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Joyce Clark Unfiltered

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jobing.com arena

Jobing.com arena

To date the media and Glendale residents have been denied access to the four bids submitted to Beacon Sports, the city’s $100,000 consultant hired to accept and vet all bids to manage Jobing.com arena, a city-owned facility. Very recently the city finally released the names of the four bidders and it has been reported that R Entertainment and Phoenix Monarch Group (PMG) were rejected for not meeting minimum specifications. By the way, Art Jimenez, principal of PMG, publicly stated that he has formed a new group, PMG Management and Entertainment, LLC. As of this date it is not registered with the Arizona Corporation Commission and the name is still available, if anyone out there is interested.

There is no legal basis with which to deny the public access to the Beacon bids. We first go to the City Charter to see what it says about bids. In Article VIII, Section 2-Competitive Bidding it says, “The city council shall establish by ordinance formal guidelines regulating the purchase of goods and services by the city. Such ordinance shall specify the conditions pursuant to which formal competitive bidding shall be required, conditions pursuant to which informal competitive bidding shall be required and those conditions under which no bidding for city contracts shall be required.”  Last amended on 3-15-88.

This section authorized the city council to establish a formal bidding process. That formal process is outlined in Glendale’s Municipal Code, which was originally adopted and subsequently amended by city council vote as ordinances. An ordinance is a city law and can only be superseded by the Arizona Revised Statutes (established and passed by the Arizona Legislature).

scalesWe then go to Glendale’s Municipal Code, Section 2-145, Formal Purchase Procedure, (2) b, Sealed Bidding Procedure (IFB) which states, “Bids shall be opened publicly at the time and place designated in the invitation for bids. The amount of each bid, and such other relevant information as may be specified by the materials manager, together with the name of each bidder shall be recorded as determined by the materials manager. This record shall be open to public inspection after the bid opening in a manner prescribed by the materials manager (bold mine). Except to the extent the bidder designates, and the city concurs, trade secrets or other proprietary data contained in the bid documents shall remain confidential.”

Then we have to check Arizona Revised Statutes to see if there is anything different from city code. For that information, we refer to Arizona Revised Statutes, Section 41-2533. Competitive Sealed Bidding. D. which states, Bids shall be opened publicly at the time and place designated in the invitation for bids.  The amount of each bid, and such other relevant information as may be specified by rule, together with the name of each bidder shall be recorded.  This record shall be open to public inspection at the bid opening in a manner prescribed by rule (bold mine).  The bids shall not be open for public inspection until after a contract is awarded.  To the extent the bidder designates and the state concurs, trade secrets or other proprietary data contained in the bid documents shall remain confidential in accordance with rules adopted by the director.”

Well, look at that, the Glendale Municipal Code and Arizona Revised Statutes (ARS) almost mirror one another on the language! Please take note of the sentence in the above cited ARS that says, “The bids shall not be open for public inspection until after a contract is awarded.” That prescription is lacking in Glendale’s Municipal Code. As it is not a prescription in Glendale’s Municipal Code it appears that Glendale is required to release the bid information after bid opening and I don’t think it means weeks later. Both bodies of law allow proprietary information to be redacted from any bid. And both codes allow public inspection after the bids are opened.

It would seem that Glendale has failed to follow its own Municipal Code process. It should release the results of the bidding process of all 4 bids NOW (in fact, it should already have done so) and redact only that information that is proprietary.  Just to be sure there is no confusion over what constitutes proprietary information; Webster’s defines it as, “possession, ownership or exclusive right.” It’s time for Glendale to cough it up.

There is no justifiable reason to discuss the Beacon bids in council Executive Session. They should have been publicly released by now. Those bids are what they are. The presentation on the bids should be in public workshop session. Council either accepts one or it rejects all but it would provide the public with an opportunity to discover just exactly how much two major companies, SMG World and Phoenix Arena Development think it’s worth to them to manage and operate Jobing.com.

There is also no reason why Councilmember Sherwood cannot discuss the worth of keeping the Coyotes in Glendale. After all, it’s not new information. During the Jamison negotiations, Interim City Manager Skeete publicly stated that keeping the Coyotes brings Glendale an approximate additional million dollars a year in revenue.

contractIt is justifiable and prudent that council discuss the RSE deal in Executive Session. They are in the midst of negotiations with the group. It provides the full council an opportunity to hear the terms of the deal and to offer any and all changes to those terms for further negotiation. It was no more than the former council did that resulted in a lower management fee and penalties and incentives for under/over performance. Once all terms are satisfactory to both sides, the deal terms should be released publicly and the vote scheduled for one week after release.

It has been widely reported that the Renaissance Entertainment’s management deal with Glendale may come before the council for a vote on June 25th, June 28th or as late as July 9th. When there was all of that furor over the Jamison ownership deal last acceptanceyear a court mandated that the deal be made public one week before any scheduled council vote on the issue. I suspect denialthat prescription still holds true. In that case, if the RSE deal is scheduled for a council vote on June 25th, it must be released to the public for its consideration one week before on June 19th. If the vote is June 28th, it must be publicly available on June 21st. If the vote is on July 9th, the public is entitled to review it on July 3rd. Come on, mayor and council, get your act together and practice the transparency that you love to preach.

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jobing.com arena

Jobing.com Arena

Well, well,well…Glendale has offered a crumb to its residents by making public the names of the four bidders that responded to the Beacon Sports RFP (at a cost of $100,000) for management of its arena, Jobing.com. More to come about the bidding process in a future blog.

