the mission of ocfec is… celebration of orange county … · the mission of ocfec is…...

The mission of OCFEC is

CELEBRATION OF ORANGE COUNTYS COMMUNITIES, INTERESTS, AGRICULTURE AND HERITAGE

(with results justifying resources expended)

NOTICE OF MEETING 32ND District Agricultural Association

OCFEC Board of Directors Thursday, October 27, 2011

10:00 a.m.

Administration Building OC Fair & Event Center

88 Fair Drive Costa Mesa, California

Board of Directors

Joyce Tucker, Board Chair

Douglas La Belle, Vice Chair David Ellis, Member

Kristina Dodge, Member Gary Hayakawa, Member

Dale Dykema, Member Ali Jahangiri, Member Nick Berardino, Member

Gerardo Mouet, Member

Secretary-Treasurer 32nd DAA Counsel Dr. Steven Beazley Roger Grable President and CEO, OCFEC Manatt, Phelps and Phillips

Those persons wishing to attend the meeting and who may require special accommodations pursuant to the provisions of the Americans with Disabilities Act are requested to contact the office of the 32nd District Agricultural Association (714) 708-1500, at least five working days prior to the meeting to insure the proper arrangements can be made. At the discretion of the Board of Directors, all items appearing on this Agenda, whether or not expressly listed for action, may be deliberated and may be subject to action by the Board of Directors. The Board may convene to closed session pursuant to Government Code section 11126, subdivisions (a) and (e) to consider personnel evaluation and/or possible litigation. Items may not necessarily be taken up in the order shown on this Agenda. This agenda, and all notices required by the Bagley-Keene Open Meeting Act are available on the Internet at: www.ocfair.com

AGENDA

1. CALL TO ORDER All matters noticed on this agenda, in any category, may be considered for action as listed. Any item not so noticed may not be considered. Items listed on this Agenda may be considered in any order, at the discretion of the chairperson.

2. THE MISSION OF OCFEC ISCelebration of Orange Countys Communities, Interests,

Agriculture and Heritage (with results justifying resources expended). 3. PLEDGE OF ALLEGIANCE 4. ROLL CALL (Policy Reference: 4.5.2.B) 5. CEOS ORGANIZATIONAL ANNOUNCEMENTS AND UPDATES 1. Orange County Wine Society 2. Centennial Farm Foundation 3. Update on CDFA Fairs Consortium on Fair Governance 4. Other 6. MATTERS OF PUBLIC COMMENT - Speakers are requested to sign in prior to the start of

the meeting and are limited to three minutes. Public comment is allowed on issues NOT on the current Agenda. However, no debate by the Board shall be permitted on such public comments, and no action will be taken on such public comment items at this time, as law requires formal public notice prior to any action on a docket item.

Comments will be accepted on Agenda items during the meeting. Speakers wishing to address the Board on items on the agenda are requested to sign in prior to the start of the meeting and identify the agenda item[s] on which you desire to address the Board. Speakers are limited to three minutes.

7. MINUTES: A. Board Meeting held September 22, 2011 Action item 8. CONSENT CALENDAR: (Policy Reference: 4.3.4)

All matters listed under Consent Calendar are operational matters about which the Board has governing policies, implementation of which is delegated to the CEO. They will be enacted in one motion by category in the order listed below. There will be no discussion of these items prior to the time the Board of Directors votes on the motion, unless members of the board, staff or public request specific items to be discussed separately and/or removed from this section. Any member of the public who wishes to discuss Consent Calendar items should notify the Chair of the Board, at the time requested and be recognized by invitation of the Chair to address the Board. AGREEMENTS: A. Standard Agreements: SA-264-11NY; SA-265-11NY; SA-266-11NY; SA-267-11NY

B. Amendements: SA-13-11EM ; SA-14-11PS; SA-65-10PS; SA-228-08SC C. Rental Agreements: R-180-11; R-181-11; R-182-11; R-184-11; R-186-11; R-187-11;

R-188-11; R-189-11; R-190-11; R-191-11; R-192-11; R-193-11; R-194-11; R-195-11; R-196-11; R-197-11; R-198-11; R-199-11; R-200-11; R-201-11; R-202-11; R-203-11; R-204-11; R-205-11; R-206-11; R-207-11; R-208-11; R-209-11; R-210-11; R-211-11; R-212-11; R-213-11; R-214-11; R-215-11

-End of Consent Calendar-

9. GOVERNANCE PROCESS

A. OC Marathon Contract Action item B. Swap Meet RFP Action Item C. Carnival/Midway Contract Action Item D. 2012 Operating Budget Action Item

10. CLOSED SESSION (Closed to the Public) A. Lease Negotiations with Tel-Phil Enterprises and Potential Litigation Pursuant to the

provisions of Government Code Section 11126(c)(7) and 11126(e)(2)(C)(i) the Board of Directors will meet in closed session to advise its negotiators, Joyce Tucker, Dale Dykema, and Steve Beazley, with respect to the terms and conditions of the lease of a portion of the Orange County Fairgrounds known as Main Parking Lot A with Tel Phil Enterprises, Inc. Negotiations would be conducted with Jeffrey Teller of Tel Phil Enterprises, Inc or his representatives. Should the negotiations not prove successful the Board will consider the initiation of litigation in order to protect the rights of the Association under the lease.

11. BOARD OF DIRECTORS MATTERS OF INFORMATION 12. NEXT BOARD MEETING: NOVEMBER 17, 2011 13. ADJOURNMENT Respectfully submitted, OC Fair & Event Center

Dr. Steven Beazley Secretary-Treasurer President and CEO, OCFEC Date of notice: 3:00 p.m. October 17, 2011

MINUTES OF OCFEC BOARD OF DIRECTORS MEETING HELD SEPTEMBER 22, 2011

1. CALL TO ORDER:

Chair Ellis called the meeting to order at 10:00 a.m. 2. MISSION STATEMENT: Chair Ellis recited the OCFEC Mission Statement. 3. PLEDGE OF ALLEGIANCE:

The Pledge of Allegiance was recited by Director Jahangiri and roll call taken.

4. DIRECTORS PRESENT: Chair Ellis, Vice Chair Tucker, Director Dodge, Director Dykema, Director Hayakawa, Director La Belle, Director Jahangiri, Director Berardino, and Director Mouet DIRECTORS ABSENT/EXCUSED: None

OTHERS PRESENT: Steve Beazley, President and CEO; Sharon Augenstein, CFO; Doug Lofstrom, VP of Events; Jerome Hoban, VP of Operations; Katherine McCoy, court reporter; Larry Sasson; Jeff Willson, OCFEC; Roger Grable, counsel; Steve Edwards, counsel; Ryan Miller, OCMP; Jeff Teller, OCMP; Stewart Suchman, OCMP counsel; Ruben Smith, OCMP counsel; Ed Buck, OCFEC; Ed Straub; Reggie Mundekis; Robin Wachner, OCFEC; Dan Gaines, OCFEC; Norberto Santana, Voice of OC; Niyaz Pirani, OCEA; Cathy Yatch; OCEA; Joe Serna, Daily Pilot; Bob Mosley; Charlene Leavett, RCS; Theresa Sears, OCFPS; Sandra Genis; Alex Vellandi; Nick Nicora, Ovations; Charlie Neary, Ovations; Nicol Shefmire; Rosey Bally; Jim Mosher; Rick Hanson; Denny Walch, Delaware North; Mike Robbins; Jeanine Robbins; Beth Kelley; Mark Knass; Claudia Agudelo; Dan Joyce, City of Costa Mesa; Greg Ridge; Roy Englebrecht; Dr. Janice Posnikoff

5. CEOS OPERATIONAL UPDATE

Dr. Steven Beazley, OCFEC President & CEO, presented a video recap of media coverage of the 2011 OC Fair. Sharon Augenstein, OCFEC CFO, presented the financial review of the 2011 OC Fair. Beazley then announced the pending retirement of Doug Lofstrom, OCFEC Vice President of Events.

OC FAIR & EVENT CENTER, 32ND DAA MINUTES OF THE BOARD OF DIRECTORS MEETING SEPTEMBER 22, 2011, PAGE 2 OF 10

Lofstrom read a prepared statement explaining his plans for the future.

6. MATTERS OF PUBLIC COMMENT

Alex Vellandi, former OCFEC Director, thanked staff for a job well done. Beth Kelley, equestrian, commented upon the Fairs use of a portion of the equestrian center during the Fair. Sandra Genis, OCFPS, commented upon increased Fair attendance and revenue, suggesting that these numbers contradict the notion of parking limitations at OCFEC. She then suggested that staff reach out to neighbors before proceeding with the Pacific Amphitheatre renovations. Lisa Sabo (on tape) commented upon the lack of public comment at the August meeting and the loss of quorum. She then commented upon comments regarding the OCFPS made by Beazley in the OC Weekly and about parking at the equestrian center. Theresa Sears discussed the nature of public comment. She then discussed a 2009 public records request, particularly regarding a Nossaman invoice. Greg Ridge commented upon how much he enjoyed the 2011 OC Fair, particularly the OCTA direct-route buses. He then commented upon parking issues at the OC Fair, providing time for public comment during public meetings, and the Board members making time for meetings.

