August 20, 2024, Item #6
DATE:
TO:
FROM:
CONTACT:
SUBJECT:
Summary:
AG EN DA REPORT City of Poway
August 20, 2024
Honorable Mayor and Members of the City Council
Audrey Denham, Director of Community Services
Allie Margis, Recreation Area Manager
858-668-4774 or [email protected]
CITY COUNCIL
Award of Agreement to Cheeseburgers in Poway, LLC to Operate the Lake Poway Concession; RFP #24-025
The Agreement for operating the concession sales area at Lake Poway between the City and current vendor is set to expire on November 3, 2024. A Request for Proposal was issued on May 16, 2024. Two proposals were received by the June 27, 2024 deadline. Based on qualifications, relevant experience, business plan, financial arrangement proposed, and financial wherewithal, staff found Cheeseburgers in Poway, LLC, to be the successful proposer.
Recommended Action:
It is recommended the City Council award the Agreement to Cheeseburgers in Poway, LLC, to operate the Lake Poway Concession and authorize the City Manager to execute the Agreement.
Discussion:
Lake Poway serves the City of Poway as both a water supply for residents, as well as an exceptional outdoor recreational amenity since 1972. Recreation opportunities include fishing and boating, pleasure boating, hiking, biking, horseback riding, seasonal camping, picnicking, and archery. The City enters into an agreement for the purpose of operating a concession during fishing and boating hours.
The concession is expected to sell packaged and prepared foods, non-alcoholic and alcoholic beverages, fishing permits, boat rentals, archery cards, merchandise related to fishing such as bait and tackle, and merchandise related to other recreational activities offered within the park.
On November 3, 2018, the City entered into an Agreement with R & B Pinto Properties, LLC, for concession services for a term of two years with the option to extend for two (2) additional two-year terms. The Agreement has exhausted its six-year term and is due to expire on November 3, 2024.
A Request for Proposals (RFP) was issued on May 16, 2024. It was advertised on the City's website 1 of21
August 20, 2024, Item #6
using BidNet Direct and mailed/emailed to 15 businesses and individuals. A legal advertisement appeared in the Poway News Chieftain on June 6, 2024 and June 13, 2024. A nonmandatory, pre proposal meeting and tour of the Lake Poway Concession took place on June 5, 2024. Two proposals were received by the June 27, 2024 deadline. Interviews were conducted with both proposers the week of June 15, 2024.
The proposals were evaluated based on the following criteria:
• Experience and qualifications
• Proposed business plan
• Proposed financial arrangement
• Financial wherewithal
The first proposal was submitted by Rick Pinto of R&B Pinto Properties, LLC. Mr. Pinto proposed maintaining the current terms of the Agreement with the City, which includes selling fishing permits, boat rentals, and archery cards on behalf of the City. The City would retain 90% of the revenue for fishing permits, boat rentals, and archery cards, and Mr. Pinto would be given 10%. Mr. Pinto would continue to offer a variety of food, snacks, beverages, as well as bait and tackle. All other concession sales beyond fishing, boating, and archery cards would be retained by Mr. Pinto. During the in-person interview, Mr. Pinto was asked about the Point-of-Sale system and his plan moving forward. Mr. Pinto stated he preferred to continue using the City's system. The City currently supplies a City-owned computer, scanner, and receipt printer, and pays all associated transaction and credit card fees for the sale of fishing permits, boat rentals, and archery cards. Mr. Pinto currently pays the transaction and credit card fees for the sale of his merchandise. All sales collected through the City's Point-of-Sale system are deposited into a City account. Through a financial administrative process, Mr. Pinto is issued a weekly check for his portion of merchandise sales and a monthly check for his 10% of fishing permits, boat rentals, and archery card sales.
The second proposal was submitted by Josh Arbenz of Cheeseburgers in Poway, LLC. Mr. Arbenz proposed staying consistent with the current revenue sharing agreement. He would sell fishing permits, boat rentals, and archery cards on behalf of the City retaining 10% of the revenue and returning 90% to the City. Mr. Arbenz proposed expanding the current offerings of the concession of packaged food, snacks, beverages, as well as bait and tackle to also include prepared foods and grilled items. In addition, Mr. Arbenz proposed upgrading the outdoor patio area with comfortable seating options to encourage guests to fully utilize the space. During his in-person interview, Mr. Arbenz was asked about his plan for a Point-of-Sale system. Mr. Arbenz proposed providing his own Point-of-Sale system that he currently uses in his other businesses. He stated that the system would generate sales reports that would be delivered to the City and the City could login in to audit sales revenue as needed.
Both proposals were evaluated using the criteria as outlined above and it was determined the business and financial arrangement offered by Josh Arbenz of Cheeseburgers in Poway, LLC, is the most favorable_ to the City.
The following is a summary of the significant changes to the current concession operations if the proposal is accepted. The proposal, in its entirety, can be reviewed in the Community Services Department.
• Expanding the food offerings to include hot fresh items like breakfast burritos, hot dogs, corn dogs, pizza by the slice, pulled pork sandwiches, hot chili, and grilled meats. 2 of21
August 20, 2024, Item #6
• Utilizing a business-owned Point-of-Sale system would streamline the transfer of revenue and would result in an annual cost savings of $9,000 in transaction fees and equipment expenses. • Upgrading the patio area to include new lounge furniture, misters, heat lamps and outdoor speakers to promote a relaxed and inviting environment.
Staff recommends awarding the Agreement (Attachment A) to Cheeseburgers in Poway, LLC, to operate the Lake Poway Concession. The term of the Agreement is for three years with the option to be extended for one additional three-year term. During the term of this Agreement, the City will continue to be responsible for the utilities and maintenance of the building. The Operator is responsible for any upgrades and any possessory interest tax associated with those additions.
