Tag: Augusta Commission

Enslaved Forever on the TEE Plantation

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Monday, November 12, 2012
Augusta, GA
By The Outsider

Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article. Cost Recovery Works is no longer in business, as of December 31, 2020.

Now all Augustans lie prostrate to Massa Billy and Massa Paul, thanks to the 6-3 vote of the Augusta Commission to pass the TEE Center deal last Thursday, November 8, 2012. White, black, Mexican, Korean, Chinese or Indian, the entire City of Augusta is now enslaved to Billy Morris and Paul Simon or, if you believe Augusta radio talker Austin Rhodes at WGAC, the Morris children.

No one can really tell who the owners of the new TEE Center management company are because it didn’t even exist until last month and it was registered by an intermediary to keep the ownership hidden, something Augusta’s procurement policies seem to prohibit. It will just have to suffice that the person’s listed on various documents for the original Morris/Simon LLC suggest that the Morris family are the principal owners. Even the Augusta Chronicle, who has acted throughout the TEE escapades as a front for these shadowy LLC’s, has been forced to weakly acknowledge that there are ties with Morris Communications.

The place where they put the permanent shackles on the people was originally supposed to be Augusta’s wonderful new TEE Center, but the massas had confiscated the building before the last concrete set up. They weren’t content to just stick spurs in horses over there in their Hippodrome in Aiken County, now the children all across Richmond County find themselves bound to a plantation and they didn’t have to move to Morris’ Creek Plantation, Wade Plantation, Butterfield Plantation or Millhaven Plantation to do it.

When you are in Augusta, you don’t move to the plantation, the plantation comes to you. Worse of all, the legalese says you and your descendants are slaves to the Morris massa’s TEE House FOREVER!!!

Yes. You read that right.

Mayor Deke Copenhaver and Administrator Fred Russell cheered as Commissioner Corey Johnson, Commissioner Matt Aitken and four other commissioners voted for this:

“Term of this Agreement” shall mean the period of time commencing on the date of this Agreement and continuing in perpetuity for so long as the TEE Center is in existence and shall include the period of time following any casualty with respect to the TEE Center for so long as City has the right to rebuild the TEE Center.

Now reader, you are just about to read the last part of that and tell me it is a way out of the Tee Center for Augusta because it ends when the TEE no longer exists.  Well, it is like the old tale of Dem Bones – “Toe bone connected to the foot bone: Foot bone connected to the leg bone: Leg bone connected to the knee bone…..” You just have to make the connections to get the whole body of facts.
Reading on:

During the Term of this Agreement (perpetuity), City shall, at its sole cost and expense, maintain the TEE Center to the Standard for so long as the TEE Center shall exist.

Getting a better picture now, reader? The “Standard” is whatever Billy and Paul’s interpretation of what their Marriott Hotel says it is and Augusta has to pay whatever it takes to meet their ‘Standard.’ That sounds expensive already, doesn’t it?

Now you Doubting Thomases who are left thinking that this pay-out to Morris and Simon isn’t FOREVER, get with the program. “The knee bone is connected to the thigh bone, and the thigh bone is connected to the hip bone.” And so it goes with the Tee Center. You follow the boneyard and find out it is the TEE Center. Now a Doubting Thomas would say “Well, if Augusta decides to contract with someone else or close down the Tee Center, we can stop paying them or stop paying costs on their behalf, right?”

This isn’t exactly true, according to the contract:

The parties acknowledge that Developer has an important interest in insuring that the TEE Center is maintained in accordance with the Standard, whether or not Developer serves as the Manager or Caterer. Accordingly, this Agreement, and particularly this section of this Agreement, may be enforced by Developer. (Developer is the Morris/Simon.)

In other words the Morris/Simon massa still has the power over the taxpayer, even if their contract is lifted.

Are you getting a queasy feeling in your stomach, Hephzibah? So you on Warren Road think that the TEE plantation you are on will meet an emancipation proclamation that sets you and all your descendants free from PERPETUAL bondage? Dear readers might still not be convinced that the TEE Center is their massa FOREVER. It’s time to read some more:

During the Term of this Agreement (PERPETUITY, remember?), City shall, at its sole cost and expense, procure and keep in effect fire and extended coverage for the TEE Center and all personal property located thereon, including rent loss or business interruption …, in amounts at no time less than the total replacement cost therefor. Such policy referred to above shall name City and Developer as loss payee and additional insureds, as their interest may appear.

