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JUL f" 198
TRANS ADMIN RLA f \trans\admrn\councrl\gateway7
Council Meeting July 14,1998 Santa MOnica, California
TO. MAYOR AND CITY COUNCIL
FROM CITY STAFF
SUBJECT Recommendation to AuthOrize the City Manager to Negotiate and
Execute an Amendment to the Contract with Gateway Outdoor
Advertlsmg
I ntrod uctlon
This report recommends approval of a second modIfication to the City's agreement With
Gateway Outdoor AdvertIsing to Increase the fees paid to the City.
Backaround
On March 22, 1994, the City Council approved a contract With Gateway Outdoor
AdvertIsing to act as concessionaire for the sale of advertIsing space on the Intenors
and extenors of the City'S Big Blue Buses The contract was executed on Apnl 19,
1994 On March 22, 1996, the City and Gateway entered Into a modification of this
agreement to Include front signs, thus increasing the amount paid by Gateway to the
City. Currently, under the agreement and the first modification, the CIty receIves
$620,000 a year, plus additional funds In support of Big Blue Bus programs such as the
Bus Roadeo We are now entering the fifth and final year of the agreement Section 5
of the City's agreement With Gateway states, "Any change, exceeding five percent
(5%), in the City's peak hour fleet shall be considered valid cause for negotiation of
stated rental rates "
(oF
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JUl t" 1998
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At the time the contract was executed, the City's normal weekday peak hour fleet was
96 buses WIth the ImplementatIon of elements of our ServIce Improvement Program,
that number has grown to 118 buses and will reach 122 buses In September City Staff
has negotiated an additional $126/900 In payments from Gateway, whIch Increases the
total annual fee paid by Gateway to $746,900 In addition to Its sponsorship of the Bus
Roadeo, Gateway WIll sponsor the Bus Lines' Awards Program for 1998, as part of the
agreement
Flnanclal/Budaetarv Considerations
The additional $126,900 will be taken as revenue in Account #41-600-656-00000-0421-
10000 The additional revenue has already been Included In the FY 1998-1999 budget.
Recommendation
City Staff recommends that the City Council authOrize the City Manager to enter Into
the attached Second Modification of Agreement with Gateway Outdoor AdvertiSing,
Inc, increasing the concession fees paid to the City
Prepared by: John Catoe, Director of Transportation
Bob Ayer, Assistant Director of Transportation
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