Environmental Review:
This item is not subject to CEQA review.
Fiscal Impact:
There are sufficient funds budgeted in account 202020-41200 for the payment of 10% to the Concession Operator for permits sold on behalf of the City. The offsetting revenue can be found in accounts 202020-72320, 202020-72330, and 202020-72370.
Public Notification:
None.
Attachments:
A. Agreement for the Operation of the Concession at Lake Poway Reviewed/Approved By:
Assistant City Manager
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Reviewed By:
Alan Fenstermacher
City Attorney
August 20, 2024, Item #6
CITY OF POWAY
AGREEMENT FOR THE OPERATION
OF THE CONCESSION AT LAKE POWAY
This Agreement· ("Agreement"). is made and entered into this 4th day of November, 2024, by and between the CITY OF POWAY, a municipal corporation (the "City") and Cheeseburgers in Poway, LLC ("Operator"), for the purpose of awarding an Agreement for the operation and maintenance of the Lake Poway Concession at the City's Lake Poway Recreation Area.
Article I of this Agreement is for the Concession Sales Area ("Concession Agreement'?-Article II of this Agreement sets forth general terms applying to the Concession Agreement.
ARTICLE I. CONCESSION AGREEMENT
This Concession Agreement is awarded subject to the following terms, conditions, and limitations:
1. Location. The area to be governed by this Concession Agreement is that portion of the Lake Poway Recreation Area known as the Lake Poway Concession, the premises located at 14656 Lake Poway Road, as shown in Exhibit A ("Concession Premises").
2. Concession Premises Use. At all times during established operating hours and during designated holidays and special events, the Operator shall be responsible for providing the following services at the Concession Premises:
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a) Sale of food and beverages, including alcoholic beverages having an alcoholic content no greater than 20 percent by volume. Operator agrees to obtain and maintain, at Operator's sole cost, a valid permit from the Department of Alcoholic Beverage Control and to conform to all applicable laws and regulations related to the sale of alcohol. All food preparation shall comply with all applicable health code requirements.
b) Sale of City of Poway fishing permits, boating permits, drop-in camping, and archery cards on the City's behalf. The City shall retain agreed-upon revenue from the sale of fishing permits, boating permits, drop-in camping, and archery cards as noted in Article I, Section 6, Compensation and Payments. The City has sole authority to establish fees for the use of Lake Poway for fishing, boating, drop-in camping, or archery; and shall have the right to change its fees with or without notice.
c) Sale of merchandise related to fishing, such as bait and tackle, and sale of merchandise related to outdoor recreation and leisure activities, such as hiking and picnicking.
d) Prices charged for merchandise shall be comparable to market rates.
ATTACHMENT A
August 20, 2024, Item #6
e) Licensee agrees that all merchandise and services offered by Licensee are subject to approval of the City and that no merchandise will be offered for sale which, in the City's sole opinion, is not in keeping with a youth-and family-oriented recreation area.
f) At all times, the Operator shall operate the Concession Premises for the purposes set forth herein. The Concession Premises shall not be used by Operator for any other purpose. Any subsequent modification by Operator to the kind or type of merchandise sold or how the Concessions Premises are used must first be approved in writing by City.
g) Operator shall provide all necessary equipment and supplies for the sale of City permits, rentals, and programs.
h) Remittance to the California State Board of Equalization (the "SBE") of all sales and use taxes applicable to the food, beverages, merchandise, and services sold from the Concession Premises, in a timely manner, along with all reports prepared in conjunction therewith, prepared in accordance with SBE guidelines. i) Operator acknowledges that the City has the right to enter into contracts with other vendors for the sale of concession items for programs held at Lake Poway. j) Operator acknowledges that the City retains the right to allow school groups, sports leagues, and nonprofit organizations to sell food, beverages, and merchandise at the lower ball field concession stand while they are approved to utilize the lower ball field.
3. Term of Agreement: The Concession Agreement is awarded for a period of three (3) years ("Concession Agreement Term"), starting November 3, 2024. This Concession Agreement may be renewed by mutual consent for an additional three (3) year term upon its expiration, unless Operator has breached any material term of this Agreement or the City has determined, in its sole discretion, that Operator has failed to demonstrate the ability to meet the terms and conditions of this Agreement to the City's satisfaction. City reserves the right to alter the terms of the Agreement.
4. Minimum Operating Hours. Operator must maintain a fully staffed and fully operational concession sales area that is accessible to the public during all regular business hours and for various special events and holidays designated by the City. Operator has the right to open and operate the concession sales area during non-regular business hours within Lake Poway operating hours; however, fishing permits and boating permits shall not be sold during these times unless advance approval is granted by the City. The hours of operation may be changed by the City Manager or designee.
Operator shall be notified in writing seven (7) calendar days in advance of any schedule changes by the City.
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a) January through December the Lake is open daily from 6:00 a.m. to sunset.
Fishing and Boating occurs Wednesdays through Sundays. The concession can remain open on Mondays and Tuesdays or elect to close. Additional hours may be established for special events and mutually agreed upon, City-approved holidays.
August 20, 2024, Item #6
b) Concession will open on all holidays that fall on a Monday or Tuesday. Holidays that fall on a weekend that are recognized by the City on a Monday will not require the concession to open, but could be negotiated. The concession will be open on the following holidays: New Year's Day, Martin Luther King Day, President's Day, Memorial Day, Independence Day, Labor Day, Veteran's Day, the Day after Thanksgiving, and Christmas Eve.
c) Lake Poway offers a variety of Special Events and programs that require the concession to remain open after normal business hours. During the months of July and August, the concession will remain open until 9:00 p.m. on Friday and Saturday evenings during night fishing. The concession will remain open until 9:00 p.m. select evenings during fall campouts, spring campouts, family campouts, and the Youth Fishing Derby campout. The City has the option to increase or decrease the amount of program offerings throughout the year and will notify the concessionaire in advance of upcoming programming.
