LTC 098-2004 Sponsorship RFP and Bid Protest
CITY OF MIAMI BEACH
Office of the City Manager
Letter to Commission No. 098-2004
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From:
Mayor David Dermer and
Members of the City Commission
Jorge M. Gonzalez \,r--..j./
City Manager 0 0
SPONSORSHIP RFP AND BID PROTEST
Date: April 29, 2004
To:
Subject:
The purpose of this LTC is to provide you information regarding a request to authorize
negotiations with the recommended vendor in a sponsorship RFP process which was on
the April 14th City Commission meeting agenda. The item was withdrawn due to a timely
bid protest received addressed to me. Subsequently articles were written in the media
regarding the process and erroneous allegations have been made.
Traditionally, I would make every effort to ignore the inflammatory and inaccurate
coverage; however, in the situation where ethics and integrity are involved, such
allegations can not go unresponded or left uncorrected.
This LTC will review in detail the process that was followed for the entire RFP relative to
sponsorships and identify the different parties involved at each step of the process.
PROCESS
The notion of sponsorships as a revenue generating support mechanism for City programs
and projects was first identified and communicated to the City Commission as part of the
Parks and Recreation Blue Ribbon Citizens Committee Report that was submitted in May
2002. The Blue Ribbon Committee specifically suggested that the City undertake
enhanced efforts to identify corporate opportunities to support Parks and Recreation
programming and City activities.
In subsequent investigation of methods to implement the Blue Ribbon Committee
recommendation, the City learned that a number of communities on a national basis have
undertaken sponsorship opportunities resulting in substantial flows of revenue to the
benefit of those particular communities. Typically those sponsorship opportunities have
taken the form of multi-year soft drink endorsements but have also recently included other
national corporations.
In order to focus appropriate attention on this important endeavor and to help implement
the recommendation, the City hired an individual to address this subject and to provide
technical assistance. Mr. Jay Moore was hired on December 16, 2002 to focus on
sponsorship opportunities and to help develop means and methods to assist the Parks and
Recreation Department. In addition to background research associated with national
sponsorship opportunities, Mr. Moore has also been very successful in attracting
advertising to the City's Recreation Review Magazine to the point that most of the costs of
publishing and mailing the document to every household in the community are now
supported by advertising.
The initial efforts of the City to implement a sponsorship program involved national
research into successful undertakings by other municipalities in this particular area. A
number of cities were identified primarily in the state of California that had experienced
success with a sponsorship program. The City obtained contracts from the cities, spoke to
the city personnel and also made contacts with various representatives of the industry in
order to better understand the sponsorship arena and to gather information for a City
program.
As part of the City's early due diligence, it was quickly established that participating in the
national sponsorship arena would require specialized help and assistance in order for the
City to maximize opportunities for success.
The City proceeded to identify a number of national firms that had assisted communities in
some way in national sponsorship programs and contracts. One of the firms contacted was
the Superlative Group. The Superlative Group was under contract to Miami Dade County
for similar work and was also a subsequent bidder in the City's RFP process. The
Superlative Group also filed the bid protest letter that has sparked this particular
discussion.
The City staff reviewed the credentials and experience of the different firms that had been
contacted and made a preliminary determination that the Superlative Group would be able
to assist the City in the development of a sponsorship program. The sponsorship program
was to be two part undertaking with the first part being the development of an asset
inventory by a consulting firm for less than $25,000 and the second part to be a
competitively bid contract to assist the City with a sponsorship program. The approach
was intended to give the City as much information as possible in the first part, before
having to solicit a consultant for the larger contract in the second part. Discussions with
the Superlative Group progressed to the point of discussing potential contract terms for
completing the first part of the work, an asset inventory, to prepare for a formalized RFP
process to follow.
As the discussions with the different consulting groups including the Superlative Group
progressed, it became apparent that there were other potentially interested vendors or
providers of service in the market place that the City might appropriately need to contact or
invite into a process. In addition, it became apparent through research that there was a
potential for a successful company to enter into a contract with the City for consulting
services that could generate over the life of a contract a substantial sum of funds. Given
the interest of other vendors in the market and the dollar amounts prospectively involved in
a contract, the City made the specific and conscious decision to end an informal selection
process for a two part project and move to a more structured and formalized RFP to invite
competitive proposals for a complete package of sponsorship assistance to the City.
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On July 30, 2003, the City Administration presented to the City Commission a request
to issue an RFP for consulting services to assist with national corporate sponsorship
opportunities. The City Commission unanimously approved the RFP and an RFP was
subsequently issued by the City Administration.
Consistent with the City's RFP practices, a Selection Committee of staff and residents was
appointed and the membership was conveyed to the City Commission for comment in an
LTC dated October 17, 2003. No comment was received from the Commission and the
Selection Committee proceeded to review the RFP proposals.
Eight proposals were received and seven were reviewed by the Selection Committee. One
vendor elected not to present to the Committee. As a result of the Selection committee
review and discussion, Sports and Sponsorship was ranked as the number one vendor and
IMG the second vendor in the ranking process. Both scores and evaluations on the
abilities and credentials of the two firms were ranked very close. The proposal of
Superlative Group was not ranked in the top four proposals by the Committee.
