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01-08-93SpMtg JANUARY 8. 1993 A Special Meeting of the City Commission of the City of Delray Beach, Florida, was called to order by Mayor Thomas E. Lynch in the City Manager's Conference Room at City Hall at 2:10 P.M., Friday, January 8, 1993. 1. Roll call showed: Present - Commissioner Jay Alperin Commissioner Ken Ellingsworth Commissioner Armand Mouw Mayor Thomas E. Lynch Absent - Commissioner David Randolph Also present were - City Manager David T. Harden and City Attorney Jeffrey S. Kurtz Mayor Lynch called the meeting to order and announced that this meeting has been called for the purpose of considering the following: 1. Aw~r~ Qf Contract: T~mporary ~eating for tgDDis tourna- ment. Mr. Ellingsworth questioned if there could be a savings in the future, if the City installs concrete stairs up to the point where the bleachers start. In response, Mr. Digby Bridges of Digby Bridges, Mark Marsh and Associates, stated that this would eliminate two courts. He did not believe that it would be economically feasible for the City to build an 8,000 seat stadium. The temporary seats the City is buying will have the same life as the stadium, about 30 years. After five years, the temporary stairs will be saving the City $5,000 a year and will be fully paid for. If the City did decide to build a permanent stadium, these seats would be used as the vomitories; they are designed and suitable to be used to go into a permanent stadium. Dr. Alperin questioned if leaving the temporary stairs up permanently would eliminate two courts. Mr. Bridges stated that it would. In response to a question from Dr. Alperin with regard to the advantage of having temporary seating over permanent, the City Attorney advised the City would break even over the first five years with the savings coming in years 6 through 15. Dr. Alperin stated the same kind of savings comes if the City buys the entire seating and stores it. Mayor Lynch added that the City would then have the liability and responsibility for storage. Mr. Bridges stated that over the next year the City should consider what it costs to build a stadium and what it costs to set up and store temporary bleachers. Mayor Lynch advised that with the buy-out at $100,000, the City is locked in. Mr. Bridges stated that the buy-out is $65,000. The City Manager advised that the contractor originally stated it would cost $100,000 to buy-out the contract after the first year. Subsequently, it was negotiated down to the City buying and supplying the stairs; then the buy-out would be 865,000. Dr. Alperin stated that actual savings would amount to $10,000. In response, the City Manager stated that it was a $35,000 savings; the City would save $5,000 on the annual rental and $35,000 with the reduced buy-out figure. Mayor Lynch asked if the stairs would only work with the current stadium. In response, the City Manager stated the only other contractor he spoke with indicated that the stairs would have to be built for the City's application. The City Attorney stated he has gone over the principal terms of the agreement with Mr. Hagar of T & B Equipment Company because of some of the City's standard language with respect to contractors' responsibilities. Mr. Hagar would like to have his attorney look at the contract and they will get back to the City with confirmation on Monday, January llth. T & B indicated that they would need 12 days to order the things that need to be specially manufactured for this project. The underfootings on which the actual seats go are in stock. The City has promised the contractor they would have access to the west side of the stadium court by January 25th and to the east side by February 4th. If the City is unable to provide those courts on those dates, for every day thereafter, the City will pay them 81,500 more. At that same time if the contractor feels that they cannot meet substantial completion by February 19th and a final completion by February 26th, provided the City gives them access to the site as specified, then every day after February 26th there would be a penalty to the contractor of $1,500 a day. The $1,500 does not contemplate the damages that the City would incur if the stadium is not ready by the beginning of the tournament. This is a penalty clause, not a liquidated damages clause. T & B seems confident that they can deliver on time. In response to a question from Mayor Lynch, Mr. Bridges stated that the site will be available on the dates required. Mayor Lynch inquired if the main 3,000 seats were concrete or pre-fab. In response, Mr. Bridges stated that the permanent structures are galvanized steel. All of the founda- tions are concrete with concrete pedestals. The cement is al- -2- 1/08/93 ready down for the main flooring and the major steel is going into place now. The City Manager stated additional restroom facilities will be needed when the temporary bleachers go up. Crowd-Pleas- ers (portable bathroom units) will be installed behind the Community Center. In response to a question from Mayor Lynch, Mr. Mouw stated that the contractor appears to know what they are doing and seems to have a good track record. The City Attorney stated the term of the agreement is for five years; a lease of the seats, the general specifications and drawings are included in the contract. The time for performance for this year is as previously reviewed. In years two through five, the contractor is going to be given access to the site as early as six weeks beforehand and will have to complete their work at least 10 days before the tournament; in this way, everything can be turned over to Lidden in accordance with the contract. The contractor needs approximately three to four weeks in order to put the seats in and they will be removed 10 days after the completion of the tournament. The payment is $110,970 for the first year and the City will pay 50% of the lease payment within seven days of signing the agreement. Forty percent will be due upon completion of the erection and ten percent due 30 days after the removal of equipment from the site. Mr. Bridges stated he had requested that the seats be left up through the following weekend in case the City wants to use the seats. He questioned if that had been put into the contract. It was the City Attorney's recollection that this matter was mentioned to the contractor; however, the City has not received a price quote. Mr. Ellingsworth stated he thought the City was being limited with the 10 day removal clause. He suggested 30 days may be more appropriate. Mr. Ellingsworth explained that he would not want the City to incur another $100,000 to put the seats back up within a month of taking them down if another event was scheduled. The City Attorney stated he would make further inquiry and bring that item back before the Commission. The