5. Employee Requirements.
a) For the purposes of this Concession Agreement "Employee" means anyone receiving compensation from Operator for services rendered on the Concession Premises. Operator agrees that Operator shall abide by all federal, state, and local labor laws.
b) Operator agrees that all employees of Operator will receive a City-furnished orientation on Lake Poway operations and local points of interest, the skills of fishing, and facilities available, sufficient to permit Operator's employees to reply adequately to questions from the visiting public. All other questions from the visiting public shall be directed to City employees.
c) Whenever the concession is open, Operator agrees that an employee over 18 years of age will be present. All minors working must have a current work permit.
An onsite staff person that is at least 18 years of age must supervise any employees used. A list of employees must be on file with the City.
6. Compensation and Payments.
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a) Operator shall remit payment to the City for 90% of gross revenue collected from the sale of all fishing permits, boating permits, drop-in camping, and archery cards.
As payment for operating the Concession Premises, Operator shall retain 10% of net gross revenue collected from the sale of all fishing permits, boating permits, drop-in camping, and archery cards. All other gross revenue collected by Operator shall remain property of the Operator.
b) Payments to the City shall be in the form of a check and received no more than 30 days after the end of each month.
c) Operator shall be responsible for all transaction fees associated with the sale of all fishing permits, boating permits, drop in camping, and archery cards.
August 20, 2024, Item #6
7. Financial Records. Operator shall keep full and accurate books of account records, cash receipts, and other pertinent data related to business and transactions. The City shall have the right to inspect and examine such records, at no cost, within five (5) business days of providing notice to Operator. In addition, the Operator must provide the City with reports (as requested by the City) in a format acceptable by the City summarizing City sales, and provide the City with access to the point of sale system to run these reports.
As soon as practicable, but no later than January 15 of each year, Operatorshall provide a profit and loss statement detailing the total revenue and expenditures and a current balance sheet.
8. Review. The Director of Community Services or designee, and Operator shall meet periodically to discuss matters of mutual concern in the administration of the Agreement. The Agreement shall be reviewed annually to enable both parties to consider operations, processes, and procedures for the purpose of making proper adjustments, if desired. Any substantive modifications of this Agreement shall be made in accordance with Article II, Section 15.
9. Utilities and Maintenance of the Concession Premises. 7 of21
a) The City agrees to provide and pay for electricity, water and trash/ recycling service to the Concession Premises. Operator agrees to pay all charges for propane, telephone, internet, and cable service used on the Concession Premises. The site has a burglar alarm system. If desired, Operator shall maintain and monitor at Operator's sole expense, including any alarm permits required by the City of Poway and the San Diego County Sheriffs Department. Costs and use of all other utilities necessary for operation shall be paid for at the Operator's sole expense, following written approval by City.
b) Operator shall pay before delinquency, all taxes and assessments assessed or levied upon Operator or the Concession Premises and its improvements by reason of this Concession Agreement (including any possessory interest tax) or on any furniture, fixtures, equipment, and personal property thereon, or by reason of the business or other activities of Operator upon or in connection with the Concession Premises, including without limitation, any sales, use, income or franchise tax, and shall pay any fees imposed by law for Agreements or permits for any business or activities of Operator upon the Concession Premises of under this Concession Agreement.
c) Operator will be liable for upholding the terms of this Agreement in the event of any planned or unplanned power outages in the area. City will notify Operator of all planned outages immediately upon notification from SDG&E. d) Operator shall clean and maintain the Concession Premises, and shall keep them in clean, orderly, and sanitary condition at all times throughout the Concession Agreement Term. Operator agrees to maintain at all times an "A" rating for cleanliness and sanitary condition, if applicable, and as determined by the appropriate health enforcement authority in San DiegoCounty.
August 20, 2024, Item #6
10. Public
Access.
Operator
understands
that
the
Concession
Premises
are
public
property,
and
as
such,
Operator
may
not
deny
access
to
the
Concession
Premises
to
any
member of
the
public
except
that
Operator
may
deny
access
to
ensure
the
health
and
safety
of
the
Concession
Premises,
such
as
barring
disruptive
individuals,
or
to
ensure
compliance
with
City
policies
or
regulations.
There
shall
be
no
discrimination
against
any
person,
or
groups
of
persons,
on
account
of
gender,
marital
status,
sexual
orientation,
age,
race,
color,
religion,
creed,
national
origin
or
ancestry
in
the
use
of
the
Concession
Premises
or
performance
of
duties
pursuant
to
this
Concession
Agreement
, and
Operator
shall
not
establish
or
permit
any
practice
of
discrimination
in
connection
with
this
Concession
Agreement
or
with
regard
to
the
use
of
the
Concession
Premises.
11. Maintenance
and
Repairs.
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a)
Operator
shall
maintain
the
facility
and
all
personal
equipment
kept
inside
or
outside
the
building
in
a clean,
safe,
sanitary,
and
attractive
condition,
and
in
good
repair
in
a
manner
deemed
acceptable
by
City.
This
includes,
but
is
not
limited
to,
floors,
walls,
counters,
interior
and
exterior
doors
and
windows,
plumbing
fixtures,
drains,
and
all
interior
building
appliances
and
similar
equipment.
Operator
shall
be
responsible
for
replacing
lighting
fixtures,
bulbs,
and
ballasts,
as
necessary.
b)
If
used,
Operator
shall
maintain
the
grease
trap/interceptor
in
good working
order
for
business
operations.
