Saturday, April 13, 2024

Arts Garage leasing proposals and news of note in Delray

Arts Garage lease discussions

The Arts Garage board of directors has sent Delray Beach a proposed lease for the group’s use of city space in Pineapple Grove. The proposal suggests a modest increase in rent and a larger change in how Arts Garage operates.

Arts Garage proposes a five-year lease of the roughly 10,000 square feet on Northeast Second Avenue. The group has been paying $800 per month, far below market value. The lease proposal from Arts Garage calls for a monthly rent of $866.

Before the old lease expired in March, Arts Garage had proposed a 10-year renewal. The new version proposes a five-year lease. The city commission extended the current lease until September, so negotiations could proceed.

The most significant part of the proposal speaks to the accountability commissioners demanded from Arts Garage, which depends not just on subsidized public space but an annual subsidy from the Community Redevelopment Agency. After an audit found management problems, the CRA withheld its final payment of nearly $70,000 for the 2014-15 budget year.

Under the proposed agreement, Arts Garage would provide to the city each year a “business plan which shall contain the following information: operations, business structure, fund raising and capital development plan and five-year strategic plan.” Arts Garage also would have to provide its budget, an audit, a management letter and any responses to the management letters.

In addition, Arts Garage would have to inform the city of its “efforts to improve diversity” on the board of directors and provide updates on “programming and collaborations with other arts organizations” in the city that want to use the space. Arts Garage would have to provide “status reports on meeting the goals and objectives outlined in the (Arts Garage) business plan” every three months.

When commissioners discussed Arts Garage two months ago, they made clear their unhappiness at being surprised by the group’s expansion to Pompano Beach and the talks with start-up firms that might want to sublease some of the space. Creative City Collaborative, which oversees both operations, responded by shifting former Arts Garage Director Alyona Ushe to Pompano Beach and naming two people to run Arts Garage.

Keith Garsson is director of operations, a title that Board Chairman Brian Rosen said in an email will cover “programming, outreach and education.” Garsson had been brought in last year to “reinvigorate the theatre department,” according to a news release. Daniel Schwartz is director of finance. He had been working for Arts Garage, and commissioners told me that Schwartz had begun to bring order to what was a disorderly organization. Both will work only for Arts Garage.

Asked about this two-headed management setup, Rosen said Garsson and Schwartz report to the board as co-equals. “There is a defined separation of duties. However, together they form a dynamic team that is working to create programming and outreach initiatives that will positively impact the community while being fiscally responsible.”

While the negotiations go on, Arts Garage apparently continues to succeed on stage. A public relations representative said recent concerts sold out. She expects the Tito Puente, Jr., show this week to be a sellout. The theatre production “Devil’s Music: The Life and Blues of Bessie Smith” was held over for a second run and “did near full houses.” The new team installed a box-office software program called OvationTix) that “has made sales and administration much more efficient.” Garsson also is working on the website.

Mayor Cary Glickstein told me Tuesday that he has not reviewed the lease proposal, but said “some sort of performance metrics” will be necessary. Once City Manager Don Cooper has reviewed the lease, he likely will schedule it for a city commission workshop.

 

More on Arts Garage

Arts Garage is also making belated progress with the Community Redevelopment Agency.

Though the group finally did receive the last of that 2014-15 money, no agreement was in place for the 2015-16 budget year that began Oct. 1. The CRA board had several concerns about issues raised in the management letter that accompanied Arts Garage’s audit and wanted them resolved before discussion of new money.

The issue came before the CRA board at its April 28 meeting. The board approved payment for the last three months of 2015, which are the first three months of the CRA’s new budget year. The amount was $68,750, the same quarterly reimbursement as in 2014-15.

For that meeting, Arts Garage Chairman Brian Rosen noted the conditions the CRA had attached and offered the group’s responses. The CRA wanted a completed audit and clean management letter. Rosen said the audit was nearly done. The CRA wanted a lease at lease at least until September. Arts Garage had obtained one. The CRA wanted a new policy and procedure manual. Rosen said the group was working on it, but lacked the staff to separate “accounting duties” as the audit had suggested.

