Five Flags Civic Ctr Privatizat
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MEMORANDUM
April 28, 2004
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT:
Five Flags Privatization
After the City Council work session on April 19th where the Five Flags Civic Center review
was presented and private management discussed, I met with SMG and Compass Facility
Management. Assistant City Manager Cindy Steinhauser, Budget Officer Dawn lang,
Personnel Manager Randy Peck, and leisure Services Manager Gil Spence joined me for
these sessions.
Both firms are well qualified to provide private management services for the Five Flags
Center. After careful review of the written material and the presentations made, my
recommendation is Compass Facility Management. This recommendation should not
reflect negatively on the skills and abilities of SMG. The following are the strengths
Compass brings to Dubuque:
. Steve Peters, President of the company, will be our contact person and the Five Flags
staff will be able to contact him any time. The responsiveness and effectiveness of a
smaller organization can sometimes be more effective than a larger organization.
. Compass focuses its business on medium and smaller market public assembly facilities
and has presented a successful track record in that work.
. Compass has a Midwest historic theater network that reflects the needs of Dubuque's
historic Five Flags Theater.
. Compass recognizes the importance of a profitable concession operation and has
offered to provide funding, or raise the necessary funds, to immediately renovate the
three concession stands.
. When discussing how to grow the business at Five Flags, Compass outlined how they
would utilize the theater and improve the ice programming.
. Compass projects to reduce the property tax support for the Center by enough the first
year to offset their fee and by the third year expects the reduction to be $255,000.
In the important matter of transition of current City employees to the new management
company, I would ask approval to negotiate a transition plan into the Management Contract
with Compass, which would begin July 1, 2004. The City currently has two vacancies in
the full-time positions at Five Flags.
The transition plan would consist of the following: The Five Flags Civic Center Manager
Paula Wolfe and all part-time employees would become employees of Compass effective
October 1, 2004. Other management employees, who include Events Coordinator Peggy
Degnan, Building Supervisor John Richardson, Concession Manager John Snider and
Technical Director Dan Holtkamp, would become employees of Compass effective
January 1, 2005. All other positions would become employees of Compass effective
January 1, 2006. Any newly-hired employees would immediately become Compass
employees.
This schedule allows the City the greatest ability to hold Compass accountable for
operation of the facility. It also allows any employees who would like to remain City
employees, time to seek other opportunities. This would be my recommendation for a
transition plan whether the City Council selects Compass or SMG.
I respectfully recommend that the Mayor and City Council direct staff to negotiate a 5-year
Management Agreement with Compass Facility Management to manage the Five Flags
Center beginning July 1, 2004.
(fkJJ ~ AJL
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Gil Spence, leisure Services Manger
Steve Peters, President, Compass
Joe Romano, Regional Vice President - Mid-West, SMG
Dave Baker, President, Teamsters Union
Paula Wolfe, Civic Center Manager
Peggy Degnan, Events Coordinator
John Snider, Concessions Manager
John Richardson, Building Supervisor
Alvy Kennedy, Utility Worker
Robert Richardson, Utility Worker
Daniel Holtkamp, Technical Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
April 27, 2004
TO: Michael C. Van Milligen, City Manager \~
FROM: Gil D. Spence, leisure Services Managet!Jì
SUBJECT: Study to Privatize Management of the Five Flags Center
INTRODUCTION
The purpose of this memorandum is to provide a summary of the process taken to
conduct the review of the Civic Center Division operation, including private
management
DISCUSSION
At the City Council goal-setting session in August 2003, the City Council asked that a
study be done of the operation of the Five Flags Center to see what could be done to
hold the line on, or reduce the property tax support. All options were to be considered,
including private management.
The privatization review was completed with the review committee comprised of the
following individuals:
Gil Spence ....................................... Leisure Services Manager
Paula Jo Wolfe ................................ Civic Center Division Manager
Peggy Degnan ................................. Events Coordinator
John Richardson """"""""""""""" Acting Operations Supervisor
Pauline Joyce .................................. Administrative Services Manager
Cindy Steinhauser ........................... Assistant City Manager
Dawn lang ....................................... Budget Director
Rich Russell ..................................... Building Services Manager
continued
privatization of FF management
page two
The committee met several times to review the present operation of the Center and
made several suggestions to reduce the property tax support. The committee then
began the study of private management for the Center.
A "Request for Proposals" was developed and mailed to five different firms. The
following three firms submitted proposals on February 2, 2004:
SMG
701 Market Street
Philadelphia PA 19106
Kinseth Hospitality Group
2 Quail Creek Circle
North Liberty IA 52317
Compass Facility Management, Inc.
Suite 200 Park Plaza Building
6th and Duff Streets
Ames IA 50010
After the committee reviewed the three proposals, the committee decided interviews
were needed. Mike Brannon and Rod Bakke from the Civic Center Advisory
Commission volunteered to represent the Commission on these interviews. All three
firms were interviewed on February 23rd.
The committee then met to discuss its selection and decided on SMG.
Commission members discussed the issue at length on March 15th and decided more
time was needed to review and study the issue. On April 12th, the Commission met to
determine its recommendation to the City Council. It was decided by unanimous vote
to recommend to the City Council that private management be pursued for the Five
Flags Center. Further, on a 3 - 2 vote the Commission voted to recommend Compass
Facility Management provide the private management services.
Both the Committee and Commission presented their recommendations to the City
Council at a work session on April 19th.
GDS:et
CITY OF DUBUQUE, IOWA
MEMORANDUM
April 23, 2004
FROM:
Michael C. Van Milligen
City Manager.
. Randy Peck rQ
Personnel Manager
TO:
SUBJECT: IPERS Coverage for Civic Center Employees
I visited with an IPERS representative following the April 19, 2004 work session
and she confirmed that the Civic Center employees would have to remain under the
direction and control of the City of Dubuque to continue coverage under IPERS. If the
Civic Center employees become employees of a private management company, IPERS
coverage would be discontinued.
If you have any questions, please feel free to call.
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