At the Regular Board meeting on September 20, 2016, the Board approved a motion to direct the County Administrator to negotiate revisions to the agreement entered into between Broward County and SMG on September 22, 2009, for professional management services for the Broward County Convention Center ("Agreement"), in order for the County Commission to consider an extension of the Agreement for a period not to exceed ten years.
The County first contracted with SMG in 1989 for the management of the newly constructed Broward County Convention Center. The most recent contract with SMG was signed in 2009, which provided for a ten-year term with the option of a ten-year extension under the same terms and conditions. In late 2016, the Board was interested in exercising the ten-year extension of the contract but recognized that due to the impending expansion of the Convention Center and the likely addition of the Northport Parking Garage to the responsibilities of SMG, new terms and conditions would have to be negotiated with SMG that precluded exercising the contract extension. The Board directed staff at its Regular meeting of September 20, 2016 to negotiate revisions to the 2009 agreement and to bring those contract revisions back to the Board for the Board to consider both the contract revisions and a ten-year extension of the contract. Exhibit 1, the resulting amended and restated agreement, will be distributed to the Board prior to the meeting.
The Board resolution from September 20, 2016 incorporated a memo from the County Auditor that required staff to perform a significant amount of due diligence prior to negotiations with SMG. The Auditor expressed that 1) management had not had adequate time to perform due diligence in preparation of negotiations, 2) time was not critical as the existing agreement did not expire until December, 2019, 3) the SMG agreement has not been subject to a competitive solicitation since its inception in 1989 and 4) it should not depart from its open, competitive procurement process without a compelling reason.
Pursuant to the Auditor's recommendations, staff performed extensive research and explored the County's options relative to future management of the convention center, considering 1) the competitive marketplace, 2) current and proposed changes to the convention center, 3) SMG's performance and 4) the future strategic direction of the CVB. Staff researched the market to analyze different convention center management options, looked at the competitive marketplace for convention center management, collected convention center management agreements from across the country and spoke to colleagues across the country who also oversee convention center operations. Staff then commenced direct negotiations with SMG, resulting in the attached amended and restated agreement.
Based on the research conducted, staff came to the conclusion that the best course of action at this time would be to continue the County's relationship with SMG. Considering the disruption to the facility and its operations over the next five years due to the Convention Center Expansion and Headquarters Hotel projects, staff believes that now is not the time to consider a change in management of the convention center. By the time the Amended and Restated Agreement expires in 2029, the expansion and hotel projects will have been completed and operating for some time and the County will be in a much better position to consider all of its options. Based on its findings, staff then commenced negotiations with SMG, resulting in the Amended and Restated Agreement now before the Board for its consideration.
The amended and restated agreement has been updated in a variety of ways. Working with the County Attorney's Office, the relevant agreement sections related to County code and State statutes have been revised to reflect current County policy and State law. New sections were added to memorialize the ongoing arrangement the County has with SMG regarding the provision of food services at the Emergency Management Center during emergencies, and to provide some management parameters for the operations of the Northport Parking Garage next to the Convention Center. Several sections were amended to provide for a closer and more collaborative working relationship between the Convention and Visitor's Bureau and SMG. And in collaboration with the County Auditor, many processes and procedures were reviewed and updated to reflect best practices.
A memo from OESBD (Exhibit 2) regarding CBE participation in this contract will also be forthcoming. Due to the unique nature of this contract and that much of the contract value is not available to CBE vendors, staff is performing an analysis of procurable services for the contract and will assign an appropriate CBE goal to that portion of the contract.
|