1 STAFF REPORT
DATE: August 22, 2023
TO: Justin Hess, City Manager
FROM: Patrick Prescott, Community Development Director VIA: David Kriske, Assistant Community Development Director BY: Marcos Fuentes, Senior Transportation Planner
SUBJECT: Approval of an Amendment t o the Bus Shelter License Agreement w ith Outfront D ecaux Street Furniture, LLC a nd Review Transit Shelter a nd Vehicle Advertisement Request for Purchase Process and Outreach.
RECOMMENDATION
1. Approve the Fourth Amendment to Bus Shelter License Agreement (Amendment) and authorize the Community Development Director, as the City Manager’s designee, to execute the Amendment (Attachment 1).
2. Note and File the update on the City’s Transit Shelter and Vehicle Advertisement Program and upcoming procurement process.
BACKGROUND
Although several local and regional transit operators provide transit service within the City of Burbank (City), transit stops themselves are owned, managed, and maintained by the City or separate operators . For all transit stops, the City provides and designates the required public right -of-way and determines the level of passenger amenity installed at each location. Basic transit stops require a minimum area of sidewalk to board and alight passengers, as well as space for the transit operator to install a transit bus stop sign and pole and red curb marking for the stop. These basic stops are installed and maintained by the City. However, many transit stops provide higher levels of amenities including benches, trash receptacles, and shade shelters . These stops with transit shelters are managed by two bus shelter advertising vendors – Clear Channel Outdoors, LLC (CCO) and Outfront Decaux Street Furniture, LLC (Outfront) . The locations for these shelters were set by the City and its vendors through two shelter advertising agreements that were executed over 20 years ago. Under these agreements, the City provides vendors with a
COMMUNITY
DEVELOPMENT
2 license to install and maintain shelter amenities in designated areas of the public right of way, and manage advertising programs at such shelters.
In August 2020, the City Council adopted a City Transit Stop and B us Shelter Policy (Attachment 2) that clarified how transit amenities should be implemented and paid for at the City’s transit stops. The City’s T ransit Stop and Bus Shelter Policy established the following objectives:
1. Designate “Critical” transit stops as those with the highest ridership or that serve as important transfer locations;
2. Ensure that all City transit stops include adequate passenger amenities to ensure rider safety, comfort, information, and convenience, in accordance with the City’s Complete Streets Plan, transit industry best management practices, and adjoining land uses;
3. Ensure that all “Critical” stops provide transit shelters as the highest level of amenity while allowing for shelters at other stops where appropriate; and
4. Preserve limited local transportation funding by financing transit stop amenities through bus shelter advertising contracts and adjacent private development.
5. Include minimum amenities consisting of seating and a trash receptacl e at every transit stop.
The primary goal of this policy is to ensure that high ridership stops would have the highest level of amenity and all transit stops provide a safe, comfortable environment to encourage transit use. The policy also minimizes the fiscal impact to the City to provide these amenities by transferring capital, operations, and maintenance costs to a third-party shelter advertising vendor.
The City of Burbank currently contracts individually with CCO and Outfront on a nonexclusive basis to provide maintenance services to 138 bus shelters citywide. Under the existing agreements, CCO’s and Outfront’s services include construction, routine cleaning and maintenance, repair, and management of commercial advertising at City bus shelters in exchange for a percentage of the net revenue gained from the advertising sold at each shelter within the City.
Additionally, the City exclusive ly contracts with CCO f or advertising on transit vehicles.
Under the transit vehicle agreement, CCO sells, installs, and removes external advertisements on the City’s transit vehicles and shares the revenues from these advertisements with the City.
Both bus shelter agreements and the transit vehicle agreement were scheduled to expire in March 2023. By their own terms and pursuant to mutual agreement by the parties, the agreements with CCO were administratively extended on a month- to-month basis and 3 may be terminated on 30 days’ notice. While the bus shelter agreement with Outfront omitted a similar exte nsion clause, the parties agreed to administratively extend the agreement for up to six months on a month-to-month basis through September 18, 2023, pursuant to Burbank Municipal Code 2-2-201(E). Now, to ensure continuous operations and maintenance of bus shelters within the City, the Outfront agreement must be extended while the City completes its solicitation and selection process for a new vendor.
DISCUSSION
Outfront Agreement
Under its agreement with the City (Attachment 2), and at its sole cost and expense, Outfront has been responsible for the maintenance, construction, installation, repair, relocation of, and advertising at 86 bus shelters throughout the City, and must comply with location, design, and operational requirements established by the City and outlined in the agreement. Under the agreement, Outfront pays the City the greater of: (1) 20% of net advertising revenue for each shelter, or (2) a minimum guaranteed payment per shelter on a quarterly basis. Since the last agreement extension in 2013, the City has received $2,476,230 in payments from this agreement and all revenues go directly to the City’s general fund where they are used to support the City’s general services. Extending this agreement between the City and Outfront would ensure the continued maintenance and revenue generation for all bus shelters managed by Outfront, as well as maintain a high level of service for public transit riders.
Proposed Outfront Agreement Extension
With the Outfront A greement set to expire on September 18, 2023, an amendment is necessary to extend the existing Agreement on a month- to-month basis while Transportation staff prepares and issues a request for proposal (RFP) to select a new vendor while also ensuring the ongoing maintenance and advertisement management at all City bus shelters managed by Outfront. Furthermore, the proposed month-to-month extension would match the terms that are already in place in the Clear Channel Bus Shelter Agreement and would ensure the City a smooth and simultaneous transition to a new vendor.
