HomeMy WebLinkAbout2005-25884 Reso
RESOLUTION NO. 2005-25884
A RESOLUTION OF THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH,
FLORIDA, AUTHORIZING THE MAYOR AND CITY
CLERK, TO EXECUTE AN AMENDED AND
RESTATED CONCESSION AGREEMENT BY AND
BETWEEN THE CITY OF MIAMI BEACH AND
BOUCHER BROTHERS MIAMI BEACH, LLC, FOR
THE MANAGEMENT AND OPERATION OF
BEACH FRONT CONCESSIONS ON THE BEACHES
SEAWARD OF LUMMUS PARK, OCEAN TERRACE
AND NORTH SHORE OPEN SPACE PARK, MIAMI
BEACH, FLORIDA
WHEREAS, in October 2001, the Mayor and City Commission approved
awarding a Concession Agreement to Boucher Brothers Miami Beach, LLC
(Boucher Brothers) for the management and operation of beachfront concessions
seaward of Lummus Park, Ocean Terrace, and North Shore Open Space Park, for
an initial term of five (5) years (November 5, 2001 thorough November IT, 2006),
with one 5 year option, subject to conclusion of good faith negotiations and mutually
agreed upon terms and conditions; and
WHEREAS, the Agreement provided that at the end of the first contract
year, the City and Boucher Brothers would meet to review Concessionaire's
performance for said contract year to discuss quality, operational, maintenance and
any other related issues; and
WHEREAS, the City and Boucher Brothers met on several occasions to
discuss and renegotiate certain contract provisions in order to address
inconsistencies and operational issues that have been identified, and should be
memorialized; and
WHEREAS, the City and Boucher Brothers concluded negotiations and have
agreed to the terms and conditions as reflected in an Amended and Restated
Concession Agreement; and
WHEREAS, on April 27, 2005, the City's Finance and Citywide Projects
Committee reviewed and discussed the terms and conditions of the proposed
Amended and Restated Concession Agreement and unanimously recommended
that same be forwarded to the Mayor and City Commission for their approval.
NOW, THEREFORE, BE IT DULY RESOLVED BYTHE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and
City Clerk, be authorized to execute an Amended and Restated Concession
Agreement by and between the City of Miami Beach and Boucher Brothers Miami
Beach, LLC, for the management and operation of beachfront concessions on the
beaches seaward of Lummus Park, Ocean Terrace and North Shore Open Space
Park, Miami Beach, Florida.
PASSED AND ADOPTED THIS 18th day of Mav, 2005.
'.~f~~
CITY CLERK
~ '".. Robert Parcher
Attest:
JMG;TH:JD:rlr
F:\DDHP\$ALL\ASSET\BEACHFRN\PUBLlC\RFP _2001\BOUCHER\AMENDED AND RESTATED RES.DOC
APPROVIDAl1O
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CITY OF MIAMI BEACH
COMMISSION ITEM SUMMARY
m
Condensed Title:
A Resolution Authorizing The Mayor And City Clerk, To Execute An Amended And Restated Concession
Agreement Between The City And Boucher Brothers Miami Beach, LLC For Management And Operation
Of Beachfront Concessions On The Beaches Seaward Of Lummus Park, Ocean Terrace And North Shore
Open Space Park, Miami Beach, Florida.
Issue:
Should the Amended and Restated Concession Agreement be approved?
Item Summa IRecommendation:
In October 2001, Boucher Brothers Miami Beach, LLC (Boucher Brothers) was awarded the concession
agreement to manage and operate the beachfront concessions seaward of certain City parks. The initial
term is for 5 years (11/5/01-111Lf/Q6), and has one 5 year option, subject to conclusion of good faith
negotiations and mutually agreed upon terms and conditions.
