
ON BEHALF OF THE CITY, TO INCREASE THE PERCENTAGE
REMITTED BY APPROVED EXHIBmON ELECTRICAL
CONTRACTORS OPERATING IN THE MIAMI BEACH
CONVENTION CENTER FROM lWENTY PERCENT (20%) OF
GROSS BILLINGS TO THIRTY PERCENT (30%) OF GROSS
BILLINGS, EFFECTIVE IMMEDIATELY FOR EVENTS NOT
CURRENTLY CONTRACTED OR NOT LATER THAN OCTOBER 1,
1997, FOR EVENTS CURRENTLY CONTRACTED WITH THE
CENTER AND FOR EXHmmONELECTRICAL SERVICES.
WHEREAS, Spectacor Management Group (SMG), as the managing entity for the Miam
Beach Convention Center, was directed to further explore enhancement of revenue sources,
and
WHEREAS, SMG put forth the option of awarding an exclusive contract for the provision of
exhibition electrical services at the Miami Beach Convention Center instead of allowin~
lessees to select from a list of approximately four approved vendors; and
WHEREAS, a Request for Proposals was issued by SMG on June 26, 1996, for the provision
of these services, resulting in three responses; and
WHEREAS, a review of the proposals was conducted by SMG staff, along with input from
the Administration, resulting in the ranking ofEdlen Electrical Exhibition Services, Inc, as the
top-ranked firm, and Trade Show Electrical as the second-ranked firm; and
WHEREAS, the Commission has determined that the issuance of an exclusive contract may
affect adversely the competitiveness of the Convention Center for future bookings; and
WHEREAS, the Commission has determined that an increase in the percentage of gross
billings for these services will not significantly affect adversely the competitiveness of the
Convention Center for future bookings,
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and
City Commission of the City of Miami Beach, Florida, authorize SMG, on behalf of the City,
to increase the percentage remitted by approved exhibition electrical contractors operating in
the Miami Beach Convention Center from twenty percent (20%) of gross billings, to thirty
percent (300.10) of gross billings, effective immediately for events not currently contracted or
not later than October 1, 1997, for events currently contracted with the Center and for
exhibition electrical services.
PASSED and ADOPTED this 19'" day of March, 199~/VI/1
ATTEST: V I f
-~p~
MAYOR
CITY CLERK
APPROVED AS TO
FORM & LANGUAGE
& FOR EXECUTION
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'I rney ate f , .
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
http:\\ci.miami-beach.f1.us
COMMISSION MEMORANDUM NO. J q L. .q 1
TO:
Mayor Seymour Gelber and
Members of the City Commission
~~:; ~:~c~:~~edros~~1
Request to Acce~lle Ranking of Proposals Received and to Authorize S'\1:4;
on Behalf of the Kdministration to Enter into Negotiations for a Contract wit 11
the Number-One Ranked Firm, Edlen Electrical Exhibition Services, Inc.., to
Provide Exclusive Exhibition Electrical Services at the Miami Bfacil
Convention Center; Should an Agreement Not Be Able to be Reached Wit'l
Edlen Electrical Exhibition Services, Inc., to Authorize SMG on Behalf of tble
Administration to Negotiate with the Second-Ranked Firm, Trade Show
Electrical.
DATE: March 19, 19~ 7
FROM:
SUBJECT:
ADMINISTRATION RECOMMENDATION:
To accept the ranking of proposals and approve the resolution.
BACKGROUND:
In response to a directive from the City Manager to further explore enhancement of revenue SOUl ce: ,
SMG, managing entity for the Miami Beach Convention Center, put forth the option of awardin.~
an exclusive contract for the provision of exhibition electric services at the Miami Beach Conventio 1
Center. Currently the Center has approved four vendors to provide services for events, with thes,~
vendors remitting twenty percent (20%) of gross billings to the City. During Fiscal Year 1995 .9( ,
these vendors billed approximately $2,000,000, resulting in commissions of approximately $400,00 )
to the City.
An RFP was issued by SMG on June 26, 1996, for the provision of these services. A pre-propl )S~ 1
conference was held on August 12, 1996, and responses were due on Monday, August 26, 199f.
Responses were received from three firms: Edd Helms Electrical Contracting, Inc., Edlen ElectIic~ I
Exhibition Services, Inc., and Trade Show Electric. These three firms are currently on the Center';
approved electric service vendor list.
Review of the proposals was conducted by SMG staff along with input from the City Manager anl
Assistant City Manager Mayra Diaz Buttacavoli. While SMG has contracting authority for thi;
service absent City Commission action, the anticipated length of the contract, five years, extend;
beyond SMG's current Management Agreement term, thus necessitating City Commission approv~J
of this item.
AGENDA ITEM -R ~ t"l..
~ \ Q CI--'
DATE~L
Exhibition Electrical Services
Page Two
March 19, 1997
ANALYSIS:
Below please find a table outlining some key comparisons of the three bids. Also included is a
comparison of the proposed rate card end user charges on five representative items.
