Showing posts with label Al Gray. Show all posts
Showing posts with label Al Gray. Show all posts

Wednesday, February 27, 2013

Short Sheeted via Term Sheet



Public Thrown for Loss in (nearly)Free Falcons Stadium?

By Al Gray


Georgia Dome to be Torn Down for new Falcons Stadium




About two months ago, a “term sheet” was signed by the Georgia World Congress Center and the Atlanta Falcons to build a new retractable-roofed stadium for their pro football team. After the travails that followed the notorious Augusta Tee Center Term Sheet, the mere mention of that phrase was enough to raise eyebrows.

The thought came to mind “What if……?” What if it was a one-sided deal against the public? What if the consultants’ reports were not analyzed? What if the cost to the taxpayer was a whole lot greater than advertised? What if the legalese meant huge opportunities for cost-shifts to the public? What if media was silent because of the team owner’s position on the board of the Atlanta newspaper’s parent company?

The deal was too huge and the possibilities too big to ignore, so this author performed a month long investigation on the reported stadium costs versus what the documents showed. The report that came from this effort is the inaugural article in agraynation.com, the multimedia blog born out of the Augusta Project, that work being a year-long series of investigations and articles that appeared in City Stink and the Augusta reform Facebook pages. 

The Falcons say they are paying $700 million of the $1.2 billion cost.

Are they really? Or is this another prank of being short sheeted via term sheet? Will the weary public think it is turning in to a warm comfy bed, only to find all openings denied?


Most of the cost is all ours.

There is a big rush to get this deal approved ASAP.

Stay tuned.

Thursday, November 8, 2012

Catering May Crater Augusta Finances

TEE Catering Delivers Sweets To Whom?
Thursday, November 8, 2012
Augusta, GA
By Al Gray

Part 2 of Reviewing Augusta’s Tee Center Contracts

When Augusta’s Trade, Exhibition, and Event (TEE) Center was officially presented as a concept for approval in August 2007, what stood as the partnership agreement was an unsigned, undated document entitled  "Term Sheet." between the city and Marriott Hotel Franchisee Augusta Riverfront LLC. Under that agreement, Augusta was not in the catering business and was not slated to furnish $1.4 million in kitchen equipment, or if it was, that detail was not spelled out for the Augusta City Commission.

Much has been written on this blog about the saga of the Tee Center Kitchen Equipment and that tale is not one to be retold now.

What is now germane is  that the Augusta Commission has been presented with a raft of contract and legal documents to be approved and executed that clearly should have been in place by late 2009, having been repeatedly promised as being “finalized” by City Administrator Fred Russell in the last half of that year. Now the Commission is being asked to whisk these complicated deals through in an expedited fashion lest Tee Center events face cancellation.

After the Management Agreement, the Tee Center Catering Agreement has the greatest impact upon TEE Center operations, as Augusta Riverfront LLC is already the Manager of Augusta’s Conference Center and Caterer for events there. Augusta is paid no share of catering from its Conference Center under previous deals.

The following represents a summary of the primary Catering Agreement issues compiled from a review of the contract documents. This list has been provided to Commissioners and has become the basis of discussion and attempts toward a speedy resolution of major issues. The approach was to review the agreements in PDF form,  write comments, apply sticky notes that Adobe Acrobat provides to annotate documents, and then to provide a summary from the compiled sticky notes.

Solutions were designed to be the product of meeting participants and were not suggested in the summary.

The author is not a licensed attorney, auditor, or public accountant. This analysis was provided from a multidisciplinary perspective in the manner that accountants, attorneys, administrators, owners, policy makers, and media might find useful in trying to decipher the pitfalls and dangers in the agreements.

