AWARD OF REQUEST FOR PROPOSAL 16-13 AND APPROVE EXPENDITURE OF FUNDS FOR ARENA MANAGEMENT WITH AEG MANAGEMENT GLENDALE, LLC
Staff Contact and Presenter: Kevin R. Phelps, City Manager
Staff Contact and Presenter: Michael D. Bailey, City Attorney
Staff Contact and Presenter: Tom Duensing, Assistant City Manager
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Purpose and Recommended Action
Recommendation [enter the recommendation here]
This is a request for City Council to authorize the City Manager to enter into an agreement with AEG Management Glendale, LLC, for management of the City-owned Gila River Arena and to approve the expenditure of funds in an annual amount not to exceed $5,600,000 for Arena Management services. The initial term of the agreement will be for five (5) years with an additional five (5) year renewal option, subject to City Manager approval.
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Background
The current amended Professional Management Services and Arena Lease Agreement (Arena Agreement) terminates June 30, 2017. Included in the current agreement is the City's option to replace the Arena Manager at any time after June 30, 2016.
In order to enter into an arena management contract that is market-based, the City issued a request for proposal (RFP) on October 19, 2015, for potential arena managers with original responses due back to the City on December 11, 2015. Changing an Arena Manager is a complicated, multi-month undertaking, and the City endeavored to ensure a) a market-based agreement could be developed, b) the City could minimize its financial risk, and c) the Arena Manager could maximize the potential of the facility and Westgate.
The City received three responses to the Arena Management RFP, coordinated subsequent proposer presentations, and based on an extensive evaluation process, the City issued a Notice of Intent to Award to AEG Facilities ("AEG") on February 3, 2016. The City has been in contract negotiations with AEG for an Arena Management Agreement that is advantageous to th...
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