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FBO DAILY - FEDBIZOPPS ISSUE OF NOVEMBER 02, 2014 FBO #4726
MODIFICATION

99 -- Amendment No. 9 to Solicitation for the award of a Concession Contract for Lodging, Food & Beverage, Retail, Transportation, and Other Services within Grand Canyon National Park - Amendment 9

Notice Date
10/31/2014
 
Notice Type
Modification/Amendment
 
NAICS
713990 — All Other Amusement and Recreation Industries
 
Contracting Office
Department of the Interior, National Park Service, NPS - All Offices, 12795 West Alameda Parkway, Post Office Box 25287, Denver, Colorado, 80225-0287
 
ZIP Code
80225-0287
 
Solicitation Number
CC-GRCA001-15B
 
Archive Date
11/18/2015
 
Point of Contact
Jennifer Parker, Phone: (303) 969-2661
 
E-Mail Address
jennifer_parker@nps.gov
(jennifer_parker@nps.gov)
 
Small Business Set-Aside
N/A
 
Description
Amendment 9 for Soliication CC-GRCA001-15B The deadline for proposals has been extended to Wednesday, November 19, 2014. Any proposal, including that of the Existing Concessioner, must be received by the Chief of Concessions, Intermountain Region, National Park Service, 12795 West Alameda Parkway, Lakewood, Colorado 80228 by 4:00 p.m. MST on Wednesday, November 19, 2014 in order to be evaluated and considered for award of the Concession Contract. Temporary Contract The National Park Service recognizes that insufficient time remains to receive proposals responding to the Solicitation, evaluate those proposals, select the best proposal, have the selected entity sign the contract incorporating the terms of that proposal, and comply with the required 60-day Congressional notice period prior to the expiration of the Existing Contract. The Service, therefore, intends to enter into a temporary concession contract pursuant to 16 U.S.C. § 5952(11)(A) and 36 C.F.R. § 51.24 having a term not to exceed one year to avoid an interruption of visitor services for the operations under the Draft Contract as set out in the Prospectus. The Service believes the temporary contract could cover a period as short as 60-120 days to accommodate the expiration of the Existing Contract and transition to a new concessions contract. The National Park Service does not need to solicit proposals for temporary concessions contracts. Background Regarding Minimum Franchise Fee Solicitation # CC-GRCA001-15B is the third prospectus the National Park Service has issued to seek proposals to replace the Existing Contract. The Service has considered questions and comments from interested entities, including the Existing Concessioner, and has responded to those comments and concerns by designing a business opportunity that recognizes the tremendous commercial potential of the operations under the Draft Contract, provides a prudent operator an opportunity for a profit based on the requirements of the Draft Contract, and retains for the benefit of the American taxpayers a reasonable franchise fee. The terms of the Draft Contract, including the required visitor services, the assignment of Concession Facilities, the financial projections, and the franchise fee for the government reflect the professional input and advice not only of experts within the National Park Service, but also of an independent hospitality expert. When determining a minimum franchise fee for a new concession contract that will provide concessioners the statutorily-required reasonable opportunity for a net profit, the National Park Service assumes all interested offerors have to make the same initial investment. The National Park Service does not differentiate between an incumbent concessioner and an operator that would have to expend working capital to hire new personnel, invest in personal property that the incumbent already would own, and/or purchase Leasehold Surrender Interest from the incumbent. In this case, the Existing Concessioner holds approximately $58 million in Leasehold Surrender Interest. Housing Allocation between CC-GRCA001-15 and CC-GRCA003-15 The Existing Concessioner has raised concerns about the allocation of employee housing between the Draft Contract and the pending concession contract CC-GRCA003-15. The National Park Service and its hospitality consultant carefully and thoroughly analyzed the operations under each contract and, using the consultant's expertise and experience, identified the staffing needs of prudent operators under each proposed contract. The analysis recognized that a number of Concession Facilities and associated services would be allocated from the 001 contract to the 003 contract, so that the concessioner under the 001 Draft Contract would need fewer employees than does the Existing Concessioner under the Existing Contract. The National Park Service then reasonably allocated housing based on those projected staffing needs. Moreover, the National Park Service does not guarantee concessioners sufficient housing for all their employees within a park. As explained in the Prospectus, in this case, the National Park Service specifically recognized that the Concessioner under the Draft Contract may need to pay some employees higher wages