 Primary Issues
  1. Since most of the language in the Catering Agreement mirrors the language of the previously-reviewed and annotated Management Agreement, this document will only be annotated with comments and questions unique to this agreement.
  2. Phantom legal documents (see “ Conference Center Management Agreement dated____, 2012”) should not be referenced.
  3. ARLLC (Augusta Riverfront LLC) is both Conference Center operator and Caterer with a captive LLC (TEE Center Manager Augusta Convention Center Management LLC) between them. Isn’t this just a fiction to eliminate a conflict of interest as alluded to in the Catering Agreement?
  4. Controls over inventories of food and beverage (to prevent co-mingling of Augusta, Hotel and Conference Center purchases) being in place before contract execution should be mandatory.
  5. If Kitchen doesn’t serve Hotels (as has been publicly stated by the Marriott General Manager), can’t that reference be taken out? 
  6. Cross over events into the Conference Center will deprive the Tee Center of catering revenues, while the agreements relieve the Conference Center of costs.
As with the Management Agreement, time will tell how many of the above issues are addressed, handled, and rectified.

 -AG

The author, Al M. Gray is President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America's leading companies, businesses and governments desiring Superior Returns. He is a frequent contributor to CityStink.net.

Wednesday, November 7, 2012

Can Augusta Avoid Outsized Tee Center Costs?


Augusta’s Tee Shot Hits Rough

Wednesday, November 7, 2012
Augusta, GA
By Al Gray

Part One – The Management Agreement

When Augusta’s Trade, Exhibition and Event (TEE) center was approved in 2007, prudence might have suggested that one of the first steps in the process of building the facility might have been to execute the Management Agreement in advance.  This being Augusta, Georgia, where almost nothing is done in accordance with normal business practices, the building has gotten within weeks of being used before a management agreement was even submitted to Augusta commissioners for approval. Worse, the management agreement was one of a covey of documents to flush out for approval.

A very rapid assessment of the provisions of the contracts was needed, because the proposed Manager immediately began hawking the loss of events that might result if the Augusta Commission has the temerity to actually deliberate on the terms and conditions of the entire contract documents.

The following represents a summary of the primary Management Agreement issues compiled from a review of the contract documents. This list has been provided to Commissioners and has become the basis of discussion and attempts toward a speedy resolution of major issues. The approach was to review the agreements in PDF form,  write comments, apply sticky notes that Adobe Acrobat provides to annotate documents, and then to provide a summary from the compiled sticky notes.

Solutions were designed to be the product of meeting participants and were not suggested in the summary.

The author is not a licensed attorney, auditor, or public accountant. This analysis was provided from a multidisciplinary perspective in the manner that accountants, attorneys, administrators, owners, policy makers, and media might find useful in trying to decipher the pitfalls and dangers in the agreements.

Tee Management Agreement Major Issues at 11/2/2012

1.       Differences in 2007 and 2009 Commission Approvals and these Documents. No cost cap. Unlimited conduit to Augusta General Fund.

2.       Cost shifting between agreements. Electric utility example. Beer inventory example. $300,000 a year for 50 years = $15,000,000 ( Augusta’s Laney Walker Improvement cost calculation method)

3.       Kitchen built under Tee Agreement where ARLLC supplies equipment switches to 50 year Conference Agreement where Augusta supplies and repairs kitchen equipment with no revenue from Conference Center.

4.       No accounting provisions for backcharged labor to Hotels or any other credits, refunds, rebates, or other benefits going to Augusta.

5.       Cross indemnification between Tee and Conference Center – sever-ability issues. WHO IS LIABLE?

6.       Too many ways to circumvent Annual Plan, including that an unknown, unknowable “Standard” trumps everything, including Annual Plan.

7.       Fringe benefits and bonuses, including for LLC PRINCIPALS, are unlimited.

8.       Accounting and auditing envision most of the accounting off TEE Center books, without rights of audit to ALL HOTEL ACCOUNTING records on a real time basis.

9.       Conventions can be booked using Tee Exhibition Hall while using Conference Center where Augusta gets no revenues.

10.   When Augusta signs these contracts, it assumes extraordinary indemnity provisions immediately so that it would have to advance payments to the Manager to defend the Manager from actions by Augusta

Time will tell how many of the above issues are addressed, handled, and rectified.