So, there you have it. Augusta has to pay for the TEE Plantation in PERPETUITY and pay to insure that it is replaced in PERPETUITY. If it is destroyed, the Morris/Simon hotels are almost certain to be destroyed too, so replacement would be driven more by the Morris/Simon decision on what to do with their hotel complex than anything Augusta decides.

How great is the claim on Augusta’s tax system to pay for the TEE Plantation? On the financing side, the project was built using general obligation sales tax bonds, as certifications by the Construction Manager, R.W. Allen attest. General obligation bonds are backed by the fullest ability of Augusta to tax people out of their homes and businesses out into the street. On the operations side of the TEE Plantation, hoteliers get looted for the first $250,000 (another $100,000 goes into capital spending), but then the rest of the TEE Center losses come out of the General Fund, which also is fed by the power to tax folks into poverty. When a contract like the TEE contract gets executed, that obligation comes before paying for essential city services, like fire and police protection.

Now that the whole skeleton of bones has been assembled, the full picture of the TEE Center deal is this – All of the people of Augusta-Richmond County, their children, and descendants are now under double general obligations to the extent of the value of all of their property to the Morris children and descendants in PERPETUITY.

Get used to the shackles and chains that Mayor Deke put you into.  Only death or getting out of Augusta will give relief.

Can you say that you’ve been TEE-totally subjugated?

It sure looks this way to an Outsider.***
OS

Catering May Crater Augusta Finances

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TEE Catering Delivers Sweets To Whom?

Originally posted on CityStink
Thursday, November 8, 2012
Augusta, GA
By Al Gray

The author, Al M. Gray, was President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns. Cost Recovery Works is no longer in business, as of December 31, 2020.

Part Two – Reviewing Augusta’s TEE Center Contracts

When Augusta’s Trade, Exhibition, and Event (TEE) Center was officially presented as a concept for approval in August 2007, what stood as the partnership agreement was an unsigned, undated document entitled  “Term Sheet” between the city and Marriott Hotel Franchisee Augusta Riverfront, LLC. Under that agreement, Augusta was not in the catering business and was not slated to furnish $1.4 million in kitchen equipment, or if it was, that detail was not spelled out for the Augusta City Commission.

Much has been written on this blog about the saga of the TEE Center Kitchen Equipment and that tale is not one to be retold now.

What is now germane is that the Augusta Commission has been presented with a raft of contract and legal documents to be approved and executed that clearly should have been in place by late 2009, having been repeatedly promised as being “finalized” by City Administrator Fred Russell in the last half of that year. Now the Commission is being asked to whisk these complicated deals through in an expedited fashion lest TEE Center events face cancellation.

After the Management Agreement, the TEE Center Catering Agreement has the greatest impact upon TEE Center operations, as Augusta Riverfront, LLC is already the Manager of Augusta’s Conference Center and Caterer for events there. Augusta is paid no share of catering from its Conference Center under previous deals.

The following represents a summary of the primary Catering Agreement issues compiled from a review of the contract documents. This list has been provided to Commissioners and has become the basis of discussion and attempts toward a speedy resolution of major issues. The approach was to review the agreements in PDF form, write comments, apply sticky notes that Adobe Acrobat provides to annotate documents, and then to provide a summary from the compiled sticky notes.

Solutions were designed to be the product of meeting participants and were not suggested in the summary.

The author is not a licensed attorney, auditor, or public accountant. This analysis was provided from a multidisciplinary perspective in the manner that accountants, attorneys, administrators, owners, policy makers, and media might find useful in trying to decipher the pitfalls and dangers in the agreements.

Primary Issues

  1. Since most of the language in the Catering Agreement mirrors the language of the previously-reviewed and annotated Management Agreement, this document will only be annotated with comments and questions unique to this agreement.
  2. Phantom legal documents (see “ Conference Center Management Agreement dated____, 2012”) should not be referenced.
  3. ARLLC (Augusta Riverfront, LLC) is both Conference Center operator and Caterer with a captive LLC (TEE Center Manager Augusta Convention Center Management, LLC) between them. Isn’t this just a fiction to eliminate a conflict of interest as alluded to in the Catering Agreement?
  4. Controls over inventories of food and beverage (to prevent co-mingling of Augusta, Hotel and Conference Center purchases) being in place before contract execution should be mandatory.
  5. If Kitchen doesn’t serve Hotels (as has been publicly stated by the Marriott General Manager), can’t that reference be taken out?
  6. Crossover events into the Conference Center will deprive the TEE Center of catering revenues, while the agreements relieve the Conference Center of costs.

