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Are Dunedin Officials Playing Favorites with Sail Honeymoon?

A legal agreement the owner of Sail Honeymoon made three years ago with the city requires that he re-bid for his business, but some commissioners are looking to create a loophole to bypass the bidding process.

 

Glen Steinke knows he's getting a good deal.

He's paying $1,000 a month to run a kayak and sailboat rental business on the only land bridge connecting a million annual visitors to Honeymoon Island State Park.

Steinke has an agreement with the city to run Sail Honeymoon on the Dunedin Causeway. He has been there for the better part of 20 years.

"You're not getting a good deal," Steinke told commissioners during the Jan. 24 public hearing. "I'd like to give you more money. I'd like a long-term contract in exchange."

A legal agreement he made three years ago with the city requires that operations of the iconic concession would go to bid on Jan. 18, before the contract expires on July 31.

But commissioners are divided when it comes to renegotiating Steinke's deal, with some looking to create a loophole to bypass the city's bidding process.

After the Jan. 24 discussion at City Hall, a decision was deferred until commissioners can review the city's purchasing plan, the city's set of legal standards used to enter into agreements with contractors and concessionaires.

Small Businessman Deserves More, Commissioner Says

Commissioner Julie Scales called for adding "more flexibility" to the purchasing plan — enough to allow the city to bypass the bidding process for Steinke on the grounds that he is doing a good job, and only go to bid at the end of a concessionaire's agreement if his or her business is doing poorly.

The purchasing plan already allows the city to give preference to the standing concessionaire, regardless of price, but does not allow for skipping the bidding process at the end of a contract based on performance.

At first, Scales said she didn't want to "get into the history of what happened there three years ago," but then dove into it and explained Steinke's frustration in not being able to obtain a long-term city contract because of plans to improve the area.

"He's always wanted a longer contract," Scales said.

She called for justifying it through policy amendments.

"For whatever reason, I don't know what happened behind the scenes, but the rug was pulled out from him. Now, I don't think that's the way to treat a small business man or woman."

Steinke is so endeared by residents on Causeway Boulevard that they wrote a letter pleading officials to reconsider his contract and not go to bid.

"Glen has been our eyes and ears to assure the maintenance of this entire Causeway area," the Dunedin Beach Civic Association president wrote in a Jan. 12 letter. 

Many of Scales' campaign contributors are a part of that neighborhood group.

Commissioner Heather Gracy, who accepted a $500 campaign contribution from Sail Honeymoon, also criticized the purchasing plan.

"Hold off on the contract is what my position is," Gracy said, clarifying that she would rather allow Steinke to continue until after the commission reviewed the purchasing policy.

Loophole is 'Stinky Form of Government,' Vice Mayor Says

Not all Dunedin officials agree.

Vice Mayor Julie Ward Bujalski said the push to negate Steinke's contract is "cronyism," a term Gracy used on her campaign mailers to describe her opponent, former Commissioner David Carson, and "a stinky form of government."

Bujalski reminded the commission that Steinke agreed to a three-year contract that would require him him to re-bid during the city's RFP (request for proposal) process. 

"There's words like 'flexibility,' 'If it's going great,' and 'Maybe,' " she said. "But, what if it's not going great, and you have this 'flexibility?' You've got nothing to rely on that says, 'Sorry, gotta go out to RFP.' You cannot have purchasing policies like that."

"I still believe that for the public — this is not our money — that we should be going out and doing an RFP so that we can say we've done our due diligence, we've been good public stewards, we've checked into the market to make sure that we're managing the money the right way, and even if someone does come out and bid a little higher, we can always give preference," Bujalski said.

Since finishing the city's purchasing policy three years ago, Bujalski said, two other concessionaires, including the Olde Bay Cafe & Dunedin Fish Market, have gone through he process, and "right at the very time we're going to bid," ... "we want to change the policy?"

"You're asking to defer a particular contract," she said. "So yes, there is favoritism going on."


