THE AVIATION DEPARTMENT RECOMMENDS APPROVAL OF THE ABOVE MOTION.
This action will allow Clear Channel the non-exclusive right to operate the advertising and display concession at FLL.
The Office of Economic and Small Business Development ("OESBD") established a 10% Airport Concession Disadvantaged Business Enterprise ("ACDBE") participation goal and Clear Channel committed to a 10.4% ACDBE goal.
On April 25, 2017 (Item No. 3) the Board approved a Request for Letters of Interest ("RLI") No. 20160425-0-AV-01, Advertising and Display Concession. One firm submitted a proposal in response to the RLI, Clear Channel.
On October 20, 2017, a combination Shortlisting/Presentation Meeting was held. The Selection Committee determined that Clear Channel was both responsive and responsible. Since Clear Channel was the only firm who submitted a proposal and was deemed responsive and responsible, they were selected as the first ranked firm.
The Selection Committee consisted of:
Yasmi Govin, Director of Business & Properties Management, Aviation (Chair)
Stacy Ritter, President/CEO, Greater Fort Lauderdale Convention & Visitors Bureau
Margaret Stapleton, Director, Office of Public Communications
On November 7, 2017 (Item No. 63), the Board approved the final ranking of the qualified firm for the RLI, Clear Channel. A Sunshine negotiation meeting with the first ranked firm, Clear Channel, was held on December 13, 2017. A second Sunshine negotiation meeting was held on January 22, 2018.
The proposed Advertising and Display Agreement between Broward County, Florida ("County") and Clear Channel ("Agreement") provides for a non-exclusive advertising and display concession at FLL. Clear Channel will provide advertising in various formats at various locations, including but not limited to, in the terminal buildings, Rental Car Center, parking garages and within FLL’s Airport App.
The term of the Agreement will commence on April 1, 2018 and will terminate on September 30, 2023. The Agreement contains a Transition Period (six months) for the Concessionaire to transition from the existing agreement and locations to this Agreement and the new locations contained therein. The Transition Period gives Clear Channel the opportunity to implement their new advertising concession program at FLL. After the initial term of the Agreement, the Agreement may be extended for an additional three years, at the County's sole discretion.
As part of their submittal to the RLI, Clear Channel proposed annual revenue to the County in the amount of $2,063,020. During negotiations, the parties were able to identify additional advertising locations yielding annual additional revenues to the County in the amount of $2,149,640. As a result, total anticipated revenue to the County during the term of this Agreement is $21,063,300. If the three years extension is exercised, anticipated revenue for the term of the Agreement is $33,701,280.
During the Transition Period, Clear Channel will pay a Privilege Fee of 61% of Gross Revenues to the County. Subsequent to the Transition Period, Clear Channel will pay to the County, the greater of a Percentage Fee of 61% of Gross Revenues or a Minimum Annual Guarantee ("MAG") in the amount of $1,010,000; to be adjusted annually by 85% of the prior year’s Privilege Fee paid. The Privilege Fee will never be less than the prior year's MAG. Clear Channel will be required to make an initial Capital Expenditure of not less than $610,000 for capital improvements within one calendar year of the Effective Date of the Agreement. In addition, Clear Channel will make a Capital Expenditure of no less than $70,000 in the third year of the Agreement and a third Capital Expenditure of no less than $90,000 during the sixth year of the Agreement, upon the County exercising its option to extend the Agreement.
Clear Channel will post a security deposit amount of $505,000. Clear Channel has provided the County with the required insurance certificates that were approved by the Broward County Aviation Department Risk Manager.
Staff and the Office of the County Attorney are still finalizing terms of the Agreement and will be subject to review by the vendor. The Office of the County Attorney will notify the Board by memorandum of any substantive changes made to the current draft of the Agreement prior to the Board meeting. The current draft of the Agreement is attached as Exhibit 2.
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