372-2000 RDA
RESOLUTION NO. 372-2000
A RESOLUTION OF THE CHAIRMAN AND MEMBERS OF THE MIAMI
BEACH REDEVELOPMENT AGENCY ADOPTING THE OPERATING
BUDGET FOR FISCAL YEAR 200012001, AS SUBMITTED BY QUlK PARK OF
FLORIDA, INC., FOR THE OPERATION OF THE PARKING COMPONENT
OF THE ANCHOR SHOPS AND PARKING AT SOUTH BEACH, IN
ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE GARAGE
FACILITY MANAGEMENT AGREEMENT DATED JULY 15, 1998, BETWEEN
THE AGENCY AND QUlK PARK OF FLORIDA, INC.
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, on September 27, 2000, Quik Park's proposed budget for Fiscal Year 2000/01
was not approved by the RDA Board due to certain discrepancies involving Quik Park's payroll
reporting procedures; and,
WHEREAS, the RDA Board directed the Administration to perform an expense audit ofQuik
Park's operations at the Anchor Garage; and,
WHEREAS, an expense audit has been performed which has determined that no significant
adverse findings have occurred; and,
WHEREAS, Quik Park's proposed budget for the operation of the Anchor Garage for FY
00/01, has been revised and analyzed extensively by the Administration and has been determined to
be in compliance with proper accounting procedures.
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 200012001, as submitted by Quik Park of Florida, Inc., for the operation of the parking
component of the Anchor Shops and Parking at South Beach, in accordance with the terms and
conditions of the Garage Facility Management Agreement dated July I5, 1998, between the Agency
and Quik Park of Florida, Inc. South Pointe and City Center Redevelopment Areas for Fiscal Year
2000/01, attached as Exhibit A hereto.
PASSED AND ADOPTED this
29th
day of November
,2000.
L
ATTEST:
APPROVED AS 10
FORM & lANGUAGE
& FOR EXECllnON
Jf1JJ,l r f tudL--
SECRETARY
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CMBPARKING
Fax:3056737853
Nov 21 '00 11 :57
CITY OF MIAMI BEACH
PARKING OEPARTMENT
16TH STREET GARAGE BUDGET - FY 2000/2001
21,Nov,2000
CMS QUIKPARK VARIANCE
TOTAL TOTAL TOTAL
52 52 0
REVENUE
TRANSIENT $961,007.28 $961,007,28 $0,00
MONTHLY $602,364:00 $602,364,00 $0.00
LOEWHOTEL $385,795.62 $385,795,62 $0,00
ROYAL PALM $63,648.00 $63.646,00 $0,00
GROSS REVENUE $2,012;814,90 $2,012,814,90 $0,00
NET REVENUE $1.889,967:04 $1 ;889,967,04 $0.00
PERSONNEL COSTS $236.99500 $279.322.27 -$42,32727
TICKETS $2,000,00 $2,000,00 $000
SIGNAGE $1,000,00 $1.000,00 $0,00
TELEPHONE $2,100,00 $2,100,00 SO.OO
UTILITIES $37,200.00 $37,200,00 $0,00
R&M $6,900iOO $6,900,00 $0.00
CONTRACTS $44,,300;00 $44,300,00 $0.00
PROF, SERVICES $20,995.88 $20,.995,88 $0,00
LICENSE $187.50 $187.50 $0.00
SECURITY , $117,790.40 $125,,944,00 ,$8,153,60
SANITATION $1,800.00 $1.800,00 $0,00
LIABILITY INSURANCE $();OO $22,512,00 -$22,512.00
COURIER SERVICE $6,591.00 $6.591.00 $0,00
WATER $1.884.00 $1.884,00 $0.00
SEWER $2,064,00 $2,064.00 $0,00
STORMWATER $2,544.00 $2.544,00 $000
SUPPLIES $4,500,00 $4,500.00 $0.00
MISC. $600,00 $60000 $0,00
MANAGEMENT FEE $40;000,00 $40,000,00 $0,00
TOTAL EXPENSES $52~,451.78 $602,444.65 -$72,992.87
PROFIT (LOSS) $1,360,515.26 $1;287,522.39 $72,992.87
P.02
Miami Beach
Redevelopment Agency
1700 Convention Center Drive
Miami Beach, Florida 33139
Telephone: (305) 673, 7295
Fax: (305) 673, 7772
REDEVELOPMENT AGENCY MEMORANDUM NO, 00- It
November 29, 2000
TO: Chairman and Members of the
Miami Beach Redevelopment Agency
FROM:
Jorge M. Gonzalez
Executive Director
