Loading...
HomeMy WebLinkAboutRotary Club of Fresno 2nd Amd to Rotary Amphitheater AgmtRESW ril REPORT TO THE CITYCOUNCIL July 29, 2008 AGENDA ITEM NO. ) J COUNCIL MEETING TYi9/I)8 Afl EM nmE i� C a MOM: RANDALL L COOPER. Director Parks, After -School, Recreation and Community Services Department BY: JERRY HAYNES, Assistant Director p PAUL MELIKIAN, Administrative M ge W Parks. After -School, Recreation and Community Services Department SU&IECT: 1) APPROVE SECOND AMENDMENT TO ROTARY AMPHITHEATER AGREEMENT BETWEEN THE CITY OF FRESNO AND THE ROTARY CLUB OF FRESNO 2) APPROVE THE 472" AMENDMENT TO MASTER FEE SCHEDULE RESOLUTION NO, 80-420 REVISING THE IMPROVEMENT FEE FOR THE WOODWARD ROTARY AMPHITHEATER 11_NbG'M4nmW KEY RESULT AREA Customer Satisfaction pm_.on YL8_ Jlspar RECOMMENDATIONS recommends that the City Council approve Ne 1) Second amendment to Rotary Amphithester Agreement earn Ne City of Fresno (City) and Fresno Rotary Club (Rotary) and 2) the 4722'x Amendment to Master Fee elution No. W-420 revising the restoration fee for the Woodward Rotary Amphitlreater, and Nat Ne new become effective August 9, 2008. e Parks, After School, Recreation and Community Services Department (PARCS) Is currency investing ,500,000 into improvements at Ne Woodward Rotary Amphitheater, made possible through Park Bond seeds. These improvements have already begun to reposition the venue into a viable chctice for concerts d other events. On August 25, 199$ the City and Rotary entered into a 50 -year agreement for the reduction of the Amphitheater. On January 16,1996 Ne agreement was amended in order to complete the nstructuan of the project The high demand and more frequent use of the facility require an amendment to t current agreement. The purpose of the Second amendment is to terminate the provision regarding the itai exclusive right to concessions. Under the proposed second amendment, all rights to concessions will st exclusively In the City, including the fight to retain all profits, consideration of Rotary's termination of its concession rights, the City agrees to Ne following', • lowest $1,000,000 for Amphitheater improvements consistent with consthutiona and local law requirements. This has already taken place Through the Pal Brand proceeds. REPORT TO THE CITY COUNCIL Second Amendment to Agreement between City and Rotary July 29, 2008 Page 2 • Assume the responsibility of promoting the Amphitheater's use. • Complete Me east section of the second fief seating including Me constmolon of the east stairway at the earliest possible time, Factory agrees to the following: • Contnbute a minimum of $50,000 for a mutually agreed upon capital improvement prgect(s)for the Amphitheater. • The Rotary seat option purchase for Me Amphitheater shall expire Leventhal 31, 2016. All seat options sold by Rotary shall be honored for a period of 10 years fora minimum of 10 events In any calendar year • Seat options for free events will not be considered as part of the 10 events previously mentioned. • The Amphitheater per ticket improvement fee amount shop be phased in at $1 001licket after January 1, 2008, $2.00lficket after January 1. 2009 and $300kticket after January 1, 2010. Conecession Revenue In section to the above contractual provisions, a new section has been added tette agreement which identifies Me allocation of gross event concession revenue between the City and Rotary. According to Mis section, all nonPartyevent permittees, licensees, promoters and/or other users shall pay Me City 10% of gross event concession revenues net only of sales/excise fares, and pay the Rotary 10% of gram event concession revenues net only of saleskexclse taxes. On Me other hand, In Me event Rotary acts as a penalties, licensee, promoter ander other user the Rotary shall pay Me CM 10%m the amount detem fined by gram event concession revenues net only of saleskexcise taxes_ The City shell direct all proceeds received to support the continued operation and improvements to the amphitheater In the event the City acts as a penalties, licensee, promoter and/or other user, the City shall pay Me Rotary 10% of the amount determined by gross event concession revenues net only m saleskexclee tapas. The term .gross event concession revenuer" refers to all revenues generated by booker arising from concession adivdes. The attached amendments to the contract and Master Fee Schedule revise ; the per icket Improvement fee. The anginal agreement with Rotary had established a $2.00 per ticket improvement fee, however due to seldom attributes of the facility before recent improvement; the demand for Me amphitheater was fairly low. As a result, the current publishetl fee m $200/ficket has never been charged. Recent and continued improvements to the Amphitheater have allowed FARCE to begin charging a reduced $1 00sadmi