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SR-906-000 (4) - 1 . \ ! I'THA : nunI!\ . City Councll Mee 8/17/82 Santa wca, a Californla y t9 ~ --t/OO \, -E AU6 1 7 1982 TO: Mayor and City Councll FROM: Clty Staff SUBJEC'I': Selection of Operator for 415 Paciflc Coast Hlghway Introductlon ThlS staff report descrlbes the process for the selectlon of an operator and outllnes the flve submltted proposals recelved for the use of State owned property located at 415 Paciflc Coast thghway. The report recommends that the Clty negotiate a lease for twenty years with Paciflc Parks, Inc. consistent wlth specified terms and condltlons. Pacific Parks, Inc. has been recommended because the proposal, as submitted and as modlfied by negotlation, best meets the crlterla for selectlon adopted by the Clty of Santa Monica and the State of Callfornla. Background 415 Pacific Coast Highway is owned by the state of California and operated by the Clty of Santa Monica pursuant to a 25 year operating agreement. The current operator's lease expired ln March 1981. The process of selectlng a long term operator was held in abeyance pendlng the conclusion of negotlatlons between the City and the State pertainlng to a beach operating agreement. ThlS beach operating agreement was slgned on December 18, 1981. 1 \ '-E A LI(J 1 'i 1982 1 . . I . . . The site is currently operated on a month to month lease WhICh extended the condltlons of the lease WhlCh expired March 31, 1981. The three acre slte currently includes a clubhouse, two restaurants, swimming pool, locker room, cocktall lounge, paddle tennis courts, forty-six beachside cabanas, an offIce and two parklng lots contalning approximately fIfty-nlne (59) and 105 spaces. B1d Criteria and Request for P~op~sal (RFP) Process On December 8, 1981, the CIty Counell approved criteria for the request for proposals for the use of the State owned property located at 415 Pacific Coast Highway. These crIteria were also amended and approved by the State Park and Recreation Commlssion on January 8, 1982. The fInal verS10n was approved by the State LegIslatlve bodies May 12, 1982. The RFP package was prepared by staff. Notice of the invitatIon was pUblIshed 1n sixteen (16) minorlty and regular circulation newspapers. Inquir1es on the availablllty of the property had been made by twelve partIes prior to the notice. Proposal packets were maIled to these partIes as well as those who inquired following the notIce. An on-site conference and tour was held on June 17 to explaln the criteria, tour the facility and answer questions. Proposals were to be rece1ved by 3 p.m. on July 6. 2 .. . . The RFP ~nd~cated the concess~ona~re select~on would be based primarily upon: 1. ComplIance with the CIty'S and State's publ~c and beach access object~ves 2. The amount of revenue der~ved from operations 3. The compliance of the proposal to be coastal dependent and beach related actIvities. In additIon, the selection should urged that "any LegIslature specifically stated that the insure "max~IPum feas1.ble publJ..c access" and structure that has a hIgh value as a visitor serving facility or has a slgnlficant remaIning useful economic life shall not be demolIshed." The stated crIteria were designed to ensure the greatest pUblic access and to enhance beach related actIVIties. The process was also desIgned to use the creatIve thinkIng of the prIvate sector as to how those goals could be accomplished. Five proposals were receIved by the CIty of Santa Mon1.ca. Each of these proposals IS summarIzed in the subsequent section of thIS staff report. The Clty Manager established a staff review commIttee to analyze the subm~SSlons. Thls review commlttee was comprIsed of the DIrector of Recreation and Parksl the Director of Community and Economic Development; the AssIstant C~ty Manager and the Director of Purchas~ng. In addit10n to deta~led staff 3 . . reVlew, the Clty contracted wlth an independent real estate consultlng firm. In conjunction wlth an accountlng flrm spec1allzing 1n restaurant and visltor serv1ng uses, the firm analyzed each proposal. Thelr recommendations were given careful consideratlon by the staff review committee. Subsequent to internal reVlew, the C1ty'S reVlew committee met wlth each of the fIve bIdders. The purpose of these meetings were to clarify the bidders attalnment of the proposed site actlvlty plans. At the conclusion of these interv1ew seSS1ons, the Staff review committee, in consultation with the Clty Manager, deslgnated Pacific Parks as the proposal whlch best meet the publlshed criteria. ThIS selection was based solely on the proposals as submitted. Under normal CIrcumstances, Staff would have returned to Council wlth a request for authorlzatlon to negotlate. Due to tl~e lInes imposed on the City by the Callfornia Legislature, this step was not feaslble. Consequently, Staff entered lnto negot1atlons wlth PacifIC Parks, Inc. and thlS submission presents the proposal both as submitted and modifled as the result of negotlatlons. The next section descrlbes these proposals. Please note that the descrlption of the Paclflc Parks submlssion is as origlnally presented, not as modifled. The proposal before the Counell for its reVlew is that which 1S outllned in the recommendatIon sect~ons of th1s report. 4 . . The Proposals (not ranked 1n any order) American Underwriters Inc. submitted by Fred Raven, Pres1dent, calls for the construction of a 240 room 24 million dollar hotel-restaurant complex. They have requested a 75 year lease because of the proposed 1nstitutional financing. They proJect the revenues to the Beach Fund to reach $1,000,000 yearly by the eleventh year. The Hotel will commit to a $10,000 per month m1nlmum rent aga1nst 5% of gross revenues. Access would be through hotel accommodations and arrangements wlth speclal groups. Room pr1ces are proJected to range from $100 to $170 per night. All structures except the North House would be demolished. The North House would be moved and lncorporated into the new bUlldlng design. Mlchael's Submitted by Michael McCarty for a corporation to be formed, propopses a world class luxury hotel and resort complex of 300 rOOMS requirlng a 50 year lease. The proposal includes $300,000 per year revenue during construct1on and $450,000 per year agalnst 3% of the gross lncome of the hotel complex thereafter. Access would be through the hotel accommodatlon and arrangements with cial groups. The North House would be converted ~nto a public museum of art. Room prlces are shown at $150 per day. All structures except the North House would be demolished. 5 . . Per1no's Submltted by Frank Esgrow, Presldent, proposes to construct Per1no's Restaurant and prov1de 332 publlC parklng spaces. The structure would occupy 42,000 square feet Wh1Ch includes 1,000 seating capacity, with 120 additional parking spaces underground for the restaurant customers. Base rent would be $150,000 annually, percentage rent 1S 2% of gross revenues versus m1nimum base rent. Antlcipated volume of the complex is $6,000,000 to $10,000,000 per year. In add1tion, they would operate and maintain the publ1C parking lots, and guarantee at least $25,000 per year versus 20% of parking fee. Projected attendance would be 580,392 not including the sWlmsuit restaurant. Access to the beach would be gained by the 332 parklng spaces and/or use of the restaurant. Construction cost estlmated at between $5,000,000 and $6,000,000. All eXlstlng structures would be demolished except the North House Wh1Ch wlll be relocated to the northwest corner of the site and refurbished for a senior center. end of lease. FaCllity ownershlp reverts to State at the Mountaln Restoration Trust Submitted by Margot Feuer, President. corporation, joins with the team of The Trust, a non-profit Robert J. Morris and 6 . . Salvatore Casola and lS requesting a 20 year lease. The Trust is the proposer and will be the master lessor responslble for all publlC access aspects of the program. The Robert J. Morrls group wll1 serve as the guarantor of the flnanClal obl~gations. The City wlll be guaranteed a mlnimum yearly rent of $100,000. Rents from the food service will be the greater of the mlnlmum or 8% of the gross recelpts. Projected revenue to the City 1n the tenth year is $536,000. The Trust avallable proposed to the day use cabanas, 10% Clty for use by low of WhlCh wlll be made and moderate lncome faml11es. Fees will be charged for use of the locker room, gym, sports courts, 1,200 locker and shower passes wlll be made available to the City free of charge annually. Year round programm1ng, lncluding llcensed day care center, wll1 be provlded (fees to be competitive wlth the surrounding area.) Projected total annual visitor use hours are 1,600,000. approximately 2,200 people daily average. In season, Paciflc Parks Incorporated This is submitted by the incumbent and seeks a 20 year lease. The proposal calls for the upgradlng and restoratlon of the eXlsting North House and construction of a gazebo pavll1ion restaurant adJoinlng the North House for dinlng. Proposes to remodel and enlarge the Ocean House Cafe for a seafood brassler 7 . . with indoor and outdoor seat1ng and construct a new barbeque picnlc area w1th self-service and a serviced grlll area. Seating capacity for the entire restaurant complex will accommodate 1,675 people. Memberships would be replaced. In the1r place, 600 annual perm1ts and 300 or more day use perm1ts. The ong01ng program of use by youth and senlor groups would be cont1nued. W1nter operat1ons would be expanded to ensure year