To: Board of Supervisors
Department or Agency Name(s): Sonoma County Public Infrastructure
Staff Name and Phone Number: Johannes J. Hoevertsz, 707-565-2550
Vote Requirement: 4/5th
Supervisorial District(s): Countywide
Title:
Title
Charles M. Schulz - Sonoma County Airport Vending Concession Lease - Prepango
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Recommended Action:
Recommended action
A) Approve and authorize the Charles M. Schulz - Sonoma County Airport Manager to execute a vending concession lease with Prepango, LLC for 3 years with up to two additional one year terms unless cancelled.
B) Authorize the Charles M. Schulz - Sonoma County Airport Manager to amend the vending concession lease with Prepango, as needed, during the term of the lease.
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Executive Summary:
The Charles M. Schulz - Sonoma County Airport (Airport), a division of Sonoma Public Infrastructure Department (SPI), requests approval of a three-year (3) year lease with two optional one-year (1) extensions for vending machine concessions with Prepango in various locations throughout the Airport terminal. Prepango has been operating vending machines in several terminal locations since 2022, while the Airport expansion project was constructed. The construction was completed in recent months creating an opportunity to expand vending machine locations, and Prepango was selected to continue and expand operations after a competitive Request for Qualifications (RFQ) process. The Airport recommends that a lease for vending machine concessions be issued to Prepango.
Discussion:
It is necessary and customary for Airports to provide a variety of food, beverage, and sundry options for the convenience of the traveling public. While staffed restaurants and shops can provide many of these items, vending machines are also available for travelers on the go and during non-standard hours. Airports typically contract out for vending machine services and receive a percentage of the gross sales in return. Because the Airport operates as an enterprise fund which does not receive general fund contributions from the County these revenues make a positive contribution to the Airport’s finances. In fiscal year 23/24 the Airport expects vending machine revenue of approximately $45,000.
The Airport has contracted for vending machine concessions to provide food, drink, and sundries to travelers, residents, and neighborhood businesses for many years with various operators. At the time of the recent vending machine concession RFQ process, the Airport had approximately ten (10) vending machines, four (4) of which were operated by Prepango. Space is now available for at least twenty-five (25) machines, with eleven (11) planned to be placed pre-security and fourteen (14) post-security. The RFQ was posted on the Supplier portal on 5/25/23 with proposals due on 6/24/23 at 3:00 PM. A total of 9 responses were received. The proposals were evaluated on 7/8/23 and interviews with the responders were held the week of 7/25/23. The proposals and interviews were evaluated by a panel. All submissions were scored based upon their vending knowledge, ability as well as the individual machines they were proposing including both specialty and standard equipment. The notices to unsuccessful proposers were sent on 8/15/23.
Prepango has significant experience with vending concessions in travel hubs throughout the country and offered the greatest number of machines with several unique and desirable options. As a result, they were selected to operate a total of thirteen (13) vending machines. A variety of small, primarily local businesses have been selected to fill the remaining spaces by operating from one (1) to five (5) additional machines each. Those agreements will be authorized by the Airport Manager and/or Department Head as previously delegated by the Board of Supervisors. Each machine was selected with a goal of providing the best variety of options to the Airport’s customer base.
Prepango and the other, mostly local, successful competitors in the Airport’s Vending RFQ process will offer a good variety of products that should be appealing to our passengers.
Prepango’s vending machines will include the following offerings:
• Gourmet hot and cold brewed coffee (pre-security and post-security)
• Just Baked hot meals and snacks such as cinnamon rolls, cheeseburger sliders, bao buns, breakfast sandwiches, and similar (post-security)
• Gift boxed licorice and pretzel snacks (post-security)
• Leading electronics brands such as JBL, Sony, Samsung, JLAB, Skullcandy, and more to meet the sound and mobile needs of post-security travelers
• Travel essentials such as over the counter medications, hygiene necessities, novelties, and more (pre-security and post-security)
• Charles M. Schulz - Sonoma County Airport branded gifts and souvenirs (pre-security)
Standard snacks and drinks including some local products.
The proposed agreement is for a term of three years, with two optional one-year extensions, with consideration paid as a percentage of sales between 10-20% depending on the type of product, plus a storage fee based upon adopted rental charges. Staff recommends the Board authorize the Airport Manager to enter into the agreement, and delegate authority to the Airport Manager to make amendments to the agreement as may be needed in order to reflect changes in the physical layout of the terminal usage over time or operational needs related to the provided machines, including changes in the number or type of machines.
Strategic Plan:
N/A
Racial Equity:
Was this item identified as an opportunity to apply the Racial Equity Toolkit?
No
Prior Board Actions:
None.
Fiscal Summary
|
Expenditures |
FY23-24 Adopted |
FY24-25 Projected |
FY25-26 Projected |
|
Budgeted Expenses |
$0 |
$0 |
$0 |
|
Additional Appropriation Requested |
|
|
|
|
Total Expenditures |
$0 |
$0 |
$0 |
|
Funding Sources |
|
|
|
|
General Fund/WA GF |
|
|
|
|
State/Federal |
|
|
|
|
Fees/Other |
$45,000 |
$50,000 |
$55,000 |
|
Use of Fund Balance |
|
|
|
|
General Fund Contingencies |
|
|
|
|
Total Sources |
$45,000 |
$50,000 |
$55,000 |
Narrative Explanation of Fiscal Impacts:
Revenues associated with vending machine sales are incorporated in the FY 2023-24 Adopted Budget (41301-34030102-44110) and will be included in future Airport Recommended Budgets. There are no material expenses associated with this Board Item.
Narrative Explanation of Staffing Impacts (If Required):
None.
Attachments:
Concession Operator Lease Agreement
Related Items “On File” with the Clerk of the Board:
None.