Grease
traps
should
be
cleaned
in
accordance
with
the
City's
FOG
(Fat,
Oil,
Grease)
Program
requirements
included
as
Exhibit
"B".
Operator
shall
pressure
wash,
adhering
to
the
Best
Management
Practices
contained
in
the
City's
Jurisdictional
Runoff
Management
Plan
(JRMP),
the
patio
area
where
eating
is
permitted
a
minimum
of
once
every
three
months,
or
as
deemed
necessary
by
City
.
c)
Operator
shall
be
responsible
for
ensuring
that
the
interior
of
the
premises
is
kept
free
of
insects
and
rodents
and
shall
keep
outdoor
areas
free
of
equipment
and
supplies
.
d)
City
may,
at
times,
require
the
Operator
to
make
repairs
such
as
interior
painting,
and
other
types
of
repairs
to
the
Concession
premises
during
the
time
of
the
Agreement.
These
repairs
will
be
made
within
thirty
(30)
days
of
any
written
request
for
the
reason
of
aesthetics
or
five
(5)
days
for
health
and
safety
reasons.
If
the
repairs
are
not
made
within
the
stated timeframe,
the
City
may
make
the
repairs
and
charge
the
costs
to
the
Operator.
Operator
shall
comply
with
all
federal,
state,
county,
and
municipal
statutes,
and
ordinances,
and
with
all
regulations,
orders,
and
directives
of
appropriate
governmental
agencies
concerning
the
use,
sanitation,
and
safety
of
the
Concession
Premises.
e)
The
City
shall,
throughout
the
term
of
this
Concession
Agreement,
at
its
own
expense,
be
responsible
for
maintenance
for
the
Concessions
Premises,
including,
but
not
limited
to:
•
Roof
repairs
.
•
Heating
and
air
conditioning
equipment
including
thermostats.
August 20, 2024, Item #6
• Acoustical tiles.
• Major plumbing with the exception of issues caused by concession operations. • Sewer lines.
• Interior and exterior electrical facilities with the exception of interior lighting fixtures, bulbs, and ballasts.
• Exterior walls and wall finishes, including restrooms. • Floors, doors, and windows.
• Patio wood structure.
f) Upon commencement of this Lease, City shall be responsible for ensuring the exterior of the building is free of insects and rodents and City shall be responsible for removing graffiti from exterior of the building.
g) City has the sole discretion to determine when repair and maintenance projects shall be completed based on available funding and resources. City shall not unreasonably delay repair and maintenance projects. If during the term of the Lease, the City has planned capital improvements to the building that will result in the need to close public access to the building for a period of time, the City and Operator shall coordinate closures to minimize business disruptions, except in emergency situations where repairs need to be made immediately. The City shall make every effort to avoid closing public access to the Premises for planned capital improvements.
12.Alterations to Premises.
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a) If during the term of this Concession Agreement, any additions, alterations, or improvements in or to the Concession Premises are requested by Operator or are required by governmental laws or regulations that relate to concession operations, they shall be made and paid for by Operator. Operator shall submit a written request describing the proposed alterations, construction dates, and funding source. The concept must be approved by the Director of Community Services or designee. The Operator must adhere to all City requirements for permits and the cost for said permits shall be the sole responsibility of the Operator. b) Operator waives any and all rights provided by law entitling Operator to make repairs at the expense of the City.
c) Operator shall make no installations, additions, or improvements in or to the Concession Premises, or structural alterations or changes either to the interior or exterior of the building located on the Concession Premises, or in the bearing walls, supports, beams, or foundation, without first obtaining the written consent of the City. All applicable City permits and approvals must be obtained prior to the installation of any additions or improvements.
d) Plans and specifications showing such proposed installations, additions, or improvements and alterations and changes, shall be submitted to City for approval upon the application for such written consent.
August 20, 2024, Item #6
e) All installations, additions, or improvements, and alterations and changes made, with the written consent of City, shall be made under the supervision of an architect or engineer satisfactory to City. Work shall be inspected and permitted by the City as required. All architects, engineers and contractors must be approved by the City, and must maintain insurance coverage deemed acceptable by the City. f) Operator shall surrender the Concession Premises upon termination of this Concession Agreement in a condition as good as received, with normal wear and tear excepted. The City may require the Operator to reverse alterations that were made to the Concession Premises at the Operator's request, at Operator's expense.
13. Personal Property.
a) Operator will, at Operator's own cost and expense, equip and maintain at the Concession Premises all furniture, fixtures, equipment, and other personal property required by Operator for the operation of the Concession Premises in accordance with the objectives of this Concession Agreement . b) Operator shall have the right, within thirty (30) days of the termination or expiration of this Concession Agreement, to remove any and all of said furniture, fixtures, equipment, and other personal property of Operator from the Concession Premises. All such property not removed within that time shall become and remain the property of the City. The removal of such property shall be affected solely at the expense of Operator, and in a manner satisfactory to the City, and without injury or damage to the Concession Premises or any of the improvements constructed by City. Operator shall promptly repair any injury or damage caused by the removal of personal property from the Concession Premises.
