Report to the BOARD OF AIRPORT COMMISSIONERS. viefy-

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1 11 _mast L A zr g ties if o rts1 A irpo rts Report to the BOARD OF AIRPORT COMMISSIONERS Meeting Date: Ite be* Approved by: Samson Mengistu, Deputy Executive Director Administrati August 20, 2013 Reviewed by Samson Men Adminis //nut-ia AL4ot&- viefy- Executive Director CAO Review' l Completed l DI I Pending jg I N/A Reviewed for Date I AOPrOval Status I By Marie Lindsey - Executive Direc r Capital Budget 08/08/13 I YO N D NA j DS Operating Budget 08/12113 E YO N D NA i RW CEQA 08/08/13 Y N ES Procurement i 08/06(13 IZYDND Cand MT SUBJECT: Second to Contract DA-4663 with Los Angeles Tourism and Convention Board Approve the Second to Contract DA-4633 with the Los Angeles Tourism and Convention Board (formerly LA INC, the Los Angeles Convention and Visitors Bureau), to extend the term of the contract for one additional year to October 13, 2014 and to increase the contract amount. The amount requested for the additional year is $2,500,000 for a total not-to-exceed amount of $7,428,440 over three years. RECOMMENDATIONS: Management RECOMMENDS that the Board of Airport Commissioners: 1. ADOPT the Staff Report. 2. DETERMINE that this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Article II, Section 2.f of the Los Angeles City CEQA Guidelines. 3. FIND that the work can be performed more economically or feasibly by an independent contractor than by City employees. 4. APPROVE the Second to Contract DA-4663 with the Los Angeles Tourism and Convention Board to extend the contract term for one year, to provide international air service marketing activities on behalf of Los Angeles World Airports for the term beginning October 14, Page 1 LA Tourism Board Contract 14

2 /Th 2013, and ending October 13, Increase the contract amount by $2,500,000 for the additional year, for a not-to-exceed amount of $7,428,440 for three years. 5. AUTHORIZE the Executive Director to execute the Second after approval as to form by the City Attorney. DISCUSSION: 1. Executive Summary Staff requests Board of Airport Commissioners (Board) approval to amend Contract DA-4663 with the Los Angeles Tourism,and Convention Board (LA Tourism). Under the existing contract, LA Tourism provides international air service marketing, advertising, and promotional services for Los Angeles International Airport (LAX) and LA/Ontario International Airport (ONT). The second amendment will extend the term for an additional year to October 13, 2014 and increase the contract amount by $2,500,000 for the additional year, for a total not-to-exceed amount of $7,428,440 over three years. 2. Prior Related Actions In February 2011, Los Angeles World Airports (LAWA) released Request for Proposals (RFP) No for international air service marketing to solicit proposals from qualified firms to perform overseas air service marketing activities in key international regions (i.e., Asia/Pacific, Europe, Latin America, India, and the Middle East/North Africa region) in the promotion of international air service for LAX. The competitive process for international air service marketing was initiated, in part, because of concerns raised by the 2009 Federal Aviation Administration audit on the use of airport revenue. The RFP asked firms to propose based on a contemplated three-year international air service marketing contract. As a result of the competitive process, LAWA staff recommended LA Tourism to provide international air service marketing services. On October 3, 2011, by Resolution No , LAWA's Board awarded Contract DA-4663 to LA Tourism for a term of one year, with an option to extend for an additional one year exercisable by the Board on written terms as agreed to by both LAWA and LA Tourism. The not-to-exceed amount for the first year was $2,280,000. In order to ensure compliance with the use of airport revenue a detailed scope of work was developed and strict accounting measures implemented. The services LA Tourism provides are in three specific categories: 1) LAWA Marketing; 2) Air Service Development; and 3) Sales Missions. Each monthly invoice includes the following information: A summary of work performed Total direct personnel, rent, and overhead costs Time records and descriptions of program costs Copies of all collateral and other documents produced by LA Tourism Total corporate overhead costs and the amount allocated to the contract On September 24, 2012, by Resolution No , the Board approved the first amendment to CIDntract DA-4663 with LA Tourism to exercise the final one-year contract extension option and to Page 2 LA Tourism Board Contract 214