to find housing outside the Park and, consequently, factored into its calculations an assumption that the Concessioner would pay approximately $500,000 each year in additional salaries. Under the original prospectus for GRCA001-15, the National Park Service also agreed to convert 28 historic cabins that would have been available for visitor accommodations to use as additional employee housing and incorporated that change in the current prospectus. In addition, the National Park Service agreed that 28 other cabins currently used as employee housing may be winterized for year-round use. The National Park Service further agreed to assign additional housing facilities on a short-term basis to assist with issues that may arise during the first year of operation. In addition, the National Park Service stated that it would be willing to re-allocate employee housing after the award of both contracts if the selected concessioners so request. Finally, the selected offeror for CC-GRCA003-15 has agreed that it will allow any employee under the Existing Contract who occupies her or his own trailer within the Trailer Village to remain there for the first year of the Draft Contract. The National Park Service believes these steps adequately address potential employee housing concerns for the concession operations under the Draft Contract. 1) Business Opportunity, Summary, Page 3 Delete: Minimum Franchise Fee The minimum franchise fee under the Draft Contract is fourteen percent (14%) of annual gross receipts. Replace with: Minimum Franchise Fee The minimum franchise fee under the Draft Contract is 10% for years one through five of the Draft Contract and 12.5% for the remainder of the term. 2) Business Opportunity, Projected Revenue, Page 21 Delete: In developing prospective revenue estimates, the Service made the following assumptions: • Estimating inflation at 2.4 percent on an annual basis • Loss of room revenue during demolition of the existing Maswik South lodging and contraction of the replacement Maswik South lodging followed by increased average daily rate for the newly constructed facility • Increased average daily rate for improved Bright Angel cabin rim lodging rooms • Additional food and beverage covers due to expanded patio dining at El Tovar • Additional food and beverage covers due to the new mobile food truck service • Additional food and beverage covers due to new operations at Maswik South and El Tovar Replace with: In developing prospective revenue estimates, the Service made the following assumptions: • Estimating inflation at 2.4 percent on an annual basis • Lodging revenues increasing by 5 percent per year for years 1-3 of the contract • Loss of room revenue during demolition of the existing Maswik South lodging and contraction of the replacement Maswik South lodging followed by increased average daily rate for the newly constructed facility • Increased average daily rate for improved Bright Angel cabin rim lodging rooms • Additional food and beverage covers due to expanded patio dining at El Tovar • Additional food and beverage covers due to the new mobile food truck service • Additional food and beverage covers due to new operations at Maswik South and El Tovar The Service projects gross revenue for all operations will reach $89 million by the end of the 5th year of operations. As stated above, however, the Service does not guarantee these projections will materialize and assumes no liability for the accuracy of the projections presented. Offerors must compile and present their own financial projections based on their independent assumptions, due diligence, and industry knowledge. 3) Business Opportunity, Lodging, Page 22 Delete: Additionally, the Service will allow the Concessioner to increase all lodging rates from the current rates, at not less than the rate of inflation (i.e., Consumer Price Index for All Urban Consumers) for the first three years of the Draft Contract, once awarded. Replace with: Additionally, the Service will allow the Concessioner to increase all lodging rates from the current rates, at a rate of 5% annually for the first three years of the Contract. After the first three years of the Contract, lodging rates will be determined using Comparability. 4) Business Opportunity, Page 28 Delete: Franchise Fee The minimum franchise fee under the Draft Contract is fourteen percent (14%) of annual gross receipts Replace with: Franchise Fee The minimum franchise fee under the Draft Contract is 10% for years one through five of the Draft Contract and 12.5% for the remainder of the term. 5) Proposal Package, Page 15 Delete: The minimum franchise fee acceptable to the Service is fourteen percent (14%) of gross receipts. The offer of a higher franchise fee than the minimum is generally beneficial to the Service and accordingly will generally result in a higher score under this selection factor; however, consideration of revenue to the United States is subordinate to the objectives of protecting, conserving, and preserving resources of the park and of providing necessary and appropriate visitor services to the public at reasonable rates. State