round use of the fac1lity. Ant1cipated visltor use hours annually, excluslve of restaurants would be 1,500,000 hours, approxlmately 2,000 people per day. The City would be guaranteed a mlnirnum rent in Alternative I of $150,000 per year against 3% food and beverage plus 5% of all other gross sales with1n amortlzatlon. In Alternatlve II, a m1nirnurn of $150,000 against 8% food and beverage plus 10% of er gross sales wlth costs of capital lmprovements to be recouped as offset against percentge rental in excess of mlnimum rent. Analysis of Proposals The proposals as subm1tted fall lnto two baS1C group1ngs. The first, comprised of the proposals submltted by Mlchael's, American Underwriters, Inc, and Perino's do not, 1n the Staff's opin1on, meet the baS1C threshold crlteria established in the RFP. These three proposals do not provlde for adequate access to 8 . . the site nor a contlnuatlon of the site as an accessible, recreatlonal facility maklng maximum use of its coastal and beach related characterlstics. h~lle both hotels offer a healthy flnanClal rate of return, both are luxury proJects wlth restrlcted hotel use and w1th access limited to those able to afford the accommodatlons. In addltion, both proposals requlre demolition of all buildlngs except the North House, a characterlst1c d1scouraged by the State of Californla. Perlno's was reJected because of the failure to malntaln existing structures, and because of the fa1lure of the proposal to Make appropriate use of tre beach and recreat10nal related characterlstlcs of the slte. Whlle restaurant use would result 1n a hlgh degree of visitor access, Staff's oplnion was that th1S form of Vlsltor access dld not make maxlmum use of the unique characterlstics of a beach front location. In addltlon, the real estate review indlcated deficiencies 1n parking requirements. The proposals submltted by Mountaln Restoration Trust and Paclfic Parks, Inc. met the basic threshold requirements of the RFP. Both proposals attempted to provlde publlC access and to provide appropr1ate revenue to t~ public. While the Mountain Restoratlon Trust proposal had much to recommend it, this proposal was rated less favorably by Staff and by independent real estate reVlew because of a lack of specificlty and because of Ilmited management experience. Manaoement ~ for the Trust's public program was yet to be hlred and existing management eVldenced a lack of fam1l1arity with important aspects of the 9 . . site and operatlonal requirements. Proposed management lacked a proven record to perform on commltments of this Slze and magnitude. Pacif1c Parks, Inc. has established 1n the proposals fees for permits, engaged an experienced restauranteur to operate the proposed facillt1es, hired a manager, leased off-site park1ng lots for the shuttle bus service proposed and has engaged a publlC relat10ns person for the purpose of promotlng the publlC use of thlS facil1ty. In short, much of the management tools necessary to meet the criteria are 1n place. The Pacific Parks proposal does provlde for the transitlon to day use as it develops and operatlonal costs become stabillzed. Based upon the soundness of the proposal, experience 1n the operations of the site, the level of detail in the proposal, Pacific Parks, Inc. is the best proposal for the lntended use of 415 Pac1fic Coast Highway. Recommendation Staff recommends that the City Councll authorlze the Clty Manager to negotlate a lease with Paciflc Parks, Inc. for the slte at 415 Pacific Coast Highway in accord w1th the condltions outllned below. Staff also recommends that the CouncIl authorlze the subm1ssion, in recommendatlon the format required by the State, of this to the Callfornia State Legislature and to the 10 . . approprlate agencies of the State of Californla as requlred by law and contract. The proposal outlined below provides for slgniflcant public access and revenue to the public. Please note ~n part~cular that all vestlges of a "private" club have been ellIDlnated. This site wlll be open and accesslble to any who choose to enjoy its unique opportun1ties. In addltion, please note that the Clty has negotiated a lease which provides a min1IDum of almost tW1ce the eX1stlng level of revenue to the Beach Fund. In addltlon, a unique publ1C, private partnersh1p is recommended WhlCh allows the City to particlpate as an lnvestor in the proposed development plan. This partlclpatlon agreement 1S an innovative example of cooperation between private lnvestors and public agencies. ThlS fully secured and cautious investment w1ll aSslst the developer and provide adequate rates of return for the corrnnunity. Terms and Condit1ons ACCESS Parking and Transportation There shall be approximately 340 spaces as follows: 22 at the cabana parking, 30 at the mid lot, 88 at the north lot, 200 at the south lot. It 1S agreed of the 340 spaces, 140 would be reserved for the annual permlt holders and cabana users. The 11 . . remaining 200 would be available for the dally permit users and public. The parklng cost for the annual permit holder would be included In the purchase of the permit. The same holds true for the cabana user. They would, however, have to pay to use any of 200 pUblic spaces. Publlc parklng will be on a flrst come first served basis. The daily permit parking cost would be comparable to the Clty'S fee with the followlng provlslons: that Pacific Parks Inc. wlIl submit a plan at a later date, for city approval, for provlding incentlve on dally permlt cost to encourage car poollng. A Pacific Parks service will run at least every 1/2 hour from 9:30 a.m. to 6:00 p.m. in the summer season on weekends. Should the need arise there'll be shuttle provlded on weekdays. The shuttle will be free to both annual and daily permit users. The precise route and service level of the shuttle wlll be determlned In consultation with the Transportatlon Dlrector of the City of Santa Monlca. Employment applicants who need not rely on the automoblle for transportation. 90% of the employees and traInees will be required to park and ride the shuttle bus during summer weekends. This excludes bicycles, walklng and ~otorcycles etc. Dally Permits The dally permit fees would be $7.00 per household unlt af two or less plus $5.00 for children within same famlly (child defined as person 17 or under). The famlly would be Issued 3 towels. 12 . . Extras would be ava~lable at a nominal charge. Included 1n the perm~t would be use of the paddle tenn1S courts (per a reservation plan to be subm~tted to the City for approval), the sw~mming pool, one locker per family, complete use of all other facilitles wlth the except~on of the massage. The number of dally permits would be unlimlted. If a user wanted to walk to the club, find alternate transportation, or rece~ve the service of the shuttle bus (to be discussed earl1er 1n this report), they could purchase a daily permit at prlces discussed above. There would be 250 perm1ts per week available free to spec1al 1nterest population defined as elderly, low-moderate income and dlsabled persons. (The weekends Iweekdays spIlt would be subMitted at a later date for Clty approval, w1th the intent10n of an expanded outreach effort to extend the free daily use permit to weekend usage.) Annual Permits As a convenience to those persons who would prefer not to use the dally perm1t, there will be 500 annual perm1ts ava1lable at a cost of $900, cost plus $22.00 per month installment payment. The $900 is for 2 adults withln the same household unit plus $5.00 per child per month. The annual permits would be avallable on a first come first serve basis yearly. If and when the demand for annual permlts exceeds 500, a llSt w1Il be created wlth pUblished deadlines for beIng included on the lIst. If In any year the demand exceeds 500, the annual permlts WIll be sold based on a random selection draWIng technlque approved by the 13 . . C~ty. The lIst must be posted publlCly and avallable for inspection. The annual permlt will include locker, parklng (per above discussion), beach equlpment, towel, pool, courts and sauna. The massage would be for a fee. Cabanas The number of cabanas can vary between the existing 46 and newly constructed ones, the total not to exceed 100. The final number will be a function of what is permItted by the Coastal Commission and local plann~ng and zoning. In no case, will condltlons of these permits alter the parking restr~ctIon for the cabanas discussed above. The prlce of the cabanas will be set at a minimum of $4,000 per year and wlll be adJusted upward on a bid baS1S. The maxlmum cabana lIcense term would be 5 years. Ten of the cabanas wlll be set aside for dally or weekly use at a $30.00 per day and some comparable and reasonable weekly fee. A plan for lImited free use of some Cabanas for special populatlons wlll be SUbmitted and approved by the City at a later date. Eight cabanas will be available on a annual llcense on a bid baSIs. ThIS number (8) may be Increased or decreased by mutual agreement by the City and Pacific Parks. Banquet Rooms Banquet rooms would be avallahle free (excludIng damage charges) to communlty groups for a minimum of One n~ght per week on a first come fIrst serve basIs, preference given to groups identified by the Clty of Santa MonIca as in special need. 14 . . Outreach Sand and Sea wlll change lts name completely. The new name will establish the open character of use. There will be a slgn 1n front ind1cat1ng that the facility 15 state owned and is open to the public under agreement with the C1ty of Santa Mon1ca (a