File Number: 131232
|Printable PDF Format Clerk's Official Copy|
|File Number: 131232||File Type: Resolution||Status: Adopted|
|Version: 0||Reference: R-520-13||Control: County Commission|
|Requester: Port of Miami||Cost:||Final Action: 7/2/2013|
|Sunset Provision: No||Effective Date:||Expiration Date:|
|Registered Lobbyist:||None Listed|
|Acting Body||Date||Agenda Item||Action||Sent To||Due Date||Returned||Pass/Fail|
|Board of County Commissioners||7/2/2013||8J1||Adopted||P|
|County Attorney||6/25/2013||Assigned||Steven B. Bass|
|County Mayor||6/25/2013||Assigned||County Attorney||7/2/2013|
|REPORT:||PORT OF MIAMI (ASST. COUNTY ATTY: UNKNOWN) (NO CMTE) (BCC CO-SPONSORS: CMSR BELL AND CMSR EDMONSON)|
|County Mayor||6/11/2013||Assigned||Jack Osterholt||6/11/2013|
RESOLUTION (1) APPROVING AND AUTHORIZING THE COUNTY MAYOR OR THE COUNTY MAYOR’S DESIGNEE TO EXECUTE A CRUISE TERMINAL USAGE AND DEVELOPMENT AGREEMENT BETWEEN MIAMI-DADE COUNTY AND BIMINI SUPERFAST OPERATIONS, LLC; AND (2) AUTHORIZING THE COUNTY MAYOR OR THE COUNTY MAYOR’S DESIGNEE TO EXERCISE ALL CANCELLATION, TERMINATION, RENEWAL AND OTHER RIGHTS THEREIN
WHEREAS, this Board desires to accomplish the purposes outlined in the accompanying memorandum, a copy of which is incorporated herein by reference,
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA, that this Board:
Section 1: Approves the Terminal Usage and Development Agreement between Miami-Dade County and Bimini SuperFast Operations, LLC (“Agreement”) and authorizes the County Mayor or the County Mayor’s Designee to execute same on behalf of Miami-Dade County, in substantially the form attached hereto and made a part hereof.
Section 2: Authorizes the County Mayor or the County Mayor’s Designee to exercise any cancellation, termination, renewal and other rights and provisions contained in the Agreement.
To: Honorable Chairwoman Rebeca Sosa
and Members, Board of County Commissioners
From: Carlos A. Gimenez
Subject: Resolution Authorizing a Cruise Terminal Usage and Development Agreement between Miami-Dade County and Bimini SuperFast Operations, LLC
It is recommended that the Board approve the accompanying Resolution approving and authorizing the Mayor or his designee to execute a Cruise Terminal Usage and Development Agreement between Miami-Dade County (“County”) and Bimini SuperFast Operations, LLC (“Bimini Superfast” or “Operator”); and authorizing the exercise of cancellation, termination and other provisions contained therein.
PortMiami is located within District 5 – Commissioner Bruno A. Barreiro. The impact of this agenda item is countywide as PortMiami is a regional asset and generates employment for residents throughout Miami-Dade County.
FISCAL IMPACT/FUNDING SOURCE
This Agreement provides Bimini SuperFast with preferential, non-exclusive berthing rights and port incentives while providing the Port with minimum annual guaranteed revenue of approximately $7 million (plus annual escalation provisions described below). Such Operator guaranteed annual Port revenue streams include approximately $4.8 million in guaranteed dockage, passenger wharfage and harbor fees throughout the initial ten year term, and another $2.2 million in annual guaranteed parking revenue during the first six years of the agreement term.
The Agreement commits the County to make certain improvements at Cruise Terminal H in order to accommodate the Operator’s passenger and vessel operations. The cost for construction improvements is estimated to be approximately $10 million and will be advanced by Bimini Superfast to the County. In consideration for advancing the terminal improvement construction costs, the Operator will be eligible to obtain dollar-for-dollar credit offsets against future Port dockage and passenger wharfage fees (up to $10 million), plus additional credits equal to Operator’s advanced payments for tenant relocation costs, not to exceed $1 million. Any incurred construction costs above $10 million, but not more than $11 million, shall also be advanced by the Operator with the Operator receiving offsets for half of such additional amount from the County. The costs paid by the County for the design service contract(s) shall be paid by the Operator with a cap not to exceed $1.5 million. The Operator shall not be entitled to offsets or credits for any costs associated with design contracts.