TSE Edlen Electrical Edd Helms
Pct. < $1 M Sales 40% 45% 40%
Pct. $IM-1.5M Sales 45% 45% 40%
Pct. > $1.5M Sales 50% 50% 40%
Marketing $25,000 $5,000 n/a
Contribution
Charitable Up to $25,000 Up to $1,000 per n/a
Contributions event
Maintenance Maintain all perm. Maintain utility n/a
Contributions outlets, switches & boxes and disconnect
devices in ex. halls panels throughout
facility
Capital Investment n/a $5,000/yr. X 5 yrs. n/a
Code Compliance n/c n/c up to $100,000
Total Return to $425,000 $460,000 $400,000
MBCC@$IM
Total Return to $900,000 $935,000 $800,000
MBCC @ $2M
Total Return to $1,400,000 $1,435,000 $1,200,000
MBCC @ $3M
NOTE: The total returns above do not include charitable in-kind contributions, as the diffe]'in:~
formats of the TSE and Edlen bids do not allow direct comparisons. Additionally, TSE's assumpjoll
of $25,000 in maintenance costs is not included, as it is assumed that TSE's and Edlen's offen of
maintenance are equal to each other, and offers by all three to bring all equipment up to c:Jd,:
compliance are not included.
Exhibition Electrical Services
Page Three
March 19, 1997
Selected Rate Card Examples
Selected TSE Edlen Electrical Edd Helms
Charges
500W 1l0V $59.50 $59.00 $66.00
2000W 11 OV $132.50 $110.00 $101.00
20a 208V 1 Phase $249.00 $236.00 $229.00
60a 208V 3 Phase $532.00 $559.00 $998.00
150W Floodlamp $59.50 $58.00 $59.00
At this point TSE and Edlen emerge as better bids; the Edd Helms bid lags behind the othen: 01
nearly every count, and it is suggested that no further consideration be given to this propo:ial
Neither Edlen or TSE rate schedules differ significantly from rate schedules currently in use by bot 1
companies within the Center. A sampling of costs of services indicates that rates would remai 1
competitive with the current end user rates, which compare as average with other cities nationwid(.
Additionally, below please find a comparison of proposed returns versus current returns.
The following table will assume that:
· Current is current open policy @ 20% commission on service and equipment (S&E)
· Open 30 assumes open policy @ 30% commission on S&E
· TSE outlines the TSE exclusive format as described earlier
· Edlen outlines the Edlen exclusive format as described earlier
Sales Vol Current Open 30 TSE Edlen
$1,000,000 $200,000 $300,000 $425,000 $460,000
$2,000,000 $400,000 $600,000 $900,000 $935,000
$3,000,000 $600,000 $900,000 $1,400,000 $1,435,000
Exhibition Electrical Services
Page Four
March 19, 1997
ANALYSIS: (Continued)
Concurrent with the Proposal Review process, SMG researched the potential effect of making thi s
service exclusive to one vendor by surveying both users of the facility and other facilities 'lvh.)
currently have exclusive agreements for this service. While users were generally opposed to thi s
change, citing loss of a choice in selecting vendors as the main reason, only one of twenty-fiv,~
facilities responding to a survey pointed to an exclusive electrical vendor as the reason for losing a 1
event, and that facility had only had one instance since 1977.
Additionally, a Custom Research Report prepared for SMG by Tradeshow Week, a leading industr 1
trade publication, showed that in 1996 approximately 72% of North American Convention Center)
and Major Exhibit Halls offered exclusive electrical services, whether provided in-house or b:' a 1
exclusive contractor. This listing included such facilities as the Georgia World Congress Centtr i 1
Atlanta, the Ernest N. Morial Convention Center in New Orleans, the Dallas Convention Center, th,~
Jacob K. Javits Convention Center in New York City, the George R. Brown Convention Centu i 1
Houston, the Tampa Convention Center, the Orange County Convention Center in Orland(,
McCormick Place in Chicago, and the New Charlotte Convention Center.
The report provided sample pricing for selected items and services, and rates quoted in the Edle 1
proposal fell generally in the average range when compared to other convention facilities, there:ur,~
not placing us at a competitive disadvantage regarding pricing should the exclusive providei' b ,~
awarded.
Subsequent to the City Commission's requests of March 5, 1997, the City's Internal Aldit
Department has reviewed the proposals and concurs with the analysis provided by SMG. Edle 1
Electrical currently provides electrical services to the majority of Convention Center users. In facT,
current projections would anticipate that Edlen will service approximately 2/3 of the City's show;
over the next 18 months, with the remaining 1/3 split between three other firms.
ADVISORY BOARD RECOMMENDATION
The Convention Center Advisory Board reviewed this item on the February 27, 1997 agenda. Th ,:
CCAB unanimously voted to endorse the recommendation of the CCAB Electrical Subcommittet "
which voted 5-0 on February 10, 1997 to recommend remaining open to approved vendors and
raising the percentage paid by vendors to 30% of gross revenue. This recommendation was based
on a desire to remain as competitive as possible in our ability to attract business to the CeIl tel .
Subsequent to the City Commission's request of March 5 for the CCAB to address the issue ofhO\ I
the CCAB would propose to make up the approximately $300,000 differential between an open
building with 30% commission versus the Edlen exclusive scenario, the CCAB, at a meeting on
March 10, 1997, voted unanimously to maintain its position on remaining open with a 30(h
commission requried from all endors. In addition, the CCAB motion indicated that it felt it was nOlt
the responsibility for the Board to decide how the difference in revenues would be recouped.
Exhibition Electrical Services
Page Five
March 19, 1997
CONCLUSION:
The Commission should accept the ranking recommended by SMG and the recommendation ofth.~
Administration and authorize SMG to commence negotiations with Edlen Electrical ExhibHio 1
Services, Inc., and if negotiations are not successfully completed, to authorize negotiations with th ,~
second-ranked firm, Trade Show Electric.
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