slgnage plan to be submitted at a later date for Clty approval). The advertlsing budget would be 1ncreased to $10,000 exclUSlve of restaurant advertis1ng. This advertlsing 1S to be keyed to the public avallability of the recreatlonal facility in partlcular (a promotlonal plan to be submitted to the City for approval). Pr1ce AdJustment Price adjustment of daily permit cost can be, with approval of the C1ty, adJusted at the CPI factor. Advertising w1l1 be annually adJusted upward at no less than CPl. Notwithstanding the above, annual permlt fees may be adJusted to compensate for posslble loss of revenue by reason of reductlon 1n the number of annual permits sold. EMPLOYMENT Employment programs found in the Paciflc Parks 1ncludes a restaurant tralning schooljlnstltute organized and operated by George Lang. All employment and trainees in the restaurant trainlng school wll1 provlde a bona-flde best effort to ach1eve at least the followlng percentages by category. This effort will be consistent wlth appl1cable State and Federal laws. The Clty 15 . . shall closely monltor performance and report publicly on a periodlc basls. Women 40-50% in all categorles lncludlng professlonal levels. Minorities and Dlsabled Minorities will be 20% (the manager will be Spanlsh speaklng) with a special effort to maximize persons bl-lingual ln Spanish in positlons In contact with the publlC. Disabled appllcants wlll be given high priorlty in hiring. REVENUE Concession Agreement The conceSSlon agreement will lnclude all standard terms and condltions. (e.g. reportlng and upkeep requlrements)j The revenue will be an annual base lease payment of $150,000 payable quarterly, agalnst an amount equal to 3% of gross income from all facility operatlons lncluding restaurants. The $150,000 wll1 be applied against the 3% of gross. Partlclpatlon Agreement The Clty wlll loan approximately 66% (for an estlmated $3 mlll10n total project cost) and requlre the balance as equlty participation by the developer. The loan wlll be made pursuant to these terms: 16 . . Term: approximately 10 years Rate: date. City's best borrowing rate approximately 11%, at this PrinClpal: approximately $2 m~llion Collateral Coverage: 100% of the Clty'S outstand~ng loan w~ll be backed by securlty acceptable to the Clty. For the purposes of this sectlon "securlty acceptable to the Cl.ty" shall meet thIS crIterIon: a non-wast~ng 1iquld asset that can be redeemed in a short period of time at no cost to the Clty (e.g. letter of credit) . Payment: No payment In year 1; self amortiz~ng ln years 2 - 10. First year payment will accrue and earn lnterest at approxImately 11%. Payments will be made quarterly. Prepayment: Prepayment permitted; if and when any net cash flow before taxes exceeds $1 million, that amount of overage shall be applled to reduce principal (there are some minor exceptlons to this). Premlum: If and when princlpal and lnterest are fully amortized, but in no case later than the beginnlng of year 11, the City will receive 6% of gross lncorne from all revenues. In addltlon, the City shall receive a limlted a partnership share in the development related to the value of the City's interest 17 . . subSldy as d1scussed above. Per the figures above th1S would represent approximately 1/6 interest. The allocat1on of beneflts (e.g. cash flow, tax deductlon, resldual value) between the partners will be negotiated to provlde a premium cash flow to the Clty 1n exchange for tax shelter to the other llmiteds. Prepared by: John H. Alschuler City Manager John Jallli Asslstant Clty Manager Don Ar nett Director of Recreat10n and Parks Mark Tigan Dlrector of Communlty and EconOffilC Development Rlchard Aronoff D1rector of Purchaslng 18 , , , , , I , -~- ~'" -1 -'. L \- ... v { +,1- ':1-_ t t . . L I I I 'N I~c ( - , , : j ., t I , I I I.-" .-. .~. . -I ':: ~ L -__L/; _).- ~- ~_..- L.- _ J .....::- , j -r / . - "'-~~ ~ -~ './~-!- - '..- { J.t; A Lt --i J_ '--- / , ! '- "'-~< , <- I.. -)--' ~.... .'.-\. 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M bv Vavor Ba~brlck, ~av~rg been a~:OUTned frG~ t~e reg~lar lee~lng cf ~~ne 10, 1930 'loll Call Present Navor Jo~n J Ba,brlck 'fayor Pre TerpD:'"e Ruth "irrat:a C~olG.~....av C<Junc::.lPlember ;"'11 1 Hl,' ~ JenI'l~gs CouncllneMbeT ChT1S ne E Reed Cou~cll~e,beT Cherv~ 1~oden Ccuncli~e,ber Perr Scott Co~nc~:~e~ber ?le er ~~a~ den Steen~c'-e~ C::. t:,- \[anager Cna les;: "c:::lal'l ActlLg Cltv Att rnev St~?hen St3r~ [ltv ~lerk ~n' S~~re \ge~Qa ~te~ ~-~ Presented for Ye3T C:tv Budget apd allocation l:c hear:~g ~avl'g beep ~?e~ed, T~e foilo~Tlqg 9otlors were Tade reVle~' t~lS tl~e '~as :he 1980-81 Flscal of Fede al ~everue S~ar~ng ?U~d5, r~e pub- a decla:ed c:Qs~d C~ ;~re l~, ~93C dlScussl~n of :~e Budget. 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U) p:: --I .::.:: Vl"c >.c: 0)....-1 t/) !/) ... ::l.j..J +-'::l '1j.-l;:l (:) !/) ctl o ::l or--! 0 m'r--! 0 Z ::s 0.. X< UU er::,o::c: p:: H U ~ ~ rj) Cl ~ ...... 0:: u.l Cl 'il ...0 U -d 0-...1 - ~ 0-'-' Z 0< u t:t:: E--'U H """ ::::J ~ 0 ......l....:J p:) ~ ,...J .....:/ ~ 0 <r;o 0.- ~ UC::: . . Alschuler: In regard to the proposed desIgn, those are not questIons that I thInk we have the fleXIbilIty to address tonight though clearly they WIll come before your Planning COrnmlSSIOn and if necessary this Council and we will be able to listen carefully to the concerns addressed to the CounCIl by adjacent neIghbors and then those that Kould seek to use sImply the VIew access and we will take those very carefully Into advisement in our negotIatIons. If I could make some clarIfIcations to some portIons of the permIt and access questIon so that there IS no ambigui ty and if a member of Council would 'WIsh to make these as amendments to the recommendatIon they are In concert with both the direction that staff has been headIng and agreeable to the permittee. The fust has to do \vi th the question of annual permits. The sole purpose of the annual permits is to prOVIde a secure base of revenue. If at a pOInt In c time, 1'ii1ich may be one year of some subsequent tlme the annual permits are unecessary we will el1illinate them and an amendment whIch states that If aud-.wke!! ~~TInl t revenue~ prov+Q.es f<?_r <l: ~~d hscal operaJ:,~~I! eUIpln<i!l.!l.,g... thp, -need for---anr__<IDI1J.g~J___.Q.e2J!!!.!~, .t1:ie::: an,nua~ permits will stncJ<en. The second questIOn that has been raIsed pertains~o the Shuttle and I think we can provide two points of clarificatIon thIS evening. One is if there. ;:)TP. ;:mv vacant seats _on the shuttle WhICh IS Q\vlled namely the_yep'Icre is. mvned and also .EP,~r:9.te(Lb~L S~<LAn<!__Se~:-~:those emptY- seats KIll De avC1iliDI€ to -anybody .Jegardless of whether or n~they hofa d JdlIv or annual perm+t so the "ext.~! .!_~at !here IS an eXIst~ng sl1uttl~__ the~~__"~e _~",-il~- not - operate It WItE ~nip1Y~It there.~?re those-people that liould.seek to use ----3.L.... Secondly, as memEers- of Council are a\iare there are two dIfferent hscal thresholds in operatIng a shuttle, one IS the inItIal capital cost purchase of the vehIcle the second is the operating costs. The City obVIously has significant bus fleet available and also has eaSIer acc~ss to capItal funds for the purchasing of tranSIt vehIcles. The developer the proposed lessee has IndIcated his willingness to prOVIde operating costs, in other words the driver for addItional vehicles up to a reasonable mnnber made available to the Clty by the City for vehicles that have no relationship to the SIte In partIcular , In other words I thInk ~e can Jlh~ough a combInation of our eXlst~~_bus fleet an~_pernaps_~ j~4lcious u~~ Qf our Prop A funds Ii1aK€ available a limIted number of yehic1es_ l<i'hich ---- waul a not'incur an additional operating cosf-to -the City that \~ould be utl_lIzed 1~!-ncrease access to aptIie-l)eaches-uicluding thIS site. Goldway: ]-Ilould that be part of the motIon we would make? Alschuler: Yes, Goldwav: That the lessee would agree to contribute to the operating ~~st ~or a snuttle sy~ whIch---rJie Cltv liould n:rn.--=----- ---- - Alschuler: For a more _generalIzed shutt1~~5:!.em, yes and that the hnal thing Just to clarify something ....hleh was included In the original language which 15 that .1!ccess ..!2J.PP Sl.TP ~Ined as the s~g, .9.:!}d_ the beach is ObVIOusly nnlimIJed, Md~ th~re wU} _b_~f.r~~ .p.1iDIR_ac~_e_s~_l~L the SIte ~ the particu)JIT._f;olit):_fQT l'fhi~h- ~_c!~ly charge d,~~Uld Q~_ley~~~y ..!h~ TQ1J,1lggs__pooL etc. those would be li-!!!!!~__ t?" -those ~oJ21e_~~/tne 1J~rmIt, but there~\'ou~d be fee pUDlIc~access to the - . " hold .--- -==------.. ---- ',~~--- I . . sand and the beach area and there is absolutely no restrict10n placed on that ~ ~ access on envisioned in that access In thIS proposal, I belIeve that IS clarifIed in the report but there appears to be some ambiguity about it so if someone wishes to strengthen that by making such an amendment its clearly compatible. Gold1.;ay: COlmcilmember Edwards Edh'ards: I 1liould like to bnng forward a motion and move staff recommendation 1ncorporating the concerns that the City ~fumager dIscussed and some of the comments of the CIty Councilmembers. Goldway: I thInk we should specific, there were three spec1fic, the staff report, the three specifIc suggestions Edwards: signIng shuttle Goldway' The City i\1anager made, then you had a questlOn about SIgning? Edwards' I think SIgning 15 a very Important part of public access Goldway; l\''hich should be included 1n the report" ~~ot only changing the name but ,expla1ning gUIte clearly what the public ac~e~~ 1~ includlnIT thF- ~de~tri~n ~rr~ss througn to the p~ach. and I tn1nk tn~t should be spe~ificallv J Included In the language. -4. Edwards: There are already other amendments after discuss10n and should alloW' :V1rs. Reed to talk. Goldway: The three the C1ty Manager made plus the fourth Councilrnember Edivards are there any others, I will second the motion, are there any other Conn: I was gOlng to do that. Goldiv'ay: suggestions,friendly amendments or amendments to the motion. Ediliards: I think there should be some discuss10n GoldwaY, I would simply like to _spefiJy QIl...1.h~~~cess !