The Agreement provided that at the end of the first contract year, the City and Boucher Brothers would meet
to review Concessionaire's performance for said contract year to discuss quality, operational, maintenance
and any other related issues. The City and Boucher Brothers met on several occasions to discuss certain
contract provisions that should be revisited in order to address inconsistencies and operational issues that
have been identified, including certain matters which should be memorialized which were not included in the
original contract. The Administration continued to meet with Boucher Brothers in order to clarify the terms
and conditions related to the aforementioned provisions, as well as addressing other matters which have
subsequently occurred which have impacted their beachfront operations. Negotiations have been
concluded with regard to all issues which have been incorporated in the attached Amended and Restated
Concession Agreement, the most relevant of which are summarized in the attached Commission memo.
Commission ado t the Resolution.
the Finance and Cit
Financial Information:
Finance Dept.
Source of
Funds:
D
Cit Clerk's Office Le islative Trackin
Jose DamienlTim Hemstreet
F:\DDHP\$ALL\ASSET\BEACHFRN\PUBLlC\RFP _2001\BOUCHER\Amended and Restated
AGENDA ITEM
DATE
C7C
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CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
www.miamibeachfl.gov
COMMISSION MEMORANDUM
From:
Mayor David Dermer and
Members of the City commis3sion
Jorge M. Gonzalez j". cJV"
City Manager 0
Date: May 18, 2005
To:
Subject:
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AUTHORIZING THE MAYOR AND CITY
CLERK, TO EXECUTE AN AMENDED AND RESTATED CONCESSION
AGREEMENT BY AND BETWEEN THE CITY OF MIAMI BEACH AND
BOUCHER BROTHERS MIAMI BEACH, LLC, FOR THE MANAGEMENT
AND OPERATION OF BEACHFRONT CONCESSIONS ON THE BEACHES
SEAWARD OF LUMMUS PARK, OCEAN TERRACE AND NORTH SHORE
OPEN SPACE PARK, MIAMI BEACH, FLORIDA.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution.
BACKGROUND
In October 2001, Boucher Brothers Miami Beach, LLC (Boucher Brothers) was awarded
the concession agreement to manage and operate the beachfront concessions seaward of
certain City parks. The Agreement has an initial term of five (5) years (November 5, 2001
thorough November 4, 2006), and contains one 5 year option, subject to conclusion of
good faith negotiations and mutually agreed upon terms and conditions.
The Agreement provided that at the end of the first contract year, the City and Boucher
Brothers would meet to review Concessionaire's performance for said contract year to
discuss quality, operational, maintenance and any other related issues. The City and
Boucher Brothers met on several occasions to discuss certain contract provisions that
should be revisited in order to address inconsistencies and operational issues that have
been identified, including certain matters which should be memorialized which were not
included in the original contract.
Since that time, the Administration has continued to meet with Boucher Brothers in an
attempt to clarify the terms and conditions related to the aforementioned provisions, as well
as addressing other matters which have subsequently occurred which have impacted their
beachfront operations.
The City and Boucher Brothers have concluded negotiations with regard to all issues which
have been incorporated in the attached Amended and Restated Concession Agreement,
the most relevant of which, are summarized below:
Sec.# Section Title Issue(s)
Lummus Beach, Ocean Buffer Zone language has been clarified and segregated to
2.1 Terrace, and North Shore Open better define areas surrounding lifeguard stands, handicap
Space Park Concession Areas access, etc.
Sec.# Section Title Issue(s)
1) Allowing that patrons, may themselves, relocate chairs and
other beach equipment within a concession area and adjacent
buffer zone, if permitted.
3.1.4 Rental of Beach Equipment
2) Allowing replacing certain standard chairs with luxury
chairs, but if standard chair is requested and not available,
luxury chair would be provided at standard chair rate.
3.2.1.1 Food and Beverage Service Allowing for up to 5 stationary Ice Cream carts in Lummus
Beach subiect to desiQn review approval
Allowing for the creation of a landscaped Storage Cell (not to
10.2.1 Garbage Receptacles and exceed 625 sq. ft.) adjacent to, and north of, the existing trash
Storage Cell facility north of 10th Street Auditorium, to alleviate storage of
concession equipment.