As with the Management Agreement, time will tell how many of the above issues are addressed, handled, and rectified.

-AG

$15 Million Augusta CONference Center Pays $25,000 a Year to City

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Originally posted by CityStink
Thursday, November 1, 2012
Augusta, GA
By Lori Davis

Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article. Cost Recovery Works is no longer in business, as of December 31, 2020.

Augusta Riverfront, LLC is the proposed caterer for the City of Augusta’s new TEE Center and a sister company is slated to be the TEE Center Manager. On Tuesday Augusta Riverfront’s Darryl Leach appeared on the Austin Rhodes show on WGAC to defend the controversial contracts for catering and management presented to the Augusta Commission.  During the show Leech brought up the fact that the existing Augusta Conference Center had cost Augusta about $14 to $15 million to build.

Since I just got back a response to my Georgia Open Records Act Request for Conference Center lease payments last week, it was surprising to hear that those buildings cost $15 million 11 years ago. What was more surprising is that Augusta only sees about $25,000 a year in lease payments on that $15 million complex!

Yes, you read that right. Augusta’s return on the Augusta Conference Center is 0.17% a year!

Scanning the accounting I got from Augusta’s legal department was interesting, to say the least.

In the TEE Center Workshop on October 10, 2012, Augusta Riverfront, LLC President Paul Simon said this regarding the Conference Center lease:

“However, we get in that case we get all of the profits from the center except we give the city 5% of the room rents, not just catering.”

Maybe he meant to say  “just not catering”, but then Augusta attorney Jim Plunkett earlier in the same meeting referred to Conference Center profits/ losses being shared by the city.

Wait a minute. The records that I got from the records request show that the leases were figured at 5% of the greater of Center expenses or Center revenues, with Augusta getting $23,395 in 2003, $21,493 in 2004, $25,137 in 2005, $24,381 in 2006, $27,559 in 2007, $14,828 in 2008, $26,277 in 2009, $26,434 in 2010 and $25,992 in 2011! The revenue figures were room rentals alone with NO CATERING REVENUES INCLUDED!

The 1999 Agreement that covers this says that “miscellaneous revenue” is supposed to be included in the base for the annual lease payment calculations. Isn’t catering an item of “miscellaneous” revenue, when it was not excluded from the contract language for the lease payment calculation?

The Conference Center lease says that the annual lease payment and reporting is supposed to be submitted by Riverfront’s “certified public accountant”, but  we could not find the name of the Riverfront controller on the roster of Georgia CPA’s.

Expensive Issues for Augusta:

In 2008, Riverfront deducted $13,164 from Augusta’s payment for resurfacing the hotel parking lot. This sort of expenditure doesn’t seem covered as an Augusta cost because hotel parking lots are hardly this city’s responsibility, although it might be covered under the separate parking lease referenced in the agreement. It looks like Riverfront arbitrarily reduced Augusta’s payment to cover an expense that they felt entitled to.

If Augusta gives them a bank account that is an open pipeline to taxpayer general funds, like Finance Director Jerry Brigham told us two weeks ago will be the case, will Riverfront feel ENTITLED to make deductions from payments to Augusta like this?

The next thing I saw that was surprising is that Riverfront figures ½ the electrical utility costs for the entire complex of hotels and conference center go to the conference center! How was this percentage arrived at? For the TEE Center, is this how the $350,000 Paul Simon suggests as the estimated TEE Center Power bill will be figured – a ballpark guesstimate? Should not there be separate metering for the conference center? Is there separate metering to make damned sure that the $350,000 power bill all goes to the TEE Center and not the hotel/conference center complex?

I have submitted an Open Records Request for the electrical design drawings for the TEE Center, in the hope of getting answers to these question from the Augusta Today membership, which now provides access to engineers who now join the Augusta Today and CityStink.net of investigators and watch dogs.

More than one commissioner is sniffing around this one, too.

Even bigger an issue is whether the Convention and Visitor’s Bureau is actively marketing events that cross over from the TEE Center, where Augusta gets the costs, into the Conference Center, where Augusta gets no revenue – all revenue goes to Augusta Riverfront, LLC.

More than one commissioner wants that question answered, too.

It is wonderful to have a clear majority of Augusta commissioners now working for the people. I never thought I would see the day. Most frightening to those wanting to drain Augusta’s general fund should be this – These guys are showing real signs of UNITY!