7. MINUTES: A. Board Meeting held June 23, 2011 Action item

ACTION: Director Hayakawa motioned and Director La Belle seconded to review and approve the minutes from the Board meeting held June 23, 2011. MOTION PASSED WITH DIRECTOR BERARDINO AND DIRECTOR MOUET ABSTAINING

B. Board Meeting held August 25, 2011 Action item

Director Berardino asked that the August 25, 2011 Minutes be amended to reflect that the public comments were moved to the end of the meeting.


ACTION: Director La Belle motioned and Director Hayakawa seconded to review and approve the minutes from the Board meeting held August 25, 2011, with the amendment reflecting that the public comments were moved to the end of the meeting. MOTION PASSED WITH VICE CHAIR TUCKER ABSTAINING

8. CONSENT CALENDAR

AGREEMENTS: A. Standard Agreements: SA-259-11LS; SA-260-11PS; SA-261-11PS;

SA-262-11GE; SA-263-11PS B. Amendements: SA-03-07PA; SA-82-09FV; SA-222-11PS;

SA-01-09TR C. Interagency Agreements: none. D. Rental Agreements: R-144-11; R-156-11; R-162-11; R-165-11;

R-166-11; R-167-11; R-168-11; R-169-11; R-170-11; R-171-11; R-174-11; R-175-11; R-176-11; R-177-11; R-178-11; R-179-11

Chair Ellis asked to discuss Amendment SA-01-09TR. Hoban explained that it was for the option year on an existing contract. Director Berardino thanked staff for providing copies of the rental agreements to Board members. ACTION: Director Dykema motioned and Vice Chair Tucker seconded to review and approve the Consent Calendar. MOTION PASSED UNANIMOUSLY

9. GOVERNANCE PROCESS:

A. Board Chairs Report on History of the Sale of the OC Fairgrounds Information Item Chair Ellis presented his report on the history of the sale of the Orange County fairgrounds. He then presented a timeline and governance details regarding the creation of the OC Fair & Event Center Foundation, specifically noting the prohibition of any Foundation Directors profiting from the non-profit. Reggie Mundekis commented upon Chair Ellis timeline and presented her timeline and documentation for review.


Theresa Sears commented upon Chair Ellis timeline and requested copies of the documents discussed by Chair Ellis. Sandra Genis commented upon Chair Ellis timeline and the creation of the OC Fair Preservation Society. Greg Ridge commented upon Chair Ellis timeline, stating that it was too little too late. Director La Belle asked about the May 2009 agreement with LSA and the scope of work. Beazley stated that LSA was contracted in 2001 to help facilitate the Master Plan. In 2009, LSA was contracted to conduct a supplemental EIR for land use at the equestrian center. The supplemental EIR was never completed due to the governors plan to sell the property. Director La Belle then asked about the hiring of subcontractors by LSA and to be provided with the dollar amount billed against the 2009 contract with LSA. Director La Belle asked about the appraisal and why it was stopped. Beazley explained the details of the appraisal process and subsequent cancellation. Beazley explained that a company was contracted through LSA to conduct an appraisal of the fairgrounds but was unable to complete the appraisal due to the lack of relevant comps on the market. Director La Belle then asked Beazley to provide an update regarding the CDFA Fairs Consortium. Lofstrom was then asked to explain the LA County Fair business structure.

B. Review and Approve Establishing an OC Fair and Events Center Citizens Oversight Committee

Action item

Director Berardino presented the item, motioning for the formation of a Fair and Events Center Citizen Oversight Committee. The purpose of the committee would be to investigate and issue a public report regarding the proposed sale of the fairgrounds. To that end, the committee would compile and review all information related to the proposed sale, including but not limited to all related documents, emails, records, minutes, memos and contracts. The committee would be charged with completing its work and issuing its report, to include findings and recommendations going forward, within 180 days of its formation. The committee would be comprised of two members from


each of the following interested constituencies: Orange County Fair Preservation Society, Orange County Fairgrounds Equestrian Center, Orange County Market Place vendors, Orange County Business Council, OC Fair & Events Center Executive Management, bargaining unit representatives, and fairground adjacent homeowner associations. Greg Ridge, Sandra Genis, Dr. Janice Posnikoff, and Theresa Sears spoke in support of the committee. Roy Englebrecht suggested that if this motion passes it should establish an advisory committee not an oversight committee. Chair Ellis asked if this committee would be subject to Bagley-Keene and if those with economic interest in the property would be allowed to serve. Roger Grabel, OCFEC legal counsel, answered that the committee would be an advisory committee subject to Bagley-Keene and members would be required to adhere to FPPC guidelines regarding Form 700-Statement of Economic Interests. Director La Belle introduced a motion to emphasize that the property is the Orange County Fair & Event Center and recommended the establishment of OCFEC advisory committee comprised of one member from the Orange County Fair Preservation Society, one member from the Orange County Fairgrounds Equestrian Center, one member from Orange County Market Place vendors, one member from the OC Business Council and one member from each incorporated city in the county, to present a report within 180 days with recommendations relative to moving forward with the OCFEC five-year business plan. The motion was not seconded. ACTION: Director Berardino motioned and Director Mouet seconded to review and approve establishing an OC Fair & Event Center Citizen Oversight Committee. MOTION FAILED WITH DIRECTOR BERARDINO AND DIRECTOR MOUET VOTING YES. Director La Belle reintroduced his previous motion. Motion failed to be seconded. Recess was taken from 12:29 p.m. to 12:41 p.m.

C. 10 Year Financial Performance of Outdoor Market Place and Lease Considerations

Action item


Beazley prefaced the item explaining the contractual relationship with

Tel Phil Enterprises. Sharon Augenstein, OCFEC CFO, presented OC Market Place

financial trends. Director Berardino asked if staff had done any market comparisons.

Augenstein stated that the presentation was based upon figures provided by Tel Phil and OCFEC performed no comparisons.

Chair Ellis asked if the rent reduction had any noticeable effect on

Market Place performance. Augenstein replied that the decline has continued despite the rent reduction.

Steve Edwards, OCFEC legal counsel, presented a timeline regarding

issues pertaining to the market place contract. Ruben Smith, Tel Phil legal counsel, spoke on behalf of his client

stating that certain issues presented by Edwards are not issues under the lease. He also took exception to claims that the market place model is failing, stating that business is up 4% over 2010 and is projected to be up 8% at the end of the year. Smith reminded the Board that Tel Phil recently paid $150,000 to OCFEC for disputed sweeping charges. Smith then emphasized that Tel Phil is not in default regarding the lease.

Mark Knass commented upon the staff report stating that the decision

to terminate the lease cannot be based simply upon money but what the Market Place provides to the community.

Claudia Agudelo talked about the success she has achieved due to her

experience at the Market Place. Greg Ridge commented upon the importance of the Market Place. Reggie Mundekis stated that numbers cannot be looked at in isolation. Denny Walch, Delaware North, stated that Delaware North would be

interested in bidding on the lease and would provide a space for every Market Place vendor.

Claudia Agudelo spoke again in support of the Market Place. Jeanine Robbins spoke in support of the Market Place.


Vice Chair Tucker presented the Tel Phil Subcommittees report

regarding the lease negotiations. Director Dykema discussed the difficult nature of OCFECs relationship

with Tel Phil. Director Mouet stated that Tel Phil has made up the rent shortfall and

he values the relationship, however difficult, with the Market Place. Director Jahangiri congratulated Jeff Teller on building a successful

business. However, he stated, it is important for the tenant to have a relationship with the landlord. It is the Boards job to direct staff regarding vision but not to dictate operational particulars to staff.

Director Berardino stated that he would not support the motion due to

the long term relationship, the current economic conditions, and Tel Phil not being in default of the lease.

Director La Belle and Director Jahangiri asked that the RFP include

language that gave current Market Place vendors right of first refusal for the new operator.

Chair Ellis stated that it is incumbent upon the tenant to get along with

the land lord. He stated that he supported amending the recommendation to include protections for the current vendors.

Jeff Teller, Orange County Market Place, stated that while he believed

some of the Board members were willing to negotiate in good faith, he would not be forced to negotiate under the threat of eviction. He stated that he is committed to working towards an equitable solution for his company and the District as well as the Market Place vendors.

ACTION: Director Dykema motioned and Director La Belle seconded to approve the Tel Phil Subcommittees recommendation that: (1) The District immediately notify Tel Phil that the District has exercised its right to terminate the Outdoor Market Place Lease dated August 1, 2005 (as amended) as of a date 18 months after Tel Phil's receipt of such notice; (2) The Staff is directed to report back to the Board at its next meeting with respect to initiatives to replace any revenues which may be lost by terminating Tel Phil pursuant to the foregoing; and (3) The Staff is directed to immediately conduct a request for proposal to contract with a swap meet operator on the expiration of the current


lease with Tel Phil, such RFP to be publicly available on or before November 1, 2011 with the goal of completing the same on or before December 31, 2011. The RFP will include reasonable protection for existing vendors. MOTION PASSED WITH DIRECTOR MOUET, DIRECTOR DODGE AND DIRECTOR BERARDINO VOTING NO.

