Articles
October 2002 Exhibit City News
LVCC delays business center decision
The board of directors of the Las Vegas Convention and Visitors Authority has postponed a decision on awarding a new contract to run the business center at the Las Vegas Convention Center. The board was set to make a decision at its September meeting, but decided at the last minute to send the issue back to the staff for further review.
The board voted to ask the LVCC staff to develop a proposal to run the business center in-house and will reconsider the issue when the internal proposal is completed. The mid-October meeting would be the earliest time a decision would be made.
The original finalists were Encore Productions, A to Z Event Solutions and the current manager at the business center, USA Hosts. Staff reviews of each company's proposals ranked Encore first. A to Z second, and USA Hosts the third of the three finalists.
Most people at the meeting had expected that the board would choose between the two top finalists, but Bill McBeath of Mirage Resorts queried why the LVCC's own staff had not sub-milled a proposal.
All the finalists promised to generate substantial revenue and their proposals included significant returns to the LVCC.
McBeath pointed out the main proposals were premised on revenue of as much as $5 million. Why, he wondered, was the board outsourcing such a lucrative contract. The potential profit was all the more significant, he argued, because the proposals included minimal capital outlays. The finalists had generally proposed no more than $400,000 in capital expenditure over the life of the contract. The bulk of that would have been spent to build a new business center in the South Hall.
A couple of board members pointed out that any staff proposal could take up to three months to become operational and asked USA Hosts Business Services Vice President Jeff Swartwout if his company would extend the current contract 90 days.
Swartwout refused to be drawn on the question, saying only that USA Hosts would discuss any interim proposal with the board.
The bidders were disappointed with the board's decision to delay any action and said in interviews after the meeting that the LVCC staff would not easily be able to match their bids because they lacked expertise in delivering business services.
"When the staff does its evaluation, we think they'll still agree that we're the best proposal," said Encore President Bill Dayton.
"It takes extensive experience and knowledge to provide convention center business services," said A to Z President Calanit Atia. While her company had been ranked second by LVCC staff, she said her company's proposal would return the greatest revenues to the LVCC.
The current contract allows USA Hosts to exclusively provide computers, some office equipment, as well as non-exclusive services such as staffing. Similar provisions will govern the new contract.