Update on Transit Shelter and Vehicle Advertising Program and Procurement Process Staff is in the early stages of preparing for the solicitation process to replace the vendors on both bus shelter agreements, and the transit vehicle advertising agreement . Under this process, staff aims to consolidate all transit vehicle and bus shelter advertising under a single operator to improve efficiencies and attract more robust competition. As part of this RFP process, staff will seek to include vendor-maintained shelters at all of the City’s critical transit stops and ensure that the future contract generates additional funding to offset the cost to the City to maintain the transit stops with minimal amenities as well.
As part of the solicitation and consolidation process, the City will request that the new vendor update the existing bus shelters with new bus shelters that have an improved 4 aesthetic to ensure that the aesthetics of the bus shelters are reflective and in congruence with the vision of the City. Additionally, a consolidated agreement could present opportunities to enhance transit rider level of comfort by providing updated passenger amenities that could include expanded shade canopies, lighting, public WiFi, enhanced wayfinding, and real-time travel information displays.
Moreover, the City will reexamine current bus shelter locations and explore opportunities to relocate or expand the number of transit shelters citywide , taking into consideration factors such as ridership levels, bus transfer activity, disability accommodations, compatibility of adjoining land uses, sufficiency of shelter amenities, and overall cost.
Community Outreach
Prior to releasing the RFP, staff will conduct public outreach to inform the community of the RFP process, identify areas to improve the City’s transit system, and gather input on the types of transit stop amenities that are important to riders. In addition to reviewing policy documents like the Complete Streets Plans and those of transit agencies like Metro, this process will reexamine the location of existing bus shelters and determine if relocating or adding shelters at new locations that have proper sidewalk width and appropriate adjoining land uses to support a new transit shelter would benefit the community. Furthermore, the RFP process will provide an opportunity for the community to give input on the aesthetic of potential new bus shelters, critical locations, bus shelter amenities, and other services the community wishes to prioritize to enhance transit ridership and improve comfort level.
The community outreach, solicitation, and selection process for a consolidated vendor is estimated to take approximately 10 months. The first step in the process would involve public outreach to determine which features residents and riders hope to see in the City’s updated transit shelters and vehicles. Based on this input, staff will develop an RFP that solicits a vendor who can address these improvements and propose additional features that will enhance the City’s overall Transit Shelter and Vehicle Advertising Program.
Vendor proposals will be evaluated against a rubric of objectives and goals established through the City’s Transit Stop and Shelter Policy, lessons learned from the expiring agreements, bench marking similar transit agreements and revenue structures from other cities in the region, and the transit needs identified by community stakeholders. Once a preferred vendor is identified, staff will draft and negotiate a proposed agreement for City Council review and final approval. This process is estimated to culminate in the second quarter of 2024, where the City Council will be asked to select the most appropriate vendor and award the new agreement.
ENVIRONMENTAL REVIEW
Approving the proposed Amendment with Outfront will have no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect 5 physical change in the environment since all infrastructure will remain the same as it exists today, and the only substantive change will be to continue existing operations of bus shelters on a month-to-month basis. As such, this action is not a “project” subject to the requirements of the California Environmental Quality Act (CEQA) pursuant to 14 Cal.
Code Regs. §15378.
FISCAL IMPACT
There would be no fiscal impact to the City s hould Council approve the proposed Amendment. Approving the extension would allow Outfront to continue to maintain 86 of the City’s 139 transit shelters at its cost and would ensure the City continues to receive a share of the transit shelter revenue generated by Outfront’s advertising sales in accordance with the current agreement. If the proposed extension is not approved, it would result in a reduction in revenue from bus shelter advertisement to the City’s General Fund and maintenance disruption to 86 City bus shelter s. Additionally, City staffing resources may need to be reallocated from other essential functions to ensure continued bus shelter maintenance, and t he City’s General Fund will incur the added expense of operating and maintaining the 86 bus shelters while the City completes its solicitation and selection process for a new vendor.
CONCLUSION
Providing ongoing transit stop maintenance services is critical to maintaining and promoting transit ridership in the City. Amending the existing agreement with Outfront would ensure that 86 of the City’s 139 bus shelters continue to be cleaned and maintained on a scheduled routine basis , and that the City will continue to receive a share of the revenue generated by Outfront’s advertising sales. Extending this agreement on a month- to-month basis would correspond with the month- to-month status of the similar Clear Channel agreement so that all of the City’s shelters would continue to be maintained.
Furthermore, in accordance with the City’s Transit Stop and Bus Shelter Policy, extending this agreement would all ow staff to prepare a procurement for a single, unified transit shelter and vehicle advertising vendor that would operate, maintain, and expand the City’s transit shelters and share advertising revenue generated from those shelters. This RFP solicitation process would allow staff to work with the community to reexamine the location of all City bus stops, assess where bus shelters are needed, and explore bus shelter amenities while preserving revenue generated through transit advertising to continue supporting the City’s transit network.
ATTACHMENTS
Attachment 1 – Proposed Amendment
Attachment 2 – Existing Outfront Bus Shelter License Agreement Attachment 3 – First Amendment to Outfront Bus Shelter License Agreement Attachment 4 – Second Amendment to Outfront Bus Shelter License Agreement Attachment 5 – Fourth Amendment to Outfront Bus Shelter License Agreement 6 Attachment 6 – Map of Existing Bus Shelters in the City of Burbank Attachment 7 – Map of Transit Stops in the City of Burbank