~! the -.!-anguage t~ you ~ugge~~ specIf1call y included in that section Knich d~SCI!be_s_ t~'PJlS - _and conditlO~~ C?EEo:;~~!~...!he introduc!_ion as i'L~~~-~12efore, !~at _thi~ '- .~t:iOIlmaicates tnat tlier~ :.!:.?~__s:larlficat-foI1 on .9-CC~~s _ and ~nclud€!s In --' It a cOinnntment forcliar and dIrecCpedestr!.<!D- ~a,c~es~~Llrr9t!,gh the p~:!klll[.lo~ to the _~~~ - Edwards, And also my concern about the design of ocean house l<;h1Ch I think 1S a matter of the record. Goldway: The record should indicate that th~~~iQll of. ocean hOll~e_J1leets view concerns and neIghbor concerns Khen brought fon-lard to _:the Council ~ any others COlIDc1lmember Lane. Zane Well, -I_~li~E' staff t~eg<?_tiate _(ill jncrease In the number of ~U~OX _~.?cial QopulatlOns I want to provide a preCIse figUre but I think that It Kould De appropriate to press for a greater number than i..as provIded in the staff report. I also thInk that 1\'1r. Batt? when he spoke 1nd1cated that the currently oper~~ed day care pr9g!~_ 2 . . for neonle llsino tnP. f.'wi 1, tLif that' 5 the 1Why 1 t couldn' t ~ be 1nc1uded as something 1n ~~luded_ i~_t~~lp~~p~~t. GoldKay: .~:~EJ9-111ing. the perm ttee available day care. case, I see no reason that fashion couldn't be Zane: Right, and I am also anxious to see more precise langu~ge about a ~~_1:. _~;;ide of facih ty oIl-1l rewJ.ar_ bas:lSufOI__llSe- fOL..s..emQr c1tizens org~lzat1ons and-organizations who are conrp.rnedj~tL_the -rnterest of.-Siisal2.ted j)oj:lul'!.tion and with mmor1ty populatl ons~n a community, if there can be some precise language in the contract that assures substantlal access to groups who historically has not had access Goldway: Is that acceptable COlIDc1lmember Edwards. Could you lnclude In that Councllmember Zane d1rection to provide prec1se language and '!lso bef()re hnahzing that language _~o consult K1th_ the ~ffe~_ted COmmun1ty organlzations. -- -_.- Zane; Fine. Gold\vay: .A.nd I would like to add to that hst the C1ty Department of Parks and Recreatlon to assure some m1nimum amount of tlme that the C1 ty san _ P 1 ~n To-have avirra~le fOY__1 is ~e- fo~ ~~bEc -~rogr_~._ Counc1lmember Reed. . '7 0- p . . ,ff/7" ~ c Ii. 7ls 11....e- ../:<< . ,<<- AUG 1 7 1982; mountains restoration trust 21361-b pacific coast highway mallbu, california 90265 (213) 456.5625 Donald Arne~~, D~rec~or Recreat~Qrr and Parks Department Room 210 C~ty of Santa Monica Santa Mon~caJ CA 90401 Dear Mr. Arnett: A~tached ~s the proposal of the Mounta~ns Restoration Trust for the operat~on of 415 Pac~fic Coast Highway (currently. the Sand IN Sea Club). Th~s proposal, descr~bed in general below and ~n particular in the attached forms. ~s des~gned to achieve two major goals: o To provide immed~ate maximum publ~c access to the fac~lity and o To ~ncrease dramat~cally the revenues generated by the operat.1.ons. A pr1mary purpose underlY1ng these goals is the prov.1.s.1.on of max~mum publ~c benefit from all aspects of the operat~on of the facility. To this end the Trustls program w.1.11 do the :followl.ng: 1. Eliminate the private characterizes the site; club whJ.ch currently 2. Transform the facl.lity from one providing only seasonal oppor~unities for use to a year-round publ~c recreational resource; 3. Institute & diverse range o:f genuinely public access and recreational opportunities designed to serve a broad economic spectrum of users; 4. Provide lease revenues to the City af Santa Man.1.ca that are competitive with other public commercial operations. enabl~ng increased public benefit from expenditures from the City's dedicated Beach Fund, and A CALIFORNIA NQN-PROFIT PUBUC BENEfIT CORPORATION ~ . . Donald Arnett Page 2 5. Reserve a substant1al port~on percentage for use by the Trust nonprofit~ land conservation act1v~t~es. of the operator1s ~n undertak~ng ~ts and recreat~onal THE PROPOSAL The Trust proposes to create a commerc~al beach recreational facil~ty un1que in the Un~ted States. The concept is patterned upon European models of publ1c shorel1ne operat~ons and breaks into two major parts: The prov1s1on of a d~versity of recreational opportun1~ies - rang1ng from free pedestrian beach access, through beach equipment rental and up to annual, lottery-based lease of beach-front cabanas; and the prov1s1on of a diverse range of food serV1ces - ranging from walk-up fast food beach serv1ce, food serV1ce on the beach, banquet and catering fac111ties and middle market din4ng operat1ons. PUBLIC ACCESS S1nce no major structural alterat10ns are proposed, the facility can be opened immediately for publ1c use. Beach related access opportuo1ties ~ll include free pedestr1an and public transit based beach access, fee park1ng 1n ex1st1ng lots, free par~ng and shuttle bus service trom lots 4n the C~ty which are currently under utilized ~n off-peak hours, and rental of towels. lockers, showers, and beach equipment (e.g., umbrellas, cha1rs, etc.). Fees will be competit1ve with sim11ar serv1ces 40 the western United States. The current facilities will provide the publ~c w1th the day use cabanas, 10% of which will be made available to the City free of charge for use by low-to moderate income f~lies. (The only structural addit10n contemplated is the add1t1on of approximately 60 cabanas Wh1Ch can be achieved without the loss of parking surface and the loss of only 2154 square feet of sand area. That particular sand area currently has very little use because of its close proximity to the volleyball courts, and its loss will be more than offset by the removal of the exclusive use restrictions currently imposed on the improved facilities and beach areas alike.) Add~t1onaly the public will have access to the locker room~ weight room and small gym (the gym and we1ght rooms will be installed in the wing of the current club bu~ld1ng which lies parallel to and jmm~diately south of the North House), the sports courts, the pool and the play areas. Fees for use of all ~mproved facil~ties will be compet1tve w~th prevail~ng rates for . . ~ Donald Arne~t Page 3 sim1lar fac11~t1es wi~hin the Western Un~ted States. The trust will g1ve to the city 1200 free locker room and shower passes each year. Cabana lessees - includ1ng the 10% made ava11able to the City - w11l be prov1ded w1th one parking stall and w11l be afforded free use of the ~proved fac1l~t1es and preferent~al access to two paddle tennis and two volleyball courts. Th~ th~rd publ~c access element of the Trust1s program prov1des the key to transform~ng the fac111ty from a seasonal operation ~nto a year-round public resource: organ1zed sports. classes, pub11C events and community serV1ces. The program w1ll organ1ze and conduct classes and c11nics in aerobics, gymnast1cs, paddle tennis, volleyball. swimm1ng, and arts and crafts, as well as hold k1te contests. It w1l1 host the f1nals of an area-wide intramural Jr. Olymp1cs program and be made available as the facility for the Los Angeles County JUD10r Life Guard training program. It w1ll prov~de organ1zed card and b~ngo programs for sen10rs as well as mov~es and dances for teenagers and young adults and a full-t1me licensed day-care faC1lity for 1ntants and children. Fees for this element of publ~c access will be nominal, based only on what is required to make these act1vit1es break even. FOOD SERVICE The Trust's program of use for the facilit~es at 415 Pac1fic Coast Highway also includes the establishment of three separate food service operations. A moderately pr1ced lunch-dinner restaurant will be located at the current site of the Ocean House. The site of the current club restaurant will be transformed into a multi-service operation. Beach users will be able to walk-up tor fast food and beverage purchases and get food and beverage delivery to the~r places on the sand by W&1ters and wa~tresses from this locat1on. (Litter problems created by beach food service will be controlled by maintenance crews employed at the expense of the Trust from revenues generated by the recreational faCilities.) It will also prov~de food and beverage service for banquets and p&rt~es to be held botb on-site and off. (Importantly. this will then become the only beach fac~lity available for hire by the publ~c between Long Beach and Oxnard.) The banquet facility will be available rent free to community groups during off-peak season hours. Th~s restaurant will also serve food and beverages to the individuals and groups participating in the organized recreat10nal progrwms wi thing the pub11c access element of . . Donald Arnett Page 4 ~he the Trust's operat~on. Add~t~onally, th~s restaurant w~ll prov1de the C1ty each month w~~h 100 half-priced meal coupons (exclus~ve of alcholo~c beverages) for commun~~y-serv~ce dustr~bution. The North House w~ll become a major restaurant developed on a theme reflect~ng the era and style of Marion Davies, ~n conJunct~on with a museum of the hlstory of the p~er, beach and otner ocean related recreat~onal act~v~ties in Santa Mon~ca. THE