D. OCFEC Employee Recognition Program Action Item Staff requested that Item 9D be continued to the October 27 meeting. E. Pacific Amphitheatre Project Action item

Jerome Hoban, Vice President Operations, presented the staff report and recommendation. Phase 1 of the project, estimated to cost $4.5 million with an expected completion date of July 2013, would include cutting an entry through the berm, relocate the Memorial Gardens exhibit building, create a small entry into amphitheatre, construct retaining walls and monuments, construct box/office and ticketing locations, and construct waterscapes and landscape. Sandra Genis expressed concerns about sound mitigation and SEQA documentation for this project. She also expressed doubt regarding the idea that Memorial Gardens had no historical value. Chair Ellis, Director Hayakawa and Director Jahangiri expressed concerns regarding sound mitigation and possible environmental issues stemming from the removal of the berm. Discussion ensued regarding possible financing options to accelerate completion of all four phases. ACTION: Director La Belle motioned and Director Dykema seconded to review and approve facility architectural concept and preliminary cost estimations for the Pacific Amphitheatre. Approve Staff to execute Phase I of the Pacific Amphitheatre facility project not to exceed $4,500,000. Staff is to provide a supplemental report to the Board in early 2012 that would provide two options: proceeding on a cash flow basis with Phases 2-4 versus combining 2-4 and financing as one phase. MOTION PASSED UNANIMOUSLY


F. Carnival/Midway Contract Action item Staff requested that Item 9F be continued to the October 27 meeting.

G. Food and Beverage Contract Action item

Lofstrom introduced Nick Nicora and Charlie Neary from Ovations and presented the staff report and recommendation. The proposed agreement includes a $600,000 capital contribution for a commercial kitchen; non-exclusive beer sales, use of two permanent concession stands by Ovations; rental rate for four independent beer concessionaires increasing from 40% to 52%; and a yearly 7% accrual fund for Pacific Amphitheatre beer sales paid by Ovations. ACTION: Director Dykema motioned and Director Dodge seconded to approve commencement of the November 2008 Board action to exercise the six year option of the contract that was to begin in 2009 and now to begin in 2012. MOTION PASSED UNANIMOUSLY

H. OC Marathon Contract Action item Chair Ellis recused himself from the discussion.

Lofstrom introduced Gary Kutscher, OC Marathon, and presented the staff report and recommendation. Staff recommended approval of a five year agreement with the OC Marathon for use of OCFEC facilities during the weekend that includes the first Sunday in May in exchange for a minimum guarantee of $100,000 per year predicated on exclusive use of the parking lots. Staff also recommended exercising exclusive use of the weekend as provided for in the second amendment of the Outdoor Market Place lease agreement dated April 1, 2009. Kutscher explained that OCFEC would realize over $100,000 in revenues through building rentals, parking fees, and food and beverage sales. Director Berardino stated that, in light of the cancellation of the Tel Phil lease, he believed the proposed contract with the OC Marathon constituted a gift of public funds. Director Berardino recommended tabling the item until the October meeting.


Theresa Sears asked if the Marathon paid for use of the property for their 2009, 2010, and 2011 events. She then stated that it would be good to see a full report pertaining to the marathon but it didnt look the proposed agreement was a gift of public funds. MOTION: Director La Belle motioned and Director Berardino seconded to continue this item until the October 27 board meeting. MOTION PASSED WITH DIRECTOR DYKEMA AND DIRECTOR HAYAKAWA VOTING NO.

I. Review of Board of Directors Nominating Task Force Recommendation and Election of Board Officers

Action item

Director Dykema presented the committee report and recommendation. ACTION: Director Dykema motioned and Director Hayakawa seconded to review and approve the Nominating Task Forces recommendation, electing Joyce Tucker as Board Chair, Doug La Belle as Vice Chair, and Steve Beazley as Secretary/Treasurer. MOTION PASSED UNANIMOUSLY

10. CLOSED SESSION

No closed session. 11. BOARD OF DIRECTORS MATTERS OF INFORMATION

Director Hayakawa congratulated staff on a fine Fair.

12. NEXT BOARD MEETING: OCTOBER 27, 2011 13. ADJOURNMENT

Meeting adjourned at 4:23 p.m.

______________________________________ David Ellis, Chair _______________________________________ Dr. Steven Beazley, President & CEO

OC FAIR & EVENT CENTER STANDARD AGREEMENTS FOR BOARD APPROVAL

CONTRACT # CONTRACTOR DESCRIPTION EFFORT TYPE TERM RECEIPT AMOUNT EXPENSE AMOUNTSA-264-11NY Joe Alessandro Elton The Early Years - Elton John tribute - New Year's Eve Performer Block Party 12/31/11 - 1/1/12 $2,500.00SA-265-11NY David Brock Wild Child - The Doors tribute - New Year's Eve Performer Block Party 12/31/11 - 1/1/12 $7,500.00SA-266-11NY JT Enterprises The Joshua Tree - U2 tribute - New Year's Eve Performer Block Party 12/31/11 - 1/1/12 $3,000.00SA-267-11NY NA NA NA NA NA

Amendments

SA-13-11EM Lisa Sexton Entertainment Marketing & Talent Buying Services for Pacific Amphitheatre Fair1/1/12 - 12/31/12(1st Year Option)

Amend the original contract with the first year option to renew.

$150,000

SA-14-11PS RK Diversified Entertainment, Inc. Production Services for Pacific Amphitheatre Fair 1/1/12 - 12/31/12(1st Year Option)

Amend the original contract with the first year option to renew.

$106,220

SA-65-10PS Richard J. Coulter & Associates, Inc. Carnival Ride Safety Inspection Services Fair 7/1/12 - 8/18/14(3-Year Option)

Amend the original contract with the three (3) year option to renew.

$163,000

SA-228-08SC Moor + South/Pier Management Co. dba California Partnership Marketing Group Corporate Sponsorship Services Interim 11/1/11 - 10/31/12(2nd Year Option)

Amend the original contract with the second year option to renew.

$207,285

OC FAIR & EVENT CENTER RENTAL AGREEMENTS FOR BOARD APPROVAL

RA # CONTRACTOR EVENT DESCRIPTION FACILITIES DATES CONTRACT AMOUNTR-180-11 Seabirds Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per day

R-181-11 Republican Party of Orange County Michelle Bachmann Rally Political Rally Pac Amp Box Office Concourse 9/16/11 $4,462.00

R-182-11 Roy Englebrecht Ent. Fight Club OC Special Event The Hangar 9/30/11 $14,851.00 R-184-11 Mun Chee5 Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per dayR-186-11 Front Porch Pops Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per dayR-187-11 Speedway International, Inc. Speedway Award Ceremony Awards event Baja Blues 10/23/11 $426.00 R-188-11 Orange County Wine Society Chili Cook Off Members only event Courtyard 10/23/11 $1,615.00

R-189-11 Jackson-Dawson Communications Chevy Sonic Ride and Drive Ride and drive Buildings 14, 16 and Lot I 11/9/11-11/11/11 $19,576.00

R-190-11 Davis Research Davis Research Automotive Market Research event Market research event Building 14 11/17/11-11/20/11 $13,513.00

R-191-11 Rancho Rocke Barbecue Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-192-11 Oh For Sweets Sake Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $40 per unit, per dayR-193-11 Seabirds Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-194-11 Slapfish Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-195-11 Sexy Burger Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-196-11 Piaggio Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-197-11 OC Food Truck Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-198-11 Bacon Mania Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per day

R-199-11 Share Our Selves Adopt-a-Family program Delivery and pick up for Adopt-a-Family programBuildings 10, 12,

Parade of Products and Courtyard

12/19/11-12/22/11 $1,905.00

R-200-11 The Dirt Racing RC Track Radio Controlled track racing Livestock Corral 10/15/11 No charge/sound studyR-201-11 Chef Joe Youkhan's Tasting Spoon Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-202-11 Desiamigo Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-203-11 Home Skillet Truck Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-204-11 The Lime Truck Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-205-11 The Lime Truck Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per dayR-206-11 Rolling Sushi Van Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-207-11 California Grill Truck Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per dayR-208-11 California Grill Truck Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-209-11 Komodo Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per dayR-210-11 Push Up Grill Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-211-11 Taco Mania Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-212-11 Waffle-icious Food Truck Fare After Dark Wednesday Food Truck gathering at OCFEC Parking Lot Wednesdays $50 per unit, per dayR-213-11 Waffle-icious Food Truck Fare Thursday Food Truck gathering at OCFEC Parking Lot Thursdays $25 per unit, per dayR-214-11 Tilly's Tilly's Holiday and Fashion Show Corporate party Building 12 10/26/11 $7,371.00

R-215-11 Girls Scouts of Orange County Cadette-O-Rama Camping eventFamily Fair Zone, Campgrounds and

Park Plaza10/28/11-10/30/11 $13,188.00

Board of Directors Agenda Report MEETING DATE: OCT. 27, 2011 ITEM NUMBER: 9A

SUBJECT: OC Marathon Contract

DATE: October 21, 2011 FROM: Doug Lofstrom, Vice President, Events PRESENTATION BY: Doug Lofstrom, Vice President, Events

CARRIED FORWARD FROM THE SEPTEMBER 22, 2011 BOARD OF DIRECTORS MEETING. RECOMMENDATION Staff recommends approval of a five year agreement with the OC Marathon for use of OCFEC facilities during the weekend that includes the first Sunday in May in exchange for a minimum guarantee of $100k per year predicated on exclusive use of the parking lots. Staff also recommends exercising exclusive use of the weekend as provided for in the second amendment of the Outdoor MarketPlace lease agreement dated April 1, 2009.