~~
SUBJECT: A RESOLUTION OF THE CHAIRMAN AND MEMBERS OF THE MIAMI
BEACH REDEVELOPMENT AGENCY ADOPTING THE OPERATING
BUDGET FOR FISCAL YEAR 2000/2001, AS SUBMITTED BY QUlK PARK
OF FLORIDA, INC., FOR THE OPERATION OF THE PARKING
COMPONENT OF THE ANCHOR SHOPS AND PARKING AT SOUTH
BEACH, IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF
THE GARAGE FACILITY MANAGEMENT AGREEMENT DATED JULY
15, 1998, BETWEEN THE AGENCY AND QUlK PARK OF FLORIDA, INC.
THE OPERATION OF THE ANCHOR GARAGE
ADMINISTRATION RECOMMENDATION:
Adopt the Resolution.
ANAINSIS
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. At the September 27, 2000
meeting, Quik Park's proposed budget for Fiscal Year 2000/01 was not approved by the RDA Board
due to certain discrepancies involving Quik Park's payroll reporting procedures. Subsequent thereto,
the Administration performed an audit of Quik Park's expenses to determine if any improprieties
were committed and the RDA Board directed the Administration to present the audit findings to the
Audit Committee. The Audit Committee met on November 22, 2000 to address the audit findings
and a verbal report will be provided at the City Commission meeting together with the audit report,
which is provided under separate cover.
S()lJTti I)()I/Ilfff:
I:ledevel()pment Ulstl1<<:t
Agenda Item 2A
I Date ,\ ~ '2.~-OO
Over the past two months, the Administration has performed an extensive analysis ofQuik Park's
operating expenses at the the Anchor Garage compared to the expenses incurred in comparable
parking facilities operated by the City of Miami Beach. Staffhas also reviewed Quik Park's payroll
reimbursement requests, and as a result, has issued a written Notice of Default to Quik Park for its
failure to fulfill its obligations under the Garage Facility Management Agreement. Quik Park was
notified of its failure to fulfill its obligations as delineated in Sections 6.1, 7.1, 8.1 and 9.1 of the
Agreement; for failure to submit modifications to its budget and failure to disclose and properly
account for certain employees' positions, not reflected in its budget, but included in its payroll
reimbursement requests. The Agreement provides a 15-day cure period to address disciplinary
and/or default notices issued to the Operator, Termination is conditioned upon failure to cure the
default.
According to the City's Internal Auditor, no significant adverse findings have occurred. Since the
Expense Audit did not demonstrate any incurable issues and since the Garage Facility Management
Agreement does not provide for an early termination, the Administration recommends adopting Quik
Park's proposed budget for FY 00/01 and retaining its services for the remaining one-year term of
the Agreement. This recommendation is conditioned upon Quik Park's remedying all audit
deficiencies noted and is due to the RDA's inability to terminate other than for failure to cure a
noticed default.
Upon expiration of the Agreement term, it is recommended that the City's Parking Department
assume operational responsibility of the facility. This is deemed advantageous both from an
economic perspective, as described later in this memo, and for operational efficiency. In the
meantime, Quik Park continues to operate the Anchor Garage, pursuant to a determination by the
Legal Department, that it can continue to operate the facility under the FY 99/00 Operating Budget
until such time that a new budget is adopted.
