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Home My WebLink About2008 07 28 Regular 602 Agreement with Winter Springs Youth Sports regarding Concession OperationsCOMMISSION AGENDA ITEM 602 July 28, 2008 Regular Meeting Consent Informational Public Hearing Regular X ~~ Mgr. / Dept. Authorization REQUEST: The Parks and Recreation Department requests that the City Commission considers the Winter Springs Youth Sports, Inc. (Babe Ruth League) proposal regarding both Concession operations at Central Winds Park and authorizes staff and the City Attorney to prepare an agreement which will come back to the City Commission for consideration. PURPOSE: To consider the Winter Springs Youth Sports, Inc. (Babe Ruth) proposal regarding concession operations at Central Winds Park and direct staff regarding an agreement. CONSIDERATIONS: • Parks and Recreation staff has been reviewing the Concession operation for the past several months. • We found a significant reduction in revenue (sales): ^ FY 06/07 as of this date $74,495 ^ FY 07/08 as of this date $36,084 ^ - $38,411 less sales The cost of products increased as high as 50% and were not passed on, poor inventory control by management and a reduction in the number of tournaments held at Central Winds Park (FY 06/07: 9 Tournaments; FY 07/08: 6 Tournaments which were also much smaller tournaments) • Staff believes that even with corrections in operation, the concession will experience a net loss of about $16,000 this FY. Staff projects a loss of as much as $25,000 in FY 08/09, due to further reduced sales. • The Concession history is as.follows: o In the first 9 years of operation, losses occurred every year and went as high as $18,403 per year. Agenda Item Regular 602 July 28, 2008 Page 2 o In 2002 the City Commission rejected a proposal from the Winter Springs Little League regarding the Concession operation at 40% net to the City. At that time, the city estimated that they would still incur a net loss. o The City Commission directed staff to do an RFP. 1 bid was received at 5% of gross sales. It was rejected due to the dispute over the 5% of gross sales and reference checks. o The City Commission approved the continuation of city operation of the concession after a study with recommendation by Profitable Food Facilities. o The Concession generated a profit of $2,310 or $3.39% in 2004, $5,356 or 6.65% in 2005. In 2007, the Concession generated a profit of $13,251 or 15.07%. o Staff again began looking at other options regarding the Concession due to the current and projected losses of profit. • Seminole County currently has had 3 large park concessions out for bid but no bids have been received. • Staff has conducted several meetings with the Winter Springs Youth Sports, Inc. (Babe Ruth) regarding the concession operations. • The Babe Ruth proposal is based on the leagues belief that they can generate enough profit to: 1. Pay the city a monthly rent of the actual utility bill for the Concession (it has it's own meter) 2. Staff with paid concession manager(s) to run and coordinate volunteers. 3. Purchase the required license and obtain certification(s). 4. Use the existing cash registers and maintain records, deposits and bi- weekly inventory. 5. Pay state sales tax on sales. 6. Purchase food, drink and needed support products. 7. Provide Concession service for most league and non-league games. 8. Repair or replace concession equipment as needed (all equipment would be leased by the league and all new or improved equipment become city property). 9. Provide A/C maintenance and pest control. 10. Provide all insurances needed to the city. 11. Cover any other miscellaneous expenses. They estimate a net profit of $20,000. If this occurs, the city would receive 50% of the net profit or $10,000 and the monthly utility bill rent payments. The Babe Ruth league would also purchase a new ice machine at their cost as a donation to the city per their 07/08 Partnership Agreement. Either party may terminate the agreement with 30 days written notice. Should this occur, the city will pursue obtaining multiple vending machines to serve the needs of park users. Agenda Item Regular 602 July 28, 2008 Page 3 • If approved, the transition from city operation would officially begin October 1, 2008. The city would operate the concession in August and September and train the league PT employees during this time at no expense to the city. • All revenue would go the city during this time and the concession inventory at the end of the day on September 29, 2008 would be compensated to the city by the league. FUNDING: Elimination of Concession budget and loss of $25,000 in FY 08/09. RECOMMENDATIONS: The Parks and Recreation Department recommends that the City Commission consider the Winter Springs Youth Sports, Inc. (Babe Ruth) proposal regarding Concession operations at Central Winds Park and authorize staff and the City Attorney to prepare an agreement to come back for consideration. ATTACHMENTS: Attachment #1: Winter Springs Youth Sports, Inc. (Babe Ruth) Concession