BACKGROUND The OC Marathon has operated its annual OC Marathon at the OCFEC since 2009 and has experienced considerable growth since that year. However, the lack of parking for event attendees limits the potential for further growth of the event, negatively impacts the customer experience, and causes the OC Marathon to consider other venue options. The OC Marathon has approached the OCFEC requesting exclusive use of the parking lots for the next five years, 2012 through 2016. In exchange for the five year contract, OC Marathon is pledging a minimum guarantee of $500K to the OCFEC over the five year period, exclusive of reimbursable expenses which the OC Marathon will continue to pay. The OCFEC currently benefits $85k for the weekend in question. Approximately $40k from Market Place revenues and $45k from the OC Marathon (parking and F&B) plus reimbursable expenses of approximately $30k. Staff has reviewed OC Marathon projections for incremental attendance, parking, F&B sales and facility use fees (attached) and believes these are reasonable and conservative projections which support the minimum of $100k annually. Additionally, the OC Marathon is actively pursuing the development of an ancillary event which will utilize additional facilities on the property, bringing in incremental parking revenue and additional F&B opportunities beginning in the first year of the contract.

FISCAL IMPACT Increase in cash by a minimum of $75k over five years with considerable upside in the range of $20k-$50k potential per year from incremental attendance, parking and F&B sales from the main event plus facility rentals and incremental revenues resulting from the addition of ancillary events.

Executive Summary

OC Marathon Five-Year Projection September 15, 2011

The OC Marathon will hold the eighth annual event on the first weekend of May 2012. It will be the fourth to have the OCFEC as the finish of the marathon and half marathon as well as the Kids Run the OC, the Nutrilite Health & Fitness Expo and the OC Wahoo's 5K. Since moving the events from the Irvine Hyatt and Irvine Spectrum in early 2009, as well as changing the date from the first week in January to the first week of May, we have seen tremendous growth from just over 9,000 total registrants in 2009 to over 14,500 in 2011. Due to the increased marketing budget and marketing collaborations with other local marathons, we expect to see continued growth going forward. The growth we have experienced has lead to significant issues with regards to the amount of available parking and traffic entering and leaving the OCFEC. These issues will compound with the growth of the event.

1) With the Kids Run the OC as well as the Health & Fitness Expo beginning at 9:00 am Saturday morning, many families could not find parking places in the available areas, were late for their childs race time or in some instances, left the facility without participating or were not able to get into the facility.

2) Due to limited supply, pre-paid parking passes were sold out a few hours before the Expo closed Saturday.

3) Participants (Full and Half), arriving Sunday morning for the shuttle service to the start line encountered problems entering the few gates available and some holding pre-paid passes were charged again when CMPD started directing runners into Gate 1 and 2 to alleviate congestion on Fair Drive.

4) Many parked off the OCFECs premises resulting in lost revenue. 5) Shuttle buses moving participants to the start from the OCFEC lots, encountered

significant traffic issues into and out of the parking lots due to the limited number of gates open for our use, which caused a delay in the start of the race.

In order for the OC Marathon to continue with our expected growth to the benefit of the community, our partner charities and the kids program, the OC Marathon requests a five-year agreement with the OC Fair and Event Center for continued use of the OCFEC facilities for the weekend that includes the first Sunday in May plus exclusive use of the parking lots during the hours of the event and first right of refusal for additional facility rentals during the weekend. This exclusive use agreement would begin with the OC Marathon event to be held May 46, 2012. We are requesting this five-year exclusive use contract for consideration of a minimum $500,000 in revenue to the OCFEC plus reimbursable expenses over this period of time. The amount, as seen in the attached projections, may be much greater, but we are confident that with our projected growth of the marathon and related events as well as the introduction of other mutually beneficial events, the OC Marathon weekend will become one of the OCFECs most profitable. Gary Kutscher OC Marathon

OC Marathon, LLC 570 Campus Dr. #570 Newport Beach, CA 92660

OCFEC Revenue SummaryActual 2006 - 2011, Estimate 2012 - 2016

September 19, 2011

2006* 2007* 2008* 2009 2010 2011 2012E 2013E 2014E 2015E 2016E

Marathon 505 683 628 1,628 1,883 2,229 2,350 2,700 2,900 3,150 3,300

Half Marathon 5,021 3,243 2,297 5,413 7,114 7,546 8,300 9,100 10,000 11,000 12,000

5K 987 1,937 2,048 1,291 1,750 1,829 2,000 2,200 2,450 2,650 2,950

Kids Run 722 987 1,530 898 1,960 2,963 4,000 4,500 5,000 5,500 6,000

TOTALS 7,235 6,850 6,503 9,230 12,707 14,567 16,650 18,500 20,350 22,300 24,250

% change N/A -5.3% -5.1% 41.9% 37.7% 14.6% 14.3% 11.1% 10.0% 9.6% 8.7%

Cars-Shuttle #'s 60% of Full and Half 2 per c 2,100 2,700 2,930 3,225 3,540 3,870 4,250 4,590Cars-5K & F.F. 80% of 5K @ 2 per 515 700 730 800 880 980 1,060 1,180Cars-Expo 80% of full, half & 5k 1.5 pe 4,450 5,730 6,000 6,800 7,460 8,200 8,960 9,730Cars-KROC 80% of reg. @ 2 per 360 785 1,185 1,600 1,800 2,000 2,200 2,400Cars (Weekend) assumes Expo, KROC & Sun 7,425 9,130 10,845 12,425 13,600 15,150 16,470 17,900

Total Parking Revenue for next five years 86,975 95,200 106,050 115,290 125,300

OCFEC Revenue from Ovations 3,860 5,300 5,580 5,700 6,000 6,300 6,600 7,000

OCFEC Revenue from facility rental (Based on facilities used 2011. Could go h 25,000 25,000 25,000 25,000 25,000

Totals Per Year 117,675 126,200 137,350 146,890 157,300

Total Projected 5 Year Revenue, not inluding reimbursables. $685,415

* Removed "Students Run LA" from totals

Board of Directors Agenda Report MEETING DATE: OCT. 27, 2011 ITEM NUMBER: 9B

SUBJECT: Swap Meet RFP DATE: October 27, 2011 FROM: Steve Beazley, President & CEO PRESENTATION BY: Steve Beazley, President & CEO ___________________________________________________________________ RECOMMENDATION Executive Management recommends Model 1 to be the basis of the terms and conditions for solicitation of an RFP. The full RFP recommended for approval will be posted 5 p.m., Monday, October 24.

BACKGROUND

Model 1 Swap Meet - Cooperative/Collaborative/Full Property Integration

This model, which is the recommendation of OCFEC Executive Management assumes the following with the adjoining financial analysis:

1. Vendor Space Sales/ManagementRFP 5 year term with 5 year option As reflected in the financial analysis below, vendor space and management currently generates approximately $4,000,000 per year in gross revenues. Under this model, the RFP would solicit for the private enterprise firm to perform this scope of work at the rental rate of 35% of gross revenues.

2. Parking Sales and OperationsOCFEC Currently OCFEC manages one parking operation on the property, while the

swap meet operator manages another. Having two parking plans is cumbersome to staff operations, confusing to the customer and is ripe for circumvention of fee assessment for parking. Parking for the swap meet customer, save for a preferred parking option, is free. Parking for those coming to year round

promoted events at OCFEC is $5. A customer can inform the parking attendant they are attending the swap meet and then attend one of the promoted events resulting in a loss of parking revenue to OCFEC.

Using the parking garage ticket validation model, customers coming to the property would receive a parking ticket, which the swap meet customer can validate at the swap meet, then present the validated ticket on the way out for free parking. Promoted event customers can either pay $5 for parking on their way out or visit the swap meet and receive validation. This would drive more property attendees to the swap meet.

The financial model assumes that 50% of swap meet attendees will obtain parking ticket validation and alleviate the fee circumvention situation. 3. Food and Beverage Sales and ManagementOvations The current operator pays 25% on food and beverage sales. Ovations, the current master concessionaire of the property, pays 34% for food sales and 40% alcohol sales. One property-wide food service company will provide consistent service, increased revenues to the District and a greater opportunity for competitively-bid, property-wide corporate sponsorships for exclusive product and or signage on the property (example: Pepsi or Coke as the exclusive soft drink of OCFEC)

4. Admission Free to Patron All OCFEC visitors would receive free admission to the swap meet, promoting a free roam approach to all areas of programming on the fairgrounds, including the Centennial Farm. This approach will promote longer stays, more patronage to all events and increased food and beverage sales.