fee, whit a threayear phased plan to reach a $3.00 per ticket. Identical to proceeds received from gram event concession revenues, the ticket fee revenue will be used for Me operating and capital Improvement needs of KEY OBJECTIVE BALANCE The amendment to Me Rotary contract will provide more besides for Fresno's intrears to enjoy when visiting Woodward Park, which will undoubtedly generate positive experiences for cozens. City employees will also have another great option in leisure advifies. PARCS is leveraging City funds by padnedng with Rotary for continued improvements to Me Wacdwam Amphitheater REPORT TO THE CITY COUNCIL Second Amendment to Agreement between City and Rotary July 29, 2000 Page 3 SA KOROOND On August 25. 1992, the City and Rotary, entered into a 50.year agreement (with an option to extend beyond the 50 years) fm the construction of the Amphitheater. Rotary agreed to Provide an engineering firm to develop plans and speclficatons for the project. On January 16, 1996 the Agreement was amerMed in order to complete Me conshuction of Me project. Section 1, Grant of License for Construction was amended to include an expiration date for final acceptance of project by City. A joint effort between City and Rotary has resulted In the current structure. The Second amendment to the Rotary agreement can only result in a better facility for the community at large to enjoy. Thus far, the community and City employees have had opportunities to enjoy the Made structures recently developed in Me Amphitheater. The joint offer[ of the City and Rotary on this project Is certainly a benefit to the community. FISCAL IMPACT Coupled with revised facility rental fees. Me per food improvement fee will allow Me Cry to generate sufficient revenue to operate the Amphitheater and set aside funds for capital Improvements. The muni -year phased In approach for the fee will allow customers to witness Improvements to Me venue over the nett several years and see the valueIn the fees charged Based on a conservative estimate of 32 events per year with an average of 1.500 attendees each, the ticket fee will generate $48 000 annually, which will be used to offset facility operation costs and contribute lower& capital improvements. The 10% of gross event concession revenue (City's portion) is somewhat more dificult to forecast as every event will offer varying levels of concessions and be affected by attendance levels. At this point. the Department estimates the revenue from 10% of gross event concession revenue to be $10,00o annually. The Department plans to return to Council in the next W days to revise Me rental rates for the Amphitheater, The aggregate effect of the 10% of gross event concession revenue,'phasecl per ticket fee, and revised rental rates will be that the Amphitheater will begin to operate as an enterprise: generating sufficient revenue to cover all operational costs, fond further wpral Improvements, and place funds Into a reserve to repair and replace aging assets. Attachments: Amendment to Rotary Amphitheater Agreement Master Fee Schetluo Amendment SECOND AMENDMENT TO ROTARY AMPHITHEATER AGREEMENT THIS SECOND AMENDMENT TO AGREEMENT ("Amendment") made and entered Into as of this 1st day of February, 2008, amends Me Agreement heretofore entered Into between the CITY OF FRESNO, a municipal corporation, hereinafter refereed to as "CfTr, and the ROTARY CLUB OF FRESNO, a Califomla nonprofit corporation, hereinafter retained to as "ROTARY'. RECITALS WHEREAS, CITY and ROTARY entered Into an Agreement, dated August 25, 1992 for the design and construction of an amphitheater, as once amended, hereinafter collectively referred to as 'Agreement" and WHEREAS, CITY and ROTARY desire to modify the Agreement in certain regards, upon he terms and conditions herein. AGREEMENT NOW, THEREFORE, in consideration of the foregoing and of the covenants, conditions, and premises hereinafter contained, to be kept and Performed by the respective parties, the Parties agree that Me aforesaid Agreement be amended as follows: 1. For purposes of this Agreement the term "CITY" shall Include as designee thereof, in the discretion of the Ciys Director of Parks and Recreation, Fresno United Neighborhood, (FUN) a California nonprofit corporation, subject to/consistent with approval by FUN. The foregoing shall not however, relieve CITY of its obligations under this Agreement. 