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Related Topics: Causeway Concession Agreement, City of Dunedin, Concessionaire, Concessionaire Contracts, Dunedin Commissioners, Kayak Rentals, Sail Honeymoon, city commission, dunedin, and dunedin city commission

Dave Pauley

10:04 am on Tuesday, February 5, 2013

In reference to your article of 2/5/2013 concerning playing favoriites with Sail Honeymoon, I think a few things need to be pointed out so the readers can get the true picture. First you say, "You're not getting a good deal, "Steinke told commissioners during the Jan. 24 hearing. I'd like to give you more money. I'd like a longterm contract in exchange." You forgot one important part. Mr. Steinke merely stated, and was repeating, what he had told Mr. Gizzi three years ago when he was paying $700.00 a month rent.
Vice Mayor Bujalski points out, "right at the very time were going to bid,"..."we want to change the policy?" If she feels the city is being mistreated how do you think Mr. Steinke felt when residents leared, three years ago, on May 10, 2010 that the city had changed policy and was disregarding a previously negotiated contract.
Your article speaks of Olde Bay Cafe & Dunedin Fish Market. As memory serves me The Dunedin Fish Market was paying $1,700.00 per month and could not make a go of the business. The city, with no tenant, took the correct step in going with an RFP. This process brought them an agreed upon rent of $1,300.00 per month for the Olde Bay Cafe.
Favorite is a strong word, be sure you know who it belongs to.
It all boils down to what Mr. Steinke said, in closing, at the Jan. 24, 2013 Commission meeting, "Your not asking them to bid on 100 feet of sand....you are asking them to bid on my business that I built up over 20 years."

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Barbara Ross

12:53 pm on Tuesday, February 5, 2013

The only fair way to handle the possibility of the City to decide to forego the bidding system and to let the tennant stay is for an independent unbiased business appraiser to examine the financial records of the business. From that analysis a fair market rent would be established. As part of that fair market rent the new lease would also include the City getting a percentage of the income generated. This is done in businesses all the time. It assures the landlord of keeping pace with the market value of the property in a long term lease. It also makes the tennant secure that he/she will be able to invest in a business that has the security it needs to make capital improvements. The taxpayers and the tennant deserve this.

If the economy goes down, so does the rent, if the economy goes up so does the rent. That is as fair as it can possibly be for both parties involved.

Outside of open bidding, this is the only way that accurate market rental income for the City can be established and continue to remain current over time. I suggest since the City is happy with this tennant and has history with him, that they enter into a new lease. In that lease the fair market rent will be easy to establish using current standards of appraisal. Back out 10% of the determined amount and then begin taking 10% of gross income per annum, payable monthly. Allow for auditing of the books.

Otherwise, the open bidding process must stand. Business is black and white.

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-Ed Harris-

12:53 pm on Tuesday, February 5, 2013

Why do we constantly seem to be mountain climbing over mole hills? Yes, Government needs to be held accountable. Yes, Government needs to be fair. But NO! Government should not be run like a business. Cut the crap and red tape! This is that mans business for the last twenty years! There is plenty of sand out there if someone else wants to make a go of it next to him. This is still a small town and yes there will be some business's that have no real competition, so what! If it ever gets out of hand we can deal with it then. The reality is no one else wants it. He is local, spends local and gives back to Dunedin. Do you really want a corporation in there sending profits away and not caring about Dunedin, just so you can say "we bid it out and got all of you residents $.06 more". Serious times remember? We are watching. Please take your cleated mountain climbing boots off this guys back!