Financial Analysis:

Revenue2YearActual

Average ProposedTermsRevenueper

ProposedTerms ProposedRevenueAssumptionsSpaceRent $3,925,831 35%ofGross $1,374,041 %against2yearSpaceRentaverageAdmission 988,894 FreeAdmission 0Parking 193,643 $5parking,100%OCFEC 735,818 2yrAdmissionavg/2.5percarx50%F&B 2,674,911 OvationsCommission 840,514TotalRevenue $7,783,278 $2,950,373Revenueas%ofGross 38%

Model 2 Full Outsource of Swap Meet Operations (Existing Swap Meet Operation)

Recommended Terms and Conditions: 1. 5 year term 2013-2018 with five-year option 2. $3,000,000- $3,250,000 minimum guarantee 3. 12 month termination without cause 4. Add 2 or 3 weekends back into SM operation

HistoricalActuals 2YearActualAverageNewMinGuarantee(Add2Weekends)

NewMinGuarantee(Add3Weekends)

TotalAdmissions 735,818

SpaceRentRevenue $3,925,831AdmissionsRevenue 988,894ParkingRevenue 193,643Food&Beverage 2,674,911TotalRevenue $7,783,278

OCFECRevenue $2,052,026 $3,000,000 $3,250,000Revenueas%ofGross 26% 35% 35%

Model 3 - Swap Meet Operated by OCFEC

Discussion: This model cannot be accomplished by OCFEC due to existing Business and Professions Code 21669 5b which states:

State or local governmental entities shall not operate or manage a swap meet for profit in direct competition to a private enterprise, unless they comply with subdivision (a) of Section 21662.

Model 4 - No Swap Meet - Revenue Replacement Plan As directed by the Board, management compiled a revenue replacement plan if, for any reason, a swap meet ceases to exist on the property in the future. Early estimates show that approximately $3,500,000 could be claimed by OCFEC by bringing all categories of pricing for the summer Fair and year round events to market rates. Categories include admission and parking fees, facility rental rates, and extending the dates of the summer Fair.

It should be noted that should a swap meet remain on the property, all OCFEC pricing should be reviewed in the next 5 year business plan for OCFEC, beginning in 2013.

OC Fair & Event Center 32nd District Agricultural Association 88 Fair Drive, Costa Mesa, CA 92626 (714) 708-1514 ocfair.com

Swap Meet Request for Proposals (RFP) Executive Summary

Dr. Steven Beazley, President & CEO Background Attached is a draft of Request for Proposals (RFP) for Swap Meet Operations being made available for your review and approval. While the entire RFP is important toward a successful bid process and eventual lease agreement, I have called out certain sections which pertain primarily to the judiciary responsibility the Board bears in selecting a particular business model it chooses to base the bid process upon. Items not included on this list are primarily operational, administrative or legal in nature and have been reviewed by the CEO and legal counsel. While the Board remains responsible for the entire RFPs content, the critical items are those listed here. Based on the staff report (9B in the Board packet), which outlines two business models, the RFP has used italics to demarcate those items which would be clarified once a business model is chosen. The staff-recommended model bids out vendor space sales and management only, reserving parking operations for the District, food and beverage service for the current on-site master concessionaire and free admission to the patron. Model #2 articulates a more existing-conditions swap meet operation with modifications of financial and contract termination language. 1. Part III, Section A. 6. Protests (p. 9-10) This section prescribes a locally based

protest process that is permissible with revenue contracts and used similarly with the Districts bidding of multi-year Spa premium space in the early 2000s.

2. Part IV, Section A. Description. (p. 12) 3. Part VI, Section 6b. Financial Proposal. (p. 20) These terms will correspond with

the business model chosen by the Board of Directors. 4. Part VIII, Section D. 1-5. Date and Hours of Operations (p. 40) 5. Part VIII, Section F. 1-2. Rent (p. 43) 6. Part VIII, Section U. 19. Prohibition Against Similar Operation (p. 60) This item

contained a 25 mile radius clause for operators to be eligible to bid. The suggestion is we open up competition by striking this prohibition.

32nd DISTRICT AGRICULTURAL ASSOCIATION

REQUEST FOR PROPOSAL PACKAGE

HIGH SCORE PROPOSAL

GROUND LEASE

FOR A

SWAP MEET OPERATION

INCLUDING

FOOD & BEVERAGE SERVICE

AND PARKING MANAGEMENT

RFP NUMBER SM-04-11

OC FAIR & EVENT CENTER

OC Fair & Event Center 32nd District Agricultural Association

88 Fair Drive Costa Mesa, CA 92626

Date Issued: November 1, 2011

Sealed Bids must be received no later than 3:00 p.m., November 30, 2011

Contact Person: Steven Beazley Email: [email protected]

This person is the only authorized person designated by the District to receive written communication concerning this RFP. Please do not attempt to contact any other person concerning this RFP. Written communication of District representatives and employees concerning the RFP (including the contact person listed above) shall not be binding on the District and shall in no way excuse the bidder of obligations as set forth in the RFP. Only questions concerning the technical requirements of the RFP will be answered. Unless initiated by the District, all communications shall be in writing.

MANDATORY PRE-BID MEETING NOVEMBER 7, 2011, 1:00 P.M.

TABLE OF CONTENTS

Page

I DEFINITIONS ..................................................................................................... 1

II GENERAL INFORMATION............................................................................. 3

III RULES GOVERNING COMPETITION & TECHNICAL

EVALUATION .................................................................................................... 8

IV HISTORY AND GENERAL INFORMATION.............................................. 12

V SWAP MEET REQUIREMENTS AND BIDDER

QUALIFICATIONS .......................................................................................... 14

VI SUBMISSION REQUIREMENTS .................................................................. 16

VII EVALUATION, SELECTION, AND SCORING PROCESS ....................... 22

VIII FORMS SECTION ............................................................................................ 27

IX EXHIBITS SECTION ....................................................................................... 35

1

PART I

DEFINITIONS

BIDDER/PROPOSER: The individual, company, organization or business entity submitting the proposal in response to the Request for Proposal.

BUSINESS DAYS: For the purposes of this proposal, any reference to Business Days will refer to Monday through Friday except for recognized State of California holidays.

CONTRACTOR: Refers to that Bidder selected by the District to provide the services set forth in this RFP. Terms can be used interchangeably.

DISTRICT: Refers to the 32nd District Agricultural Association which is an agency of the State of California within the Division of Fairs & Expositions under the Department of Food & Agriculture.

FAIRGROUNDS: Refers to the real property known as the OC Fair & Event Center

FAIRTIME / OC FAIR Refers to the approved dates for the OC Fair established annually from time to time by Board of Directors of the District.

FINANCIAL

RECORDS:

Financial Records means true and accurate books of account and business records conforming to generally accepted accounting principles showing all the Lessees Gross Revenues relating to the Lease Agreement including, without limitation, all sales, tax reports, bank deposit records, contracts, licenses and any documents called for in the Lease Agreement.

GROSS REVENUES: Gross Revenues means any and all revenue generated by the swap meet operation to include, but not limited to, all admission fees, space rental charges, food and beverage sales, parking charges, miscellaneous income and sales, sponsorship and/or advertising fees collected by the Lessee. Sales tax collected by Lessee is not part of Gross Revenues.

IMPROVEMENTS: Improvements means any addition to or modification of the Premises during the Term of this Lease Agreement, as approved by the District pursuant to Lease Terms.

LEASE AGREEMENT: Lease Agreement refers to the agreement for lease of property and operating rights between the District and the Contractor selected by the District for the swap meet pursuant to this RFP.

LEASE YEAR: Lease Year means each successive twelve (12) month period during the Term of the Lease Agreement.

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MINIMUM

GUARANTEED RENT:

Minimum Guaranteed Rent means the amount determined as the minimum rent guaranteed by the Lease Agreement.

STATE AGENCIES: Those agencies of the State of California having applicable jurisdiction over this transaction; including the Department of General Services, and the Division of Fairs & Expositions, and Department of Food and Agriculture, which is a division of the agency of the State of California overseeing the activities of District Agricultural Associations and County and Citrus Fruit Fairs.

SWAP MEET: Swap meet means the swap meet operations and all associated business to be conducted on the Premises pursuant to the Lease Agreement.

PERCENTAGE RENT: Percentage Rent means the amount determined as the percentage of Gross Revenue by the Lease Agreement.

PREMISES: Premises refers to that certain parcel of real property located in the City of Costa Mesa, Orange County, State of California, described as the vendor space on the attached Exhibit A incorporated into this RFP. The boundaries on Exhibit A are fixed and absolute (subject to adjustments as provided in Part IV of this RFP). No part of the swap meet may exceed these boundaries without the prior written consent of the District.

RENTAL: Rental refers to the consideration that will be paid to the District by the successful bidder pursuant to the Lease Agreement to be awarded under this RFP process. Rental shall be the Minimum Guaranteed Rent or Percentage Rent, whichever is greater, plus any other fees, payments, or penalties required by the Lease Agreement.