14. Damage to the Premises.
a) Operator shall, at Operator's own expense, repair any damage to the Concession Premises caused by Operator or Operator's employees and/or vendors and contracted service providers. If the Concession Premises or any part thereof, or any appurtenance thereto is so damaged that the same cannot be used for Operator's purposes, and the damage has been cause by Operator or Operator's employees and/or vendors and contracted service providers, Operator shall provide written notice to the City within ten (10) calendar days following the occurrence of the damage. Operator shall provide a proposal to the City for repair of the damage within thirty (30) calendar days of the occurrence of the damage and shall commence the repairs within ninety (90) calendar days of receiving written approval of the repair plan from the City. In the event of minor damage to any part of the Concession Premises, and if such damage does not render the Concession Premises unusable for Operator's purposes, Operator shall promptly repair such damage at Operator's sole cost and expense. Should Operator or City repairs to the Concession Premises result in closure, City shall, when practical, provide space to Operator to continue in the performance of services described herein at a level deemed appropriate by City.
b) If the Concession Premises, or any area of the Lake Poway Recreation Area, is so 10 of 21
August 20, 2024, Item #6
damaged that the same cannot be used for Operator's purposes or results in closure to the public, and the damage has not been caused by Operator or Operator's employees and/or vendors and contracted service providers, then Operator shall have the right to terminate this Concession Agreement within ninety (90) calendar days following such damage while repairs are being made at City's sole cost and expense. If Operator elects not to terminate this Concession Agreement while the City is repairing the Premises, Operator agrees that Operator shall not be entitled to compensation for any time periods when the concession business is closed pending repairs.
15. Sign. Operator agrees that the content, style, appearance, and location of all signs, placards, and advertising in or about the Concession Premises, including window advertising, are subject to City's prior written approval. All signs must comply with the City's Municipal Code, Chapter 17.40 Comprehensive Sign Regulations.
If Operator wishes to change the business name from Lake Poway Concession, Operator shall submit a written request to the Director of Community Services for approval.
16. Direction of Communication. Neither Operator nor any employee shall engage in any verbal or written criticism of the City's staff, park management, business decisions, etc., to any third party. Operator agrees to direct all concerns or complaints directly to the Recreation Area Manager, and if no response, to the Community Services Director, and to encourage Operator's patrons, friends, and guests to do the same.
17. Termination and Revocation of Concession Agreement. 11 of 21
a) This Concession Agreement may be terminated by either party by providing written notice to the other party at least ninety (90) calendar days in advance of the desired termination date. Notwithstanding the foregoing, this Concession Agreement may be terminated by City prior to the expiration of the Concession Agreement Term pursuant to the paragraph below.
b) This Concession Agreement may be revoked by the City twenty (20) calendar days after a written notice to Operator that City has determined that Operator has done any of the following, and if Operator has not cured the noticed breach within ten (10) business days after the notice, provided that if the nature of a non-monetary default is such that it cannot be fully cured within said five (5) day period, Operator shall have such additional time as may be reasonably necessary to cure such default so long as Operator proceeds promptly after service of City's notice and proceeds diligently at all times to complete said cure:
1) Failed to confine use of the Concession Premises to concession sales, pursuant to the terms of Article I, Section 2 of this Concession Agreement; 2) Failed to maintain the required operating hours, pursuant to Article I, Section 4 of this Concession Agreement on four (4) or more occasions during any twelve month period;
3) Failed to remit payment, pursuant to Article I, Section 6 of this Agreement; August 20, 2024, Item #6
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4) Failed to adequately clean and maintain the Concession Premises or failed to comply with all County Health Department "A-rated" health requirements pursuant to Article I, Section 9 of this Agreement;
5) Failed to maintain adequate insurance, pursuant to Article II, Section 1 of this Concession Agreement;
6) Failed to abide by employment-related laws, pursuant to Article II, Section 3 of thisAgreement;
7) Failed to work cooperatively with City staff;
8) Taking actions to the detriment of the Operator or the City. 9) Failed to maintain all permits required, including but not limited to: City of Poway Business Certificate, ABC Agreement, and County Health Department Permit.
10) Failed to present any written or verbal criticism of the City's staff, park management, business decisions, etc., directly to the Recreation Area Manager or the Community Services Director, as required in Article I, Section 17 of this Concession Agreement.
11) Operator becoming insolvent, making an assignment for the benefit of creditors, becoming the subject of a bankruptcy proceeding, reorganization, receivership, liquidation or dissolution proceeding, or any judicial sale of Operator's interest under this Concession Agreement. Should Operator form a corporation for the purpose of conducting business, Operator must notify City in writing within thirty (30) days of filing an application for incorporation, and shall not permit transfer of the Lease or possession of the Premises by merger, consolidation or dissolution, nor permit sale of a controlling interest in the voting stock in said corporation, without the written consent of the City; or 12) Failed to perform any other provision of this Concession Agreement. Except for default arising from Operator's failure to maintain the required hours of operation, as described in subparagraph (2), above, which default shall be deemed material and will not be allowed to be cured, if the default cannot be cured within five (5) business days, the Operator shall not be in default of this Concession Agreement if Operator commences to cure the default within the five-day period, and diligently and in good faith continues to cure the default.
Notice of any default given to Operator pursuant to this Section shall specify the nature of the alleged default and the applicable Concession Agreement provisions and shall demand that Operator perform the provisions of this Concession Agreement within the applicable time period or quit the Concession Premises. No such notice of default shall be deemed a termination of this Concession Agreement unless City elects to provide Operator with a notice of termination as set forth in Section 17.
August 20, 2024, Item #6
c.)
Upon
termination
or
revocation
of
this
Agreement,
Operator
agrees
to
vacate
the
Concession
Premises
within
five
(5)
working
days,
and
to
surrender
this
Agreement.
18. City's
Remedies
for
Default.
City
shall
have
the
remedies
set
forth
in
this
Section
in
the
event
of
Operator's
default.
These
remedies
are
not
exclusive,
and
do
not
preclude
City
from
pursuing
any
other
remedies
allowed
by
law.
a)
Operator's
Right
to
Possession
not
Terminated.
