Recreatoin and Park Department Concessions

R&P should establish a mandatory procedure to enable those City employees whose duties bring them to R&P facilities to report substandard conditions quickly and easily.

Supervisory personnel should regularly visit all facilities for which they have oversight responsibility to determine whether both R&P's and concessionaire's on-site staff are doing their jobs.

When on-site personnel report any maintenance problems that might affect safety, or health of either employees or users, R&P senior staff should promptly alert the appropriate City departments as well as the concessionaire.

R&P should train staff at all levels to follow up on all reported problems and make certain they have been fully corrected within a reasonable amount of time.

R&P personnel should provide printed forms that encourage members of the general public who use its facilities to report any areas of concern.

R&P should be meticulous in maintaining its contractual obligations, thereby encouraging concessionaires to maintain theirs. Concession Contracts Findings The Grand Jury found several problems related to the wording, awarding, and maintenance of both golf course and other recreational concession contracts. Some lessees fail to make required capital improvements in a timely fashion, but R&P contracts seldom provide other options - - either increased rent or alternative improvements - - when the original agreement cannot be fulfilled. In one case, a contract required a golf course concessionaire to build a driving range within eighteen months; the concessionaire did not even submit plans till three years had passed. By then, various neighborhood changes and newly discovered environmental concerns had made the project infeasible, but the contract did not require the lessee to build the range at an alternative location or, if that was not possible, recompense the City monetarily. In another instance, a concessionaire constructed a golf cart-storage shed that was markedly smaller than contract specifications, then let it fall into disrepair. The Grand Jury could find no evidence that R&P either exacted compensation for the reduced building size or insisted the shed be properly maintained. Contracts alert lessees to the specific years for which they may expect audits, encouraging them to report revenues accurately for those years but not necessarily for every year. Rather than issuing RFPs well in advance, especially for those concessions not performing up to expectations, R&P often allows contracts to expire and go on a month- to-month rental, thereby sometimes prolonging a relationship with an unsatisfactory tenant. The Grand Jury found eight concessions operating with expired agreements and two others due to expire in 1998. One of those is a golf course under consideration for an upgrade to professional tournament standards, which would require substantial expenditure of funds and add considerably to the complexity of negotiating a new lease. R&P has allowed several tenants to fall into arrears on their rents, resulting not only in loss of income to the City but also in occasional lengthy disputes over amounts due, some of which have required the City Attorney's intervention. In one such case, the amount in dispute is over $100,000. Although the SF Controller alerted R&P to problems with one contract in a 1994 audit, R&P neglected to take corrective action for two years and has just recently referred the matter to the City Attorney.

R&P contracts should contain provisions that ensure lessees comply with contractual obligations in a timely fashion, provide remedies for unwarranted delays, and penalize concessionaires who willfully neglect to fulfill agreed-upon contractual obligations.

Contracts should provide mutually agreed-upon remedies, including renegotiation, in the event factors beyond the lessees' control, such as environmental restrictions or neighborhood objections, prevent fulfilling the original conditions.

R&P should review contracts long enough before their expiration dates to be able to effect any desired changes in terms or issue RFPs.

R&P should make timely and accurate rent payment by its concessionaires a higher priority than has been its practice, instituting remedial action whenever lessees either fall into arrers with or under report monies due.

Contracts should not specify in which (or for which) years audits will occur. Record Keeping Findings The Grand Jury had some difficulty in making certain determinations because R&P did not keep the kinds of records necessary to review the histories of each property thoroughly. For example, when the Jury requested proof of insurance and workers' compensation policies, R&P's Property Management division did not have current certificates on file. (R&P subsequently obtained, and then gave the Jury, up-to-date certificates for all concessionaires.) R&P never was able to provide building plans the Jury requested.

R&P should institute procedures to determine on a regular basis whether lessees are maintaining all required insurance.

R&P should keep files of blueprints and other related construction documents so that its own staff or outside examiners can readily check any structures against their original plans. REQUESTED RESPONSES Mayor San Francisco Board of Supervisors General Manager, Recreation and Park Department Recreation and Park Commission Controller City Attorney Footnotes 1. The concessionaire at Sharp Park Golf Course provides on-site supervision; the result is an admirable model for other lessees to emulate..