RENTAL

COMMENCEMENT

DATE:

Rental Commencement Dates means March 28, 2013.

RFP: Request For Proposal.

RESPONSIVE: Proposals that are timely, meet the proper format required for submittal of the proposals, and provide the required information pursuant to the criteria outlined in the RFP will be considered responsive.

TERM: Term refers to the period of time beginning on the Rental Commencement Date and ending on the date provided for in the Lease Agreement or as terminated pursuant to the terms and conditions set forth in the Lease Agreement.

3

PART II

GENERAL INFORMATION

A. Request For Proposals (RFP)

The Board of Directors of the District in releasing this RFP intends to award a Lease Agreement for the operation of a swap meet on the Premises. The term of the Lease Agreement will be for five years, with a five-year renewal option. Only the District, in its sole and exclusive discretion, may exercise the Lease Agreement renewal option. The Districts exercise of the option to extend the Lease Agreement may include or require renegotiation of all or part of the Lease Agreement, in the Districts sole and exclusive discretion.

B. Bidder Responsibility

Bidders are urged to read the documents thoroughly. The District will not be responsible for errors and/or omissions on the part of the bidder. It is recommended that each bidder carefully review the proposal to be submitted in response to the RFP. The District, the Scoring committee, and other individuals reviewing proposals on behalf of the District will not make interpretations or correct any errors in calculations.

All costs associated with the bidder completing and submitting a proposal are the sole responsibility of the bidder.

TO BE CONSIDERED RESPONSIVE, BIDDERS ARE REQUIRED TO ATTEND A

MANDATORY PRE-BID MEETING ON November 7, 2011 at 1:00 p.m. in the Districts

Administration Building located at 88 Fair Drive, Costa Mesa, CA 92626. ALL BIDDERS

MUST SIGN IN AT THE MANDATORY WALK-THROUGH. BIDS OR PROPOSALS

WILL NOT BE ACCEPTED FROM BIDDERS WHO DO NOT ATTEND THE

MEETING.

Persons and entities submitting qualifications or responses to this RFP will assume all financial costs and risks of submission or bidding. No reimbursement or remuneration will be made by the District to cover the costs of any bids, whether or not any parties are selected or whether or not any subsequent bid is selected. No broker or finder is entitled to any commission or finders fee in connection with this or any future transaction related to the Premises.

C. Delivery of Proposals

No proposal will be considered if it has not been physically received at the place, and prior to the closing time, stated in this RFP. Receipts and/or postmarks dated prior to or on this deadline will not be acceptable if actual documents are not received as stated below. Proposals failing to meet these requirements will be deemed non-responsive, and will not be accepted,

considered or scored.

Proposals must meet the following format requirements to be deemed responsive for District consideration:

4

One sealed package containing five (5) copies of the Proposal including a copy of the Bidder/Contractor Status Form and labeled with the bidders name and SWAP MEET OPERATION (For additional details, see Part VI, B1.)

All proposals must have original signatures, and must be submitted to the Districts Administration Office, no later than Wednesday, November 30, 2011, 3:00 p.m. The District reserves the right to refuse to accept for consideration any proposal which has not been received at the place, and prior to the time, stated in this RFP.

The sealed package must be placed in a second package with the bidders name on the outside and addressed as follows.

The terms of the swap meet operations will be based on the Lease Agreement attached as Exhibit D. The fully-executed Lease Agreement submitted by a bidder may contain modifications to the terms of the Lease Agreement attached hereto. The extent to which the blacklined version of the Lease Agreement shows modifications to the terms of the Lease Agreement attached hereto will be a consideration in the selection of the successful bidder. The District will look more favorably upon offers containing minimal modifications to the form of Lease Agreement attached hereto.

RFP NUMBER SM-04-11

32nd District Agricultural Association

OC Fair & Event Center

88 Fair Drive

Costa Mesa, CA. 92626

D. Contract Award

The contract shall be awarded to the qualified bidder who obtains the highest score, subject to the approval of the Districts Board of Directors and all State Agencies, as required by law. The technical and financial proposal of each bidder will be evaluated and scored by the Evaluation and Selection Committee (Scoring Committee) based on the score sheet contained in Section VII, Evaluation, Selection, and Scoring Process. A Notice of Proposed Award will be posted for five (5) business days at the Districts Administration Office. In addition, a copy of the notice will be sent by certified mail to each bidder.

A contract award is not final until:

the time for posting notice of award has expired;

protests filed, if any, have been withdrawn or rejected by the District Board of Directors;

the award of contract is approved by the District Board of Directors; and

all applicable State agencies have approved the fully-executed Lease Agreement.

5

E. Tentative Schedule

RFP Released November 1, 2011

MANDATORY PRE-BID MEETING 1:00 p.m., November 7, 2011

*Questions Due via Email 5:00 p.m. November 8, 2011

*Answers Posted on District Web Site November 10, 2011

Proposal Deadline 3:00 PM November 30, 2011

Proposals Scored December 1, 2011 through December 2, 2011

Interviews, presentations, visitations may be required as part of the scoring process.

Post/mail Notice of Proposed Award December 2, 2011

Protest deadline date December 9, 2011

Response deadline to protest December 14, 2011

Contract approved by the District Board December 15, 2011

Lease approval by State Agencies January 15, 2012 (estimated)

New Lease Commences March 28, 2013

*Questions are to be submitted in writing. All bidders will be sent email notification

when questions and answers are posted on the District's web site. No RFP related questions will be accepted following 5:00 p.m. on November 8, 2011.

F. Contact for Information

Oral communications of District officers and employees concerning the RFP are not binding on the District, and will not excuse any bidder or competitor of any obligations established by this RFP. Only questions concerning technical requirements will be answered.

All inquiries concerning this RFP are to be directed to:

Steven Beazley, CEO 32nd District Agricultural Association

88 Fair Drive Costa Mesa, CA 92626 [email protected]

6

G. Small Business Preference

California Government Code section 14835, et seq., (the Small Business Procurement and Contract Act) requires that a five percent (5%) preference must be given to bidders who qualify as a small business. The rules and regulations of the Small Business Procurement and Contract Act are in the California Code of Regulations, title 2, section 1896, et seq. A copy of the regulations is available upon request.

To claim the small business preference, which may not exceed $50,000 for any proposal, bidder's company must have its principal place of business in the state of California and have a complete application (including proof of annual receipts) on file with the State Office of Small Business & Disabled Veteran Business Enterprise (OSDS). Questions regarding the preference approval process should be directed to the OSDS, 707 Third St., First Floor, Room 400, West Sacramento, California 95605, (916) 375-4940.

If bidder is claiming the 5% small business preference, a copy of the OSDS Small Business Certification must be submitted with the Proposal.

H. Bidder/Contractor Status Form

All bidders must complete, sign and submit the Bidder/Contractor Status Form together with its proposal in response to the RFP. Failure to include this form with the proposal will result in the proposal being deemed non-responsive. The District reserves the right to verify the information on the Bidder/Contractor Status Form. If the bidder is a corporation, the form must include the title of the person signing, (i.e., corporate officer status), and a copy of the corporate resolution authorizing the signing of the form and must be attached. If the bidder is a partnership, the signing partner must be the authorized general partner and if the bidder is a limited liability company, the signer must be the authorized manager or managing member.

I. Insurance

The bidder awarded the contract must provide a signed original Certificate of Insurance in the minimum amount of $5,000,000 in commercial liability coverage, including liquor liability, $1,000,000 in automobile liability insurance per occurrence for bodily injury and property damage liability combined prior to the time of entering into a contract pursuant to this RFP.

Unless the successful bidder is on the Master Insurance Certificate List of California State Fairs Association, or Division of Fairs and Expositions, California Department of Agriculture, the insurance certificate must include the following:

Evidence of authorized insurance for not less than the initial year of the term of the Lease Agreement;

An agreement to provide the District with written notice of cancellation of the insurance no less than 30 days prior to any cancellation:

The name and address of the District, shown as the certificate holder,

7

An additional insured paragraph stating: The State of California, the District Agricultural Association, County Fair, the County in which the County Fair is located, Lessor/Sublessor if fair site is leased/subleased, Citrus Fruit Fair, or California Exposition and State Fair, their directors, officers, agents, servants, and employees are made additional insureds, but only insofar as the operations under this contract are concerned.

In addition to the certificate of insurance, the successful bidder will be required to provide a certified copy of the additional insured endorsement, in a form satisfactory to the District, showing the State of California, the 32nd District Agricultural Association, the OC Fair & Event Center, Orange County, and their respective agents, directors, officers, servants, and employees as additional insureds on the successful bidders policies of commercial liability and automobile liability insurance.

The successful bidder will also be required to provide proof of Workers Compensation Insurance meeting the requirements of the Lease Agreement.

