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Tourism Complex RFP process delays Old Town concession contract

With the request for proposal process taking longer than expected, Diane Powers’ operation of Bazaar del Mundo will continue several months past the end of Powers’ current contract with the state.

Last April, it was announced that for the first time in 30 years, Powers’ concession contract for the Old Town tourist hub would come up for bid. Powers’ current contract ends in June.

Since April, however, little official action has taken place.

According to John Shelton, chief of the state’s concessions reservations division, the request for proposals document has proven exceptionally elaborate to create.

In fact, Bazaar del Mundo is the most complicated concession in the park’s system, Shelton said.

It’s also the most profitable. The five-restaurant, 16-shop complex had gross sales of $24 million in fiscal 1998-’99 and surpassed that figure last year, according to Powers. She currently pays the state a rent of 7.3 percent of sales.

Other top concessions in the state parks system are the Asilomar Conference Center in Pacific Grove, which had gross sales of $14.1 million in its last fiscal year, and Hearst-San Simeon State Historic Park, which had gross sales of $4.1 million.

For the same period, Asilomar’s operators paid the state $1.3 million in rent, with an 8.6 percent rent percentage, and Hearst paid $1.46 million, from 26 percent of food sales and 50 percent of gift shop sales. Last fall, the state parks system informed Powers that they would be extending her concessions contract on a month-to-month basis, but it would likely last through the beginning of 2002.

The state parks department’s original goal last spring for Bazaar del Mundo was having the RFP process completed and the contract awarded well before the end of Powers’ contract, to allow a smooth transition if needed, Shelton said.

Powers has said from the start that she’ll be among those bidding on the contract.

It’s unlikely that she’ll be the only one. One reason is Bazaar del Mundo’s standing as the most lucrative concession in the state parks system, said Sal Giametta, vice president of community relations for the San Diego Convention & Visitors Bureau.

“The appeal of that kind of concession would obviously be tremendous,” Giametta said.

“Old Town happens to be one of our most visited attractions in San Diego County,” he added, “and we happen to believe that one of the reasons it’s become so popular over the years is because of the presence of Bazaar del Mundo, which Diane Powers was obviously so instrumental in bringing to the park many years ago.”

Shelton said that since April, the state has been working on designing the RFP, ironing out requirements and other details.

“It’s a pretty complex operation that exists down there today,” Shelton said. “There’s a lot of different theories coming together on how we should proceed and the length of the term of contract and everything.”

Among the issues the concessions department is examining is Bazaar del Mundo’s unusual blend of retail and restaurants, he said.

Another focus is deciding how much emphasis the state wants to place on the historic vs. business elements of the contract, he said.

One of the historically oriented decisions would be whether buildings should be restored to a 19th-century architecture style, Shelton said.

Powers expects the plans won’t affect the Bazaar del Mundo’s main buildings , originally designed as the Casa de Pico Motel by Richard Requa, a well-known architect whose work included many buildings in Balboa Park.

When Powers took over the site in the early ’70s, it had become dilapidated and rundown. At the time, she was the only bidder, and obtained what has been called a “sweetheart” deal, paying a lower percentage of rent than other parks.

In several negotiations to extend the contract since then, Powers has continually kept a lower rent percentage compared to other concessions in the state park system.

For instance, Asilomar operators pay an annual rent of $1 million or 8.6 percent of sales, whichever amount is more, and 25 percent of gross receipts if sales total more than $14.93 million.

Now, with the concessions contract somewhat extended, Powers is pleased to continue to operate the tourist complex.

“It’s not a long extension, seven months or so,” she noted, “and that gives us a little bit more planning ability at least through the summer and winter months.”

The planning time is still limited, however, Powers said. “We need to think way ahead and project out purchasing, and advertising, promotion and so on. You have to plan months and months in advance.”

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