BC~INESS ASPECTS The Mountains Restorat~on Trust, a non-prof~t corporat~on JOlns w1th the team of Robert J. Morr4s and Salvatore Casola, successful restauranteurs, ~n mak~ng th~s proposal. The Trust ~s the proposer and will be the master lessor of the s~te and the entLty respons~ble for all public access aspects of the program. The Robert J. Morris group brings entrepreneurai~ expertise to the program, and w111 serve as guarantor of the financial obligat~ons. They have the abIlity to Ident~fy and select operators with tbe proper commer~cal cbaracter ~nd volume for the North House Restaurant and the one at the south end of the property. T01S proposal contemplates that the Robert J. Morrls group w~ll operate the restaurant and banquet facility in tbe central areA. That operation will be subJect to the same lease terms as the other restaurants in the fac~l~ty. The program creatively comblnes nonprofit (quasi-publlC) and prIvate entrepreneurial expertise to create a model tor h~gh publ~c beneflt and hlgh economic profitab~lity. The success of thlS model depends upon lts concept and upon the expertlse of the operators. The Trust conceived of the program and brings to lt the security of a nonprofit lessor WhlCh is closely assoc~ated with public coastal ~ssues and whose board ~s comprLsed of a broad spectrum of ~nstrests including former Coastal Commissioners Margot Feuer and Lois Ewen. The Robert J. Morris group are established restaurant operators, havlng Gladstone's 4 Fish, &J's The Rib JOlnt, Adams, and Jetty's to their credit. Together we combine to establish an enterprise wh~ch creates an income stre~ generous enough to provide substant~al benef1t directly to the City, suff~cient income to fund our aggresslve public access and recreat~onal program, attractive profit to the entrepreneur~al particlpants and suffic~ent income to the trust to enable it to expand Lts public benefit activities. . . i)oU.;l.l<.i A.rnett Page 5 The success of the bus~ness concept depends upon ~he w1de var~ety of eat1ng opt1ons with~n the faci11~Y. and pro~1des for optimum f1nanC1al SeCllr1ty. For these reasonsJ the three food service operat1ons are des1gned to be conducted ~ndependently. Var1ety tends to 1ncrease publ~c use by appea11ng to diverse sectors of the pub11ct and 1t prov1des secur1ty to the fac111ty 1n the event of the fa11ure of any s1ngle operator. (If the fac111ty were operated s~ngleYJ the econom1C fa11ure would br1ng the ent1re operat~on to a halt. That w11l not occur under the Trustls proposal.) Pub11c access and recreat~onal aspects of the program are successful because of new opportun1t1es for a broad range of uses Wh1Ch attracts all 1ncome levels. Th~s ~x of opportun1t~es elim1nates exclusivity. I urge your favorable cons1deration of the attached proposal and suggest that you contact Steve Harris of our board for addit10nal information (550-8405). You may also w1sh to contact Donald Rubenstein of the State Coastal Convervancy who has lent considerable technical aSs1stance in the development of th1S program concep~ (415-464-1015). Sincer~ ---;-; ~EUER \-~ President cc: Robert J. Morris Donald Rubenstein . . ?~CPCSE~ uncers~an~s. ag=ees, ar~ ~arrar.~s. :~a~ ?~C?CSER ~as ~~e ~apab~l~~y ~O sucoess:ully ~nder~ake and =cmple~e ~'e respcns~~~:~~~es and ob:~ga~ons proposed he:a~n. ~a~ a :1c:1-re=u."'ldahle Proposer's sWxlIJ.tul fee 1.:1 -:..,e 51.;:11 of ssoa and :.n <:"',e :or.:\. c: a Cash~er's or CertJ.::.ed ~~eck made payable to ~'e C:.~y of San~a ~onJ.ca must ~e 5u;~tted ~4~' ~,~s p:oposal and attached hereto. ~~at th~s proposal may be w~~~drawn (along W1~~ ~he 5Ub~t~al fee) at any ~~me pr~or ~o ~~e '=~e set :or openJ.ng proposals to Lease ~'e property located at 4:5 ?ac:.::.c Coast ~J.gnway but may not be wl.~~drawn af~er ~be ~~e set for such ::pen.l.ng. Thee ?~CPCSER has ~~ly ~ornpleted ~'e proposer's QuestJ.onnaJ.re contaJ.ned hereJ.n. an~ ~ia~ ~,e :c:pleted ~~estl.onnaJ.re ~s attac~ed 'ereta toce~~er Wl.~ al: 5u~pia~e~~al ~a~e=~a~ ~e~=ed ~hare~n. ~at all the J.nformatl.On conta2.."1ed lor. or supp~e:nen,,=:..:':g SUe ques~onna~re ::"5 tr~e and ::orrec-::. to t.:~e best of PROPOSER 'S kno""lec.ge. That -:.'1e proposal 1.5 submJ.tted on t."'J.e property at 413 PacJ.::::"c Coast HJ.gnway in an "as 1.5" conel.t.J.on Wl.t.., no :ur~er 1!llprovement, mal.n~enance. repa...:. g~adl.ng, f:.11 or removal 0: mat.er1.i!ll to be per=ormed by t..,e C::..ty or State. Tl".ae C:'!''! reser.res the :':t.gh-::. t.o reJect any or ~ll pr::rposals anc:. ':.0 accept t.'1a~ proposal wnl.~' wl.ll, 1.:1 lots sole opJ.:1l.on, best s~~e the publJ.: l.nterest. That pr:.or to commencement of contract. preparatl.on wJ.t..~ the selec~ed proposer, the ?RO?C:~R shall S"Jo",,~t. the som of S5,000 and l.n t.'1e form Qf a <:asl-.J.er's or Cer:J.f1.ed Check made payable to the City of Santa. MOnJ.ca. whJ.ch shall be appll.eC to cont.=act in the event a contract :t.s exeC'.1ted or l.n t.~e ~vent a contract is not executed !:Iy proposer in the for.n approved by t.."1e C1.ty shall be non-refunnJ'lble. That the ?ROPCSE;R wl.ll be required to enter into an agreement in a. !orm approved by t.."l.e Cl.ty and t.,at such aqreement lDUSt be approved by t..'le State. t (If PROilOSER is a partnerslup, all general partners must uqn the proposal. If PllOPOSER is a corporaticn. the authcr1.zed corporate Qff1.cers must sign the proposal and the corporate seal must be affixed.) PROPOSER: t t [ ... J t f [ I t r l ~ --- Moutnains Restoration Trust (Please Sign~ ~ ~ ~1}-1)1~ h~.tIP~) -r~4 I I I . . i ! ; r I J. . . :.EASE PROPOSAL ~ote: One of the C.~y's cbJect~ves ~s to max~ze =evenues ~~rough ~~stomary and/or creat1ve f~anc~ng scenar~os. use t.~J.S form to ~ndJ.cate proposed revenue to be returned to tJle city t..'lrough the lease of the subjec~ property at 415 PacJ.fic Coast Highway. r.E.\S~_ PROPOSA.t;. The Trust in assoc~ation with The Robert J. Morr~s group, proposes a 20 year master lease of the ent~re fac~l~ty. Each food service fac~lity will be subleased to a differen~ operator; the cabanas will be leased ~o ind~viduals and fees w~ll be charged for park~ng and beach services. Together these sources w~ll provide the income stream for the operation. Revenues from the cabana rentals will provide both secur~ty for the payment of the m1nimum rent guaranteed to the City and the funding for pUbl1C recreational ~cprovements and facilities. Revenues generated by the food serV1ce operat~ons will prov1de the prof1t. The City will be guaranteed a minimum yearly rent of $100,000, w1th the Trust 1n turn sUbleasing the food service operat1ons for a min1mum annual rent of $105.000. The City annual rent will be pa1d against an 8% interest in the food and beverage service gross, less sales taxes where applicable. D1stribut1ons will be calculated as set forth below. t r F1nancing of recreational improvements will be prov1ded by cash flow from the Trustts recreational services operations and is anticipa~ed to require a total capital comm1tment of $187,500. Financing for the capital improvements on ~he south restauran~. the central facility and the North House restaurant are expected to require $300,000, $200.000. and $800,000 respectively. Those costs will be recaptured by each operator tram revenues over a 10 year cap1talization period. Food service yearly revenues will be dedicated first to the payment of minimum rent and then to the recapture ot the appropriate annualized portion of the operator's capital 1nvestment. i . . i ~ . t t ~ 1 , , . ... . Rents from the food service operations w11l be Ln each case, the greater of the minimum rent or 8~ of the gross receipts, less sales taxes where applicable. Minimum rents for the south restaurant, the central facility and the North House restaurant are expected to be $25,000, $30,000 and $50,000 respect1velty. Each operat1on will pay annually for the first ten years the greater of (1) mimumum ren~ or (2) 8~ of gross less the annualized allocation of capitalized costs. Unrecaptured portions of annual capitalization allocations may be carried forward into succeeding years with~n the first ten year period. For all years after the tenth year each operator will pay the greater of min1mum rent or 8~ of gross , [ i i i i I I I I l t ;- r ~ F ~ ~ i . . w~~hout regard to cap~tal~zat~on costs. D1str1bution of 1ncome from food serv~ce operations and the recreational faci11ty between the Trust and the City w1l1 be as follows: income will be split annually 60% to the Ci~Y and 40% to the Trust until the City's share reaches $400,000. Thereaf~er, all 1ncome w111 go to the Trus~ unt11 1tS share reaches $400,000, and thereafter income w~ll be div1ded equally between the City and the Trust. (See cash flow analys~s 1D the ItEslamated Gross Rece~pts" sect10n of the proposal.) The Trust 1n also prepared to make contr1butions to the b1ke path front1ng the facility and the Jo~nt SCAG-Mounta~ns Conservancy Transit Program, but 1S await~ng advice from the City concern1ng the uses desired so that a mutually agreeable contribut1on accord can be reached. I >- . } I ~ ~ > ~ t ~ ~ r t- t t l 1 { ~ ~ c f t , f ~ t , t ~It . . ?~POSED ~~TP.CD OF OPERAT!ON(Eu5~~ess Plan) :escrLbe your plan for development and/or operation. !nd~cate proposed hours of operat~on, number of employees, menu to be af~ered (J.f appropr~a~e). DJ.SCUSS any cpt~anal serv~ces and uses wh~ch you w~l seek permJ.ss1on to prcv~de. Target clJ.entele by use. FOOD SERVICE rhe food serv~ce program ~ncludes the es~abl~shment of three separate food serv~ce operations each operated compet~t~vely and independen~ly: 1. Ocean House - a moderately pr~ced restaurant prov~d~ng s~t down and walk-up food and beverage serV4ce to both beach users and normal lunch and d~nner traffic. 