2. All rights granted to ROTARY to operate Amphitheater cancession(s) are hereby terminated as to ROTARY and concurrently vested exclusively In the CITY Including the right to retain all profits, subject to Me remaining terms hereof. For Purposes of this section the term °conwsslon(s)' means without timitation any and all sales by any person or entity of fwd, beverages, and merchandise of every kind and nature occurring on the Amphitheater premises, or adjacent thereto if sold to Amphitheater event attendees. & In wnsidsration of ROTARY'S termination of its concession right as provided for herein, CITY as lead and awarding agency agrees to Invest $1,000,000 of allocated and available Parks funs, consistent with constitutional and local law requirements, on Amphitheater improvements to n commenced on or about January 1, 2008, and to responsibly promote its use. CITY agrees to Proceed win the completion of the east section of the second tier seating including the wnstructlon of the east stairway at the earliest possible time. ROTARY will contribute a minimum of $50,000 for a mutually agreed upon capital improvement project(s). 4. All rights granted to ROTARY to establish and sell seat options for events at the Amphitheater shall expire on December 31, 2016. It is understood and agreed that all seat options cold by Rotary shall be honored for a period of ten (10) years commencing with the year that the seat option holders may exercise the option to purchase tickets for their specific seatsfora minimum of ten (10) events in any calendar year. CITY will require users of the Amphitheater for free concerts or similar events to notify seat option holders of such events, but such events will not constihne one of the minimum ten (10) events. S Concurrent with the effective date of this Second Amendment, the Amphitheater Ticket Surcharge amount referenced in Section 7 of the Agreement shall be $ VRckot after January 1, 2008, $2/Ticket after January t, 2009, and $3/Tlcket after January 2010. 6. The fell is added to the Agreement as new Section 17: 017. Allocation of Revenue and Expenses. Unless otherwise expressly provided herein: A. All non-party event permittees, licensees, promoters and/or other users shall (i) pay the CITY tan percent (10%) of the amount determined by gross event revenues net only of sales/exclse taxes, and (ii) pay the ROTARY len percent (100k) of the amount determined by gross event revenues net only of aales/excise taxes. In the event ROTARY acts as a nominee, licensee, promoter and/or other user the ROTARY shall pay me CITY ten percent (10%) of the amount determined by gross event revenues net only of sales/excise taxes. In the event the CITY acts as a permittee, licensee, promoter and/or other user (other than as to concessions) activities as defined herein) the CITY shall pay the ROTARY ten percent (10%) of the amount determined by gross event revenues net only of sales/axisse taxes. For purposes of this section the term 'gross event revenues' means all revenues generated by and/or arising from concessions) activities. B. All such remittance to the CITY antl ROTARY shall be made not later than the antl of the next business day following the earlier of invoice for payment or the day in which such revenues are realized and shall be accompanied by an appropriate accounting to CITY and ROTARY, such accounting shall W sufficient under generally accepted accounting principles. C. Unless otherwise expressly agreed in writing by the parties hereto and any/all such event permittees, licensees, promoters and/or other users, all costs and expenses arising out of or related to such I .. event(s) shall be borne solely by the event permttlees, licensees, promoters anther other users." 7. All capitalized terms used In the Amendment, unless otherwise defined herein, shall have the meanings assigned to such terms In the Agreement. 8. Except as otherwise provided herein, the Agreement remains in full force and effect. IN WITNESS WHEREOF, the parties have executed this Amendment at Fresno, Califomla, the day and year first above written, CITY OF FRESNO ROTARY CLUB OF FRESNO, a municipal corporation a Califomi fit ration By Randall L Cooper By Don E es Title Director Title President ATTEST: REBECCA E. KITSCH City Clerk By: Deputy APPROVED AS TO FORM: JAMES C. SANCHEZ City Attorney By: g 6.19-a6 Deputy 4%wAlk cmor�suo aya.iv:amnloigm.0 COND AMENDMENT TO ROTARY AMPHITHEATER AGREEMENT THIS SECOND AMENDMENT TO AGREEMENT (-Amendment") made and entered Into as of this tat day of February, 2008, amends the Agreement heretofore entered into between Me CITY OF FRESNO, a municipal corporation, hereinafter referred to as "CITY', and the ROTARY CLUB OF FRESNO, a California nonprofit corporation, hereinafter referred to as "ROTARY". RECITALS WHEREAS, CITY and ROTARY entered into an Agreement, dated August 25, 1992 for the design and construction of an amphitheater, as once amended, hereinafter cnllectivaly referred to as "Agreement' and WHEREAS, CITY and ROTARY desire to all the Agreement In certain regards, upon the terms and conditions herein. AGREEMENT NOW, THEREFORE, in consideration of the foregoing and of the covenants, conditions, and premises hereinafter contained. to be kept and Performed by the respective parties, the parties agree Mat the aforesaid Agreement be amended as follows: 1. For purposes of this Agreement the term "CITY" shall Include as designs, thereof, in Me discretion of Me City's Director of Parks and Recreation, Fresno United Neighborhood, (FUN) a California nonprofit corporation, subject to/consistent with approval by FUN. The foregoing shall not however, relieve CITY of Its obligations under this Agreement. 