8

PART III

RULES GOVERNING COMPETITION & TECHNICAL EVALUATION

A. RFP REQUIREMENTS AND CONDITIONS

1. Errors

If a bidder discovers any ambiguity, conflict, discrepancy, omission, or other error in this RFP, the bidder must immediately notify the District of the error in writing, addressed to the contact person and copied to the District Board Chair as listed in Section II, paragraph F, and include a request for modification or clarification of the RFP. Modifications will be made in writing by way of an addendum issued pursuant to paragraph 2 below. Clarifications will be given by written notice to all parties to whom the District had sent notice of the RFP and to persons or entities who have requested to be given notice of any modification or notices.

2. Addenda

The District reserves the right to modify the RFP prior to the date set for submission of final proposals, by issuing a written addendum to all parties who have been furnished notice of the RFP for bidding purposes. All bidders should inquire from the contact person listed on the cover sheet whether any addenda have been issued prior to submitting a proposal in response to the RFP.

3. Definitions

The use of shall, must or will indicates a mandatory requirement or condition in this RFP. Failure to include such mandatory requirements or conditions will result in the disqualification of a proposal.

The words should or may indicate a desirable attribute or condition, but are permissive in nature and may affect the score the proposal receives.

4. Grounds for Rejection of the Proposal

A proposal will be rejected if:

It is received at any time after the exact time and date set for receipt of proposals as stated in Part II, paragraphs C and E.

It is not prepared in accordance with the required format or information is not submitted in the format required by this RFP.

The bidder has submitted multiple bids in response to this RFP without formally withdrawing other bids.

A proposal may be rejected if:

9

It contains false or misleading statements or references, which do not support attributes or conditions, contended by the bidder. (The proposal will be rejected if, in the opinion of the District, such information was intended to mislead the District in its evaluation of the proposal and the attribute, condition or capability of requirement of this RFP.)

It is unsigned.

5. Right to Reject any or all Proposals

It is the policy of the District not to solicit proposals unless there is a bona fide intention to award a contract. However, the District reserves the right to reject any or all proposals or to cancel the RFP at any time during the process. The District reserves the right to disqualify any bidders that do not completely comply with the submission requirements and reserves the right to reject any or all bidders at its sole discretion. The District also reserves the right to select a limited number of parties for interviews or select qualified bidders without conducting interviews. In any event, the District shall have no liability arising from its selection of qualified bidders or its denial of any party submitting a response.

The District reserves the right to:

Request additional information, seek clarification or interview proposers;

Amend, modify or withdraw this RFP prior to submission of bids;

Issue subsequent RFPs for the Premises if no bidder is selected;

Disqualify or disapprove any entities, teams or team members for good cause; and

Waive non-material deficiencies, informalities or irregularities in the process, form or substance of the matters described herein.

6. Protests

A proposer / bidder may file a written statement of protest against the awarding of the contract with the Districts Chief Executive Officer. The written statement of protest shall be signed by the protestor, shall specify the grounds for the protest, and may include a demand for a hearing. The protest must be received within five (5) business days after the District has issued a Notice of Proposed Award to award the contract. Copies of the written statement of protest must be served within the same time period by the proposer / bidder on the successful bidder, and on the following:

Steven Beazley, CEO 32nd District Agricultural Association

88 Fair Drive Costa Mesa, CA 92626 [email protected]

10

Roger A. Grable, Esq. General Counsel

Manatt, Phelps & Phillips, LLP 695 Town Center Drive, 14th Floor

Costa Mesa, CA 92626 [email protected]

If a protest is timely served, the successful bidder may file a response to the protest. Any

response to the protest by a successful bidder must be received by the Districts Chief Executive Officer on or before 5:00 p.m. on December 14, 2011. Copies of the response must be simultaneously served on the protestant, on the Chair of the Board of Directors and the General Counsel as detailed above.

If the protestant does not demand a hearing, or if the Districts Board of Directors does not order a hearing, then the Board of Directors shall take action on the protest at a public meeting of the Board of Directors.

If the protestant demands a hearing, or, if the Districts Board of Directors orders a hearing, the Board of Directors shall conduct the hearing prior to the award of the Lease.

In all events, the action of the Board of Directors on the protest shall be final.

B. Other Information

1. Disposition of Proposals

All materials submitted in response to this RFP will become the property of the District. All proposals, evaluations and scoring sheets will be made available for public inspection at the conclusion of the scoring process and the issuance and posting of the Notice of Proposed Award. Unless otherwise required by law, Bidders shall maintain confidentiality of their proposals until the scoring process is complete and the Notice of Proposed Award is issued and posted.

If an individual requests copies of these documents, the District will assess a fee to cover duplicating costs. Proposals may be returned only at the Districts option and at the bidders expense. Two copies of the proposal will be retained for official District files.

2. Confidentiality of Proposals

Subject to the provisions of Part III, Paragraph B.1, the District will hold the contents of all proposals in confidence until issuance and posting of the Notice of the Proposed Award. However, once the Notice of Award is issued and posted, no proposal, or any part of a proposal, will be treated as confidential.

Please note the District may use materials submitted to justify the awarding or not awarding of a contract if a protest is filed. The District will use its best efforts to prevent the release of all or any part of a bid until the Notice of Proposed Award is issued and posted. However, the District will not be liable for inadvertently releasing any information contained in

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any bid, including, but not limited to, any information deemed or labeled as proprietary and confidential.

3. Modification or Withdrawal of Proposals

Any proposal received by the District before the time and date described in Part II (C) above may be withdrawn or modified at the written request of the bidder. Any modified proposal must be received by the time and date described in Part II (C) above to be considered responsive.

A bidder will not be permitted to withdraw or modify a proposal after the time and date described in Part II (C) above. No bid may be timed to expire on a specific date. Any bid timed to expire on a specific date will be deemed non-responsive.

4. No Representations or Warranties by District

The District and its consultants, attorneys and other agents and advisors make no express or implied representations or warranties as to the current or future entitlements for the Premises, the physical condition of the Premises or the fitness of the Premises for the use intended by Contractor. The successful bidder will take the Premises AS IS and with all faults. Any bidder is responsible for conducting its own due diligence with respect to the Premises, including, without limitation, its zoning, current or future entitlements, applicability of the City of Costa Mesa, County of Orange and/or State of California requirements and all other matters dealing with the intended use of the Premises. Any offers to lease the Premises are to be based solely upon the independent judgment of the potential bidder and its advisors.

Any information provided in this RFP, including boundary lines, dimensions and other information contained on Exhibit A, and any additional information, whether written or oral, provided by the District and/or its representatives is based upon available information and is believed to be accurate. However, no representation or warranty is made with respect thereto. The information in this RFP is intended to help prospective bidders create responsive submissions. However, it is the sole and absolute responsibility of those responding to this RFP to complete their own due diligence.

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PART IV

HISTORY AND GENERAL INFORMATION

SWAP MEET OPERATIONS

A. Description

The OC Fair & Event Center is a multi-use event center hosting an annual fair and a diverse range of non-fair events and programs. The annual fair operates for approximately four (4) weeks every July/August, including five weekends, and attracts over 1,400,000 visitors from throughout Southern California. There is active use of all fairground facilities on a year-round basis including exhibit buildings, livestock facilities, an Equestrian Center, grandstand arena, amphitheater, various open areas, Centennial Farm and parking lots. In addition, as provided in the Lease Agreement, the District reserves the right to designate the following additional weekends for the District's exclusive use of the entire fairgrounds, including the Premises, such that there will be no swap meet operations on such designated weekends: (1) to extend the run of the OC Fair; (2) for the annual Barrett-Jackson automobile auction, and (3) up to three (3) additional weekends per year. Bidders should propose Minimum Guaranteed Rent on the assumption that the OC Fair will span five (5) weekends and that the Barrett-Jackson event will utilize a weekend each year. The Lease Agreement provides for a ratable reduction in Minimum Guaranteed Rent if the District exercises its rights to designate additional weekends for its exclusive use of the fairgrounds, including the Premises, beyond the five (5) week run of the OC Fair and the Barrett-Jackson weekend

B. Master Plan

The Districts Board of Directors is in the process of implementing an adopted master plan for the facilities and grounds. The master plan contemplates the addition of exhibit buildings, a remodel of the amphitheater to expand its facilities and potential uses, and construction of a new arena. A copy of the illustrative drawing of the preferred master plan is included in this RFP packet as Exhibit C.

C. Swap Meet History

A weekly swap meet has operated on the fairgrounds since 1969. Revenue is derived from seller space rentals, admission, preferred parking, food and beverage sales, sponsorship/advertising and miscellaneous service income. Under the current RFP, the swap meet will only operate and manage space rental to swap meet vendors, and the swap meet operator will not charge fees for admission. Moreover, the District or its concessioners shall control and charge for parking and food and beverage concession revenue. Space is available for approximately 1,500 sellers. The operating schedule is every Saturday and Sunday, except for four weekends in July for the annual Fair, inclement weather, and Easter Sunday (at the request of the operator). In addition, the swap meet operates the Friday following Thanksgiving, and five weekdays (flexible) in the seven day period immediately preceding Christmas. When in operation, the swap meet is open from 7:00 a.m. to 4:00 p.m.