-AG

The author, Al M. Gray is President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America's leading companies, businesses and governments desiring Superior Returns

Wednesday, October 31, 2012

Video: Augustans Get Dud Wiser from TEE Calamity

Wednesday, October 31st, 2012
Augusta, GA
From CityStink.net Reports

Some are calling the Augusta Tee Center a huge Dud. Cost Recovery Works' Al Gray continues his voluntary work for Augusta Today in a Cost Avoidance Role. He says to Augustans - "When you've been Dud-wisered, you've paid it all." See Al's special video report below:


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Sunday, October 28, 2012

Video: TEE Center Management Contract is Riddled with Land Mines

Sunday, October 28, 2012
Augusta, GA
From CityStink.net Reports

On the eve of Mayor Deke Copenhaver forcing yet another Tee Center vote on balking commissioners, Augusta Today contributor Al Gray challenges cost controls after being silenced by Copenhaver a week earlier. See our video report below. 

Thursday, October 11, 2012

Augusta Held Hostage: Day 18


Thursday, October 11, 2012
Augusta, GA

By Al Gray

Yesterday, yet another Tee Center work session was scheduled by Augusta Commissioner Jerry Brigham. This meeting came on the heels of an amazing series of revelations, contradictions, and absurdities emanating from the fiasco of the first Tee Center work session last week.

On hand to present for Tee Center partner and soon-to-be manager were Mr. Paul Simon of Augusta Riverfront LLC and Mr. Bob Kuhar. Present to answer questions and representing the city was attorney Jim Plunkett.


  • Who is Augusta Convention Center Management LLC, who is named the TEE Center Manager? Where  is an assessment of this entity's financial viability? Who are its principals? Don't we need to know who they are to be sure that they are not paid as the contract dictates?

  • In the last work session Mr. Simon called for us to look at the Commission's December 7, 2009 vote authorize the mayor to execute the Tee Center CORE agreement, but this document does not now exist, does it? Doesn't this invalidate the motion that passed the Commission in December 2009?

  • The Tee Center Catering Agreement references that certain Conference Center Management Agreement dated as of __________, 2012 by and between Caterer and City. Where is this document? If it does exist, why were we not provided with it?

  • Let us see if we understand this correctly from the last work session: Mr. Simon said “So what I’m saying to the city in this (August 2007) term sheet we’ll give you land. Now what are we getting back for our land? We’re getting the kitchen. The term sheet says “The LLC and Augusta will allow the necessary modifications to the Convention Center to provide for the combined use of the kitchen, laundry, and back of the house areas.” The Term sheet also says that “AUGUSTA AND LLC AGREE TO THE FOLLOWING TERMS TO OWN, BUILD, AND OPERATE THE TRADE CENTER” Doesn't this mean that the LLC agreed to bear costs in the term sheet for which it is responsible? 
     
  • Doesn't the 2007 Term Sheet say that “Augusta's Capital Funds shall specifically not be used for items related to Kitchen Equipment, Laundry Equipment, or any Convention Center and Convention Center and/or Hotel capital cost.” When did the Commission assume its LLC partner's cost of Kitchen Equipment? 
     
  • Mr. Simon cites that the Tee Center cost estimates included $700,000 for kitchen equipment (later increased to $1.4 million without any change in the estimate) but why isn't this a LLC cost to “own, build, and operate?” when the Term Sheet says it is an LLC cost?

  • The invoice for the Kitchen Equipment shows refurbishment of existing kitchen equipment. Whose equipment was this? Whose equipment will it become?

  • The RW Allen Contract caps the overhead and profit on a subcontract but the kitchen equipment invoice for roughly $1.4 million and data in Augusta's possession is insufficient to determine whether this limit has been breached? Why don't we insist on getting the information required to assure this limit has been met?