2. The s~te of the current club restaurant - a moderately pr~ced multi-service operat~on for fast food and beverage purchases with bo~h walk-up service and beach service by wa~tresses and wa1ters. The facility will also prov~de catering and banquet services. Meeting rooms will also be ava~lable for commun1ty organizations (th1S will be the only public banquet and meeting room facility on the sand between Long Beach and Oxnard). 3. North House a developed on the Marion Davies and of Santa Monica. continental restaurant and museum theme reflect1ng the era and style of the history of the pier and beaches PUBLIC ACCESS AND COMMUNITY SERVICES The Trus~ proposes to create a commerc~al beach recreat10nal facility unique in the United States. The concept ~s patterned upon European models of public shoreline operat~ons and breaks 1nto two major parts: The provision of a diversity of recreational opportunities - ranging from free pedestrian beach access~ through beach equipment; and the provis1on of a diverse range of food services outl~ned above. , f t j ~ . ~ r . L Since no major structural alterations are proposed, the facility can be opened immediately for public use. Beach related access opportunities will include free pedestrian and public transit based beach access, fee parking ~n existing lots, fee parking and shuttle bus service from lots in the City which are currently under utilized in off-peak hours~ and rental of towels. lockers and beach equipment (e.g., umbrellas, chairs, etc.). Fees will be competit1ve with s~milar services in the western United States. I f . . The curren~ facil~t1es will provide the publ~c w~th day use cabanas, 10% of which will be made available ~o the C~ty free of charge for use by low-to-~oderate income fam1lies. Add4t~onally, the public will have access to the locker room, we~ght room and small gym, the sports courts, the pool and ~he play areas. Fees for the use of all 1mproved fac1l~ties w1l1 be competit1ve with prevail1ng rates for S1m1lar fac~11~1es w~th1n Sothern Cal1forn1a. The trust w1ll g1ve ~o the C1ty 1200 free locker room and shower passes each year. Cabana lessees - includ~ng the 10% made ava~lable to the C1ty will be provided with one free park1ng stall and w~11 be afforded free use of the improved facilit1es and preferent1al access to three paddle tennis and two volleyball courts. The th1rd public access element of the Trustls program prov1des the key to transforming the facility from a seasonal operat1on 1nto a year-round public resource: organ1zed sports, classes, pUblic events and commun1ty services. The program w1ll be financed largely through ~he revenues generated from the cabanas and other for-fee aspects of the public recreational services and. will organize and conduct classes and clinics in aerobics, gymnast1Cs. paddle tennis, volleyball, sW1mming, and arts and cratts, as well as hold k~te contests. It will host the finals ot an area-wide intramural Jr. Olymp~cs program. and be made ava~lable as the facility for the Los Angeles County Junior L1fe Guard tra1n1ng program. It will provide organized card and bingo programs for seniors as well as movies and dances for teenagers and young adults and a full-time 11censed day-care faci11ty for infants and children. Fees for th15 element of public access will be nominal. Based only on what 1S required to make these activ1t~es break even. Th~s program is det~l in the qProposed Pub11C Use of the Sitel' section of this proposal. ~ I l ~ i I l } , ~ ~ t r . . PRCPOSE~ ?~~L:C USE OF S!TE Ind~cate your strategy to ensure ~~e g=eatest publ~c access possible. ?roposals n..~_.. __~...~J...,ely :lUX both daily use and longer term arrangements such as annual pe~.:.ts are be~ng sought. The CJ.ty and State's goa1 J.S to prov~de open access to t..'le site for t..'le general puhl~c. rf your plan of:ers day use fees only, rather ~~an a ~ of day use fees and longer term arrangemen-cs I explaJ.I1 how this plan ~s to funct.1.on. If your plan :.ncludes as one of ~'le proposed dev~ces a membersh.:.? organ:.zat.1.on, the const1tution and by-laws must be subnu.t'ted for the C1ty' 5 approval. !n accord w:.th t..'le crJ.ter:.a established for open access, the membershJ.p plan should prov1de for a high degree of access for ~~e general publ:.c. Cons.:.deration w1l1 be g~ven to the manner employed in accept.:.ng memberships, wh.:.ch shall be of nO greater than a.."lr:::;,3.~ d.~rat1on and shall be cons1stent wit.'1 the City's goal of provl.r'!'ing open access. PROPOSED PUBLIC OSE q~ S!T~ I I l I ~ ~ All uses and facilities at the site will be available to the general public. To the extent that certain oppo~tun1ties are l~mited ~n number by their nature (e.g.. the cabanas or the banquet faci14t1es) they w111 be made available through a broadly public4zed public program. Specifically, the cabanas will be available through a lottery to the general pub11C and the banquet fac~lit1es ~n the centra~ area restaurant will be open on a f1rst-come f~rst-serve reservat10n system. All other facilities, serV1ces and opportunities will be fully open to the general public on a d&1~Y basis, limited only by the carrying capacity of the fac1lities. . I ~ , E . , l ~ . t i I f t . . ~ ~ l ~ r Ninety percent of the cabanas will be leased out on an annual basis with no options for lease renewals so that at the end of each year all cabana lessees return to the general lottery pool. The rema1n1ng teQ percent of the cabanas will be given to the City for availability to low and moderate income users on whatever basis the City deems appropriate. Fees, as such, will be charged da11y to users of ~he faci11ty and will be determined only by the amen~ties being used. Beach use will be free; use of a locker and a towel will cost a basic fee; use of spor~s courts will be on an hourly fee basis; use of equipment (e.g., umbrellas) will be on a flat daily charge; etc. All tees charged at the facility will be fully competitive. . : Cabana lessees will require longer term use arrangements for recreational use of the facility. Two paddle tennis and two volleYball courts will be reserved for their use at no charge beyond the1r lease payments. They will also enjoy one . . park~ng stall per cabana and a reserved locker. The Trust w~ll encourage year round pUb11c access by the provision of organized sports and communty serv~ce even~s. The programs w~ll be a~med at all age and econom1C levels of the populat~on and will be des~gned to encourage use from a large geograph~c area. D4fferent programs and recreat~onal opportun~t~es will be aimed at d1st~nct age groups rang~ng from day-care center for 1nfants and young ch~ldrenJ to athletics for older children and teenagers, ~o dances and mov~es for teenagers and young adults up to b1ngo and card nights and crafts workshops for sen10r citAzens. (A sample schedule of actAvites 15 attached.) Public access to the fac111ty will also be encouraged by mak1ng the banquet area available free of rental charge on a f~rst-come f1rst-serve reservation bas1s to community groups. Parking will be public parking and w~ll be augmented by the prov1sion of shuttle service from lots withing the City, and the restaurants w111 be open to the general publ~c. f , r r . I ! ~ ~ ~ . r < . SUMMER SCHEDULE Monday - Frl.day . June 1 - September 30 6:00 am - 7:00 am SWl.mm~ng for serv~ce orgainzatl.ons 7:30 am - ~censed chl.ld-care opens ~onday, Wednesday, Friday 9:00 am - 10:00 am - 1:00 pm - 3:00 pm - 6:30 pm - 7:-00 pm - 11:00 am 12:00 pm 3:00 pm 5:00 pm 8:00 pm 9:00 pm Tuesda.y and Thursday 10:00 am - 4:00 pm 9:00 am 11:00 am 10:00 am - 12:00 pm 12:00 pm - 3:00 pm 3:00 pm - 4:00 pm 3:00 pm - 5:00 pm 7:00 pm - 9:00 pm Sa.turda.y 81 Sunday 6:00 a.m - 10:00 am 9:00 am - 11:30 am } 1:00 pm - 5:00 pm ~ 2:00 pm - 5:00 pm i l- f f . e l ~ i . .. r k t F [ { ~ Arts &. Cra.fts Aerobics Arts 81 Crafts Aerobics Gym. cla.ss Movie night Junior Olympl.c programs (volleyball, basketball, track & field) :\rts &. Crafts Aerobl.cs Senior Citl.zens program Paddle tennis clinl.c Volleyball tournaments Movie night Swimming for serV1ce orga.nizations Arts l Crafts Volleyball, softball, basketball, Junior Olympics program. Outreach program Senior Citizens program . . " WINTER SCHEDULE October 1 - December 31 Monday - Friday 6:00 am - 7:30 a.m - 10:00 am - 10:30 am - 2;00 pm - 3;30 pm - 3:30 pm - Boys SW1.m club L~censed ch~ld-care opens Paddle tennis classes Aerobl.CS Sen~or Cit~zens b~ngo, card games SW1.mming program After school beach program, boys & girls volleyball, basketball Monday, Wednesday, Fr1.day 6;00 pm - 9;00 pm Senior C1.t1zens dance program, arts & crafts Tuesday and Thursday 7:00 pm - 10:00 pm High School program (includes mov1.es, dancing, exercise) ~ . ~ i Saturday & Sunday 6;00 am Swimmtng sports program and cl~nics 9:00 am Senior Citizens Program (card games, dancing, lunch) 12:00 pm - 4;00 pm Outreach program - Citywide - l.ncludes Jun1.or Olymp1c Development program I i , . I ~ ~ , > , , . { i I , L ~ ~ f . . PROPOSED v~~~:~G PLAN Deta~l your prc9csed ~ke~ng plan J.~d~catJ.~q t.~e strategy to ~e employed to 1~crease ?ubl~c access and ~e proposed publ~c use aspects of ~~e sJ.te k.