April 19, 2005

SUBJECT: Award of Contract to Provide Recreational Gymnastics Instruction to the Public through the City’s Recreation Program (F0403-50)

Approval is requested for the award of a one-year contract to California Sports Center of San Jose, with an option to extend the contract for an additional one-year period, to provide recreational gymnastics instruction to members of the public through the City’s Recreation Program.

For a number of years, the City has offered recreational gymnastics classes to the public through its Recreation Program. As is typical with Recreation Program classes, the City contracted with private firms to teach the classes, and revenue generated was shared between the City and these firms. In the past, this program has averaged 120 participants per session.

Beginning in March 2004, the City began contracting with California Sports Center to provide gymnastics classes under the City Manager’s contract award authority of $50,000. California Sports Center was selected, based on its proven success operating the City of Santa Clara’s recreational gymnastics program along with other private gymnastics instructors in the area. The current one-year contract began on January 1, 2005.

Since contracting with this firm, the City has seen a significant increase in gymnastics class enrollment with a corresponding increase in revenue generated by the gymnastics program. So far in 2005, the program has averaged 400 participants per session; and it is expected that participation will remain at this level or even increase, based on the overall quality of instruction offered by California Sports Center.

The company is paid 75% of the resident registration fee for all gymnastics class participants. The remaining 25% is retained by the City to offset the cost of handling class registration.

The current contract term will not end until December 31, 2005; and it is anticipated at this time that total payments to California Sports Center under the existing contract will be significantly more than the City Manager’s contract award authority. Staff, therefore, recommends that the existing contract be terminated and replaced by the attached one-year agreement in an amount not to exceed $180,000 per year and with an option to extend the agreement for an additional year.

Section 2.08.070(b) of the Sunnyvale Municipal Code exempts professional services, including instructors, from the City’s competitive bidding requirement.

Although impossible to predict, it is anticipated that total payments to California Sports Center for its share of program revenue during the one-year contract term will not exceed $180,000. However, it should be noted that this program has generated a net profit to the City of $26,331 through Accounting Period 9 of the current fiscal year. Staff anticipates that this program will end the fiscal year with a profit which will be used to help subsidize other recreation programs offered by the City.

It is recommended that Council award a one-year contract to California Sports Center, in an amount not to exceed $180,000 per year, in substantially the same format as the attached draft and with an option to extend the contract for an additional one-year period, to provide recreational gymnastics instruction through the City’s Recreation Program.

Prepared by:

Elaine Wesely
Purchasing Officer

Reviewed by:

Mary J. Bradley
Director, Finance

Reviewed by:

Curtis Black
Interim Director, Parks and Recreation

Approved by:

Amy Chan
City Manager

Attachment
Draft Service Agreement (.pdf format)