In preparing this item to present to the City Commission, the City Administration
determined that there were several key and important facts that had not been fully
developed as part of the Selection Committee review discussion. As such, a supplemental
questionnaire was sent to the leading four proposers in the RFP Selection Committee
review process. Only the four proposers ranked by the Committee were invited to submit
additional information. This process of requesting additional information is not an unusual
part of the procurement process and is used to assure that full information on proposals is
available to the Administration and Commission.
The Administration received the written responses of the leading four vendors. Before
sending the item to Commission for consideration, the original selection Committee was
reconvened and provided the supplemental materials for review and comment. Only four
of the members were available to review the supplement.
The Administration evaluated all of the information available, together with the Selection
Committee discussion and information to develop a recommendation forthe Commission.
As the original materials submitted for review by the selection committee were rather
general, the supplemental questions which were very focused and specific (copy attached)
formed an important basis for a recommendation. Supplemental information on projects
completed for similar entities as the City, details on the project team, and more specific and
detailed information as to the method of approach to the project were solicited. As a result
of the much more detailed material submitted by the leading four vendors, it was
determined that IMG had a better overall technical proposal for the City, broader actual
experience in performing sponsorship work and a more experienced project team that had
worked together on a number of projects over a period of years.
A recommendation was forwarded to the City Commission for the April 14th City
Commission meeting to authorize the City Administration to enter into contract
negotiations with the firm IMG.
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Prior to the April 14th City Commission meeting, the Administration presented to the
members of the Finance and Citywide Project Committee at its April 6th meeting, a
background discussion item so as to reacquaint the members of the Finance Committee
with the background associated with the sponsorship program and work that had been
completed to date. No action was required or requested and the Finance Committee
recommended that the entire matter be moved to the City Commission for final
determination.
The materials that were submitted to the City Commission for review and consideration
were the Selection Committee review and comments, the Administration's review and
comments and the background proposal information made by each of the two highest
ranked vendors. The only action sought from the City Commission was to authorize
negotiation for a contract.
Prior to the April 14th City Commission meeting, a bid protest letter was received from the
Superlative Group relative to the recommended rankings and the request for authorization
to negotiate a contract. In order to investigate the Superlative Group bid protest, the matter
was withdrawn by the City Administration from the Commission Agenda, as is the
customary practice when a protest is received that requires appropriate research and
review.
Media Inaccuracies
Specific inaccuracies regarding the previously described process which are contained in
the media coverage and require clarification and correction include the following:
. It has been reported that a prepared contract was included in the aqenda material
and recommended for approval by the members of City Commission.
As indicated previously, the material submitted to the City Commission included the
proposals by the two leading firms and the Administration's review relative to those
professional qualifications. While the proposers included desired contract information,
no recommendation was forwarded to the City Commission on a contract. The
Commission Memo indicated that the Finance Committee recommended proceeding
with a negotiation strategy for a contract with the successful firm that relied more
heavily on a commission arrangement for payment of the consulting firm rather than
front end fees. No recommendation on contracts was submitted to the Commission
and no action was requested or required by Commission on contracts.
. Assertions have been made that City officials were aware of the alleqed influence
exerted by Mr. Michael Milberq to influence the RFP process.
This statement is factually inaccurate. Mr. Milberg was one of the sponsorship vendors
that was contacted in the early or preliminary stages of due diligence by the City
inasmuch as he had a contract with the City for the vending machines on City
properties. There were no conversations with City officials at any level with Mr. Milberg
once the RFP process had been commenced. No City officials are aware of private
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conversations which might have been undertaken between Mr. Milberg, the Superlative
Group or any other of the vendors in the RFP process. It is factually inaccurate to say
that City officials at any level were aware of influence alleged to have been asserted by
Mr. Milberg in this process.
. It has been reported that the City Administration was askinq the Commission to
approve a specific monthly retainer and contract arranqement.
The representation is factually inaccurate as the request to the Commission was
specifically to request authorization to negotiate. The Commission Memo specifically
referenced the Finance Committees suggested strategy of contract structure, which
was to have a no front end cost contract and commission reimbursement as a basis for
retaining a firm.
Conclusion
The media attention clearly attempts to establish a conspiracy and improper behaviors
where none exist. It is very unfortunate that with the facts that are readily available and
verifiable and public officials who are willing to address such information, that some in the
media would choose to print such inaccurate and inflammatory coverage relative to a
process undertaken by the City. The process undertaken by the City for a sponsorship
program was intended to be a benefit to the City, and was undertaken with the appropriate
due diligence and research associated with any of the projects which the City pursues. As
most of you know on a personal level, this type of inaccurate and misleading coverage
occurs occasionally in the public sector. It is one of the very great frustrations of the public
sector to be subjected to this type of innuendo with no ability for recourse or a venue to
correctly report facts.
As is customary, upon receipt of the timely bid protest, I immediately referred the matter to
the City Attorney's office and our Procurement Director for appropriate review and action.
Staff had begun to investigate the issues raised and had contacted Superlative to seek
greater input and information when they were directed to discontinue their efforts and it is
my understanding that this matter has since been referred to the State Attorney's office for
investigation. While in this instance, the process has been altered, I assure you that I and
the Administration will cooperate fully with the State Attorney, however they determine to
proceed.
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