City Manager interjected that the contractor wanted to get experience before giving the City a price. The contractor's preference would be to negotiate after they have gotten through the first tournament. He believes that the City can negotiate a better deal then. -3- 1/08/93 The City Attorney stated several options are contained in paragraph six of the contract. The first of which is the purchase of the stairways. The contractor is agreeable to the purchase of that equipment, then selling it to the City at their cost. Under the agreement, the City would have until March 1, 1993 to exercise that option. Mr. Ellingsworth questioned if the contractor would consider a lease option, if the City decided after the first year not to purchase the stairs. In response the City Attorney stated the City would not get the equipment at that price. In response to a question from Mayor Lynch with regard to extending the option-to-purchase date to April 1, 1993, the City Attorney stated if the City went to April 1st, the stairs would have to be shipped back because everything will be off the site. Mayor Lynch stated that he would like to see the stairs in use during the tournament before making a decision to purchase. The City Attorney advised that, if the option is executed, the annual lease payment would be reduced by $5,000, down to $105,970. The options to terminate the agreement is either to buy-out after the first year, which would cost the City $65,000 or buy-out after the second year at $50,000. This option must be exercised by September 1, 1993. Mayor Lynch suggested that two changes be made to the insurance form. In paragraph 7.311 the limits should be modified to meet the standards for umbrella policies today. In paragraph 7.321 the City Attorney should ask for an umbrella policy instead of excess coverage. On the vehicles, paragraph 7.331, the coverage should be $500,000. In response to a question from Mayor Lynch with regard to paragraph 7.34, 7.342 and 7.35, the City Attorney responded for loses over $10,000 the settlement shall be jointly payable to T & B and the City. The City does not pay for any additional insurance. Additionally, coverage will be with a B+ company which is a standard requirement in all City agreements. The City Attorney stated the rest of the contract is fairly standard and covers the City for the five year period. Mayor Lynch questioned if there was a provision in the contract to allow the City to buy out the equipment from T & B, without penalty, should they go out of business or bankrupt. The City Attorney stated there is an automatic termina- tion at that point in time. If the company actually went into bankruptcy, he did not know if it would be enforceable for the City to buy out T & B, as the stairs would be an asset of the corporation. -4- 1/08/93 Mr. Ellingsworth questioned if there was an escape clause which would allow the City out of the contract should Lidden decide not to have a tournament in the City. The City Attorney stated the escape clause is only good until September 1993. If the escape clause is not executed by September, the City would have to pay the $110,000. The City Manager stated that Liddy owns the tournament rights; wWhat expires in two years is the contract with Virginia Slims. n response to a question from Mayor Lynch with regard to increasing the penalty from $1,500 a day for the first year and $500 a day during the second through fifth year, the City Attorney stated the City asked for $3,000 per day, which the contractor rejected and came back with $1,500 a day. The way this item is structured is that it is a penalty, not liquidated damages. There is the potential for further damages if T & B does not get the work completed. The same applies during the second and fifth years. The City Attorney explained it has been his experience, when dealing with contractors, that if a heavy penalty is thrown at them they want more money for assuming that potential risk. Mr. Mouw moved for approval of the contract as present- ed, seconded by Dr. Alperin. Upon roll call the Commission voted as follows: Mr. Mouw - Yes; Dr. Alperin - Yes; Mr. Ellingsworth - Yes; Mayor Lynch - Yes. Said motion passed with a 4 to 0 vote. Before roll call the following discussion was had: The City Attorney requested authorization to make changes to the contract to correct typographical errors or other small items. Any material changes will be brought back before the Commission for approval. At this time the roll was called to the motion. Dr. Alperin requested research be done on the changes in the stadium which required a change in the stands. He was not made aware of a change in the stadium which has caused the change in the stands. The architect told the Commission at the last meeting the original stands were designed to go on ground level. In response, Mr. Bridges stated no changes were made except when it was decided, because Lidden preferred to have seats all the way around the stadium. At one time, the stadium was to be a U-shaped stadium with seats starting at ground level and going up one side. That decision was changed because Lidden did not like that scenario and wanted the good box seats all around. -5- 1/08/93 Dr. Alperin stated someone made the decision and he wants to know who is responsible. The City Manager stated prices were received for both scenarios. The initial price was $6.75 to $7.25 for seats start- ing at the ground level. After the City learned that the seats were going to be up in the air some distance, staff went back and asked for prices starting at 14 feet above ground level, and got a price of $10.00 a seat from two different vendors. The City Attorney stated that a motion is needed to declare an emergency under Section 30.15 of the Code of Ordinanc- es and waive all of the purchasing ordinances, because this con- tract was not done in accordance with normal purchasing proce- dures of the City. Mr. Mouw moved to declare an emergency and waive all the purchasing ordinances, seconded by Dr. Alperin. Upon roll call the Commission voted as follows: Dr. Alperin - Yes; Mr. Ellingsworth - Yes; Mayor Lynch - Yes; Mr. Mouw - Yes. Said motion passed with a 4 to 0 vote. Mayor Lynch declared the meeting adjourned at 2:50 P.M. ATTEST: The undersigned is the City Clerk of the City of Delray Beach and that the information provided herein is the minutes of the meeting of said City Commission of January 8, 1993. which minutes were formally approved and adopted by the City Commission -6- 1/08/93 If the minutes that you have received are not completed as indi- cated above, then this means that these are not the official minutes of the City Commission. They will become the official minutes only after they have been reviewed and approved which may involve some amendments, additions or deletions to the minutes as set forth above. -7- 1/08/93