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D. Setting

The portion of the fairgrounds that has been available for the operation of an swap meet includes approximately 22.3 acres in the vendor space of the fairgrounds, described in the attached Exhibit A. No part of the swap meet may exceed the boundaries of the vendor space of the fairgrounds, without the prior written consent of the District.

For the purpose of this RFP, all bidders must assume that the Premises that will be leased under the Lease Agreement do not include any permanent or temporary buildings or other facilities.

Major access to the area is provided by the Costa Mesa Freeway (State Route 55), Newport Boulevard, Fair Drive and Fairview Avenue. The Fairgrounds are also located in close proximity to the San Diego Freeway (Interstate Freeway 405).

The Fairgrounds are surrounded by other major public facilities, including the Costa Mesa City Hall/Civic Center, Southern California College and Newport Mesa Christian Center to the south across Fair Drive; Orange Coast Community College to the northwest across Fairview Avenue; and Costa Mesa High School, Davis School, and Tewinkel Park to the north across Arlington Drive. Single-family residential neighborhoods surround the fairgrounds vicinity.

The District has adopted a 10-year master plan for the fairgrounds property and within the term of this Lease Agreement, elements of the master plan will be implemented. This may cause a need to relocate parts of the swap meet to a space on the fairgrounds of similar size. By submitting a proposal in response to this RFP, all Bidders acknowledge and agree that relocation of the swap meet may be required and that selection of the site for relocation is in the sole and exclusive discretion of the District. All costs attributed to relocation will be at the sole expense of the Lessee.

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PART V

SWAP MEET REQUIREMENTS AND BIDDER QUALIFICATIONS

Business and Professions Code Sections 21669 and 21669.1 establish minimum requirements for bidders. The proposed swap meet operations and the swap meet bidder must meet the requirements outlined below and each bidder will be required to certify, in writing, that it is in compliance with Business and Professions Code section 21669 and 21669.1. (Forms, Part VIII) Any bidder who cannot satisfy the requirements of Sections 21669 and 21669.1 shall be disqualified.

Business and Professions Code sections 21669 and 21669.1 state:

Section 21669. Swap Meets Conducted on Government Premises; Procedures; Operation

by Government Entities for Profit.

a. All swap meets which are conducted two or more times per business year on any premises or property owned or leased by any city, county, city and county, state, or any other local governmental agency, entity, or board, shall comply with all of the following procedures:

1) The swap meet operator shall have a valid business license.

2) The swap meet operator shall have a valid California sellers permit number (State Board of Equalization sales tax number), if applicable.

3) The swap meet operator shall provide the state or local governmental entities described in this subdivision upon whose property the swap meet is being held, a certificate of insurance certifying that the swap meet lessee maintains public liability and property damage insurance for the operation of the swap meet of at least two million dollars ($2,000,000), and that the policy names that governmental entity as an additional insured under the policy.

4) The swap meet operator shall provide the state or local governmental entity a hold harmless and indemnification agreement for his or her operation of the swap meet and activities and acts arising from that swap meet.

5) The swap meet operator shall comply with all other provisions of this article relating to swap meets.

b. State or local governmental entities shall not operate or manage a swap meet for profit in direct competition to a private enterprise, unless they comply with subdivision (a) of Section 21662.

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Section 21669.1 Swap Meets on Government Property; Average Daily Attendance of

10,000 or more; Requirements

a. In addition to the requirements specified in subdivision (a) of Section 21669, all swap meets conducted on the premises or property of a state or local governmental entity which has or expects to have an average daily attendance of 10,000 or more persons shall provide all of the following:

1) A statement of ownership, including the identity of individuals holding a financial interest of 5 percent or more.

2) A sworn statement that no individuals who have a financial interest of 5 percent or more in the swap meet have been convicted of any crime involving dishonesty or moral turpitude.

3) A financial statement showing the operators financial capability to operate a major swap meet and to meet any financial obligations to the Lessor under the terms of the Lease Agreement, the operators creditors, independent contractors, subcontractors, and vendors.

4) A statement that the operator is not knowingly delinquent in any payments owed to a state or local governmental entity and that he or she is not knowingly in violation of any state or local law or ordinance related to public health or safety standards.

5) Evidence that the operator has a minimum of five years of experience in the management and operation of a swap meet for profit with an average daily attendance of 5,000 or more.

6) A plan for operations including security, crowd control, sanitation and emergency medical response.

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PART VI

SUBMISSION REQUIREMENTS

A. Mandatory Format and Content Requirements

1. Introduction

This part provides instructions to the bidder regarding the mandatory proposal format and content requirements. Potential bidders are instructed that:

All proposals must follow the instructions for proposal format;

All information must be presented in the order and the manner requested;

All questions must be answered; and

All requested data must be supplied.

Proposals not meeting these requirements, or any other requirements described in this RFP, will be deemed non-responsive and may be rejected.

2. Proposal Content and Format

Each proposal must be prepared as one (1) document. Sealed packages are inserted into a second package. All packages must be addressed and labeled in the manner described in Part II, paragraph C.

a. Technical Proposal:

Information in the proposal is to be provided in the order requested beginning with the cover letter. Each page is to be numbered at bottom, starting with the number 1; all pages should be 8-1/2 x 11 inch paper; and all narrative portions of the proposal should be typed.

The first page of the proposal must be a signed cover letter on the letterhead of the bidder and contain the following statement verbatim:

Submission of this proposal signifies that all terms, conditions,

requirements, protest procedures, performance measures and instructions

concerning the award of RFP Number SM-04-11 to which this proposal

responds, have been read and understood. Further, in signing this letter, as

the authorized representative of the submitting bidder, it is expressly agreed

by the bidder that failure to have provided accurate and truthful information

in this proposal or any deviation from any requirement or performance

measure stated in the RFP shall constitute grounds for rejection of this

proposal. Bidder also agrees that if the submitted proposal is not in the

format required by the RFP, bidders proposal will be deemed non-

responsive.

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The persons name must be printed clearly below the signature line and dated. If bidder fails to submit this document, or the document is not signed and dated, the proposal may be rejected as non-responsive.

The organization of the proposal shall be as follows:

1) All narrative material must be typed and five (5) copies submitted.

2) Photos, manuals and supporting materials may be submitted in one (1) master folder.

3) Information to be provided by Bidder:

Required Submittals

NOTICE: For the purpose of this Part VI SUBMISSION REQUIREMENTS no bidder /

proposer is required to submit any information identifying any persons, firms, or entities

that rent space from the bidder/proposer at any current swap meet, or may rent space

from the bidder/proposer at the bidder/proposers proposed operation at the Orange

County Fairgrounds.

3. Current Operation and Evidence of Experience

a. Bidder shall submit evidence that it meets the requirements of the California Business and Professions Code section 21669, as described in Section V of this RFP, by completing the Declaration of Compliance, Form A, Part VIII of this RFP.

b. Bidder shall submit the following information describing its current swap meet operation(s):

1) Describe current customer services and conveniences policies and practices, specifically but not limited to:

pedestrian access, traffic flow

rest areas, restrooms or other customer conveniences

promotions, special events

access to information

other practices, programs, and/or policies that add to a quality customer experience at the swap meet.

2) Describe vendor programs, practices, policies and management of vendors, specifically but not limited to:

vendor solicitation, selection, contracting, and cultivation of productive vendor relations

policies and practices related to vendor layout and space pricing

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existing policies and practices governing vendor sales

other practices, programs, and/or policies that contribute to high standards of vendors.

3) Describe administrative systems and functions in the current operation of the swap meet, specifically but not limited to:

revenue collection, record keeping and internal audit controls

admissions operation

practices that insure company compliance with applicable local, State and Federal law

practices that insure vendor compliance with applicable local, State and Federal law, including, without limitation, providing evidence to the District of the licensing of swap meet vendors under applicable law

other practices, systems, operations, programs that contribute to quality administrative operations of the swap meet.

4) Describe operations and presentation of the current swap meet, specifically but not limited to:

Number of food service facilities, layout, menu and pricing of food & beverage

Parking and traffic control operations

Vendor load-in, set up, load-out and tear down procedures

Waste management and cleanliness of operation

Public safety and security operation

Crowd control measures

Emergency response measures

Other practices, operations, programs that contribute to a quality operations, aesthetics, and presentation of the current swap meet.

5) Average daily attendance, total annual attendance and gross annual revenue for the past five (5) years.

6) Evidence of the experience of current swap meet management team and staff.

7) Community outreach efforts and programs that involve the swap meet with the community and/or charitable promotions.

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8) Programs, practices, operations that add to the aesthetic presentation of the current swap meet, specifically signs, flags, banners, dcor and other measures.

9) This is an opportunity to submit information not already presented in another category, that provides evidence of creative management techniques, practices, and/or programs that have lead to an increase in revenue, increase in market share, and/or have contributed to creating and maintaining high standards of the swap meet operation.

4. Financial Information

Each bidder must submit:

a. Unqualified audited financial statements for the past five (5) years;

b. Current balance sheet and profit and loss statement;

c. Current list of major vendors and/or contractors, including company name, contact name, address and phone number;

d. List of all financial institutions with which the bidder conducts business, including company name, contact name, address and phon

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