TEE Center Update: Did Fred Fix the Kitchen But Fail to Execute?

The Convention Center Agreement Today

Fred and Barry’s Unexecuted Fix?

Friday, Feb. 24, 2012

Augusta, GA

by Al Gray

In TEE Center Kitchen Costs Leave Taxpayers Burnt! , yesterday’s City Stink exclusive, this writer covered deficiencies in the City of Augusta’s TEE Center Term Sheet with its partner in the project, Augusta Riverfront, LLC, which was approved by the City Commission on August 21, 2007. This was the approved document recently cited by attorney Jim Plunkett’s resolution recounting the history of Commission votes ratifying TEE and Parking Deck Agreements. A formal agreement was belatedly drafted and conditionally approved for the Reynolds Street Parking Deck on February 7.

Despite references in Board of Commissioner meetings all through 2009, no formal contractual agreement has been found executing the final TEE (now Conference Center) operating agreement. The original operating agreement for the Convention Center was recorded in the office of the Clerk of Superior Court. There doesn’t seem to have been any modification nor has there been any action to define rights with respect to the .23 acre tract that the LLC owns under the TEE Center. Like the parking deck agreements, the formal agreement seems to have lagged negotiations by years.

Based upon a schedule obtained in an earlier open records request by City Stink contributor Lori Davis (See Modifications Sheet Document Here) and informational updates made since the August 21, 2007 approval of the original term sheet that was unfavorable to Augusta, as noted yesterday, it looks like Augusta City Administrator Fred Russell and City Convention and Visitor’s Bureau Chief Barry White actually may have done an exceptional job of renegotiating the deal so that it is dramatically more favorable to the City!

The proposed modifications put the City in control of the Center’s finances, gives it catering revenues, provides for a set fee rather than profits from operations, and provides that profits from operations go to Augusta. If this modification represents the final agreement, it is vastly superior to the original deal and is actually a very good deal for the City of Augusta.

From here it looks like the original Term Sheet stands as the only basis of an operating agreement actually approved by the Commission and that the final agreement has been mired in what have to be tremendous legal complexities of merging the TEE agreement with the existing Convention Center Agreement.

The final agreement should take care of the issue of the new kitchen equipment and replacements of that equipment going forward, but the Issue of how the new agreement relieved the LLC’s responsibilities going into this transaction, up to and until the combined TEE Center starts operations, still stands as does the issue of LLC responsibility for the proposed HVAC changes demanded by the Marriott.

Leaving issues like these, which should have been finalized before construction, hanging for 4 ½ years is a huge failure of administration, despite Fred Russell’s accomplishment of what looks to be a much, much better deal.

This story will be updated as new developments are known.***


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