When do we go the other way and start getting our money back? In the case of the TEE Center,  a power shift is overdue. From the looks of how aggressively Riverfront pursues Augusta’s money, the taxpayers need this commission to show backbone!***

Lori Davis GORA Response 10262012 – Conference Center Lease

LD

Conference Center 2008 Schedule

Mayor Retreats from Locked and Loaded Commissioners on TEE Center

Video

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Originally published October 31, 2012 on the now defunct CityStink.net site.
Wednesday, October 31, 2012
Augusta, GA
From CityStink.net Reports

Locketted and Loaded was Commissioner Bill Lockett when the TEE Center was removed from Monday’s Augusta Commission Committee meeting. See our exclusive video below:

Video: TEE Center Management Contract is Riddled with Land Mines

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Originally posted by CityStink
Sunday, October 28, 2012
Augusta, GA
From CityStink.net Reports

On the eve of Mayor Deke Copenhaver forcing yet another TEE Center vote on balking commissioners, Augusta Today contributor Al Gray challenges cost controls after being silenced by Copenhaver a week earlier. See our video report below.

Video: Bowles Bows to TEE Bonuses

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Originally posted on Citystink
Wednesday, October 24, 2012
Augusta, GA
From CityStink.net Reports

Augusta Commissioner Joe Bowles takes a stab at TEE Center Management Bonuses, but falls to Simon Says and ends up voting for them anyway. Watch Simon say the taxpayer is going to lose and his managers will be paid in the video below.

Special Report: Augusta Catered to Death

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TEE Center under construction August 2012

Originally posted on CityStink
Thursday, October 4, 2012
Augusta, GA
By Bradley Owens

Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article. Cost Recovery Works is no longer in business, as of December 31, 2020.

Houston, we have a problem. Rather the City of Augusta’s special counsel Jim Plunkett and his predecessors who created the TEE Center Agreements have a host of problems. Most of them center around “Conference Center” versus “Convention Center” but the TEE Center Catering Agreement is the lynchpin. Our Augusta Today and CityStink.net investigative team now seems prescient in our dogged pursuit of the elusive kitchen equipment.

The entire TEE Center fiasco began with an unsigned, undated “Term Sheet” that became the only partnership agreement with Augusta Riverfront, LLC that was approved by the Augusta City Commission. This agreement refers repeatedly to the “ Conference Center” as being subject to the preexisting agreement between the partners. It says that Augusta and Riverfront agree to “modify their agreement for the operation of the Convention Center to include the Trade Center.” Trouble was, there was no agreement to operate any “Convention Center”, only the 1999 agreement for the operation of the “Conference Center.”

Since then there has been considerable publicity given that the entire TEE Center, Parking Decks, and existing Conference/Convention Center are now the “Convention Center,” which furthers the misconception that there ever was a “Convention Center” before, but all the while the lawyers reverted to labeling the existing facility as the “Conference Center.” Was it deceit or wanton incompetence? Read on and you decide.

On September 24, 2012 Augusta Riverfront, LLC’s Paul S. Simon appeared before the Augusta Commission with an ultimatum – Execute a plethora of contracts, assignments, releases, modifications and other legal documents within 22 days or face cancellation of TEE/Trade Center events. Augusta then knew it was being held hostage to the lawyer’s handiwork, efforts that Administrator Fred Russell promised were nearly complete 3 years ago.

Included was the catering agreement. This document spells out that the new kitchen built in the TEE Center, but legally carved out as the “Conference Center Annex”, is to serve both Marriott hotels and the existing Conference Center. Why is the term “ Conference Center” so important? Why, it is because if the existing Conference Center agreement was intended to continue – which it was – it means that the $1.4 million of kitchen equipment that Augusta bought under a controversial change order to the TEE Center Contract will mostly be used to generate revenues for the Marriotts and not Augusta. This is because the existing Conference Center agreement pays Augusta 5% of the rental space revenues and nothing else, including catering.

TEE Center abuts The Marriott Hotel

Unless Riverfront has quietly reimbursed the city, Augusta paid $1.4 million for kitchen equipment that it will get almost NO USE OF, because the Trade Center space will be used primarily for exhibits, with attendees adjourning to meeting rooms in the freely-catered Conference Center for meals. So far, our Georgia Open Records request responses from Augusta have not shown that the Commission ever agreed to relieve Riverfront of the LLC’s responsibilities for kitchen equipment.