During the waiver period addressed in 4.2.1 below,
Concessionaire agreed to provide an off-duty police officer, on
3.4.3 Watersport Equipment Rental weekends and holidays to monitor watersport operations.
Clarification of first year "ramp-up" period provided to
Concessionaire to allow for its amassing and deploying its full
4.1 Minimum Guarantee (MG) compliment of equipment, resulting in pro-rata $137,500
credit applied in the 2nd contract year.
Credit for adverse impact related to City's sand excavation
(from Lummus Beach) and renourishment (to 30th Street)
Percentage of Gross (PG) project, resulting a waiver of any amounts due in excess of
4.2.1 the minimum guarantee for watersports in contract years 2
vs. Minimum Guarantee (MG) and 3, and only 62.5% of any amounts due in excess of the
minimum guarantee would be due in year 4 (Also see 3.4.3
above)
Concessionaire's requirement to use receipt printing cash
5 Maintenance and Examination registers or a like alternative as would be required by an
of Records independent CPA in order to audit a statement of annual
qross receipts and profit and loss statement (see item below)
Concessionaire's requirement to submit at the end of each
contract year, an audited annual statement of gross receipts,
in a form consistent with generally accepted accounting
principles, has been replaced with alternative language
requiring an annual statement of gross receipts accompanied
6 Inspection and Audit by a report from an independent CPA firm which shall perform
certain agreed upon procedures, as described in the attached
Exhibit "6". Concessionaire has further agreed to reimburse
the City, an amount equal to $20,000, for the first 3 year
audits, which were, or will be performed by the City. New
agreed upon procedures will take effect in year 4.
10.7 Vehicles on the Beach Amended to allow for golf carts and/or all terrain vehicles
(ATV's), with a maximum total of 6 vehicles of any kind.
Amend watersport liability insurance requirements to be
11.a.2 Insurance consistent with regulations for all other beachfront concession
operators.
12.5.b Force Majeure Added "direct acts of terrorism"
$200,000 performance bond requirement language amended
Performance Bond or Alternate to increase to $300,000 in 4th year, instead of 2nd year, and to
14 Security increase to $400,000 in 5th year instead of 3rd year, and also
provides for alternate UCC-1 financing statement in lieu of
bond, at City ManaQer's discretion.
Sec.# Section Title Issue(s)
This section contains new language intended to clarify the
parties rights, and exclusively reserves unto the City all
present and future rights to negotiate all forms of
endorsement and/or sponsorship agreements based on the
16.4 Sponsorships marketing value the City may have, while allowing
Concessionaire the right to sell, rent, or use, any particular
brand/product that would be permitted for use or sale
pursuant to this Agreement, and not limit its ability to negotiate
reduced rates for same.
On April 27, 2005, the City's Finance and Citywide Projects Committee reviewed and
discussed the terms and conditions being proposed as possible amendments to the
Boucher Brothers Concession Agreement. The Committee unanimously approved same
and recommended that the Amended and Restated Concession Agreement be forwarded
to the Mayor and City Commission for their approval.
The administration recommends that the Mayor and City Commission accept the
recommendations of the Finance and Citywide Projects Committee and approve the
Amended and Restated Concession Agreement with Boucher Brothers Miami Beach LLC.
JMG:TH:JD:rd
Attachment
F:\DDHP\$ALL\ASSET\BEACHFRN\PUBLlC\RFP _2001\BOUCHER\AMENDED AND RESTATED MEM.DOC
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
www.miamibeachfl.gov
COMMISSION MEMORANDUM
To: Mayor David Dermer and Date: May 18, 2005
Members of the City Commission
From: Jorge M. Gonzalez f_ . , -.1 ~
City Manager ~l ~
Subject: Responses to Resident Concerns Related to the Amendment to Beach
Concession Agreement by and between the City and Boucher Brothers
Miami Beach, LLC
As a point of general information, the purpose of the concession arrangement is to provide
a uniform structure by which services and amenities that are requested and heavily utilized
by visitors to the City's beaches, both residents and tourists, alike, can be provided and
regulated. These amenities (beverages, food, lounge chairs, and beach umbrellas) would
not otherwise be readily available to the City's tourists and residents without the concession
agreements. There is a market demand for these items and the concession arrangement is
one model by which to provide these services.