Quik Park's proposed budget for the operation of the Anchor Garage for FY 00/01, has been revised
and analyzed extensively by the Administration and has been determined to be in compliance with
proper accounting procedures. The revised budget presented herein reflects a total operating expense
budget of $602,444.45 compared with $596,515.87 requested on September 2000. The increase in
the budget is primarily attributed to a $10,000 increase to the "contracts" (property management)
line item that was dictated by the Administration. Therefore, there is an overall net decrease, absent
the increase to the "contracts" (property management) line item, resulting in a $4,000 decrease, in
the budget presented herein when compared to the budget presented on September 27, 2000.
Pursuant to the Administration's direction, Quik Park has reduced its proposed payroll to only reflect
those positions involved in the actual day-to-day operation of the facility and has properly reflected
the administrative/audit manpower dedicated to the operation ofthe facility under the Professional
Services expense category. This allocation has been deemed acceptable in the Expense Audit
performed by the City. While the Administration has reviewed and concurs with the proposed
staffing levels in the garage, it should be noted, that without the benefit of knowing the intricacies
of the flow of business in the garage, the Administration did not feel it was in the best interest of
the RDA to dictate staffing and/or supervisory levels in the garage. Doing so could result in Quik
Park attributing any decline in service and/or customer complaints to the directives of the
Administration.
Compared to last year's budget, Quik Park has been a little more aggressive with its revenue
projections for FY 00/01, which are expected to increase by approximately 21 percent over actual
revenue collections for FY 99/00. Quik Park's estimates are not only based on actual operating
results for the first year-and-a-half of the facility's operations, but also take into account the
successful rate reduction program which went into effect in June 2000, as well as the RDA's ability
to dedicate under-utilized spaces by Loews for additional monthly accounts.
In analyzing the revenue projections by source, the largest increase in revenue is anticipated to be
derived from monthly accounts, which is expected to increase by approximately 78 percent over
actual revenue collections for FY 99/00. Quik Park is being cautious by projecting little change 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. With regards to anticipated valet
usage by the Royal Palm Crowne Plaza, it is estimated that the hotel will be operational by May
2001. 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 oftheir allocation of 174 spaces in the Anchor Garage. The transient
base, comprising construction, weekend and retail-related business is also forecasted to remain
relatively constant, reflecting a 2 percent increase over FY 99/00.
Operating expenses are projected to increase by approximately 12 percent over actual expenses
incurred during FY 99/00, reflecting an increase in certain pass-through expenses, including but not
limited to maintenance contracts for equipment no longer under warranty and/or previously
maintained by the General Contractor, enhanced security coverage and increased maintenance and
repair expenses as previously described. An itemized explanation of expenses is included with the
attached budget. As indicated previously, the line item for Payroll has been reduced from the
previously submitted proposed budget by $16,067 and represents an 8 percent reduction from actual
Payroll expenditures during the prior fiscal year. Alternatively, and as a result of the audit report,
the Administration has authorized Quik Park to increase Professional Services by $18,854, to
properly reflect the re-classification of certain administrative/audit functions previously included
under the Payroll line item
It is anticipated 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 00/01.
Since the RDA meeting of September 27, the Administration has performed an analysis 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 this analysis is included with this memorandum. The basis for the
analysis drew upon the City's experience in managing municipal garages. It should be noted that
due to differences in categorizing expenditures between the two facilities, certain line items had to
be adjusted in order to perform a true "apples-to-apples" comparison of the two budgets. The
analysis reflects an estimated savings of approximately $73,000 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.
AB previously described, since the Expense Audit did not demonstrate any incurable issues and since
the Garage Facility Management Agreement does not provide for an early termination, it is
recommended that the budget be approved for this remaining year, conditioned upon Quik Park
successfully remedying the audit deficiencies. 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.
JMG/C~'llt'
T:IAGENDA \2000INov29001RDA Iquikparkmemo,doc
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