Under the circumstances, it would be wildly irresponsible for Augusta’s Commissioners to agree to pay for any of the kitchen equipment, particularly since some of the charges on the vendor’s invoices was to repair Riverfront LLC equipment! (Under prior agreements Riverfront owned the equipment.) Where is our $1.4 million? Is there any prohibition whatsoever barring Riverfront from running a commercial catering operation citywide out of the Conference Center portion of the Convention Center, using the $1.4 million of Augusta kitchen equipment?

Worst of all, the catering agreement mentions in several places that services to the hotels, to the restaurants, and to the existing Conference Center will be provided by the kitchen. There is no operational procedure manual to set out controls over food and beverage procurement, use or inventory for the TEE Center versus these other operations. Without controls and in the midst of all of these operations that consume food and beverage, how will Augusta avoid being looted from various parties on and off the premises? Will there be household with freezers of steaks, courtesy of Augusta taxpayers?

How many of the Marriott’s existing catering staff will be assigned to the TEE Center contract? Since the vast majority of the catering seems to be outside of the TEE Center, why should management level employees be charged to the TEE Center Catering Agreement?

In life, timing is everything. With the unsigned, undated Term Sheet that began the TEE Center project in 2007, the seed was planted in the minds of the public and the commission that there was going to be a new  Convention Center agreement. After that the branding was changed to emphasize the  Convention Center labeling, including announcements at the opening of the Reynolds Street Parking Deck and at last month’s  meeting. Behind the scenes, the legal wording, finally disclosed at the September 24 meeting, narrowly focused on the Conference Center and preserved the sparse 5% payout to the city for the existing center, with no provision for catering revenues. The wording of the catering agreement is that catering only applies to the TEE/Trade Center.

Meanwhile, the Amendment to the CORE Agreement extends these agreements out 50 years. Never mind a reported reduction to 15 years.

Throughout these agreements, one thing is repeatedly clear. The hotels and these agreements, which in the hands of others not as civic in their mindset as Paul Simon and Billy Morris provide an UNLIMITED CONDUIT to taxpayer funds, can be SOLD! In the hands of money hungry financiers of Wall Street, these agreements are loaded guns aimed directly at the finances of we Augustans.

How much more can Mr.’s Morris and Simon get for their two Marriott Hotels, with $70 million of dedicated Augusta buildings permanently and legally bound to them with an UNLIMITED conduit into the general revenues of Augusta Richmond County?

There you have it, reader. Augustans already find themselves facing a property tax increase. How many more tax increases will be coming to feed the TEE/Trade/Conference/Convention monster?

When the finances of Augusta crater it will be in no small part because of Catering.***
BO
**Cost Recovery Analyst Al Gray, President of Cost Recovery Works, Inc. contributed to this report. Cost Recovery Works is no longer in business, as of December 31, 2020.

Tee Catering Definitions From 9-2012 Agreement1999 Core Agreement Conference Center – Revenues

Special Report: Is it TEE Total Extortion?

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Originally posted on the now defunct CityStink.net site October 3, 2012

Wednesday, October 3rd, 2012
Augusta, GA
By Al Gray

The author, Al M. Gray was President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns. Cost Recovery Works is no longer in business, as of December 31, 2020.

In the five-year twisting tale of Augusta’s TEE Center project, we who have observed the events and decisions as they happened, learned to expect the unexpected. This didn’t keep reporter Susan McCord’s tweet from the September 24, 2012  Augusta Commission meeting from astounding me.

“Paul Simon: If documents aren’t approved by Oct. 15, (we) will have to cancel January police chiefs convention at TEE center,” she typed. My jaw dropped at the audacity of the city’s TEE Center partner suddenly resorting to what looks like a shakedown to get a management deal approved.

Simon’s Augusta Riverfront, LLC is getting a $2 million a year subsidy courtesy of an unsigned, undated proposal from 2007, and that isn’t enough for him and his partners at Augusta Riverfront, LLC?  Augusta has been held hostage since then. What is worse is that the City Administrator, legal counsel, and Augusta Convention and Visitors Bureau might be the source of this clumsy, heavy handed way of extorting an agreement out of a suddenly reluctant Commission.

Augusta Held Hostage

It is impossible for me to accept this assault by Management Agreement on the city’s finances in silence.

·         Augusta built at least $50 million in new buildings across multiple parcels owned by this Riverfront organization and probably $20 million of existing buildings, yet now is held hostage to liens on some of them?

·         There will be hundreds of pages of recorded easements, cross easements, assignments, and agreements on these lands, meaning that Augusta has all of the costs of land ownership, but few of the packages of rights that come with land ownership. Can’t we at least get a fee in lieu of taxes?