~own to t~e general publ~c and to commun~ty-based groups. Ind~cate an aggress~ve affi:ma~~7e actJ.on m~~ket1ng program. Such strategy may 1nclude ava~l~ng ~~e publ~c of ex~st~ng trans1t systems fer access to the s~te. PROPOSED M~~ETING PLAN The pr~mary strategy the Trust w11l employ to increase public access w1l1 be the complete ellm1nat~on of the pr1vate club which currently occup1es the s~te. As descrlbed elsewhere 1n t~lS proposal the club will be replaced by a wlde spectrum of public recreat~onal uses and programs. The pub11C w11l be informed of the ava~labl11ty of the facll~ties In a variet~ of ways. RENAMING CONTEST t ~ ~ r i . ~ f ~ , The Trust will lmmed1ately conduct a contest to rename the fac~llty, seeklng a name which both captures the flavor of the new operation and dispells the current 1mage of exclsivity. The contest will be open to both lnd~viduals and organizatlons 1n the general public who will compete for $10,000 in prizes to be awarded. The contest, tne programs, and the public availability of the fac11ity. will be made known throughout the Los Angeles metropolitan area, through the media. Add~tionally, the unique aspects of the program are genuinely newsworthy, and the Trust w1ll actively prusue feature art1cles and stories in printed and electronic med1a. . , i ~ To encourage use of the facility by community groups, the Trust will prepare an announcement of 1ts programs and the availability ot the site. The aDnouncement will then be marketed widely to commun1ty based groups and clubs. Further. the Trust will prepare a descriptive article about the facility and its programs, to be made available free of charge for pUblication 1n the newsletters of community organ1zat~ons. . ~ I t t r t t ~ l i I I 1 t J_ Specif1c affirmative action market1ug wl1l be ach1eved.in two ways: The orgainzed sports and comm11n1ty programs offered a~ the fac1lity will be specif1cally deSigned to reach special populations including the disabled, the elderly, worklng and single parents and economically disadvantaged individuals; for example, the day care center will assist parents. Bingo and card games. dancing and craft classes will reach senior cit~zens. Further, elemen~s of the organized sports programs will be speCifically designed to reach econom~cally disadvantaged ~ndividuals. To this end, the Trust will ass1st in organizing intramural sports comepet1tions through . the numerous parks and recreation departments with1n the Los . . Angeles County area. Individual recrea~~onal units w~thin each departmen~ w~ll conduct compe~it~ve rounds ~n such events as volleyball, track and basketball. Departmen~s can then select f~nal~sts who w~ll all compete at a two-day Jun~or Olymp~cs style event to be hosted for compet1tors, the~r fr~ends and fam~lies and the general publ~c at the fac~l~ty. The second aff~rmat~ve act10n strategy ~nvolves the encouragement of add~tional publ~c trans~t to the site. The Trust will work with local and reg~on&l trans1t systems to provide ~mproved serV1ces from all areas, and 1t will prov~de a site for public trans1t stops. Th1S w1ll create a quasi-publ~c transit ava11ability of the facilit1es shu~tle bus or buses to aSs1st d~sabled ind~viduals ~n reach1ng the s1te. ~ I I ~ ! . ~ [ i E ~ . J I . . PRC?OSED AC~SS p~ L~d~cate ~1e plan you w211 employ to prov~de bea~~ access. rncl~de an estimat~cn ~f v~s~tor use hours per year and ger season. ConsJ.der ~~e site to be ~~e focal :o~nt ~cr ~ncreased use est~mates. Include plans wh~ch w~ll provide for access to beach and fac1:~ty for special populat1ons such as ~~e d~sabled, senior c~t~z~~~ and econonucally dJ.sadvantaged groups. Also l.ndJ.cate your plan to prOV1.de for regularly s~~eduled access to ~~e facility by recreat~on groups. PROPOSED ACCESS PLAN - . f t f t 1 t t t ; l- t 1- ; t . I- Beach access w11l be encouraged by chang~ng the character of ~he fac~l~ty ~nto a publ~c recreat~onal resource. Beach use will be patterned on a European model~ offer~ng a var~ety of opportunities designed to attract a m~x o~ user$. BasJ.c beach access will be free, and services - available equally to the general publ~c - will be provided at competitive fees: e.g., par~ng, lcokers, towels, weight rooms, sports courts, etc. The Trust will prov~de personnel for the delivery of add~t1onal opt~onal services ~ncluding food and beverage del~very, set~J.ng up beach umbrellas, selling sundr1es, etc. Opera~ing revenues will cover the cost of a clean up crew for the faci11ty and the beach area down to the water l~ne. They will also enable the fac~l~ty to contr~bute to the cost of l~feguards for the same area. Est~mates of beach use levels are necessar~11 speculative. Based upon the attract1veness of the s~te and the programs, the food service facilit1es, upon park1ng available on-site, add~tional parking to be secured off-site and served by a shuttle system, and increased publ~c transit to the facil~ty, the Trust conservatively proJects an average da~11 ~Jmmer season use of 2,200 people. The projections break out as follows: F ! i t Publ1c Beach and Recreat~onal Program Use l,OOOjday South Restaurant Use (150 seats turned over 2 times) 300/day ~ r , 1 I I f t Fast Food and Banquet Fac1l1ty Use North Restaurant Use (250 seats turned over 2 times) 400/day SOO/da.y ..s:....=...= PROJECTED SUMMB~ USE 2,200/day Assuming that beach use will average four restaruant users will average a 1/2 banquet facility users will average fac11ity will generate approximately hours during the 120 day snmmf!r season. Off-season use of the tac~lity will be lower; however, hours e&.ch, hours ea.ch and 4 hours each, 800,000 vis1.tor that that the use the '1"1 t l ! ~ f . t f ~ , ~ f . . . D extensive recrea~ional and commun~ty serv~ce programs w~ll encourage a h~gh level ot use. The Trust ant~c1pa~es be~ng able to ma~ntain off-season use at an average da~ly level of 50% of on-season use. Based upon a 240 day off season, that use w~ll generate an addi~~onal approx~mate 800,000 V~S1tor use hoars. Total annual v~sitor use hours are proJected at 1,600,000. (Plans and programs for spec1al populat10ns and recreat10n groups are deta~led 1n ear11er seC~10ns of th~s proposal.) . . PROPOSE~ SITE ?r.A...': Sub~: a scaled s~te plan wh~ch ind~cates locat~on ~f structures, par~~g, ot~er ~provements, B1.ther new constrJ.ct~on or renovat~on or ex~st~ng structures. Include an ar.alys~s of proposed amen.1.t.l.es. Tlle Proposer ~y :lot de:nol.l.sh t.~e Nor~, House, but J.t may be =elocated on ~e site. The North House may be employed for such uses as, but not lJ.mited to, a restaurant or museum open to the general public. The struct1.lre now J..nhabited by the Ocean House restaurant may be expanded as a restaurant. Arch~tectura1 Sensit1V1ty to histor1.cal design should be cons1.dered. See Attached [ , . t ~ ~ ... .- , ~ , ~ ~ f ~ t ~ l ~ i. t i ~ I 11. ~\ -.1 ~ \i ; l i ;. ~ ~i i ~:::l ~...t' ~ ~ ~ \- 'J -tr i ~ ~ ~ ~ ~ 'r- =. _'("" \n. ~ ~.to.... ~ --= '2. ~ ~~ L ~ 'Z. -z. r.- <.: ..,r.. '4 "- ~ ')- - - ~-- ~__cr__ i;, ~ 'T- - - @'@@@@ ~ -~ i ~ ~, ... l ~ '4 .J. ~'l" ~~ '4 -r ~ \- ~~ ~ ~~ ~ ~t ~ ~~ ~ ~ >U\ ~2..~ 'Z. ~ ~ .....s~ "Z. ... ~ "'Z. ~"! ~ ~ ~ ~ ..(. ~ 'lod .. 'l- ',L ~ ~ -~ _8@_~---@ @ ill!iflllllllll!IJllll!I!llili!!fll!11111!111111Ill!O I ~ I .1 j 1 I ~'" ~ ~ <. ~ ~ ')- ~ ~ . " 1 dl ~~ -;:z. ~~ , J:t ~~ =1 rll ,I . d i =:1 \ @ 1\ .0"'1 ""ih...L.t'-'''ililllll~I' '-""1 'I, 'WI '" ...i~,"Hr ,'1'" ':fi~:JJI u , I. II, IJ'. ',:. j Iii III ':-.... :~tl . '"~,'-- - -~ ~ /~ I ' L_ ~ ~ z.. - ':ll. 'i. ~ oS 4 t --J.. ~~~ . 1 ! ~ ~ ---- -- - - ------ - -- /7 -r ~~~ ~-~ -~ 'L ~~ \ t ~ ~ '-S'" ~ '\- \\" ~ ~ - 'L- ~ I. /, \~ - ~ \ . ?ROFOSED SC~E~ATIC E~VATICNS Attach ~ereto your proposed schemat~c eleva~ons. i t f f ! , . I ~ f .. ~ ,. ~ t- i t t f f f i l J See Attached 12. . 1 - ~ \' ~ ., -=- - ~ ~~ ;E l ,--.., z ~ ~ ~ -~ ~ :z. ~ ~. t..../ -- . - --- ---- ~ ~ ~ '\ ,I , " \ , \ \ ., , \ \ , \ , , \. \ I \ \' I \ " \ ;\ \ \ , ., \ \ \ \ \ \ \ \ i \ \ , I I I , '-.....Ji . . PRCPOSE::> USE CPO CrlE1>..NAS. '" APP!.:c.;;au:: Ind~cate YOU4 planned 'JSe of ~~e ex~st~ng cabanas, ~f ~~ey are to =e reta~ned en the crem~ses. If cabanas are to be offered, lJ.mJ.tat~ons on the durat~on of cabana rentals is des~able. Cons~derat~on w~ll be g1ven to ~~e manner of select1ng cabana renters. The m.et.1.od employed should Serve to =urther -=..,e C~tyl s goal of open publ~c ac:;:ess. PROPOSED USE OF CABANAS -- Cabanas w11l be offered t~rough a well-advert~sed publ~c lottery for annual lease. Ten percent (10%) of the cabans will be g1ven without lease charge to the C~ty for ~ts allocat~on to low and moderate income users. For the f1rst year of operat~on, current cabana Sand 'N Sea members w111 be offered a right of f1rst refusal for a single year's lease at ~he publ~cly offered lease rate of such numbers of the cabanas as are left 1n a usable condition upon the vacat10n of the present operator. Upon the expiration of each cabana lease, the leasee shall be treated as any other member of the general public in the process of select~ng lessees for the next or any SUbsequent year. n , l As ~ndicated elsewhere 1n th~s proposal) the income generated from cabana leases will provide the bulk of the revenues needed to operate the publ~c access and community serV1ces programs. ;' . , j 1- i J t to , ,r j t C t l Ii ," " fl ~ ( . .. ~ ! ~ ~ " . ~ I t ~ l ; ~ . . P~~CSE:J rlFF:?J1A'l':~..."E .