HomeMy WebLinkAbout08 - Corona del Mar State Beach Consession���WPOQr CITY OF
NEWPORT BEACH
C9G1F00.NP City Council Staff Report Agenda Item No. 8
May 24, 2011
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Administrative Services Department
Tracy McCraner, Administrative Services Director/Treasurer
949 - 644 -3123, tmccraner @newportbeachca.gov
PREPARED BY: Evelyn Tseng, Revenue Manager
APPROVED:
TITLE: Grant City Manager authority to enter into concession agreement(s)
for Corona del Mar State Beach
ABSTRACT:
On April 8, 2011, the City issued a Request for Proposals for Concession Operations at
Corona del Mar State Beach ( "RFP "). The City received only one proposal - from Kilmer
Enterprises, Inc. ( "Kilmer ") to serve cheeseburgers, hot dogs, fries, and similar types of
food. Rather than committing to a long -term agreement from a process that garnered
only one respondent, City staff is currently assessing the RFP process - including the
terms of the concession and the overall suitability of the facility. In the interim, a
temporary solution to provide food during the summer months should be pursued.
RECOMMENDATION:
Authorize the City Manager to enter into one (1) or more concession agreements from
May 27 through September 30, 2011, on terms approved by the Office of the City
Attorney.
FUNDING REQUIREMENTS:
The financial impact (if any) may be limited to lower rents and is not expected to be
significant.
DISCUSSION:
In 2006, the City upgraded and improved the infrastructure at Corona del Mar State
Beach, which includes a concession area intended to provide food /drink service to
beach visitors. The City contracted with Fuji Grill in 2008, to operate the concession at
Corona del Mar. In December 2010, Fuji Grill and the City mutually agreed to terminate
the agreement. At that time, Fuji Grill explained that Corona del Mar's parking lot
Grant City Manager authority to enter into concession agreement(s) for Corona del Mar
State Beach
May 24, 2011
Page 2
situation created difficulty in establishing a customer base during the off - season
months. Pursuant to the termination agreement, Fuji Grill removed several pieces of
equipment which it had paid for, including the refrigeration unit, ovens and broiler.
While the City respects Mr. Kilmer and would welcome a proposal from him in response
to a re- issued RFP, City staff believes that one response does not provide a competitive
context for the selection process associated with a long -term contract, and it is wise to
re -issue a revised RFP. The City's current economic development consultant is
assisting revenue staff in reframing the RFP to encourage more proposers. Staff will
also assess ways to mitigate the potential negative business conditions of Corona del
Mar concession (lack of off - season business and the expense of parking) and will
conduct an aggressive outreach effort to attract qualified bidders. City staff anticipates
that the RFP will be re- issued in the fall.
Summer is the busiest season at Corona del Mar State Beach. There are no convenient
options for the purchase of food or beverages to the public at that beach. In order to
address the need for food concessions as summer approaches, Revenue staff is
investigating options for this summer, but anticipates entering into one (1) or more
temporary lease agreements for the concession. Staff shall negotiate and contract with
reputable vendors with proven track records in the food service industry.
Staff anticipates a high level of interest by vendors and staff could establish a schedule
where different vendors would provide concessions. Staff does not foresee a significant
impact to restaurants in the Corona del Mar area given the location at the beach is far
removed from area restaurants.
Staff is requesting that Council authorize City Manager to enter into concession
agreements for the Corona del Mar facility, upon terms approved by the Office of the
City Attorney. Such terms shall include, but not be limited to, rent provisions, menu,
hours, and, because the kitchen is currently ill- suited for the provision of food without
costly tenant improvements, the possibility of the preparation of food in a mobile facility
in the Corona del Mar parking lot. The previous Fuji Grill agreement dedicated three (3)
parking spaces for concession staff, and those spaces could be used, without any
decrease in parking revenue, for the food preparation facility.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will
not result in a direct or reasonably foreseeable indirect physical change in the
environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378)
of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it
Grant City Manager authority to enter into concession agreement(s) for Corona del Mar
State Beach
May 24, 2011
Page 3
has no potential for resulting in physical change to the environment, directly or
indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
Submitted by:
Tracy McCraner
Administrative Services Director/Treasurer