operations proposal. COMMISSION ACTION: ~_ ~. ATTACHMENT 1 Winter Springs Babe Ruth League Proposal (Unsolicited) for Central Winds Concessions Operations 1) Winter Springs Youth Sports, Inc. D/B/A Winter Springs Babe Ruth (The League) makes the following unsolicited proposal to the City of Winter Springs (the City)for the operation of all concession operations at Central Winds Park. 2) The League will execute a contract with the City based on sharing net revenue after all expenses for the full time operations of all concession facilities at Central Winds Park. The League proposes net revenue after all mutually agreed expense be shared by the following formula; 40~ for The City 10~ for Central Winds Park upgrades 50~ for The League 3) The League would not be responsible for expenses for the general maintenance of the building(s) (the roof, the exterior including painting, and or repair of any bathrooms or any infrastructure expense not directly in support of the operation of the concession(s) facilities. The League will pay electric costs based on the separate meter for the concession facility twelve months a year and this cost will be an expense. The League will provide for routine pest control and air conditioner maintenance twelve months a year as an expense. 4) The League will provide all staffing and management of the concession(s) operations through League resources (volunteers) and a Concession Manager(s) paid by the League as an expense. The League will have a trained and sanitation certified Concession Manager present at Central Winds Park anytime more than two fields (any sport/league) are scheduled for more than three hours of continuous use or one field with six hours (not including 30 minutes between the end of one game and the beginning of the next) of scheduled use. If an emergency prevents a Concession Manager from being present a League Official will be present. For special events like registration for City approved activities or other special events sanctioned by the City, the League will operate the concession if the event is at least three hours long and the City expects at least 200 people to attend. The City will provide the League with a minimum of 14 calendar days notice for the need to operate the concession facilities for events not sponsored by the League. The League will include in concession expenses items like power, water and maintenance of the concession equipment. Any expense to make League and City agreed modifications/repairs/purchases in support of concession operations to maintain/improve concession operations would be an expense. The League would agree to maintain all equipment and repair or replace as needed in the concession(s) operation as an expense. The League would repair or replace concession equipment with mutual consent between the City and the League. -~-- / ~~ 5) The League will follow "accepted accounting standards" and maintain all financial records for review by the City. The League will use the existing cash register currently in place and will pay all State, Local and Federal taxes as required by law and hold the City harmless for any failure by the League to pay any lawful State, Local or Federal tax. The League will maintain inventory to support operations anal balance purchased inventory against sales on a weekly or bi-weekly basis. 6) The League would agree to lease all the concession facilities at Central Winds Park and all equipment for $1.00 per year. Any improvements made including equipment purchases for concession operations would become City property by expressed consent of the League. The League would agree to termination by either party with or without cause with 30 days written notice. Termination by either party would require compensation for any on hand consumable inventory at the time of termination. 7) The League would staff the concession operations for all League and non-League events. The City would provide fourteen calendar day notices of non-League events that needed to be covered. Concession pricing between League and non-League events would be the same. 8) The League will comply with all City, State and Federal laws and regulations including health and sanitation regulations and certifications. 9) The League will maintain appropriate liability and medical insurance with the City as a named insured. The League believes that an arrangement structured along these lines will provide substantial benefit to the City and the League. In the past the City issued a Request For Proposal for concession operations, the League responded but no award was made by the City. The League, understanding that the City must follow procurement law and procedures requests that the City consider issuing an Invitation To Negotiate (ITN) as opposed to a Request For Proposal (RFP) or an Invitation To Bid (ITB) The League believes An ITN is appropriate and in the best interest of the City and any potential vendor. On Behalf of the Board of Directors, Bill Manooch President Winter Springs Youth Sports D/B/A Winter Springs Babe Ruth