the amount of franchise fee you propose. Such fee must at least equal the minimum franchise fee set forth above. Express this fee as a percentage of annual gross receipts. Do not propose a tiered franchise fee, e.g., 5% on the first $10,000 of gross receipts, 6% on gross receipts between $10,001 and $25,000, 7% on gross receipts between $25,001 and above. Replace with: The minimum franchise fee under the Draft Contract is 10% for years one through five of the Draft Contract and 12.5% for the remainder of the term. The offer of a higher franchise fee than the minimum is generally beneficial to the Service and accordingly will generally result in a higher score under this selection factor; however, consideration of revenue to the United States is subordinate to the objectives of protecting, conserving, and preserving resources of the park and of providing necessary and appropriate visitor services to the public at reasonable rates. State the amount of franchise fee you propose. Such fee must at least equal the minimum franchise fee set forth above. Express this fee as a percentage of annual gross receipts. Do not propose a tiered franchise fee, e.g., 5% on the first $10,000 of gross receipts, 6% on gross receipts between $10,001 and $25,000, 7% on gross receipts between $25,001 and above. 6) Operating Plan, Page B-4, Sec. 3)C)(4), Rate Approval Methods Delete: (1) Rate Approval Methods. The currently approved rate method is comparability for all services and facilities except for the following: (a) Lodging. The Concessioner will be allowed to increase all lodging rates from the currently approved rates, at not less than the rate of inflation (i.e., Consumer Price Index for All Urban Consumers averaged over the prior 12 months) for the first three years of the Contract. The Concessioner must submit a rate approval request and provide justification for any increase requested above CPI. If an increase above CPI is requested, the Service will conduct a rate review based on Comparability. After the first three years of the Contract, lodging rates will be determined using Comparability. (b) Food and Beverage. The Concessioner must submit all requests in accordance with the Service Rate Administration Guide for its Core Menu rate requests. The current draft Core Menu is an Attachment to this Operating Plan. Core Menu items are subject to comparability analysis. All menus and prices are subject to Service approval prior to finalization. The Service may choose to conduct a full rate review at any time. (c) Retail. The Concessioner must determine its souvenir and gift prices in accordance with the Service's Competitive Market Declaration (CMD) guidelines. If the item is marked with a manufacturer's suggested retail price, the Concessioner must sell the merchandise at that price or less. (d) Convenience and Grocery Items. The Concessioner must determine prices using the National Association of Convenience Stores (NACS) Markup Percentages, or if printed on packaging, the manufacturer's suggested retail price. The Service will provide updates to Convenience Stores Markup Percentages annually. Replace with: (2) Rate Approval Methods. The currently approved rate method is comparability for all services and facilities except for the following: (a) Lodging. The Concessioner will be allowed to increase all lodging rates from the currently approved rates at a rate of 5% annually for the first three years of the Contract. After the first three years of the Contract, lodging rates will be determined using Comparability. (b) Food and Beverage. The Concessioner must submit all requests in accordance with the Service Rate Administration Guide for its Core Menu rate requests. The current draft Core Menu is an Attachment to this Operating Plan. Core Menu items are subject to comparability analysis. All menus and prices are subject to Service approval prior to finalization. The Service may choose to conduct a full rate review at any time. (c) Retail. The Concessioner must determine its souvenir and gift prices in accordance with the Service's Competitive Market Declaration (CMD) guidelines. If the item is marked with a manufacturer's suggested retail price, the Concessioner must sell the merchandise at that price or less. (d) Convenience and Grocery Items. The Concessioner must determine prices using the National Association of Convenience Stores (NACS) Markup Percentages, or if printed on packaging, the manufacturer's suggested retail price. The Service will provide updates to Convenience Stores Markup Percentages annually. The NPS will also be posting the Amendment, to the NPS Commercial Services Website at the following link: http://concessions.nps.gov/grca001-15b.htm.
 
Web Link
FBO.gov Permalink
(https://www.fbo.gov/spg/DOI/NPS/APC-IS/CC-GRCA001-15B/listing.html)
 
Place of Performance
Address: Grand Canyon National Park, 86023, United States
Zip Code: 86023
 
Record
SN03563146-W 20141102/141031233941-c8ed9679c574410a6c8a42f367130e2b (fbodaily.com)
 
Source
FedBizOpps Link to This Notice
(may not be valid after Archive Date)

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