NS Purchasing - SportsPlex Facility Management Agreement

Browse Search

.2 extensive support and detailed input for the new Central Orange Senior Center as well as the SportsPlex renovation. Further, RFP has been a willing and active participant in the SportsPlex Advisory Committee, providing information and responding to questions and concerns. Their performance is a visible characteristic of a successful public-private partnership whose goal is • outstanding service for Orange County. Material terms of the renewal are proposed as follows: • The renewal term of the agreement as provided by Section 3.2 is recommended for five years; Management fee is proposed at $10,000 per month, with a 4% annual increase (section 4.1); and Monthly expenses payable to RFP is proposed to increase from $1,000 per month to a flat fee of $1,250 per month over the five year renewal period. (Section 4.1) Other terms and conditions of the contract remain the same. Upon Board approval of the terms cited, a renewal agreement will be prepared and following County Attorney approval would be executed by the Board Chair. Approval of this item will serve as the County's 150-day notice to RFP of the County's intention to renew the agreement per Section 3.2 (b). FINANCIAL IMPACT: The monthly expense reimbursement will increase by $250 per month ($3,000 per year) and the proposed monthly management fee will increase from $6,250 ($75,000 per year) to $10,000 ($120,000 per year). Although the management fee represents a 60% increase in management fees, the Board will recall that the initial rate was somewhat . discounted, in part, based on the then less than attractive financial position of the SportsPlex and the County's desire for RFP to prove its ability to build the facility's business base. The business is considerably more stable than when the County acquired the facility, conceivably due in large part to RFP's management. Although the construction of the senior center and renovations of the SportsPlex .will occur during this renewal period, the anticipated revenues will nonetheless support the management fee increase. Frequent collaboration between the County, the Contractor and the SportsPlex management will ensure operational disruptions are minimized to the SportsPlex customers. The cost of this agreement will be paid through the SportsPlex operating budget, which is maintained in an enterprise fund that is separate from the County's General Fund. The Board will continue to approve the operating budget for the SportsPlex as part of the annual budget process. RECOMMENDATION(S): The Manager recommends that the Board approve the management agreement renewal with Recreation Factory Partners, Inc. through June 30, 2013, contingent upon attorney review of the renewal documents; and authorize the Chair to sign on behalf of the Board. •