With regard to the specific issues raised, below please find the Administration's responses:
1) Does this draft Agreement fully protect the CitylS financial interest? Not really.
Many real impacts on the public beach (long term storage, vehicles, refueling,
private tours in vehicles, major jet-ski staging on Monument Island) are not even
ON the accounting and evaluation radar.
The Administration deems that the City's financial interests are well protected. The
Agreement, as amended, provides for the City's share of a percentage of gross
receipts, (including a minimum guaranteed amount), penalties for late payments, and
the financial controls (including agreed upon accounting procedures, inspection of
records and auditing requirements) commensurate with a concession operation that
handles cash transactions. Any issues related to storage, vehicle usage, and fueling
have been addressed in t~e amended Agreement to the Administration's satisfaction.
As to Monument Island; it is not within the scope ofthe Concession Agreement. Staff
will follow-up directly with the resident to determine if there is an on-going issue at
Monument Island that requires some type of enforcement action.
2) Does the Agreement uphold City policy to guarantee open space on this famous
public resource? Sadly, it rewards a company that has sought to evade this
policy.
Yes, the Agreement does provide for open space and we have not found any
evidence of non-compliance with this provision. The Agreement requires that
Concessionaire's use of the beach not exceed approximately fifty percent (50%) of
the beach frontage. However, we must keep in mind that the Concessionaire has a
contractual obligation to provide concession services to the public (tourists and
residents alike), based on demand. As such, the Agreement, as originally approved
Agenda Item C 7 c..
-
Date 5-'g'-O~
by the Mayor and City Commission, does provide that Concessionaire may, on a
limited basis, expand its operations if public demand would require same.
3) If as certain sections suggest, beach erosion reduces usable areas of the
beach, or life guard stands are added, should the concessionaire be entitled to
a privileged proportion of the remaining beach? Wasn1t the hard fought 50-50
rule meant to guarantee EQUAL footing, EQUALLY proportionate footprints, to
the public? Even if beach surface is reduced by erosion or special events?
Neither beach erosion nor special events impact the "50-50 rule". All provisions that
address placement of equipment and the respective distance requirements (buffer
zones) from lifeguard stands must be complied with at all times. Moreover, the
Agreement contemplates that additional lifeguard stands may be located, if deemed
necessary by the City, and provides for appropriate buffer zones in such events.
4) Aren't there terms in the Agreement where the City gets short-changed? Such
as Section 4 (page 24) 4.32.1, pertaining to concessionaire compensation for
loss of revenue due to beach erosion.
Section 4 does not address compensation resulting from beach erosion. However, it
does recognize the correlation between the City's excavation/ beach renourishment
project and its impact on Concessionaire's operation as it relates to business
disruption and reduction of usable beach width/depth for extended periods of time.
The Agreement Amendment, as proposed, does provide for certain mutually agreed
upon credits that have been deemed to be appropriate under the aforementioned
circumstances.
Instead, the City should be paid rent by the concessionaire for LONG TERM
STORAGE over many blocks on PUBLIC LAND, of hundreds of cubic feet of
unused inventory. The City does not earn a dime from many hundreds of
stacked chairs. Why are they taking up public space, year in, year out? Would
anyone be foolish enough to show this clutter in an advertisement?