Commencing early-October through the time that Terminal H improvements are substantially completed, Bimini SuperFast will operate from a tent annex. The Port will incur all costs associated with the temporary tent facility for approximately 24 months of usage, which is expected to average approximately $28,000 monthly.
The Operator has no right to terminate the Agreement without cause prior to the later of the second anniversary of this Agreement or attainment of substantial completion of the Terminal H improvements. After such period, Operator’s ability to terminate without cause shall be governed by a termination fee schedule ranging from an estimated $7 million termination payment in the early years (after the application of offsets), to a $2 million minimum termination payment toward the conclusion of the initial term of this Agreement.
The Seaport Department staff members responsible for monitoring the Agreement and the affiliated contracts are Juan Kuryla, Director Designee, Kevin Lynskey, Assistant Director, Business Initiatives, and Hydi Webb, Manager of Business Development.
Resorts World Group, owner of the Bimini SuperFast vessel, has a twenty-six year track record of investing in the United States. Its business in Florida started thirteen years ago when it acquired Miami-based Norwegian Cruise Line (“NCL”) and spent $5 billion building eight new ships, which transformed NCL into the youngest and fastest-growing cruise line. Resorts World Group currently owns 44% of NCL. In 2011, Resorts World invested approximately $500 million in Downtown Miami’s Omni District, purchasing 30 acres of waterfront property, with plans to transform the area into a vibrant residential and commercial district. This investment was followed in early 2013 with the purchase of Resorts World Bimini Superfast, a 670 ft ship that is anticipated to make two daily calls from PortMiami to Bimini. The vessel, which may also transport cargo, is capable of carrying 1,600 passengers and will have a travel time from Miami to Bimini of approximately 2 ½ hours. At this time it is anticipated that Bimini SuperFast will operate morning and afternoon/evening sailings, with specific sailing times subject to modification based on customer demand and/or operational needs. Additionally, Bimini SuperFast may also operate cargo operations from Terminal H provided it obtains authorization from U.S. Customs and Border Protection and/or any applicable regulatory agencies.
The Bimini SuperFast vessel arrived at PortMiami on June 17, 2013, and, as of the date of this writing, is anticipated to commence passenger operations on or about June 28, 2013. Initial passenger and vessel operations will take place at Cruise Terminal F through early-October 2013. Thereafter, the vessel will operate from a temporary tent terminal facility located adjacent to Terminal H until the time that Terminal H improvements are completed. The Port will incur all costs associated with the temporary tent facility, which is expected to average approximately $28,000 (twenty-eight thousand dollars) monthly for approximately twenty-four (24) months. The Port’s use of a tent facility is customary when no terminals are available to service a valued cruise customer. Should Terminal H improvements not be ready in 24 months of the County’s execution of the principal design contract, tent-related expenses incurred by the County shall be reimbursed by the Operator (for up to six months) and the Operator will receive offset credits on a dollar-for-dollar match. It is worth mentioning that, due to the shorter length of the Terminal H berth, it has been an under-utilized passenger terminal at the Port for a number of years.
Terminal Tariff No. 010 (“Tariff”) currently does not provide for daily passenger regulations and rates. Thus, Bimini SuperFast has agreed to pay the County the following negotiated vessel and passenger rates for its high density, single-day cruise passenger vessel:
Single-day cruise passengers returning same day of departure $ 2.15 per embark/debark
Single-day cruise passengers returning on a different day $10.00 per embark/debark
A 20% discount to Tariff rates, which are currently as follows:
Cruise passenger vessels arriving on Thursday – Monday $.32 per each GRT ($.256 with discount)
Cruise passenger vessels arriving on Tuesday – Wednesday $.28 per each GRT ($.224 with discount)
Per Tariff as follows:
Passenger vessels making 300 and more sailings per year $50.00 per day
Dockage and harbor fees shall be charged only once per 24-hour period for multiple sailings with the same vessel. During the first five years of the Agreement’s term, provided the Operator has a minimum of 500 vessel calls per year, the Port shall not eliminate the current “300 and more sailings” Harbor Fee Tariff discount threshold as currently provided for in the Tariff. Annual increases to dockage and passenger rates wharfage will be capped at three percent (3%) per year, which is consistent with other cruise terminal agreements. All other port fees will be charged as per Tariff rates.
Under the initial term of this Agreement, Bimini SuperFast commits annual guaranteed revenues to the County of approximately $7 million during each of the first six years of the Agreement (based on $1.9 million in harbor and passenger wharfage fees, $2.9 in dockage fees, plus $2.2 million in parking guarantees – plus annual escalations as further described below).