·         The unsigned, undated partnership agreement from 2007 says throughout that Riverfront is responsible for kitchen equipment while saying that Augusta is responsible for the kitchen space. Augusta has not been able to show where its City Commission has ever voted to change the partnership agreement, only that Augusta approved the change order to add $1.4 million of equipment to a project that Riverfront agreed to participate in as a builder and operator. Where is Augusta’s money?

·         The September 24 meeting was the first the Commission as a body had seen of the catering or management agreements and they were presented with an ultimatum that the documents have to be approved within 22 days! Five years of dithering and now the people of Augusta are presented with a manufactured emergency? Why? Keep reading!

·         Can we say there might be C-O-N-S-P-I-R-A-C-Y within Augusta government? Darryl Leech was the General Manager of the Augusta Marriott. On September 24, Paul Simon announced the TEE Center is now the AUGUSTA CONVENTION CENTER. The agreements that Augusta has been commanded to execute are now with an entity called the Augusta Convention Center Management, LLC. This is where things get really get good. Darryl Leech is now the General Manager of the Augusta Convention Center. In fact, it seems nearly all of the former Marriott Augusta Staff, Don Fuller, Janet Pierce, Greg DeSandy and Sharon Koon, are now on the Augusta Convention Center Team!

The Augusta Convention Center

Who gets to decide if all, any or part of these employees – whose salaries and fringe benefits likely exceed a million dollars – who used to be Marriott costs become Augusta costs? The Management Agreement says the Augusta Convention Center Management, LLC, “… shall have discretion and control, free from interference, interruption or disturbance, in all matters relating to management and operation of the TEE Center,” and, “Manager shall select, employ, promote, terminate where appropriate, supervise, direct, train, and assign the duties of all personnel which Manager reasonably determines to be necessary or appropriate for the operation of the TEE Center.” This Management agreement and the catering agreement provide capability for 100% of former Marriott employees to shift onto the Augusta payroll! It sure looks like Augusta will have no rights to contest this cost shift once this agreement is executed.

The Augusta Convention Center

·         Consultation with the Georgia Secretary of State Corporations Division does not show Augusta Convention Center Management, LLC as being registered to do business in Georgia. Augusta is being demanded to execute an agreement with an entity that does not yet exist?

·         Augusta is forced to deposit $250,000 at the beginning of the year into the operating account, but if the balance in that account falls below the amount to fund that account for the next 90 days, Augusta is required to contribute from GENERAL REVENUES enough funding to meet those expenses without regard to how soon the next $250,000 funds injection is required!!!!! The original partnership agreement limits Augusta funding requirements to $250,000 for operations and $100,000 for capital, yet this management agreement calls for an unlimited pipeline of funding from Augusta? Who authorized or negotiated that?

·         The unlimited ability of this  Augusta Convention Center Management, LLC to establish what costs are is not limited by the Annual Plan that the Augusta Commission approves, because “the Annual Plan will be only a planning tool.” Also, shouldn’t references to any Annual Plan limits be clearly defined not just as the types of costs to be included, but the amounts as well?

·         The management agreement provides for annual audits only, with no real-time or even monthly reporting. How can Augusta monitor these cost reimbursable agreements without continuous reporting and the strongest of audit rights? Shouldn’t these agreements be made subject to open records requests? Maybe the Augusta Chronicle can help us! No?

·         The management agreement called for the CVB to begin marketing for the Convention Center with execution of the construction contract to the tune of $350,000. However, the use of these funds by the CVB to market the Center before it opens was against the city’s own ordinance.

Summary

The TEE Center management agreement looks to have morphed into an agreement that allows most of the administrative staff of the Augusta Marriott to be shifted to Augusta’s Conference Center expense. There are unexpected liens on some of the property under the Center, and a parcel that was not liened was never conveyed prior to construction. The Augusta Administrator promised the agreement was nearly complete over 3 years ago and now has provided the City Commission with just 22 days to review and approve the contracts. The entity that Augusta is contracting with may not exist yet. The operating expenses, capped by the 2007 partnership agreement, are now unlimited conduits to the general funds of the city. The contracts fail to provide real-time program management and accounting.

***************

The Augusta Commission should walk away from these agreements and put the management and catering agreements out for bid. Otherwise outside counsel from far outside of Augusta needs to be brought in to renegotiate the management agreement to conform to model contracts from other cities.

Beyond this, it looks to me that Commissioner Bill Lockett’s idea of a forensic audit or a county-funded investigation of these transactions needs to be revisited. The project was funded by sales taxes, there are ample unused sales tax revenues in the coffers of Augusta, and legal costs are legitimate uses of sales tax money.

