TO: Board of Supervisors
FROM: Steven Lederer, Director of Public Works
REPORT BY: Leigh Sears, Concessions Manager
SUBJECT: Approval of Lake Berryessa Interim Concession Contracts
RECOMMENDATION
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Director of Public Works requests approval of and authorization for the Chair to sign the following Agreements for the term November 1, 2023 though October 31, 2024 with an option to extend for one additional year, in return for 3% of gross revenue from operating the resort areas at Lake Berryessa:
1. Agreement No. 240192B for the Steele Canyon resort area with Steele Canyon Campground, Inc.; and
2. Agreement No. 240193B for the Spanish Flat resort area with Spanish Flat Campground, LLC.
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EXECUTIVE SUMMARY
The Spanish Flat and Steele Canyon resort areas at Lake Berryessa are currently operated under interim concession contracts with Sun Lake Berryessa LLC (Sun Communities). Sun Communities assumed operation of these resort areas while it investigated the feasibility of developing and operating both sites long-term. On June 27, 2023, Sun Communities announced it was no longer pursuing a long-term agreement for the resort areas, and that it would cease operating the sites on October 31, 2023.
The new interim concession contracts are with the same operators Sun Communities hired to run the Steele Canyon and Spanish Flat resort areas. They formed new corporate entities to assume operations because they will no longer be working for Sun Communities. They will operate the resort areas under substantially the same terms and conditions as the existing interim contracts, in return for paying the County 3% of the gross revenue realized from operating the sites.
FISCAL & STRATEGIC PLAN IMPACT
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Is there a Fiscal Impact? |
Yes |
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Is it currently budgeted? |
No |
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Is it Mandatory or Discretionary? |
Discretionary |
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Discretionary Justification: |
Sun Communities is ceasing operations on October 31, 2023. |
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Is the general fund affected? |
No |
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Future fiscal impact: |
County will receive 3% of gross revenue generated from operating the resort areas. |
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Consequences if not approved: |
County will need to close the resort areas or find new operators for the sites. |
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County Strategic Plan pillar addressed: |
Healthy, Safe, and Welcoming Place to Live, Work, and Visit |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: The proposed action is categorically exempt from the California Environmental Quality Act under CEQA Guidelines section 15301, as the operation of existing public facilities involving negligible or no expansion of existing or former use.
BACKGROUND AND DISCUSSION
The United States Bureau of Reclamation and the County entered into Managing Agreement Number 20-LC-20-2623 (Napa County Agreement No. 200285B) dated March 9, 2020, for the administration, operation, maintenance and development of public recreation facilities at Lake Berryessa. Since January 1, 2021, the Spanish Flat and Steele Canyon recreation areas have been operating under interim concession contracts approved by the Board. The Spanish Flat and Steele Canyon resort areas at Lake Berryessa are currently operated under interim concession contracts (Napa County Agreement Nos. 220197B and 220198B) with Sun Lake Berryessa LLC (Sun Communities). Sun Communities assumed operation of these resort areas while it investigated the feasibility of developing and operating both sites long-term. On June 27, 2023, Sun Communities announced it was no longer pursuing a long-term agreement for the resort areas, and that it would cease operating the sites on October 31, 2023.
The new interim concession contracts are with the same operators Sun Communities hired to run the Steele Canyon and Spanish Flat resort areas. They formed new corporate entities to assume operations because they will no longer be working for Sun Communities. Spanish Flat Campground LLC is managed by Tiffany Jones, a local resident who has been operating the Spanish Flat resort area under Sun Communities for the last 2 years. Steele Canyon Campground Inc. is managed by Joseph (Rocky) Costanzo, a resident of Berryessa Highlands who has been operating the Steele Canyon resort area under Sun Communities for the last 2 years. Rocky is a long-time resident of the Lake Berryessa area and is very familiar with the lake.
Both concessionaires will operate the resort areas under substantially the same terms and conditions as the existing interim contracts, in return for paying the County 3% of the gross revenue realized from operating the sites. During the terms of the interim concession contracts, the County will continue pursuing opportunities for long-term development and operating agreements for the resort areas.