During
the
period
that
Operator
is
in
default,
City
shall
have
the
right
to
terminate
the
Concession
Agreement,
enter
the
Premises
to
operate
the
concession,
and/or
to
grant
a
new
Agreement
to
a
third
party
("re-Agreement
").
Operator
shall
be
liable
to
City
for
all
costs
incurred
in
re-licensing
the
Concession
Premises,
including
reasonable
amounts
to
repair
the
Concession
Premises,
if necessary,
to
make
the
Concession
Premises
suitable
to
be
re-Agreement
d.
No
act
by
City
pursuant
to
this
paragraph
shall
terminate
this
Concession
Agreement
unless
City
notifies
Operator
in
writing
that
the
City
is
electing
to
terminate
the
Concession
Agreement.
b)
Termination
of
Operator's
Right
of
Possession.
City
has
the
right
to
terminate
Operator's
possession
of
the
Premises
at
any
time
upon
Operator's
default,
if such
default
constitutes
a
material
breach
of
this
Concession
Agreement,
as
set
forth
in
Article
I,
Section
17 . No
act
by
City,
other
than
giving
written
notice
of
termination
to
Operator,
shall
terminate
this
Concession
Agreement.
City
has
the
right
to
recover
from
Operator
such
amounts
and
costs
necessary
to
compensate
City
for
all
detriment
proximately
caused
by
Operator's
default.
c)
City's
Right
to
Cure
Operator's
Default.
City,
at
any
time
after
Operator
commits
a
default,
can
cure
the
default
at
Operator's
cost
if Operator
does
not
cure
pursuant
to
Paragraph
17(b)
. If
City,
at
any
time,
by
reason
of
Operator's
default,
pays
any
sum
or
does
any
act
that
requires
the
payment
of
any
sum,
the
amount
paid
by
the
City
shall
be
due
immediately
from
Operator,
and
if
paid
at
a
later
date
shall
bear
interest
at
the
rate
of
eighteen
percent
(18%)
per
annum,
or
if
the
highest
lawful
rate
is
less
than
eighteen
percent
(18%)
per
annum,
at
that
rate
from
the
date
the
sum
is
due
until
City
is
reimbursed
by
Operator.
d)
Failure
to
Enforce:
Failure
by
the
City
of
Poway
at
any
time
to
enforce
the
provisions
of
the
contract
shall
not
be
construed
as
a waiver
of
any
such
provision
.
Such
failure
to
enforce
shall
not
affect
the
validity
of
the
contract
or
any
part
thereof
or
the
right
of
the
City
of
Poway
to
enforce
any
provision
at
any
time
in
accordance
with
its
terms.
e)
Force
Majeure
Clause:
The
parties
to
the
contract
shall
be
excused
from
performance
during
the
time
and
to
the
extent
that
they
are
prevented
from
obtaining,
delivering
or
performing
by
act
of
God,
fire,
strike,
loss,
shortage
of
public
transportation
facilities,
walkout
or
commandeering
of
materials,
products,
or
facilities
by
the
government
provided
that
the
nonperformance
is
not
due
to
the
fault
of
neglect
of
the
contractor/supplier.
In
such
cases,
however,
satisfactory
evidence
thereof
must
be
presented
.
13 of
21 August 20, 2024, Item #6
19. As-ls Condition of Property. Operator acknowledges that Operator is fully knowledgeable of the condition of the Concession Premises. City makes no representations whatsoever to Operator concerning the condition of the Concession Premises, and specifically does not represent to Operator that the Concession Premises is fit for the use that Operator intends. Operator has inspected the Concession Premises and accepts the Concession Premises in AS-IS condition.
Operator shall not allow contamination, shall not commit waste, and, subject to Operator's right to remove personal improvements and fixtures, shall not do anything on the Concession Premises that will cause damage to the Concession Premises.
20. Entry by City. City may, at any time, in response to emergency, and in all other cases upon 72 hours prior written notice to Operator, and at times deemed reasonable by Operator, enter the Concession Premises for the purpose of inspecting the property, making such repairs as the City may deem necessary, preparing for City's future use of the Concession Premises, constructing public improvements on the property, and other public utilities and improvements, or for such other purposes or at such times as may be deemed necessary by City. City shall make verbal notification to Operator prior to such entry when possible. To the extent that City does construct public improvements on the Concession Premises, Operator shall relinquish all rights and interest therein and all tenancy to that portion of the property affected without additional compensation.
21. Liens. Operator shall keep the Concession Premises, including all buildings and improvements now or hereafter located on the property, free and clear of all liens and claims of liens for labor, services, materials, supplies, or equipment performed on or furnished to the Concession Premises. If a lien or other encumbrance attaches to the Concession Premises and/or improvements on the property, Operator shall promptly pay and discharge, or cause the property to be released from, or cause to be insured or bonded over any such lien or claim of lien.
ARTICLE II. GENERAL CONCESSION AGREEMENT TERMS
1. Insurance Requirements. Operator shall obtain and maintain during the life of this Concession Agreement all of the following insurance coverages:
a) Comprehensive General Liability, including premises-operations, products/completed, broad form property damage, and blanket contractual liability with the following coverages:
General Liability:
$1,000,000 per occurrence
$2,000,000 aggregate per occurrence
$1,000,000 property damage per occurrence Liquor Liability Insurance Rider b) Property Insurance Coverage. Operator shall, at its own cost and expense, maintain in full force and effect property insurance, including fire and extended coverage insurance, covering Operator's personal property, including removable trade fixtures, located in the Concession Premises, in an amount of at least one 14 of 21
August 20, 2024, Item #6
hundred percent (100%) of their cash value.
c) Workers' Compensation insurance in statutory amount. All of the endorsements, which are required above, shall be obtained for the policy of Workers' Compensation insurance.
d) Endorsements shall be obtained so that each policy contains the following three provisions:
1) Additional Insured Status (Not required for Workers' Compensation): "City of Poway and its elected and appointed boards, officers, agents, and employees are additional insured with respect to this subject property and Agreement with City."
