Category: All

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

Special Report: Out of Line Asking for a Single Line?

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TEE-Totally Fried Circuits

A $2.6 Million Cover Up?

Originally Posted on CityStink
Thursday, November 8, 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.

In $15 Million Augusta Conference Center Pays $25,000 a Year to City, this writer brought up the issue of the enormous electrical power costs that were evident in an earlier Georgia Open Records Request in which the accounting for Augusta Conference Center lease payments was obtained. Those records suggested that the Conference Center Manager, Augusta Riverfront, LLC (owner and operator of the Marriott hotels), was using estimates to separate power used by the Marriotts from that charged to Augusta’s Conference Center rather than precise separate metering.

That got me to thinking. If they are estimating for the Conference Center, where they are responsible for the power bill, are they going to estimate again for the TEE Center power? Will there be separate metering for the bill that the taxpayer has to pay out of the General Fund of Augusta-Richmond County?

In a Georgia Open Records Act Request submitted on October 31, 2012 an official inquiry was made to access the simple single line diagram that would answer my question. A single line diagram looks like this:

It doesn’t show locations, specifications, or details, it just shows how power enters a development or building and the uses to which it is directed. Imagine the shock when the response from Augusta’s Law Department was a refusal to provide an answer to my request based upon considerations that disclosure, “would compromise security.”

Why is Fred Russell’s and Deke Copenhaver’s Law Department engaged in this cover up? Russell flits about, dismissing public watchdogs’ efforts as being concerned over nickles and dimes, when he hides the truth about the legitimacy of a $5.2 million ($350,000 for 15 years) TEE Center Cost? Proposed Management company executive Paul S. Simon thinks that, “this is a very expensive building to operate,” while citing a $350,000 annual power bill as a reason, so a key player doesn’t see this Fred’s way.

Sources tell me that the way the TEE Center electricity was routed was such that the TEE Center, where Augusta pays the bill, is on the same incoming circuit as the Conference Center, where Augusta Riverfront, LLC pays the bill.  They say that, in the aftermath of last Friday’s meeting between three Augusta Commissioners with Augusta’s contracted counsel and an Augusta Riverfront, LLC attorney efforts are underway to accomplish separate metering.

The watchdogs want to see proof of developments on the issue. We want to see savings.

At just one-half the costs indicated by Mr. Simon, this is a $2.6 million question. It is good to see a team of Augusta commissioners looking for answers that Fred Russell and the Law Department intend to hide.

-LD

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

Can Augusta Avoid Outsized TEE Center Costs?

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Augusta’s Tee Shot Hits Rough

Originally posted on CityStink
Wednesday, November 7, 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 One – The Management Agreement

When Augusta’s Trade, Exhibition and Event (TEE) center was approved in 2007, prudence might have suggested that one of the first steps in the process of building the facility might have been to execute the Management Agreement in advance.  This being Augusta, Georgia, where almost nothing is done in accordance with normal business practices, the building has gotten within weeks of being used before a management agreement was even submitted to Augusta commissioners for approval. Worse, the management agreement was one of a covey of documents to flush out for approval.

A very rapid assessment of the provisions of the contracts was needed, because the proposed Manager immediately began hawking the loss of events that might result if the Augusta Commission has the temerity to actually deliberate on the terms and conditions of the entire contract documents.

The following represents a summary of the primary Management 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.

TEE Management Agreement Major Issues at 11/2/2012
  1. Differences in 2007 and 2009 Commission Approvals and these Documents. No cost cap. Unlimited conduit to Augusta General Fund.
  2. Cost shifting between agreements. Electric utility example. Beer inventory example. $300,000 a year for 50 years = $15,000,000 (Augusta’s Laney Walker Improvement cost calculation method)
  3. Kitchen built under TEE Agreement where ARLLC supplies equipment switches to 50 year Conference Agreement where Augusta supplies and repairs kitchen equipment with no revenue from Conference Center.
  4.  No accounting provisions for backcharged labor to Hotels or any other credits, refunds, rebates, or other benefits going to Augusta.
  5. Cross indemnification between TEE and Conference Center – sever-ability issues. WHO IS LIABLE?
  6.  Too many ways to circumvent Annual Plan, including that an unknown, unknowable “Standard” trumps everything, including Annual Plan.
  7.  Fringe benefits and bonuses, including for LLC PRINCIPALS, are unlimited.
  8. Accounting and auditing envision most of the accounting off TEE Center books, without rights of audit to ALL HOTEL ACCOUNTING records on a real time basis.
  9. Conventions can be booked using TEE Exhibition Hall while using Conference Center where Augusta gets no revenues.
  10. When Augusta signs these contracts, it assumes extraordinary indemnity provisions immediately so that it would have to advance payments to the Manager to defend the Manager from actions by Augusta

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.

Augusta Held Hostage: Day 24

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A Little White Lie?

Originally posted on CityStink
Tuesday, October 16, 2012
Augusta, GA
By Kurt Huttar

Here we go. It is now official. As my Augusta Today colleagues and fellow CityStink.net contributors, Lori Davis, Brad Owens and Al Gray have been saying for months, the Augusta TEE/Convention/Conference/Whatever-it-is- called-next-week is a TEETOTAL DISASTER. Yesterday the projected LOSSES came out for this already-extinct dinosaur –$911,000 plus in losses! 

Since only $250,000 is going to be available from the dedicated funding source of the hotel transportation tax, Augusta Administrator Fred Russell has had to admit that the balance of the funding for this enormous albatross on city taxpayers will have to come out of the General Fund. One supposes that fire and police protection will take another hit.

Of course, accompanying the news of this debacle the Augusta Chronicle, who shares ownership with erstwhile TEE manager Augusta Riverfront, LLC, trotted out the usual wildly optimistic tourism revenue growth propaganda.

“As (Augusta Riverfront’s Paul S.) Simon and Augusta Conven­tion and Visitors Bureau officials have said, the benefits to the city don’t come from revenue from the center but from visitor spending. Simon’s report includes a CVB (Convention and Visitors Bureau) chart estimating $8.7 million in visitor spending in the first year from 13 conventions.”

This statement rang a bell from a July 8, 2007 propaganda piece that Barry White, Director of the CVB, had published in the Chronicle. White wrote at the time: “Not only does Augusta Riverfront LLC bring proven expertise, it has offered to donate to the city downtown real estate valued at an estimated $1 million. The LLC also will pay annual center operating expenses over $250,000 and capital improvements over $100,000 a year.”

Wow!

How much more wrong can a bureaucrat be? The deal went from the LLC funding $350,000 a year being reported in Mr. Simon’s former newspaper to Augusta’s losses being capped at $350,000 annually a month later – an amazing $700,000 swing against Augusta taxpayers in one month! This looks like the first bait-and-switch. Now we have the second. Now the losses to Augusta are nearly $1 million!!

Who can believe anything coming out of CVB now? The free land had $7 millions in liens on it and now the city will lose millions instead of getting millions in contributions from its “partners.”

The 2007 Barry White piece in the Chronicle also reminds one of another little white lie that TEE Center supporters hawk – that the voters of Augusta approved the TEE Center in 2005. What they never bring up is that the voters approved this boondoggle after being told it would cost ‘only’ $20 million. Now the cost is over $50 million ($tens of millions more taking into account the existing Conference Center) and it looks like the operating losses for the first decade will easily exceed $20 million. Bear in mind that none of the projected losses include depreciation or debt service!

Little white lies got one huge white elephant constructed on Reynolds Street.

Reality trumps slanted projections and you can’t use “White Out”, either.

 
 
 

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