~CT!O~ :::MPLC~1:E~~T P!';uI rnd~cate ~e plan you w~ll employ to encourage Aff~~t~ve Act~on ~n ecployment pract1ces. Favorable consideratJ.on wlll be g~ven ~o proposals which represent ~~e best effort to ~mplement an aggress2ve and creat1ve af~~~t~'le actJ.on and employment plan and Wh2ch attempts to max~m!ze ~~e part2c~pation of mJ.norJ.ty vendors. PROPOSE~ AFf.IRMATIVE ACTION EMPLOYMENT PLAN The Trust w111 pursue an act~ve atf~rmat1ve act~on program through two strateg~es. F1rst. ~t will require all of i~s sublessess to undertake affirmat~ve act10n recrU1tment and h1ring programs. These programs will be consistent w1th those successful models used by other operators in the food service 1ndustry ~n the Los Angeles Area. Second, the Trust will act~vely recru1t 1ts own employees from the spec1al population groups wh~ch part1c1pate in the Trusts recreat10D and commun~ty service programs. Additionally, successful competitors in the Trust's area-wide sports competit1ons will be offered summer and other employment as opt1onal pr1zes. The Trustts goal will be to meet the aff~rmative action hiring standards ot the State of Cal~fornia. . > . F t < 1. I ! , f . r . f t f t . 1 f f t t ; . . EST!:~TED C:~S~RCCTICN COST Supply a deta~led constr~ct~on cost est1~ate for devAlopm.ent. ,- c-:r ~ "" _ .= a~ ~ opr:::.a..e. ESTIMATED CONSTROCTION COST Public Facil~t~es i~ ~s ant~c~pated that approx~mately $184,500 w~ll be spen~ ~o refurb~sh publ~c fac~li~~es. This ~s only an estimate s~nce ~t ~s ~mposs~ble to determ~ne what cond~~~on ~he fac~l~~~es w~ll be ~n once the current operator vacates. Restaurant Facil~ties - the costs will be born by the sub leasee (operator) of the ~hree restaurant faC11ities. Cabanas-Construct~on Foundat~on and s~te work , ~ ~ ~ . 1 Exter~or sid~ng and labor $24,000 $27,250 $15,075 Fram~ng and lumber Roof $8,000 $26,500 $16,500 $10,550 $1,500 $11,500 $7.000 $2.000 Plumb~ng ~ t Electr1cal (includes f~xture costs) Dry wall Pa~nting Glaz1.ng ! . , ~ r . ~ ~ Finish work (includes materia.l) Clea.n up . f . ~ r i f I J t t l Contingency $18,500 $13,125 Contractors profit and supervision =--==-==- TOTAL CONSTRUCTION COST $181,500 15. . . ::::ST:!~!A':'E OF GROSS ?ECE:~S I. Prov1de your es~~te of the expected average annual gross rece1pts to be J~~~v~~ :~~ill ~ach use or serv~ce re~~1red and for each sJ.gn~f~cant opt~onal use or serv~ce wnJ.ch you plan to provJ.de: A. Dur~ng t.'1e first f~ve operatJ.ng years. B. Dur~ng ~~e second five operat~ng years. I:. Cash Flow Analys~s Develop and attach a cash flow analys~s demonstrat~ng your th~nk~ng W1~~ regard to the proJected ab11J.ty of the proposed development to prOV1de suff1cient reVenue to recapture your ~nvestment. cover operatwg expenses. and y~eld an adequate return to you. '!'!lJ.s cash flow analysis should project your antic~patJ.on through the first ten years of the lease. I t t .. i t ! t r- ~ ( f I . I ! . , t ~ ! . . ! ~ ( I See Attached f . . f , ~ f ! I l ~ . r ~ [ I I r ~ ANNUAL AVERAGE GROSS RECEIPTS 1st 5 Yrs. Of OperatJoon 2nd 5 Yrs. Of Operat~on (1) 3 Restaurant Operat~on 5,030,320 8,056,600 Rent 8% of Gross 402,425 644,528 (1) Less Cap~ta1 Improvements <115,555> <144,444> ~et Revenue 286,870 500,084 All Other Income Cabana 486,900 611,838 Beach & Public Use 250,000 296,138 736,900 907,974 {2} Rerurbl,sh and Construction < 74,400> .a operating Expenses <4l3,250> <459,386> ~49, 250 448,588 Net Income Restaurant Rent 286,870 500,084 All Other 249,250 448,588 TOTAL 536,120 948,672 . . Est~TOate (con ~t) ....~ '-'- :;rcss ~ece~?ts AJ.'mUAL AVERAGE 1st 5 Yrs. 2nd 5 Yrs. GROSS RECEIPTS Of Operation Of Operat~on Income S?l~t (3) C:..ty of Santa Mon~ca 310,677 474,338 Master Lessor & Assoc~ates 225,658 474,338 NOTES (1) We are ant~cipating that the three restaurant operat~ons to be at anticipated Gross Revenue by the end of 3rd year. % ~n~lationary factor has been used from year 4 for~ard. " . Rest. if1 Ocean House Gross 1,500,000 -!f;2 Banquet and Cater~ng Gross 2,000,000 it3 MarJ.on DavJ.s Gross 2,500,000 ~ t . It f r t t ~ I t ~ f I I All lease of restaurants w~ll have m~n~um rent. or 6% gross wh~ch ever ~s greater. Cap~tal~zed improvement cost will be ammoritJ.zed over a max~um perJ.od of 10 years. Estimated cap1talized improvement cost. Rest. *1 =1:2 ~3 300,000 200,000 800,000 (2) It is anticipated that 187,500 wJ.Il be used for constructJ.on of cabanas and an addit10nal 184,500 for pUblJ.c facJ.litJ.es refurbishment. (3 ) Net revenues are split as follows~ $100,000 minimum to City of Santa Monica. Income thereafter is distributed at 60% to City and 40% to master lessor unt~l City's total income is $400,000. Thereafter all 1ncome in excess of the City's $4QO,000 1$ distr~buted to the master lesso~ until 4t is receiving $400,nOO~ All income beyond what is needed to reach that level is split 50%-Scr% Between City and master lessor. ..... ":'\ - - ~ = .: ~ - t ,. ~ ~ f = .... .." - .i.I CJ Q.1 --r :l .. :w Jl CD - ... Q.1 Co ~ ~ ~ In ~ I,C E E r t . ~ .. ~ o o = ... 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(l) I~come - 3 ~estau=ant Fac~:~t~es #1 ;2 Gross ~eceipts 1,500,000 2,000,000 8% of Rece~p't.s 120,000 160,000 Minunum Rent 25,000 35,000 Cap~tal Improve- ments. 300,000 200,000 , ~ - . .,.... 2,500,000 200,000 50,000 800,000 (2} Gross rental ~ncome on restaurants based on 6% inflat~on beg~nning 4th year. (3) Cabana Income - ant~cipates an 1ncrease of 10% every two years. (4) Beach & Publ~c use - ~ncome ~ncludes - park~ng, sports-clin~cs, film location, retail sales of sun~~ (5) Ant~c~pated Equipment and Repa~rs - 1st year W~L~ add~t~onal refurb~shing and equipment 2nd year. - ~ ( 6) Expenses: General manager, office staff and 1nstructors Instructors Ma~ntenance, beach crew, ~nstruction staff - summer season Utilities Insurance Repair up-keep * AccountinqlAudi t (7) Contingency RJM Management Fee 75,000 f ~ i r r , 150,000 30,000 25,000 50,000 25,000 35,000 23,250 :. r , : , t ~ i f ~ p 413,250 * Account1ng and Audit - outside account~ng firm w~ll be hired to supervise all accounts and all procedures not less frequently than weekly. Robert J. Morr~s Group Enterpr~ses manager fee - w~ll receive a management fee on all incomes d~rived directly f~om the proposal venture, except from the banquet fac~lity which they will directly operate. Fee is for execut~ve superv1s~on of all managers, recreational and public serv1ce act~v1ties, oversee~ng of construction and leasing of cabanas. - Ant~c~pates expense to increase proportionatelywith beach and pub11c use income. ~) Net revenues are split as follows: $100,000 minimum to City of Santa Mon~ca. Income tbereafter ~s distributed at 60~ to C~ty and 40% to ~aster lessor until City's total income 15 $400,000. Thereafter all ~ncome in excess of the City's $400,000 ~s distr~buted to the master lessor until ~t ~s receiv~ng $400,QOO. All income beyond what ~s needed to reach that level ~s spl~~ 50%-50% cetween City and master lessor. . L to E f l ~ l . . ?POFOSED CCMPLIA-~~ 3C::EDL~ ~e CITY J.S concerned about t~ely execut~on of any comc~~ents by proposed operator. Present here ~~e schedule you ~ntend to employ to ensure speecy ~plementatJ.on of any agreed upon c.evelopment program. At a :runlllum. the PROPOSER shall offer a ?erformance Bond equal to one year's annual rent or SlOO,OOO, wh~chever l.S greater, to g",Jarantee ~'le compliance wi t.i. a subliU. ttad schedule fer t..'le establishment of tile folloWlllg, ~f appropriate to the enterprl.se: ~arketing plan, beach access plan. lottery, da~ly use, fee schedule, restaurant cons~,Jct~on, extension of bue path and any other actJ.Vl.tJ.es crl.tl.cal to tile J..mplementat~on, includL~g but not l~ted to capl.tal renovatJ.ons. The ?erformance bond =equ~=ed above ~11 be due upon executJ.on of contract. PROPOSED COMPLIANCE SCHEDULE The proposers w~ll offer to. the c~ty of Santa Mon~ca a performance bond ~n the amount of $100,000 ~o guarantee the follow~ng schedule of development upon the formal s~gn~ng of agreements: PUblic Access Beaches and any fac~l~ty not refurb~sh~ng will be opened immed~ately. YarKet1n~ Plan - Will start immediately with renaming contest and med~a--coverage. Advertis~ng and med~a coverage by restaurant operators to follow. need~ng caoanas - Plans and operation to start immediately with first lot~ery to be held within 90 days for those cabanas available for the lottery. Restaurants - Ocean House (south) lease will be s~gned within 60 days, and construction to start w1thin 30 days thereafter, subject to permit process. Estimated opening w1thin 150 days. t l r , i Fast Food and Banquet Facility - Lease will be s~gned within 30 days, with construction to start w1thin 30 days thereafter, SUbJect to permit process. Fast food estimated open1ng within 30 days, banquet facility w~th~n 150 days. t i- i- t t l t i f t f . l North aouse - Lease will be signed with~n 90 days, with construction to start w1thin 60 days thereafter, subject ot permit process, and Histor1cal Society approval. Remainlni Facilities - All refurbishing of facilities ~s subject to condition of property as vacated by current leasee. It is anticipated that 50~ of the refurbiShing will be completed within 150 days and be open before the first summer season. Refurbishing will be done by fac~lity and building with the balance to be completeQ prior to the secoad Sllmm~r sea.son. 17. ~ . t f r ~ I f l l i r r . } [ I . . ?ROPOSER Name: . Mnl1n~r:I' nc: Qpc:t'nr"l+-~ nn '!'1"",'~~ (?lease prJ.nt) Malibu,Ca. '11~1 ~ Or:l~'fi~ r~r:lC:~ Hwy Telephone No.: (?1":l:) .1t\h-:;':;?, The undersJ.gned, b.ereJ.nafter referred to as "PROPOSER" hereby subDU.ts a proposal to the CJ.ty of Santa Monica, hereinafter referred to as "CITY", to lease t.1te property located at 415 PacJ.fic Coast Highway, and currently known as the Sand and Sea Club. Signed: ~1ountains REerat~OI1 Trust \'\\ I .-- -; Bv \"l~l)a I ~J)_ r - Dated: r- ~J1 d~ _ _18. (.." j ge~ ) ~ .~ /