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CITY OF HOUSTON - CITY COUNCIL
Meeting Date: 12/9/2014
District B, District I
Item Creation Date: 11/25/2014
HAS - Concession and Purchase Agreement with Smarte Carte
Agenda Item#: 79.
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| | | | | | | | Summary:
ORDINANCE approving and authorizing Concession and Purchase Agreement between the City of Houston and SMARTE CARTE INC for Passenger Luggage Cart Services at George Bush Intercontinental Airport and William P. Hobby Airport; providing a maximum contract amount - 5 years - DISTRICTS B - DAVIS and I - GALLEGOS |
| | | | | | | | Background:
In August 2014, HAS issued a Request for Proposals (RFP) to provide Passenger Luggage Cart Services at George Bush Intercontinental Airport/Houston (IAH) and William P. Hobby Airport (HOU). The RFP required that luggage carts be rented to domestic passengers for a fee, a service which would be provided as a concession. Additionally, the RFP required that luggage carts be provided free of charge to international passengers arriving at the IAH Federal Inspection Services (FIS) and the future HOU FIS. This service would be purchased by HAS.
The RFP was advertised extensively and sent directly to five companies providing luggage carts. Smarte Carte Inc. was the only respondent. A selection committee evaluated the proposal submitted based on the following criteria: Financial Projection & Fees to the City (25 points); Customer Service & Management Plan (25 points), Experience and Qualifications (20 points), Design Detail of Equipment & Quality of Improvements (15 points), Capital Investment Plan (15 Points), Financial Strength (pass/fail), and ACDBE participation (pass/fail).
Based on the information provided in Smarte Carte’s proposal and the evaluation criteria defined in the RFP document, the evaluation committee recommended Smarte Carte Inc. be awarded the Concession and Purchase Agreement for Passenger Luggage Cart Services.
The pertinent terms and conditions of this agreement are as follows:
1. Scope of Service
Concessionaire will be responsible for the provision, operation, maintenance, and management of Luggage Carts and related equipment.
2. Financial Terms
In consideration of Concessionaire providing complimentary luggage carts in the FIS areas to arriving international passengers, the City will purchase these services at a cost of 32 cents per deplaned FIS international passenger, with a total cost not to exceed a maximum annual amount. The maximum annual amount will be $1.3MM in the first contract year and will escalate 3% in each subsequent contract year.
The Concessionaire will pay HAS 25% of gross sales generated by luggage cart rentals to domestic passengers. The amount paid to the City during fiscal year 2014 was approximately $280,000.
3. Capital Investment
Concessionaire estimates a capital investment of $1,354,000.
4. ACDBE Goal
The Office of Business Opportunity has established the following Airport Concession Disadvantaged Business Enterprise (ACDBE) participation goals for this concession:
IAH – 25% HOU – 7%
Smarte Carte proposes to achieve the established goals through a labor subcontract with Chandler, Campbelle and Daschle, a certified ACDBE company with the City of Houston.
5. Term
The term will be five (5) years, with a 90 day termination for convenience option.
6. Performance Security
The Concessionaire will maintain a performance surety for the duration of the term.
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| | | | | | | | Amount of Funding:
REVENUE: $280,000 annually
EXPENSE:
FY 15 $ 730,000
Out Years $6,172,000
Total Funding $6,902,000 HAS Revenue Fund (8001)
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| | | | | | | | Contact Information:
Kathy Elek Phone: 281-233-1826
Ian Wadsworth 281-233-1682
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| ATTACHMENTS: | | Description | Type | | RCA | Signed Cover sheet |
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