| | | | | | | | Agenda Item - 3.f.
City of Garden Grove
INTER-DEPARTMENT MEMORANDUM
| To: | Lisa L. Kim
| From: | William E. Murray
| | Dept.: | City Manager
| Dept.: | Public Works
| | Subject: | Approval of a 15-Year Bus Shelter License Agreement with Clear Channel Outdoor, LLC. (Action Item) | Date: | 9/12/2023 |
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| | | | | | | | OBJECTIVE
For City Council to approve a 15-year bus shelter license agreement with Clear Channel Outdoor, LLC (Clear Channel) for the maintenance, operation, administration of, and the solicitation, sale and placement of out-of-home advertising on bus shelters, including benches, within the City. |
| | | | | | | | BACKGROUND
The former license agreement with Clear Channel expired in early 2022. Thereafter, staff proceeded to issue a Request for Proposals (RFP) in the Fall of 2022 and received a total of one proposal by December 2022. Another firm had shown interest in the RFP, however, they stated they would only consider it if the City would purchase all new shelters, benches, and receptacles for all existing Clear Channel locations, equaling an approximate capital investment of $700,000. |
| | | | | | | | DISCUSSION
After concluding negotiations with Clear Channel, the foregoing proposed agreement represents their Best and Final Offer. The following is a summary of major contractual changes:
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Program Area
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Description
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New Refurbishment Program
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Clear Channel will refurbish all 88 bus shelter locations during the first three (3) years of the Agreement (Year 1 = 30 locations, Year 2 = 29 locations, Year 3 = 29 locations). Shelters will be refurbished once again during contract years 11, 12, and 13 (same number of locations per year). The scope of work will include repainting the shelter units, replacing (or polishing) roof panels, installing receptacle lids and liners, and repairing or replacing solar lighting systems.
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New Quarterly Water Pressure Washing and/or Steam Cleanings
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Once quarterly, Clear Channel will pressure wash and/or steam clean all thirty (30) City-designated “hot spot” bus shelter locations. These locations could be modified by the City at any time.
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Additional Weekly Cleanings
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Clear Channel will collect all refuse and replace all liners twice weekly at all 30 City-designated “hot spot” locations. All remaining bus stop shelter locations will be serviced once weekly. Clear Channel will do additional cleanings when specifically or urgently requested by City.
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Bus Shelter Wraps
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Clear Channel proposes to install bus shelter wraps (Attachment 2) at specific locations throughout the City, potentially generating additional revenue-sharing for City.
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Liquidated Damages
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The proposed agreement adds liquidated damages provisions in the event of missed trash removal, repairs, graffiti, and performance schedule.
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Option to Sell Bus Furniture & Amenities to City
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The proposed agreement will allow both parties to negotiate the purchase/sell of bus shelters, benches, and receptacles for a mutually-agreed fair market value once contract expires.
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Revenue
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During the last five years of the former agreement, the City received $140,000 in annual payments. The proposed agreement includes annual payments of $25,000 or 20% of gross revenue, whichever is greater.
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| | | | | | | | FINANCIAL IMPACT
Clear Channel will refurbish all 88 bus shelters and benches at no cost to the City as well as include new services outlined above. The new license agreement will include annual payments of $25,000 or 20% of gross revenue, whichever is greater. |
| | | | | | | | RECOMMENDATION
It is recommended that the City Council:
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Authorize the City Manager to approve the 15-year license agreement with Clear Channel Outdoor, LLC to provide, operate, and maintain 88 bus shelter, benches, and receptacles throughout the City, and approve minor modifications as necessary.
By: Ana V. Neal, Principal Administrative Analyst
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