  • In the work session of last week, Mr. Simon and Mr. Plunkett said that the decision to build the Tee Center had to come before an operating plan was completed. They said that these contracts have to be signed before there is a plan. Doesn't these contracts make the plan only a guide with no authority at the same time it gives the Manager and Caterer absolute authority to assign personnel? Isn't there a Convention Center website listing very highly compensated General Manager, Catering Manager, Security Director, Finance Manager, and about 6 or 7 more overhead staff? Are these the same 11 full time, permanent employees Mr. Simon mentioned last week?

  • At last week's work session Mr. Plunkett, the city's attorney said this The expense of the kitchen is an expense of the TEE Center. The maintenance of that facility, this equipment, is being shared basically between the Conference Center, the TEE Center and the hotels proportionate based on plates. If this is true, why do these agreements set it up so that all of the capital and maintenance costs of the Kitchen, which is now being referred to as the “Conference Center Annex” are born by the city? There is a separate fund for this in the Catering Agreement.

These agreements are so convoluted at this juncture, it is becoming apparent that no one understands them, including the attorneys. The commission would be wise to obtain the proposed plan, budget and procedure manual before agreement should be reached.

Update: Augusta Today and CityStink.net contributor Brad Owens was invited to speak at the October 10, 2012 and was forceful in his presentation of many of the foregoing issues. A key point made was that the land given up by the Augusta Riverfront LLC could not be conceivably worth the $65 million that Augusta has spent constructing buildings that primarily benefit the LLC's two Marriott hotels.

MORE TO COME!***

Sunday, September 30, 2012

Hounded into Making a Splash


Al and Molly before a hunt

Being Molly

Sunday, September 30, 2012
By Al Gray

Rabbits probably laughed at Molly. A gray-headed, bow-legged old girl of a beagle just would not have filled their hearts with fear. Her voice at full cry was a moderate bawl. She didn't have a fantastic cold trail nose that would detect where they had exited the sorghum field and tipped to their warrens hours before at dawn. Her legs were bowed, so speed wasn't a threat.  Molly purely looked and sounded like what she was - a mostly worn out beagle bitch of about 7 years of age. She certainly wasn't the ideal image of a dog around whom one would build a rabbit hunting pack.

Molly would have to do, as it turned out. We managed to aggregate a pack of dissimilar beagles into a rag-tag gang of hare-harassing noise makers.  Molly became the constant.  Jack and Dolly had superior noses, but tended to get caught up in trying to slowly extract the last scent rising from the trail. Queenie was a briar-busting runt of a jump dog, who had no nose at all. Back-track sometimes ran the trail backwards. Mabel was an even more aged relic, albeit a wise dog with experience. Of necessity, we rarely hunted pine thickets or open terrain. When we did, there was Molly to keep the clan functional.

Over time, Jack and Dolly discovered that their master was full of praise when they lifted their noses from back down the trail and went to Molly in the lead. Queenie found it was fun to stay with the gang and lend her squeaky voice in pursuit of those cottontails. Mabel kept pace and often straightened the pack out where Molly sometimes hesitated.  Back Track got left home and became a shot-deer tracking hound, as he confused the heck out of all the others, Molly included. By the second season, the group was a functional pack, just one devoid of speed.

Cottontails and swampers who survived a Molly chase were the ones who didn't sit on their haunches laughing. Molly had grim determination. Molly purely LOVED to hunt rabbits. Had Br-er  Rabbit gotten close enough to see, he would have trembled with fear. The old gal had ears tattered and bleeding from dogged pursuit through blackberry briers. Sometimes one of those steel-tough green briers would have torn an ear. Her tail ended in a hairless tip, with only the peripheral hair left to offer when her tail was held high. The pads of her feet were like iron. Those bow legs might have lacked speed but made up with power to bulldoze through thickets.

In a hunt Molly was bold, audacious, relentless, and cunning. Without being encouraged or trained to do so, she took the initiative to find, defend, and retrieve a downed quarry. That the rabbit was a relatively huge burden for a 29 pound beagle carry never deterred our Molly. She had a heart seemingly as large as a whole rabbit.