The contenders are: Phoenix Monarch Group, R Entertainment, SMG World and Phoenix Arena Development. Have you noticed who is missing? We see none of the expected and well known players in either the arena management industry or the entertainment venue industry – Global Spectrum, AEG and IFG. I suspect that when they learned that as part of the bid Glendale was seeking their investment (counts for 10% of bidding score) they probably said thanks, but no thanks.

Let’s look at the bidders. First up is R Entertainment. It is a privately held company registered with the Arizona Corporation Commission in August, 2006. It is located in Scottsdale with 1-10 employees. Its Statutory Agent is Kerry Dunne and according to the media, a partner. It manages one venue, the Pepsi Amphitheater at Fort Tuthill County Park near Flagstaff. By the way, the seating capacity of the Amphitheater is 2,750, not quite a 17,000 seat arena. I congratulate them for submitting a bid but I fear they are way out of their league (no pun intended). Investment counts for 10% of the bid score and this company is too small to make a major investment in Glendale’s arena. Experience is another 15% of the bid score and the company’s management experience with the Pepsi Amphitheater does not meet managing a similar sports facility. Personnel accounts for another 10% of the score. The current management staff of the arena numbers about 135, full time and part time. With a staff of 1-10 people R Entertainment is simply too small to manage a venue of this size. This company’s bid could lose about 35% of available points according to the bid criteria. Quite frankly, it should have been rejected as not meeting the basic criteria of the bid.

Next up is SMG World whose headquarters are located in Philadelphia, PA. It is a world-wide event and venue management company established in 1977. It has the personnel and experience to manage Jobing.com arena and advertises on its website http://smgworld.com that it has managed 230 facilities. So it certainly is a viable contender. One problematical concern revolves around an old saying that you are judged by the company you keep. SMG has a relationship with the Bidwill subsidiary, Rojo Event Management. Yes, the same Rojo that submitted a bid to the city to manage its Youth Sports fields adjacent to the stadium. Rojo’s bid for management is greater than the current Global Spectrum contract and offers way less revenue to the city. This is the Youth Sports field bid the city should reject unless it likes being taken to the cleaners once again.

Another bidder has indeed risen like the mythical Phoenix Bird and that is the Phoenix Monarch Group (PMG). It was registered with the Arizona Corporation Commission in August of 2012 and its managing member is Arturo Jimenez. In the one telephone conversation I had with Mr. Jimenez (at Councilmember Lieberman’s request) he indicated that an Alvarez (don’t remember the first name) and Tony Herrera were part of his group (more about them in a minute). This group should sound familiar to you. It the group that Councilmember Alvarez brokered a meeting for with former Mayor Scruggs and former Councilmember Lieberman. At that time they were asking for about $7M to host 25 events. Their experience is problematical. They ran an event for the Hispanic Fire Fighters Association (HFFA) which ended with HFFA paying vendors because PMG did not. The only other event (that they classify as ‘major.’ I do not) PMG hosted was a Hispanic Festival for a Peoria Councilmember. PMG easily loses 35% of bid points for lack of experience, personnel and investment. But once again the specter of relationships is troubling. I do not know if the Alvarez Mr. Jimenez referred to is a distant, or otherwise, relative of Councilmember Alvarez. Mr. Herrera, another PMG participant, has a close relationship with Councilmember Chavira with both listed as managing members of two companies, Cool Heads,LLC. and the McCoy Group, LLC. At least in terms of public perception, if no other, Councilmembers Alvarez and Chavira should recluse themselves due to a conflict of interest. They have no business advocating for or participating in discussions and votes on choosing a Beacon bidder to manage the arena.

Last up is Phoenix Arena Development Limited Partnership. It is headquartered in Phoenix but according to the Arizona Corporation Commission it is a foreign limited partnership. It is a privately held company and owned by the Phoenix Suns Limited Partnership. The general partner of the Phoenix Suns Limited Partnership is JDM Sports, Inc. and as of 1992 Jerry Colangelo was its president. This company was created for one purpose only and that is to manage the Suns basketball team’s venue. It crafted a sweet deal for itself with the City of Phoenix. Reminds me of the Ellman deal, Coyotes and Jobing.com Arena. It has experience in managing one venue exclusively and somehow or another; I don’t think they will be making an investment in Glendale’s arena. More likely is that, if chosen, Glendale will end up making a hefty payment to this company.

So there you have it – the four bidders that Glendale taxpayers spent $100,000 to find. Pick your poison. It’s the height of chutzpah for Beacon to even present R Entertainment or the Phoenix Monarch Group as viable bidders to the council. Clearly neither one is qualified by experience alone, to manage Jobing.com. Left standing is SMG World with ties to the Bidwills or Phoenix Arena Development with ties to Colangelo. To date, we have not seen the details of any of these bids and have no clue as to the management fee any of these groups is requesting.

Coyotes logoKeep in mind that NHL Commissioner Gary Bettman said the Beacon process was “silly” and it is. The same, major issue is before this council just as it was before the former council and that is, if you choose to keep the Coyotes in Glendale, Westgate viable and save the city’s third major economic area, you must pay the freight and use the team owner as the arena’s manager. The only issue for Glendale is what can it afford to pay to make that happen and will it be enough to keep the Coyotes long-term?

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