Finally, the CRA wanted Arts Garage’s “strategic plan.” Rosen said that part would take longer. The group was seeking firms to moderate a “strategic retreat” that would take place this month or next. Rosen said Arts Garage had submitted a “business plan” to “help the CRA make an informed decision.”

According to CRA Director Jeff Costello, the board will base additional payments on what Rosen called “further documentation.” In the letter, Rosen said payments for the last nine months of the budget year were not as urgent. Still, a new agreement between Arts Garage and the CRA is essential and would represent major progress.

 

Delray City Attorney update

Tuesday’s discussion about Delray Beach’s next city attorney showed again why it’s so unfortunate that Delray Beach is losing its current city attorney.

Supposedly, the city commission would cut the recruiter’s list of candidates to those whom the commission wanted to interview. That happened, but the ending was far from conclusive as to who will succeed Noel Pfeffer.

Shelly Petrolia said, “I’m not impressed” by any of the eight candidates. Mitch Katz me-tooed: “I was not impressed.” Though the commission did schedule a full day of interviews, public and private, for June 10, it’s hard to imagine Petrolia and Katz embracing a candidate. A 3-2 vote hardly would make the winner feel secure.

Many cities use private firms for their legal work, with one lawyer from the firm acting as the city attorney who attends meetings and advises the elected officials who set policy. Delray Beach has a five-person legal staff, with one lawyer serving as an advisor to the police department. There’s no talk of firing the staff, so discussion moved to a “hybrid” system in which a private lawyer would hold the top job and the other four staffers would do the daily stuff. Unlike many cities, Delray Beach assigns its own lawyers to handle tort cases.

No Palm Beach County city of any size has used such a system. Pfeffer cited Fort Lauderdale and Coral Springs as examples from Broward County. It would seem problematic for Delray Beach to adopt such a system essentially by default, rather than to achieve a goal. Regular conflicts also could loom if the lawyer’s firm does litigation. Would the lawyer base a recommendation to sue based on what’s good for Delray Beach or what’s good for the firm? Such a system, Mayor Glickstein said, “would be a hard climb for me.”

If saving money is the objective, Pfeffer said that using an outside firm “will be more expensive. It’s the nature of the business.” A private firm associate making $100,000, he said, must generate roughly $300,000 in billable hours. Even if a firm works on retainer, that cost is figured into the city’s monthly bill. The budget for Delray Beach’s legal department is roughly $1.2 million, with about $900,000 for salaries. Pfeffer makes $150,000 and has a $7,500 car allowance.

Pfeffer told me Wednesday that he will prepare a memo for the commission that examines the hybrid system and offers some financial comparisons. He wants to complete the memo by early next week, so the commission can review it before the interviews.

Whoever takes over will have the immediate priority of monitoring the Atlantic Crossing lawsuit. With trial set for October in federal court, the most recent monthly bill for the city’s outside counsel was $30,000. Pfeffer said the total cost is at $200,000 “and rising rapidly.” He had estimated the final bill – just for the trial – at between $350,000 and $700,000, and the city budgeted accordingly.

So this not a time for the Delray Beach City Commission to be indecisive about one of the two people the commission hires. There’s too much at stake.

Randy Schultz
Randy Schultz
Randy Schultz, a native of Hartford, Connecticut, has been a South Florida journalist since 1974. He worked for The Miami Herald until 1976 and for The Palm Beach Post from 1976 until 2014, where he served as managing editor and editorial page editor. Since 2014, he has written a politics blog, commentaries and other articles for Boca magazine. His writing has earned first-place awards from the Florida Magazine Association and the Florida Society of Newspaper Editors. Randy has lived in Boca Raton with his wife, Shelley Huff-Schultz, since 1985. His son, daughter-in-law and their three children also live in Boca Raton.

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