The Agreement Amendment, as proposed, provides for the creation of a fenced
storage area adjacent to an existing fenced dumpster site which will be used for the
storage of certain equipment. Additionally certain areas on the beach are permitted
to be used for the stacking of chairs that are not readily required to meet anticipated
demand. The City has determined that from both an environmental and public safety
perspective, the Agreement provides certain flexibility for managing beachfront
equipment, which is deemed to be far less of an impact and preferable to the increase
in beachfront vehicular traffic that would otherwise result by the continuous
transporting of equipment, to and from the beachfront in order to satisfy patron
demand. In part, this is expressed in certain clauses in the Agreement that limit to a
specific ratio the number of vacant chairs that can be placed on the beach for rental
(Section 3.1.5). In short, due to the volume of chairs that are regularly utilized on the
beach, and the requirement to balance how many are placed out for use to address
aesthetic issues, there should be some flexibility afforded the concessionaire in order
to effectively manage its operation. Staff deems the Agreement strikes a fair balance
between a number of competing needs in this regard.
5) Isn't it time the City collect revenues commensurate with real impacts, by
implementing better auditing of real impacts? For example EUR Durable
Concession items such as vehicles, stands, and chairs would be clearly
numbered, and their uses defined. If the concessionaire continued to give rides
and private tours up and down the beach, a number or visible "badge" would
identify those using the public beach as a private road.
EUR Hand held computers with print receipts are used in restaurants and car
rentals all over the country. Surely the Concessionaire could provide a printed
account of numbers of chairs rented per day Iper area. Numbers rented would
be compared with maxima currently tolerated. Numbers allowed per area would
be posted, like Maximum Capacity in elevators or night clubs.
The percentage of revenues paid by the Concessionaire to the City are
commensurate with the provisions of the Agreement, as negotiated and originally
approved by the Mayor and City Commission, and for the first three contract years,
have been reviewed by the City's Chief Financial Officer and audited by the City's
Internal Auditor. Due to certain operational issues which were brought forth by
Concessionaire regarding the financial non-feasibility of following certain previously
existing contractual accounting/auditing requirements, the City and Concessionaire
alternatively established mutually acceptable "agreed upon procedures" which have
been deemed to provide the City with the same level of comfort with regard to
verification of Concessionaire's required payments to the City.
6) Doesn't language in Section 2.1.5 (page 10) undermine the letter and the spirit of
the 50-50 rule by apparently giving the concessionaire discretion to cluster "his"
50% wherever he chooses? Is it 50-50 if ONE party gets to choose where and
how to implement the rule? The intent of the 50-50 rule is to guarantee open
space at predictable and visible intervals.
Knowing that open space exists out of sight somewhere is not good enough.
Just as Handicapped Parking spaces are off limit, so a paying customer can
comprehend "that is the public beach area, period".
The Agreement gives the beach-going patron the ability to, themselves, relocate
his/her chair and/or umbrella to any location on the public beach they choose to,
provided it would be otherwise permissible to any other non-concession associated
beach-user. The Agreement does provide the Concessionaire the necessary flexibility
to meet customer demands, by reallocating certain equipment, from area to area, so
long as the overall number of equipment does not exceed the maximum number
allowed. Notwithstanding the foregoing, the "50-50 rule" is still in effect and not
diminished. The Agreement does not segregate the beach-going public into "paying"
and "non-paying" areas or categories.
7) And finally, before rewarding such a lucrative monopoly, shouldn't there be
some discussion of the concessionaire's past performance and what many of us
see as non compliance on City beaches from 15th to 23rd street? Where long
city blocks of merged concessions are the rule, against the rule.
For the purposes of the Proposed Agreement Amendment, it should be clarified that
the beaches from 15th Street to 23rd Street, are not part of, nor governed by this
Concession Agreement. With regard to the scope that is covered within the
Agreement, the Concessionaire's performance has been exemplary during the initial
three and one-half (3 %) year period and has generated net revenues payable to the
City in excess of $1,100,000 during said period. Moreover, to date, the Office of Asset
Management, who oversees this Agreement, reports that complaints associated with
Concessionaire's operations have been virtually non-existent.
I hope the responses provided above have addressed the concerns that have been
reported. If you have any questions or need additional clarification please do not hesitate
to contact me.
JM~JD:rlr
T:\AGENDA\2005\MAY1805\CONSENT\BOUCHER AGREEMENT CONCERNS MEM.DOC