HomeMy WebLinkAbout2016-03-28 16-128 ORDERCOUNCIL ACTION
Item No. 16-128
Date: March 28, 2016
Item/Subject: ORDER,, Order, Amending the Contract with Spectra Venue Management to Operate
the Cross Insurance Center.
Responsible Department: Finance
Commentary: This Order will amend the contract with Spectra Venue Management to Operate the Cross
Insurance Center for a period of 5 years with an option to extend for an additional 5 years. Since 2013, the
Cross Insurance Center has been operated by Spectra Venue Management, formerly Global Spectrum.
Despite a few early glitches following the opening of the center, operational successes for the Center have
greatly exceeded early financial and event projections, such that the facility ended with small operational
surpluses over the last two years. Over the past three years the facility has played host to an extensive
variety of entertainment events that have appealed to a broad range of interests including Bob Seger, Jeff
Dunham, the Broadway Series, and Cirque du Soleil. Most recently, the Cross Insurance Center hosted
professional bull riding to a sellout crowd.
Spectra Venue Management is seeking to build on their success and have offered the City $285,000 to pay
for LED lighting and to fund an event development and marketing fund. The fund would have an
amortization schedule of 10 years and should the city not opt to extend the contract in 2021 we would repay
50% of that amount.
Additionally, the contract fixes a management fee of $125,000 which is subject to annual increases in the
CPI. Spectra would be further eligible to earn incentives up to 100% of the management fee based on food
and beverage sales, ticket sales, concert attendance and customer satisfaction as outlined in the contract.
If approved by the council, the final form of the contract would be subject to review and approval of the City
Solicitor and Bond Counsel.
This item was reviewed in Executive Session on March 14, 2016.
Department Head
Manager's Comments:
01A
City Manager
Associated Information: Term Sheet
Budget Approval:
Finance Director
Legal Approval:
Introduced for
_X Passage
First Reading
Referral
Solicitor
Page 1 of _1`
Assigned to Councilor Nealley
CI'T'Y OF BANGOR
16-128
MARCH 28, 2016
(TITLE.) Order, Amending the Contract with Spectra Venue Management to Operate the Cross
Insurance Center.
WHEREAS, The City has a contract with Spectra Venue Management, formerly known as Global
Spectrum to operate the Cross Insurance Center that expires in 2018; and
WHEREAS, Spectra would like to extend the current operating agreement for an additional 3
years with an option to extend 5 -years beyond; and
WHEREAS, Spectra has had hosted a variety of high quality shows that appeal to a broad
audience including the Broadway Series, Cirque De Solei, Bob Seger, and more
recently the Bull Riding; and
WHEREAS, Spectra has hosted numerous conventions and events including the Chamber
Dinner, which is the largest plated dinner in the state as well as state conventions
for both Democrats and Republicans. The Cross Insurance Center will also play
host to the Maine Municipal Convention in 2016, which is one of the largest
conventions in the State; and
WHEREAS, Spectra has worked hard through many of the startup Issues to develop a first class
facility that has done financially better than early projections; and
WHEREAS, Spectra is offering the City $285,000 towards funding a proposed LED lighting
upgrade and to seed an Event Development Fund to be amortized over 10 years.
By the City Council of the City of Bangor.
ORDERED, THAT the contract with Spectra Venue Management be amended to provide an initial term of
5 years through 2021 and that the City will have the option to extend the contract for an additional five
year through 2026.
The City pay a fixed management fee of $125,000 subject to an annual CRI increase with the opportunity
to earn incentive fees not to exceed 1006 of the management fee based on criteria established in the
contract which will be based on food and beverage sales, attendance, ticket sales, and customer
satisfaction. Additionally, the City will pay percentages laid out in the contract for advertising and sales.
In consideration, Spectra will provide the City with $285,000 to upgrade the LED lighting in the City and
to seed a marketing and event development fund. The final form of the agreement shall be approved by
the Bond Counsel and the City Solicitor.
IN CITY COUNCIL
MARCH 28, 2016
MOTION MADE AND SECONDED FOR PASSAGE
PASSED
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CITY CLERK