Before the fourth season with Molly and company, life changes and the wear of time struck. Mabel passed away around Independence Day. Queenie had a severe back injury and had to be put to sleep by Dr. Garner. It was time to find replacements and to expand the pack with young blood.  Over in Grovetown, Mr. Stephenson found himself with his own health issues in the form of congestive heart failure which ended his beagling days just as his 8 month old litter of AKC-registered gun dog pups was ready to begin training. His five pups found a buyer eager to accommodate his wishes that the entire litter be kept intact to form a hunting pack.

Those pups were significantly faster than Jack, Dolly, Molly and Mr. Calvin Clem’s contributions to the pack, Lucy and Mack. Each sibling had a different temperament and style. Molly would bend them all to meet hers. She became their mentor. Sapphire, the only female, was the first to begin running rabbits and quickly became the leader of the pack, always adroitly and quickly handing the outs that the rabbits would throw at the pack. When she didn't,  Jack and Dolly had learned to release the scent trail and go to where the leaders were, so they were there to work out the challenges Sapphire found more difficult. Brothers Louie, Andy, and Pete were quick learners and became excellent rabbit beagles.  Molly was there with them all.

The last hold-out amongst the Stephenson pups was Amos. The poor boy seemed befuddled and perhaps even afraid at all of the racket that the others made in pursuit. Amos stayed at Master’s feet. I could not shoot for fear of causing gun-shyness in Amos. This finally ended in a planted pine grove down below Girard, when a fleet cottontail that had far outdistanced the noisy pack darted across the fire break in front of us. Amos took off after him, barking in a high chop voice on the hot trail. From then on, Amos was a key member of the team that we released in open terrain and pine plantations. Alas, even a hot scent could not entice Amos into a brier patch. He would pace outside, hoping that the rabbit would play HIS game, not the rabbit’s.

The constant in the pups’ education in the field was old Molly. It was about the time that the naughty pups came into her hunts that she ‘learned’ to retrieve rabbits. Jack already had picked up on that as a way to gain his master’s praise. Jack was a burly enforcer, broad chested and 17 inches at the shoulder, which is large for a beagle. Molly had a lot of trouble because of her short legs. One can see the difficulty she had in this picture of Molly retrieving a rabbit.



I don’t know about you, but our pets at times have taught such powerful human lessons that it becomes humbling, poignant, and powerful all at the same time. Molly rarely led the pack any more. Sapphire and Pete seemed to have jumped to the fore. From the outset, they had more speed.  It might have hurt the old girl’s feelings, but Molly was all heart, with a smidgeon of cunning.

Most of the pups early training was in open terrain and planted pine plantations, but by late in the season, the hunting party had to resort to unconventional habitat.  One of the toughest venues for rabbit hunts were the brier choked drainage ditches for fields with center pivot irrigation. Down by Highway 301, near Rubin Oliver’s place, there was such a place. At the rear was a water filled canal that was too wide for us to leap. The water was too deep to wade.

A rabbit jumped up along one of the center ditches, exploited a gap in our containment to the sound of three desperate shots from Cousin Hugh, and dashed to the rear of the field and into the dense blackberry patch there. Pete and Sapphire led the pack in pursuit.  When the beagles reached the ditch, all noise stopped. The rabbit had swum the ditch. Five young beagle gun dogs were left clueless and whining at the edge of that canal. Suddenly, there was a graying blur as this bow legged doyenne of a wizened huntress barged through the youngsters and leapt into the water with no hesitation. The five whiners quickly followed her example and swam to the other side, where a furious pursuit of Mr. Rabbit resumed that lasted until dark.

The sight of Molly’s charge into the canal became more than a fixed memory; It became an inspiration for her masters. Molly took charge and plunged into what looked to her companions like a well of doom. Despite her age, aching bow legs, and the coldness of the water, Molly knew her duty and did not shrink from it. She inspired the youngsters around her and taught them with leadership in action.

We should all do the same in these times of encountering vast moats of troubles.

Be Molly.


Molly in Action