The Augusta Commission voted 6-3 on Thursday to approve a revised management agreement with Marriott operator Augusta Riverfront LLC to run the new Augusta Convention Center, ending a monthlong stalemate that led the venue’s first convention to cancel.
The revisions give both parties a way out should the relationship sour and appear to address potential loopholes that critics believe could leave the city liable for nearly unlimited costs and losses.
Included in two pages of revisions approved with draft agreements attached to Thursday’s meeting agenda was a shorter, two-year exclusive catering agreement that provides the city a percentage of gross catering receipts when they exceed $400,000 annually.
The change replaced a 15-year catering contract that made the city responsible for catering expenses but gave it all the profits.
“While it does not give us as much upside benefit, it substantially minimizes the downside risk, and that’s one of the concerns we’ve heard,” said Jim Plunkett, the outside city counsel who has worked on the deal for years.
The revision addresses “the perceived ability of the caterer to shift expenses to the city,” Plunkett said.
Other revisions allow either party to end the management agreement after five years – and provide for installation of a locking door between the convention center and the Marriott conference center and the separation of integrated systems such as security and Internet – should the relationship fizzle or Augusta Riverfront transfer its responsibilities to another company.
The city of Augusta can terminate the agreement if it doesn’t approve of the transferee.
The commission voted in 2009 to build the convention center, also known as the TEE Center, next to the Marriott, but it only received the management agreement in late September, after 13 conventions were booked by Augusta Riverfront and the Augusta Convention and Visitors Bureau.
The revised agreement limits the number of times a year the city can modify the center’s annual plan.
The plan, presented by Augusta Riverfront annually, is expected to account for the firm’s system of awarding bonuses and commissions.
Commissioners Bill Lockett, Alvin Mason and J.R. Hatney voted against the deal. Commissioner Wayne Guilfoyle was absent.
Mason accused Commissioners Corey Johnson Joe Jackson and Guilfoyle of meeting improperly with attorneys and two private citizens – Al Gray and Brad Owens – on Friday without commission approval.
The meeting wasn’t illegal, Plunkett said, because there was no quorum.
“That meeting was not to negotiate; it was to clarify various points,” he said.
Mason said the decision to book conventions, then give the commission just a few weeks to approve the management deal, created “a manufactured crisis.”
Despite the changes, “it’s still a bad deal,” Lockett said.
Johnson said his main
concern was “minimizing the losses,” which Augusta Riverfront President Paul Simon said could exceed $900,000 in the facility’s first year.
Hatney, whose successor, Marion Williams, sat in the gallery Thursday, would not be persuaded.
“At the end of the day there are so many unanswered questions about this whole thing,” Hatney said. “Y’all do what you want to do; I ain’t supporting it.”
Simon said afterward that he was relieved the agreement was in place. His company has ties to management of Morris Communications Co., the owner of The Augusta Chronicle.