To: Mayor and City Council
From: City Staff
Subject: Agreement between the City of
This report recommends that the City
Council authorize the City Manager to negotiate and execute a two-year
agreement with Roth Management for operation and routine maintenance of the
Santa Monica Pier Carousel.
Background
The Looff Hippodrome, built in 1916, is one of the few
remaining original carousel buildings, and the last remaining one on the west
coast. The carousel housed in the
hippodrome was built in 1922 by the Philadelphia Toboggan Co. and has become
one of
Open year-round, carousel rides are currently 50 cents for children over five years and $1.00 for adults; children five years of age and under ride free with a ticketed adult. During 2004-05, 86,307 adults and 37,056 children rode the carousel. Revenue from ticket sales are deposited into the Pier Fund. Children that ride for free are not included in the ridership count. Roth Management estimates that 70% of all children that ride the carousel ride for free.
Discussion
Roth Management has operated the carousel since September
2001. The most recent carousel operating agreement expired June 30, 2005 and
contains a month-to-month holdover provision, currently in effect. In the summer of 2005, staff prepared and
issued a Request for Proposals seeking a qualified entity to operate and
maintain the carousel. The RFP was advertised in the Los Angeles Times,
the City’s website and disseminated through direct mailings to persons on the
City’s interested-parties waiting list.
Roth Management was the only respondent to the
Request for Proposal. During the term of
its prior agreement, Roth Management has provided excellent service to the
City. It routinely maintains the
condition of the carousel and operates and manages the carousel in a
professional manner. The proposed
management fee covers responsibilities that include managing day to day
operations, employee operation training, recording and depositing revenue,
payroll management, paint restoration, repairs, weekly maintenance, and carving
and replacing missing pieces.
The proposed
contract term is for a two-year period that would begin upon execution of the
contract by the City Manager. The City will pay Roth Management an annual
management fee of $88,500, and reimburse Roth Management their costs for staff
salaries and maintenance. These are estimated to be $100,000, based on a
six-day per week operation from mid March through the end of August (closed
Tuesdays), and a five-day per week operation (closed Tuesdays and Wednesdays)
from September through the second week of March (see Attachment A - Carousel
Schedule Hours of Operation).
Roth Management estimates a 36% increase in reimbursement
for employee wages in comparison to the budgeted employee wages from the
previous management agreement. This is
largely due to increases in hourly wages to conform to the City’s living wage policy
and to a 3% increase in Workers Compensation insurance. The management fee increased 8% in comparison
to the fee from the prior management agreement due to an increase in liability insurance
costs.
A recommendation to proceed with selection of Roth
Management Company was approved by the Pier Restoration Corporation Board of
Directors at its February 1, 2006 meeting.
Budget/Financial Impact
Funds are available in the proposed budget for fiscal
year 2005-06 at Account 30625.577240.
Recommendation
It is recommended that the City Council authorize the
City Manager to negotiate and execute an agreement with Roth Management Company
to operate and maintain the Santa Monica Pier carousel for a two-year period as
summarized above.
Prepared
by:
Miriam Mack, Economic
Development Manager
Sheela Voleti, Senior
Administrative Analyst