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Barbara Ross

3:57 pm on Tuesday, February 5, 2013

I doubt the City would allow another competitive vendor on the Causeway but don't know that for certain. If the City can't provide a longer lease term due to unknown future of the Causeway's proposed improvements then the tenant will have to weigh that in his decision to bid for his lease as it seems he has always done. Otherwise, by sharing in his income via a per centage of his revenue I think the City should give him a long term lease of ten years. He should have security if he is paying current market rate during the whole term by writing the lease this way. I still think this is the fairest solution for all.

glen steinke

2:12 pm on Tuesday, February 5, 2013

The contract you mention item 10 says, [ to encourage continuity of sucessfull operations, the city may give preference to the concessionaire in the extension or renegotiation of the agreement.]
May 10 2010 City attorney Hubbard,[ the city has the legal ability to go out for an r.f.p., but in fact had no obligation to do so]
The policy was voted on 6/16/2011 one year after this contract was let, each of the commission agreed that they would exclude, the blue jays, the fine arts centre, the golf club, the historical museum, and could exclude any other that they choose. Mayor Eggers comment [ a new commission might say they want to go ahead and negotiate IN GOOD FAITH the current lease, or there is a need to go out to bid.] Commissioner Bujalski [ that does not mean that the commission cannot adjust that policy in a particular situation.]
I see no loophole here, everyone agrees there is no requirement to go to an r.f.p.
Why was a policy set that excludes all others and targets the ony successfull operation the Causeway has ever had?
Sail Honeymoon had been promised a long term contract for years, as soon as we do a survey, as soon as we finish the causeway master plan, as soon as we know the details of bridge construction, as soon as we have a new city manager, as soon as,,,,,This has gone on since before most of the commission started in politics.
Is honoring those promises Playing Favorites? Is doing right thing Playing Favorites?
Glen Steinke
Sail Honeymoon

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glen steinke

3:57 pm on Tuesday, February 5, 2013

Barbra Ross thank you, your comments are quite valid. The City has done a market comparison, several in fact, my rents have allways been based on a percentage of gross, the city remains behind the curve as they have not allowed a long term contract. the contract approved by city staff and city attorney in 2010 included what you propose and more, the commission at that time did not approve the contract sighting a legal obligation to go out for r.f.p., when it was pointed out there was no legal obligation then it became a moral issue then back to we need to see what else is out there. and once again the city misses out on thousands in non tax based revenue in the process.
We have hope, this is a new commission and there is a chance that common sense will win.
Now for the Dunedin Patch you have mentioned my contribution to the Gracy campain many, many times, this was legal, honest and in the sunshine, after all in this country if you see a politician you do not aprove of you support the competition, the Patch it seems has tried to make it something else, I will say this one time clearly, The only thing I expected of Heather Gracy in exchange for my contribution is to REPLACE DAVID CARSON, she has done that and I feel Dunedin is a better place for it.
Glen Steinke
Sail Honeymoon

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Dave Pauley

7:01 pm on Tuesday, February 5, 2013

Well said Mr. Steinke! I made the same contribution for the same reason, and am very pleased with the rusults and feel Dunedin is a better place. I do appreciate Mr. Dave Carson's willingness to serve and the time he committed. In the same breath I am most excited with the postive effects I feel Mrs. Gracy will have on the community as a entity.
Sincerely,
Dave Pauley

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Miriam Benitez-Nixon

8:45 pm on Tuesday, February 5, 2013

Chances are Mr. Steinke may win the bid, but anyone who wants to bid should be allowed to do so -- especially since it's Dunedin's purchasing policy to call for bids.

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Terry Hopkins

9:14 pm on Wednesday, February 6, 2013

Sail Honeymoon is great business and plus for our city...but any business person would like a little longer that one year to see if the business can continue...a one year contact is pretty short for any business so a longer term makes a lot of business sense to me and should be considered. If it costs a little more then the present tenant has no problems, then lets offer a longer term 3 years, five years, or ten years. The question seems to be when, and there is always something coming up to delay offering the expended term. So let's see when would be a good time to offer an extended lease on this, now or in six months or next year. A time should be set up for offer an extended term for a business, a year to year is too, short. So when would be a good time to offer longer term contact for this area?

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Martha Dunningham

3:38 pm on Thursday, February 7, 2013

This is such a waste of time. Sail is a blessing to Dunedin. This should not be an issue.

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