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Wednesday, August 24, 2011

Harry Grove Stadium Lease Act ll

George Wenschhof

In what is playing out in a similar manner as the famous Abbott and Costello classic baseball comedic routine of “Who’s on first”, the already muddied and confusing Request For Proposals (RFP) process has taken yet another turn.

Months after the city announced The Frederick Keys had won the RFP and a city lease negotiation team announced, the city remains without a ratified lease for the use of Harry Grove Stadium.

City of Frederick Mayor Randy McClement has now announced the city is dropping the negotiation with The Keys over revenue splits of parking revenue. Instead, the mayor says he now wants to go back to what was in the original RFP.

Seems, new city administrator Josh Russin, who was leading the city negotiating team was not having any better success in dealing with The Keys than his predecessor, Rick Weldon.

Interestingly, it was the failure by former city administrator Rick Weldon and the city to negotiate a satisfactory extension of the existing lease with The Frederick Keys which led Mayor McClement to issue the RFP.

The 120 day period the bids were require to stay in effect per the RFP, has now expired, making one wonder what the mayor is referring to when he says he wants to go back to the original RFP. Why were lease negotiations taking place outside of the RFP is another good question.

When I informed John Lavoie, Managing Member of Frederick Atlantic LLC of the latest development he said the following in an email I received last evening; “saw the new Gazette article today ..

If that is all recent info from the Mayor, the City's pending course of action is possibly illegal and confusing at best. If taken at face value, this will now totally ensure that the proposed Keys Lease does NOT comply with their RFP submission and that the Mayor and Aldermen are all active and knowing participants who have orchestrated this flawed RFP, engineered a closed process and concluded a one-sided auction in concert with one of the bidders- The Keys club.”

In a follow up phone conversation with Mr. Lavoie, he indicated it was fine for me to publish verbatim what he had stated in his email.

The announcement by the mayor comes after The Keys negotiated terms with the city which had them receiving the first $150,000 in parking revenue to reimburse them for the estimated annual cost of utilities at the stadium. This was later dropped to $125,000, before the mayor announced, at the last minute, he was pulling the discussion of the Harry Grove Stadium lease from the scheduled workshop last week.

Next, to appear was a financial analysis from Aldermen Karen Young which indicated the city’s financial cost to operate the stadium was not covered by the offer made by The Keys and showed Frederick Atlantic LLC offered a better deal for the city.

What followed was a motion by Aldermen Carol Krimm, which was unanimously approved, at the mayor and board meeting the next day, to release minutes of the private mayor and board meetings pertaining to the stadium lease.

What was the startling disclosure that resulted from this action? – The Keys were to receive extra points in the evaluation of their proposal due to their affiliation with a major league baseball team. The person who suggested the added weight to be given to The Frederick Keys was Alderman Karen Young.

Hardly a surprise, as this was clearly spelled out in the RFP evaluation criteria which was provided to the bidders.

In addition, over the last six months, gossip was spread around town by supporters of both teams. One, persistent rumor had The Frederick Keys for sale and/or leaving town.

The responding rumor involved original owner of The Keys; Peter Kirk, who is now affiliated with Opening Day Partners who has a strong relationship with Frederick Atlantic LLC. Kirk had a past relationship with former City of Frederick Mayor Ron Young, with the rumor suggesting this would make his current wife; Alderman Karen Young a supporter of Frederick Atlantic LLC. I wrote about both rumors in a column dated 4-20-2011.

Casting aside all of the smoke and mirrors one has to ask; where do all these theatrics leave the city?

According to the side-by-side comparison (prepared by John Lavoie; Managing Member of Frederick Atlantic LLC) of the two bids received by the city; The Frederick Keys did not offer to pay for utilities and Frederick Atlantic LLC offered to pay 100%.

So, with the recent announcement from the mayor, do the mayor and board of aldermen now intend to accept an offer from The Keys that does not include payment of utilities? Or, do they intend to alter the bid received from The Keys and include payment for utilities? Is this a fair approach in the RFP award process?

Where does this leave the city in regard to additional revenue streams? Clearly, one of the purposes of issuing the RFP was to see what reasonable additional revenues could be utilized for the benefit of the city.

Meanwhile, the question remains as to whether the city will receive enough money from the lease to pay for their operating expenses of the stadium.

Another unanswered question which remains is how did the secretive RFP review committee come up with their evaluation of the two proposals in the first place?

No request was made by the committee to have representatives of the two bidders give an oral presentation (allowed under the guidelines of the issued RFP) to them.

This oral presentation would have allowed the committee to get all their questions answered in regard to additional revenue streams and to also make sure they were comparing “apples to apples” when evaluating what was arguably a difficult RFP to rank.

A presentation from the review committee to the mayor and board in a workshop also never took place which would have allowed a clear picture to unfold. If, the aldermen or mayor had questions, they could have been answered at that time.

Whether what has transpired to date with the RFP process has been legal or not is best left for lawyers to decide. Let's hope it does not come to that.

In my column published on Sunday, I presented a series of steps which, if taken, were intended to result in a fair outcome to both bidders and the city.

Instead, city taxpayers are left wondering, Who’s on first?

Stay Tuned…


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