Can all of these issues and the progression toward the renaming of the TEE Center as the Augusta Conference Center be just incompetence?

Can Augusta afford an unlimited pipeline to its general revenues?

I don’t think so.***

AG

Analyzing the Aftermath of the Parking Deck Saga

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Originally posted on CityStink
Tuesday, August 28, 2012
Augusta, GA
By The Outsider

Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article. Cost Recovery Works is no longer in business, as of December 31, 2012.

After the more than nine month long ordeal over the Reynolds Street Parking deck debacle, yesterday’s events at the Marble Palace that resulted in the approval of  the long beleaguered parking management contract may have seemed rather anti-climatic. Indeed, we got wind that approval of the contract was imminent — if certain conditions were met. Key to passing the agreement was the inclusion of safeguards for the city that specifically stated in clear language that Augusta Riverfront, LLC (ARLLC) could not bill the city for their overhead expenses. Previous proposals were riddled with loopholes that ARLLC could exploit, amounting to a blank check from the taxpayers.

Also, included in yesterday’s contract was a clause giving the city the right to audit ARLLC’s books to verify their compliance. This was a crucial safeguard for the city and one that ARLLC’s lawyers were fighting all the way up until the final hours leading up to yesterday’s vote, but in the end they yielded and agreed to include the rights to audit.

Wayne Says Sell It!
Commissioner Wayne Guilfoyle deserves a large amount of the credit for these safeguards being included in the final contract. We understand that the lawyers were trying to twist Guilfoyle’s arm all the way up to the final hours to get him to bend under the pressure and approve the deal without these key safeguards, but the District 8 commissioner would not budge. He stood his ground and insisted that these conditions be met or his vote would be NO. Guilfoyle added the stipulations and to the agreement in his motion yesterday to approve the contract.

The citizens of of District 8 in South Richmond County can feel confident that they have someone like Wayne Guilfoyle representing them. Though a freshman commissioner, Guilfoyle has demonstrated leadership on a variety of important issues and continues to exhibit a willingness to study the details of these complex contracts, weigh all of the options, and play hardball when necessary to get the best deal for the taxpayers. Augusta could use more commissioners like him.

Not Gonna Be Bowled Over
Mayor Pro-tem Joe Bowles deserves credit for negotiating better terms in the contract that gives the city a much more favorable split of deck revenues at 70/30%. He also negotiated the inclusion of a pedestrian skywalk over Reynolds Street from the deck to the TEE Center that will enhance public safety and steer patrons to the city-owned parking spaces on the upper levels. Bowles even found the savings in the construction of the deck that will pay for the skywalk at no additional cost to the city. It’s this keen eye that makes Bowles a consistent leader on the commission.

The mayor pro-tem is also willing to admit when mistakes have been made and then work diligently to correct them. He also has a knack for forging compromise through the art of negotiation, but is willing to stand his ground when necessary to make sure the interests of the taxpayers are protected. His leadership will certainly be missed when his term expires at the end of this year, but Bowles will leave office with a nice legacy and he has certainly set the tone for all future mayor pro-tems.

Wise Man Lockett
From the very beginning, Commissioner Bill Lockett has been a vocal critic of the parking management deal with Augusta Riverfront, LLC. This is probably why he voted against approving yesterday’s contract — as a protest of the entire process. That is understandable. Time and time again, Lockett’s wise caution from his in-depth study and analysis of these complex matters has been proven right. Lockett doesn’t take anything at face value. He wants to see it in writing — he asks the right questions — he goes over every detail with a fine tooth comb. Some people may find this tiresome, but without Lockett’s determination to get to the truth and his attention to every detail, Augusta would have likely ended up with a much worse deal nine months ago, locking the city into a 15 year contract with ARLLC instead of just 5.

Though ultimately unsuccessful in getting the forensic audit to probe the process that gave us this debacle, Lockett was right in asking for it, and we predict when all is said and done he will be vindicated on that issue as well. Augusta could use more commissioners like Bill Lockett, who understand that their primary duty is in protecting the interests of the taxpayers of Augusta instead of bending to the whims of people like Paul S Simon. We suspect this is why Lockett does not face opposition for reelection.

Theater of the Absurd
On the opposite end of the spectrum is outgoing Commissioner Jerry Brigham, who fought vehemently against all attempts to give taxpayers a better deal over the parking deck. In what can be best described as a scene from the theater of absurdity, Brigham jumped at the opportunity yesterday to get in front of the cameras after the vote and tell a reporter for WJBF News that the final contract is, “… financially more stable than what was originally proposed and I think the Commissioners feel better, in general, with this proposal.”