3 include within the scope of work: 1) Marketing and grand opening event services related to the New Bradley West Terminal; and 2) Increased air service development actives for LAX and ONT. 3. Current Action Staff requests Board approval of the second amendment to Contract DA-4663 to extend the term for one additional year, and to increase the contract amount by $2,500,000 for the additional year, for a total not-to-exceed amount of $7,428,440 over three years. Under the existing contract, LA Tourism provides international air service marketing, advertising, and promotional services for LAX and ONT, including the following services: 1. Direct marketing and promotion of LAWA facilities and services 2. Route development and marketing/promoting international LAX and ONT Air Service 3. Organize and host LAWA's participation in international trade missions to promote LAWA's airports. While the term of the air service marketing contract envisioned under the RFP was three years, staff recommended an initial contract with LA Tourism for one year with a one-year option. Staff is developing an RFP for similar services with a goal to have a new contract in place sometime in Staff now recommends an additional one-year contract extension as the most effective option for maintaining these services as provided by City Charter Section 371 (e) (10) until such time as the new contract is in place.. LAWA does not currently have full-time staff dedicated to air service marketing of our facilities and services; however, the international air service marketing provided (or contemplated) through LA Tourism's contract is essential to our business. Opening the New Bradley Terminal and the many other improvements at LAX will require continual promotion to the international airline industry, international travel industry, and media. In addition, LAWA seeks to bring air carriers to ONT. LA Tourism has the marketing resources and infrastructure to accomplish these objectives, and staff recommends extending Contract DA-4663 for an additional year. During that time, LAWA staff will evaluate its air service marketing goals and determine the resources necessary to accomplish them. 4. Alternatives Considered No Contract Not amending the current contract would limit LAWA's ability to market its facilities to international airlines at this critical juncture. Similarly, engaging in a new competitive process may delay vital marketing efforts. FISCAL & ECONOMIC IMPACT STATEMENT: Funding for this item is available in the FY Los Angeles World Airports Operating Budget in LAX Cost Center External Affairs, Commitment Item Advertising and Public Relations. Funding for subsequent fiscal years will be requested as part of the regular budget process. Page 3 LA Tourism Board Contract 2nd

4 STANDARD PROVISIONS: ' 1. This item, as a continuing administrative and personnel-related activity, is exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Article II, Section 2.f of the Los Angeles City CEQA Guidelines. 2. This item will be approved as to form by the City Attorney. 3. Actions taken on this item by the Board of Airport Commissioners will become final pursuant to the provisions of Los Angeles City Charter Section LA Tourism is required by contract to comply with the provisions of the Living Wage Ordinance 5. Procurement Services has reviewed this action (File #6389) and established a 15% combined Minority/Women Business Enterprise level of participation for this project. LA Tourism committed to 6% M/WBE levels of participation and has achieved 6.83% participation to date. 6. LA Tourism is required by contract to comply with the provisions of the Affirmative Action Program. 7. LA Tourism has been assigned Business Tax Registration Certificate No LA Tourism is required by contract to comply with the provisions of the Child Support Obligations Ordinance. 9. LA Tourism has approved insurance documents, in the terms and amounts required, on file with the Los Angeles World Airports. 10. Pursuant to Charter Section 1022, staff determined the work specifiéd on the proposed contract can be performed more feasibly or economically by an Independent Contractor than by City employees. 11. LA Tourism has submitted the Contractor Responsibility Pledge of Compliance and will comply with the provisions of the Contractor Responsibility Program. 12. LA Tourism has been determined by Public Works, Office of Contract Compliance, to be in compliance with the provisions of the Equal Benefits Ordinance. 13. LA Tourism will be required to comply with the provisions of the First Source Hiring Program for all non-trade LAX Airport jobs. 14. LA Tourism must submit the Bidder Contributions CEC Form 55 prior to execution of the. Page 4 LA Tourism Board Contract 2r4

5 SUBCONTRACTOR UTILIZATION STATUS SECOND AMENDMENT TO DA-4663 BOARD REPORT SUBJECT/PROGRAM LA Mc PRIME CONTRACTOR Page z of Sub - Contractor Information 1 Sonja Murray LLC i 220-Bluff View Drive Guilford, CT Contact /No. Sonja Murray (310) Contact /No. i IL Contact /No. Contact /No. City/State/Lp Contact /No. City/Staie/Zip Contact /No. Contact /No. Profile Information. Use appropriate classification from list below: Group - MBE, WBE, DBE, OBE, ACDRE, SBE Ethnicity- Asian, Black Caucasian, Hispanic, Native American - Female, Male NAICS - North American Industry Classecation System Status P articipation Proposed % Yes Level of No (P41e lgormatloor Participation &Dolt Ethnicity' Ethnicity' Group; Ethnicity; Gander EMnicity- I WBE Caucasian Female Amt (s) to-date (Invoiced/ Gross Receipts) kirimislitteskr,oa Arr..-twe s _ % Utilized to-date Brief Description of Project Servkes 6% $168, % Marketing Consulting Services... Liar tt by, T. CI -,...tr:.1.1( rime Contractor Contact, Tel4lofliil Signature s L &la-tea-145m %Oat Li OW 3TI

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