2. All rights granted to ROTARY to operate Amphitheater coxession(s) are hereby terminated as to ROTARY and concurrently vested exclusively in the CITY Including the right to retain all profits, subject to the remaining terms hereof. For purposes of this section the term "concessions) means without limitation any and all sales by any person or entity of food beverages, and merchandise of every kind and nature occurring on the Amphitheater premises, or adjacent thereto if sold to Amphitheater event attendees, 3. In consideration of ROTARY'S termination of its concession right as Provided for herein, CITY as lead and awarding agency agrees to invest $1,000,000 of allocated and available Parks funds, consistent with constitutional and local law requirements, on Amphitheater improvements to be commenced on or about January 1, 2008, and to responsibly promote Its use. CITY agrees to proceed with Me completion of the east section of Me second tier seating Including the construction of the east stairway at the earliest possible time. ROTARY will contribute a minimum of $50,000 for a mutually agreed upon capital Improvement pro(ect(s). 4. All rights granted to ROTARY to establish and sell seat options for events at the Amphitheater shall expire on December 31, 2016. It Is understood and agreed that all seat options sold by Rotary shall be ho oned for a period of ten (10) years commencing with the year that the seat option holders may exercise the option to purchase tickets for their specific seats for a minimum of ten (10) events in any calendar year. CITY will require user's of the Amphitheater for free concerts or similar events to nobly seat option holders of such events, but such events will not constitute one of the minimum ton (10) events. 5. Concurrent with the effective date of this Second Amendment, the Amphitheater Ticket Surcharge amount referenced in Section 7 of the Agreement shall be $1/Thed after January 1, 2008, $2/Tickst after January 1, 2009, and $3/Ticket after January 2010. e. The following is added to the Agreement as new Section 17: "17. Allocation of Revenue and Expenses. Unless otherwise expressly provided herein: A. All non-party event permittees, licensees, promoters and/or other users shall (I) pay the CITY ten percent (10%) of Me amount determined by gross event revenues net only of salesnexcse taxes, and 00 pay the ROTARY ten percent (10%) of the amount determined by gross event revenues net only of sales/excies taxes. In Me event ROTARY acts as a permittee, licensee, promoter and/or other user Me ROTARY shall pay Me CITY tan percent (10%) of Me amount determined by gross event revenues net only of salesexcise taxes. In the event the CITY acts as a permittee, licensee, promoter and/or other user (other than as to concession(s) activities as defined herein) the CITY shall pay the ROTARY ten percent (10%) of the amount determined by gross event revenues net only of sales/excise taxes. For purposes of this section the term "gross event revenues' means all revenues generated by and/or arising from concession(s) activities. B. All such remittance to the CITY and/or ROTARY shall be made not later than the end of the next business day following the earlier of invoice for payment or the day in which such revenues are realized and shall be accompanied by an appropriate accounting to CITY and ROTARY, such accounting shall be sufficient under generally accepted accounting principles. C. Unless otherwise expressly agreed in writing by Me parties hereto and any/all such event funniness, licensees, promoters and/or other users, all costs and expenses ansing out of or related to such events) shall be home solety by Me event permittees, licensees, promoters and/or other users' 7. All capitalized terms used in the Amendment. unless otherwise defined herein, shall have Me meanings assigned to such terms in the Agreement. S. Except as otherwise provided herein, Me Agreement remains in full force and affect. IN WITNESS WHEREOF, the parties have executed this Amendment at Fresno, California, the day and year first above written. CITY OF FRESNO a municipal it By andail LL C Title Director ROTARY CLUB OF FRESNO, a Caliform ffl rattan By Don E es Title President ATTEST: REBECCA E. KIJSCH City Clerk " By: naJ pitww.uRlci Depth' APPROVED AS TO FORM: JAMES C. SANCHEZ City Attorney By:_[�. ISA Deputy 41`A-'