It’s too bad the reporter did not retort by saying something along the lines of:

“But Mr Brigham, weren’t you the one who wanted to rush this deal along and fought against these changes from the very beginning?”

Indeed, if Brigham had gotten his way, the parking deck contract would have been passed last fall and it would have been for 15 years instead of 5 years and would have been riddled with loopholes that ARLLC could exploit as a blank check, using the taxpayers as their own personal piggy bank. Brigham’s contract had none of the safeguards and denied the city the rights to audit. And when these deficiencies were brought to his attention by government watchdogs, Brigham refused to budge and admit that errors were made. So maybe Mr. Brigham’s statement means he has had a change of heart? We doubt it — it’s probably more about saving face and trying to take the credit for the hard work of others who in the end forged the compromise that got a much better deal for the city.

Unlike his colleague Joe Bowles, Brigham will leave office with a cloud over his head. In every step of the process, Commissioner Brigham fought hard for the interests of Paul Simon and Augusta Riverfront, LLC over those of the taxpayers in his district and the city as a whole. We can only hope that his successor will be someone more like Commissioner Guilfoyle, Bowles or Lockett. The voters certainly have a choice before them this fall.

What Happens Next?

Though this closes the chapter on the nine month long saga over the parking deck contract, the issue is far from over. Now commissioners will have to decide how to hold the people accountable who created this mess in the first place. Why was the RFP (Requests For Proposals) process circumvented in favor of a hideously unfavorable deal with ARLLC — one for which they did not even submit a bid? Why were commissioners consistently mislead about the land under the deck being donated? Why were commissioners not informed of the $millions worth of liens on the property until after government watchdogs discovered them? Why were commissioners not made aware of the results of a 2009 parking study that showed that a $12 million parking deck was not even necessary and a $1 million surface lot would have sufficed. Why did city-hired outside counsel agree to such atrocious terms under previous contract proposals that were written entirely by the lawyers for ARLLC?

Now that the contract terms have been settled these are the questions commissioners need to ask and find answers. This process did not happen by mistake. What should have been a simple and clear-cut process was intentionally made more complex and nearly incomprehensible to most commissioners, the media and the public in an effort to sneak through a contract riddled with loopholes, lacking controls and caps on expenses and absent safeguards like the rights to audit. The people responsible for this must be held accountable so that this does not happen again. This ordeal also demonstrates why the city needs consistent procedures and guidelines governing these kinds of contracts. What we currently have is a an ad-hoc process governed by whim. That must change or Augusta will keep repeating the same mistakes with future contracts.

As the agenda now moves on to the the much larger TEE Center contract there is much more at stake. If commissioners have learned anything from the parking deck saga, they now know not to take anything at face value and to study every detail and spot every loop hole. Instead of rushing something through like commissioners did in December of 2009 that gave us this mess, they would be wise to yield to caution to insure that the interests of the taxpayers are protected above all else. If commissioners ask the right questions, study the details, and use good judgement and common sense, we don’t expect this process to drag out for nine months. But it’s entirely up to them.***

OS

The Day City Stink Took Over The Marble Palace (Video)

  By , ,

Originally posted on CityStink
Thursday, Augusta 23, 2012
Augusta, GA
From CityStink.net Reports

Al M. Gray, President of Cost Recovery Works, Inc. contributed multidisciplinary review techniques in support of this article. Cost Recovery Works is no longer in business, as of December 31, 2020.

Amid all of the hullabaloo of Tuesday’s runoff elections, something remarkable happened at The Marble Palace. Paul S. Simon, president of Augusta Riverfront, LLC, was on the agenda to give a presentation before the Augusta Commission about the Reynolds Street parking deck management contract in a special called meeting at 4:30pm. Representatives from CityStink.net and Augusta Today were also there including Al Gray, Lori Davis, Brad Owens and former Augusta commissioner Andy Cheek.  After Simon’s presentation, commissioners adjourned into a closed door legal session to discuss personnel matters. That’s when members of CityStink.net and Augusta Today took over the commission chambers. Al Gray went to the front of the chambers and began to address the gallery and questioned Simon about key points in the management contract. We have the video of that exchange below:

The speaker in the video is Al M. Gray, President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America’s leading companies, businesses and governments desiring Superior Returns, which is no longer in business, as of December 31, 2020.