Broward County Commission Regular Meeting


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AI-24908 20.       
Meeting Date: 08/22/2017  
Director's Name: Steven Cernak
Department: Port Everglades Division: Business Administration

Information
Requested Action
MOTION TO ADOPT Resolution No. 2017-388 directing the County Administrator to publish a Notice of Public Hearing to be held on October 3, 2017, at 10:00 a.m. in the County Commissioners’ Meeting Room (Room 422), Governmental Center, 115 South Andrews Avenue, Fort Lauderdale, Florida, to consider an application to renew the nonexclusive franchise of Tugz Company, LLC d/b/a McAllister Towing of Port Everglades, to provide tugboat and towing services for a ten-year term at Broward County's Port Everglades.

ACTION:  (T-10:19 AM)  Approved.
 
VOTE: 9-0.
Why Action is Necessary
Public hearing is required pursuant to Chapter 94-429, Laws of Florida, and Section 32.22a of the Broward County Administrative Code. Franchises are issued pursuant to Chapter 32 of the Broward County Administrative Code.
What Action Accomplishes
It allows a Public Hearing date to be set and notices to be published twice in local newspapers.
Is this Action Goal Related
Previous Action Taken
None.
Summary Explanation/Background
THE PORT EVERGLADES DEPARTMENT RECOMMENDS APPROVAL.

This action supports the Board of County Commissioners' Value of "Ensuring economic opportunities for Broward’s diverse population and businesses" and Goal to "Increase the economic strength and impact of revenue-generating County enterprises balancing economic, environmental, and community needs."

On August 21, 2001 (Item No. 8-PH), the Broward County Board of County Commissioners (Board) entered into a Tugboat and Towing Services Franchise Agreement with Tugz International, LLC, to provide tugboat and towing services at Port Everglades for a term commencing August 21, 2001, and ending October 28, 2007. On June 24, 2003 (Item No. 3-PH), the Board approved assignment of the franchise by Tugz International, LLC, to Tugz Company, LLC, for the reminder of the franchise term through October 28, 2007. In 2004, McAllister Towing of Florida, Inc. became a managing member of Tugz Company, LLC, and the company added to its franchise a fictitious name, McAllister Towing of Port Everglades. On September 11, 2007 (Item No. 28-PH), the Board approved the renewal of the franchise for a ten-year term commencing on October 29, 2007, and ending on October 28, 2017. The company is requesting renewal of the franchise for a ten-year term.

Tugz Company, LLC (Tugz), a limited liability company, was formed in the State of Delaware on April 25, 2003, and registered to do business in the State of Florida on May 19, 2003.

Tugz holds a separate land lease for offices at Berth 28 where it currently docks its fleet of tugboats. Under the terms of the proposed franchise agreement, and in recognition of the suitable dock space, Tugz is required to operate and maintain a minimum of two modern harbor tugboats equipped with firefighting apparatus, which will provide efficient and satisfactory tugboat and towing services and firefighting capabilities at Port Everglades.

The company will continue to operate the tugboat and towing service at Port Everglades on a 24 hour per day basis and will pay 5% of its revenues net of its discounts derived from its franchised operations at Port Everglades.

Port staff has reviewed the application pursuant to the Broward County Administrative Code and has determined that the applicant meets the criteria for renewal. Staff’s due diligence included corresponding with the applicant's representative to clarify franchise requirements, and reviewing the applicant's corporate status, business history/experience, litigation history, insurance, financial documents and creditworthiness, required licenses, company programs and policies, and statement of intended activities. In addition, no safety or environmental violations were found in reviewing the company’s record. Tugboat and Towing Franchises may be issued for any period of time up to ten years. Accordingly, staff is recommending that the franchise renewal be approved for a ten-year term.

The franchise agreement has been reviewed by the Port Everglades' Risk Manager and approved as to form by the Office of the County Attorney. The complete application and supporting documents are on file in the Port Everglades Business Administration Office. 
Source of Additional Information
Jorge Hernández, Enterprise Director of Administration, Port Everglades Department 954-468-3501
Ángela Osorno Belleme, Franchise Manager, Port Everglades Department 954-468-0112

Fiscal Impact
Fiscal Impact/Cost Summary:
The company will pay 5% of revenues net of its discounts derived from its franchised operations at Port Everglades. As a result, it is expected that over the ten-year franchise term, the County will realize approximately $5,638,771 in revenue.  For comparison purposes, for the ten calendar year period from 2007-2016, revenue from Tugz's franchised operations at the port totaled $3,439,509.
Attachments
Exhibit 1 - Agreement Summary
Exhibit 2 - Resolution
Exhibit 3 - Notice to Publish
Exhibit 4 - Agreement
Exhibit 5 - Application


    

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