The board of the Atlantic City Convention and Visitors Authority named a new company to operate its facilities for the next five years at its Thursday meeting.
Global Spectrum, a subsidiary of Comcast-Spectacor, will replace the current operator, SMG, in early 2013. The Philadelphia-based firm manages the Wells Fargo Center, Temple University's Liacouras Center and the Sun National Bank Center in Trenton. It operates venues in more than 100 cities in the United States, Canada, Saudi Arabia and Singapore.
The company will be broadly responsible for day-to-day operations at the Atlantic City Convention Center, Boardwalk Hall and West Hall. The responsibilities include event production, building maintenance, public safety, labor relations and coordination with the current food service contractor, according to the initial request for proposal.
Global Spectrum promises a "seamless transition," the company's chief operating officer, John Page, said after the meeting.
He said the company will look to use its resources to increase the profile of the Atlantic City venues, both for entertainment and trade shows. The company will work with the Casino Reinvestment Development Authority and the Atlantic City Alliance to increase shows and hotel nights, Page said, doing whatever it can collaboratively.
A final contract, including costs and fees, will be ratified in the coming weeks between Global Spectrum and the ACCVA. The current contract with SMG is worth $221,052 per year, according to federal court filings, with as much as $221,052 available in different bonuses and incentives.
Authority President Jeff Vasser said after the meeting that SMG receives about $400,000 a year and that no figures for this new contract were available.
"We're looking forward to a seamless change," Vasser said.
The ACCVA board unanimously approved Global Spectrum's proposal by a 4-0 vote, without comment from the board and following a 40-minute executive session. Board Chairman Alfred R. Scerni was absent for of medical reasons, board members said.
The board's decision was postponed from late November, after a number of people spoke up at a board meeting. Some were concerned that Global Spectrum would favor its Philadelphia properties at the expense of Atlantic City.
Vasser dismissed that fear, saying, "We looked at that and we didn't feel that would happen."
Thursday's vote followed an earlier, unanimous vote by the selection committee to go with Global Spectrum, Vasser said.
The selection committee included Vassar, he said, as well as Michael Reynolds, the authority's convention senior sales director, Gary Musich, its vice president for convention sales and service, Liza Cartmell, president of the Atlantic City Alliance, and John Palmieri, the Casino Reinvestment Development Authority's executive director.
The criteria it used emphasized experience and the company's plans, according to federal court filings.
The management team and the proposed approach and methodology were half of how the selection committee measured the proposals. The company's experience, qualifications and references counted for 20 percent, as did the proposed financial compensation. The firm's financial stability was worth 10 percent.
Vasser said the evaluation committee liked the company's global reach and believes that it will have the ability to drive business to Atlantic City through its extensive database and its marketing ability. He said Global Spectrum also made a stronger financial proposal.
"The assets they bring to the table are tremendous," he said.
Vassar said the company committed to keeping most of the employees. There are 125 to 150 employees, covered under 15 union contracts. At other venues, Vasser said Global Spectrum typically retained 90 percent of staff.
Reynolds said the ACCVA contacted the officials behind the Duke Energy Convention Center in Cincinnati, the Greater Richmond (Va.) Convention Center, and the Miami Beach (Fla.) Convention Center.
SMG has managed the Atlantic City facilities for the last 17 years and currently operates the Wildwood Convention Center. It sued the ACCVA in federal court last month, challenging the process it claimed in court filings was flawed. The suit claims that the authority's request for proposal is illegal because it says that arbitration, rather than the courts, is the only way to resolve differences over the process.
SMG also raised questions of propriety regarding the selection committee. In a Nov. 30 letter the company questioned the presence of Cartmell and Palmieri, saying their agencies had strong financial ties to the casino industry and no currently obvious governmental role at the ACCVA.
Furthermore, the CRDA will eventually take over the ACCVA, attorney Christopher M. Hartwyk wrote, meaning Palmieri will someday be the boss of a majority of the selection committee.
A judge last week refused to hold up the process while the legal issues were dealt with. Chief U.S. District Judge Jerome Simandle stated the bidding process was not flawed, but ordered the authority to follow procedures for a hearing once it has awarded a contract.
In a statement, SMG spokesman John Samerjan said the company would pursue its legal challenge "as well as all administrative and legal actions available to remedy a clearly flawed authority process."
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