2) Notice: "Said policy shall not terminate, nor shall it be canceled, until thirty (30) days after written notice is given to City."
3) Primary Coverage: "The policy provides primary coverage to City and its elected and appointed boards, officers, agents, and employees It is not secondary or in any way subordinate to any other insurance or coverage maintained by City."
e) Operator shall provide City certificates of insurance with proper endorsements showing the insurance coverage described in the paragraphs above, in a form and content approved by City.
f) In the event that Operator fails to procure the required insurance policies described above, the City is authorized by this Agreement to purchase the insurance and to deduct 100% of the cost of the premiums from the Operator's monthly compensation as provided in Article I, Section 6. g) Failure to comply with insurance requirements under this Agreement shall be a material breach of this Agreement.
2. Indemnification. Except to the extent of the active negligence or willful misconduct of City or City's representatives, agents, employees, or officers. Operator shall hold harmless, defend, and indemnify the City, and its elected and appointed officers, officials, employees, agents, volunteers, guests, invitees and Operators (other than Operator) (the "City lndemnitees") free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury, in law or in equity, to property or persons, including wrongful death, to the extent arising out of or incident to any acts, omissions, or misconduct of the Operator or its officers, employees, agents, volunteers, guests, invitees and Operators in connection with the performance of this Agreement, including without limitation, the payment of attorneys' fees and other related costs and expenses.
Operator's responsibility to hold harmless, defend and indemnify the City lndemnitees does not include claims, demands, causes of action, costs, expenses, liability, loss, damage or injury to the extent arising out of the negligence or willful misconduct of any of the City lndemnitees. This Section shall apply to all liability regardless of whether any insurance policies are applicable. 15 of 21
August 20, 2024, Item #6
Any insurance policy limits do not act as a limitation upon the amount of indemnification to be provided to the City lndemnitees.
Operator shall act as an independent contractor and will not be an agent or employee of the City. Operator shall not represent or otherwise hold out itself or any of its subcontractors, sub-subcontractors, directors, officers, partners, employees, or agents to be an agent or employee of the City.
City and its elected and appointed boards, officials, officers, agents, employees and volunteers (individually and collectively, "lndemnitees") shall have no liability to Operator or any other person for, and Operator shall indemnify, defend, protect and hold harmless lndemnitees from and against, any and all liabilities, claims, actions, causes of action, proceedings, suits, damages, judgments, liens, levies, costs and expenses of whatever nature, including reasonable attorneys' fees and disbursements (collectively "Claims"), which lndemnitees may suffer or incur or to which lndemnitees may become subject by reason of or arising out of any injury to or death of any person(s), damage to property, loss of use of property, economic loss or otherwise occurring as a result of or allegedly caused by Operator's use of the City's property or Operator's performance under this Contract.
If any action or proceeding is brought against lndemnitees by reason of any of the matters against which Operator has agreed to indemnify lndemnitees as provided above, Operator, upon notice from City, shall defend lndemnitees at Operator's expense by counsel acceptable to City, such acceptance not to be unreasonably withheld. lndemnitees need not have first paid for any of the matters to which lndemnitees are entitled to indemnification in order to be so indemnified. The insurance required to be maintained by Operator under Article II, section 1, shall ensure Operator's obligations under this section, but the limits of such insurance shall not limit the liability of Operator hereunder. Operator shall, upon receipt of written notice of any Claim, promptly take all action necessary to make a claim under any applicable insurance policy or policies Operator is carrying and maintaining; however, if Operator fails to take such action as is necessary to make a claim under any such insurance policy, Operator shall reimburse City for any and all costs, charges, expenses, damages and liabilities incurred by City in making any claim on behalf of Operator under any insurance policy or policies required under Article II, section 1.
The provisions of this section shall survive the expiration or earlier termination of this Agreement.
The provisions of this section do not apply to Claims occurring as a result of this City's sole negligence or willful acts or omissions.
The parties agree to cooperate fully in the resolution of any claims for such liability, loss or damage.
3. Employment Laws. Operator agrees to comply with all local, state, and federal laws affecting the employment of personnel, the payment of wages, and the payment of taxes in operating the businesses of the Concession Premises.
4. Anti-Assignment Clause. As the City has relied on the particular proposal of 16 of 21
August 20, 2024, Item #6
Operator in entering into this Agreement, Operator shall not assign, delegate, transfer, or sub-Agreement any duty or right under this Agreement, or any portion of the Operator's use of the Concession Premises. Any such purported assignment, delegation, transfer, or sub-Agreement shall be void, unless the City has previously approved such action in writing.
5. Operator not a Lessee. Not legal title or leasehold interest in the Concession Premises or appurtenances thereto shall be deemed or construed to have been created or vested in the Operator by anything contained in this Agreement.
6. Compliance with Laws. Operator shall comply with all federal, state, and local laws applicable to the Concession Premises and its use.
7. Provisions Cumulative. The foregoing provisions are cumulative and in addition to and not in limitation of any rights or remedies available to the City.
8. Merger Clause. This Agreement and its attachments, whether physically attached to the Agreement or merely referenced in this section (the "Incorporated Documents") are the entire understanding of the parties, and there are no other terms or conditions, written or oral, controlling this matter. In the event of any conflict between the provisions of this Agreement and the Incorporated Documents, the provisions of this Agreement shall prevail.