The Port shall guarantee Bimini SuperFast three-hundred (300) parking spaces during peak season (October 15 through April 15) each year as per the long-term Tariff parking rate, which is currently twenty dollars ($20) per space per day at least during the first six years of the initial term. Should the County increase the long-term parking rate above twenty-five dollars ($25) per day during the first six years of the initial term, the Operator may unilaterally opt out of its seasonal parking guarantee. If the Operator drops this parking guarantee after year six, the wharfage rate chargeable from the County to Bimini SuperFast will increase by $ .35 per passenger plus the then-applicable annual escalator.
The Agreement commits the County to make improvements at Cruise Terminal H in order to accommodate the Operator’s passenger and vessel operations. These infrastructure improvements, estimated to cost approximately ten million dollars ($10,000,000), consist of enclosing a currently open-air terminal area, air condition systems, fire and life safety systems, escalators, elevators, new passenger holding areas, luggage laydown area, Customs Border Protection primary and secondary requirements, ticket counters, seating, restrooms, a passenger boarding bridge, way finding, entrance canopy, and intermodal needs, among other enhancements. The facility will need to be modified to code, including ADA requirements. PortMiami and Bimini SuperFast shall adjust the scope to fit within the agreed upon budget. The County will be responsible for the competitive selection of an architect and engineer, and a general contractor via the County’s competitive processes.
Under the proposed Agreement, Bimini SuperFast shall pay for the improvements to Cruise Terminal H. The County will credit Bimini SuperFast for construction project costs up to $10 million via dollar-for-dollar offset credits against future passenger wharfage and dockage fee charges. Such offsets may only be used to pay up to fifty percent (50%) of Port charges for dockage and passenger wharfage fees due in any billing period. Any construction cost incurred above the expected $10 million, but not more than $11 million, shall further be paid by the Operator with the Operator receiving half of such amount back from the County via offset credits. For cash flow purposes, Operator agrees to make an initial advance contribution payment of $2 million upon the County’s award of a construction contract. The Operator will also make milestone payments for architectural and engineering services and the passenger boarding bridge.
The costs paid by the County for design services shall be paid by the Operator with a cap not to exceed $1.5 million, without offsets. PortMiami retains design control of the planned improvements and will work with the Operator to prioritize improvements to align with project credit and cost limits.
To accommodate the Operator’s vessel requirements, the Port will need to relocate a few tenants in Terminal H. Bimini SuperFast will advance up to $1,000,000 to cover the Port’s anticipated tenant relocation costs, subject to recouping such advance in the future through dockage and passenger wharfage offsets.
Upon completion, the Operator may lease up to 1,000 square feet of exclusive use space within the facility for its marketing office. The Operator will pay the then-applicable Tariff square footage lease rate per Tariff item #602, which is currently $23 per square foot. Additionally, should the Operator sell retail within Terminal H (sales of food, beverages, apparel, merchandise or other retail) then the Operator shall pay to the County 7% of all gross revenues collected. The Operator also has expressed interest in electronic signage on the exterior of Terminal H. Should the Port obtain future rights to install electronic signage, the Parties will enter into good faith negotiations as to its design, construction and usage.
As mentioned in the above Fiscal Impact section, the Operator has no right to terminate the Agreement without cause prior to the later of the second anniversary of this Agreement or to substantial completion of the Terminal H improvements. Termination rights from years 3 to year 10 shall be governed by a schedule ranging from a $7 million terminal fee payment (after the application of offsets) in the earlier years to a $2 million payments towards the conclusion of the initial term of this Agreement.
The term of the Agreement shall be for an initial period of ten (10) years with two (2) additional renewal terms of five (5) years each upon mutual consent. Should either of these options be exercised, Bimini SuperFast and the County shall negotiate mutually-agreeable terms for the extension periods and such extensions will be brought back to the Board for approval.
Bimini SuperFast will provide residents and tourists a new attraction in Miami-Dade County. Its daily vessel operation will contribute substantial revenue to the County plus create jobs to stimulate our local economy.
In accordance with Section 2-8.3 of the Miami-Dade County Code related to identifying delegation of Board authority, there are no authorities beyond those specific in the resolution which include the authority for the Mayor or designee to execute the Agreement and to exercise any cancellation and renewal provisions.
Jack Osterholt, Deputy Mayor
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