9. Anti-Waiver Clause. None of the provisions contained herein shall be waived because of previous failure to insist upon strict performance, nor shall any provision be waived because any other, Provision has been waived, in whole or in part.
10. Severability. The invalidity in whole or in part of any provision of this Agreement shall not void or affect the validity of any other provisions of this Agreement.
11. Notices to Parties. Any statements, communications, or notices to be provided pursuant to this Agreement shall be sent to the attention of the persons indicated below, until such time as notice of any changes of person to be notified or change of address if forwarded to all parties:
City:
City of Poway
P.O. Box 789
Poway, CA 92074
Attn: Director of Community Services
Operator:
Cheeseburgers in Poway, LLC
1539 Molly Circle
Oceanside, CA 92054
Attn: Josh Arbenz
12. Choice of Law. This Agreement shall be governed by the laws of the State of California. Venue for any action arising from this Agreement, including but not limited to matters concerning validity, construction, performance or enforcement shall be exclusively in the state or federal courts located in San Diego County, California.
Operator hereby waives any right to remove any such action from San Diego County as is otherwise permitted by California Code of Civil Procedure section 394.
17 of 21
August 20, 2024, Item #6
13. Business Certificate. The Operator shall be required to obtain a City of Poway Business Certificate prior to execution of this Agreement.
14. Amendment. The provisions of this Agreement may be amended or modified only by mutual consent and written agreement of the Parties.
IN WITNESS WHEREOF, this Agreement has been executed on behalf of the City by its Officer thereunto authorized and by Operator, the date and year first above written.
CITY OF POWAY, A Municipal Corporation: Cheeseburgers in Poway, an LLC:
Chris Hazeltine, City Manager Josh Arbenz, Managing Member Date: Date:
ATTEST:
Carrie Gallagher, City Clerk
Date:
APPROVED AS TO FORM:
Alan Fenstermacher, City Attorney
18 of 21
August 20, 2024, Item #6
EXHIBIT A
19 of 21
August 20, 2024, Item #6
EXHIBIT B
City of Poway
Public Works, Wastewater Division
FOG Program for Food Establishment Wastewater Discharge Maintenance of Grease Removal Equipment (GRE)
The City of Poway's Industrial Wastewater Pretreatment Program (Chapter 13.05 of the Poway Municipal Code) requires that GRE (Grease Removal Equipment: grease traps and interceptors) be maintained in efficient operating condition by periodic removal of the accumulated grease and solid food waste. The cleaning interval varies with the amount of food preparation/clean-up activities and with the facility's housekeeping procedures. This interval must be determined by each facility, but will be mandated by the City when maintenance is found to be unsatisfactory. On the back of this page are acceptable grease and oil levels for different size grease traps and interceptors.
Methods
Two maintenance methods are approved by the City of Poway:
1. Manual Removal of Grease. This consists of skimming out accumulated grease and oil and removing solids that have settled at the bottom. None of the removed material can be disposed of in the sewer or storm drain system.
Collected material can be put in a grease-recycling barrel if the barrel is specifically designated to hold grease trap waste. If applicable, you must ensure that your grease recycler or waste hauler accepts grease trap waste. Any of the material that is disposed of in the trash must be in a container and may not be over 50% liquid.
2. Pumping. You may hire a pumping service to empty your GRE. If you have a grease interceptor, pump all grease, oil, and food matter from each chamber and sample box including solids or sludge at the bottom of each chamber, specifically at the bottom of all standpipes. The City requires a complete pump out at each cleaning.
Additional Information
Bacterial products may help to reduce cleaning frequency. However, high temperature, high or low pH level, sanitizers and other cleaning products render them ineffective. Bacterial products may also cause the accumulated grease to "fluff-up" or take more space in your GRE than if left alone. These products are not to be substituted instead of Methods 1 or 2.
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August 20, 2024, Item #6
Maintenance of GRE
Enzyme products are never allowed because they keep grease and oil suspended in the water, which causes them to pass through your grease trap or interceptor. They may also contribute to the corrosion of your GRE.
IN ALL CASES, FACILITY OPERATORS ARE SOLELY RESPONSIBLE FOR PROPER GRE MAINTENANCE.
Summary
GRE collects grease that would otherwise enter the sewer lines and cause blockages and overflows. Methods 1 and 2 are the best ways of disposing grease. Bacteria may reduce the frequency of manual cleaning or pumping, but it does not eliminate the need for manual cleaning or pumping.
A record of the dates, methods and identity of the people/company cleaning GRE must be kept at the facility and be available for review at any time. During facility inspections, all GRE will be required to be opened and will be examined for proper maintenance.
The maximum grease and/or oil levels, including any solids or sludge that has accumulated on the bottom of your grease trap or grease interceptor, are as follows:
Grease Trap/Grease Interceptor 25% Capacity Standard
The 25% rule is used to determine when a grease trap/grease interceptor (or oil separator) is full.
"The total depth of the floating grease layer plus the settle-able solids layer cannot exceed 25% of the total liquid depth of the interceptor." Determination is made by taking a core sample with a Sludge Judge or Dipstick Pro.
The device is lowered slowly through the fats, oils, and grease layer all the way to the bottom through the solids layer of the trap/interceptor and then capped or plugged and slowly removed and set aside to rest. This allows the captured FOG to collect at the top of the device while the solids settle at the bottom.
A measurement is taken, typically in inches, from the top of the FOG layer to the bottom of the device, which represents the tanks total water column. Then the FOG and solids layers are each measured, also typically in inches, and added together. If the combined FOG and solids layers are equal to or greater than 25% of the total water column, then the interceptor is considered full. At no time should there be visible grease or oil in the sample box.
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