Council conditionally approves Oak View management contract for Palm Springs Convention Center, adds community and incentive review

Palm Springs City Council voted July 21 to award a five‑year operations and management contract for the Palm Springs Convention Center, visitor services and the city’s bureau of tourism to Oak View Group (OVG), while directing staff to return with clarified nonprofit‑use rules and refinements to the incentive structure.

The council approved a base management fee plus a performance incentive structure; OVG offered a capital investment package and transition support in its proposal. The contract as approved includes a base fee, structured annual increases, an incentive component that can add up to 150 percent of the base fee, and an initial up‑front investment from Oak View Group to support center improvements and transition costs.

Why it matters: The contract will transfer day‑to‑day convention center operations to OVG under a five‑year term with a possible extension, and it includes a labor‑harmony provision that stakeholders and labor unions said would create local hiring and apprenticeship opportunities. Council members asked staff and the contractor to return with detailed nonprofit usage rules, an explicit role for the tourism advisory process, and a refined incentive metric that includes room‑night targets and stronger community feedback.

Staff presentation and contract highlights: Chief Economic Development Officer Wayne Olson summarized the procurement process: two responses were received to the city RFP; the council authorized negotiations with Oak View Group after evaluation. Special counsel Seth Merowitz walked council through key contract terms including scope (convention center, visitor center, Well in the Desert/Wellwood Murray Memorial Library and Bureau of Tourism), base compensation with annual increases, a not‑to‑exceed total that includes potential incentives, and the $1.8 million capital investment OVG made available to the city during the transition.

Oak View Group’s David O’Neil and a multi‑member transition team described their plan to begin intensive outreach, protect continuity for existing clients, and retain and onboard employees. OVG said it would prioritize existing client relationships, add sales focus for slower months and non‑traditional market segments (for example, tech and specialty sports events), and propose an operational staffing and HR plan aimed at high retention during transition. OVG told the council it has managed hundreds of venues and operates a regional support structure by function (sales, operations, finance, HR) to support local teams.

Labor and community input: Labor representatives and local building‑trades leaders testified in favor of the contract after staff and Oak View affirmed a “labor harmony” clause to the agreement. Representatives of IATSE Local 122, Painters and Allied Trades District Council 36, and others urged council to adopt the agreement and endorsed the labor language as a path to local hiring and career pathways.

Council direction and follow‑ups: Council approved the contract but instructed staff and OVG to return with additional details on several items before incentive fees are finalized: (1) a nonprofit usage policy that spells out eligibility, cost reductions, and how those requests are vetted; (2) a clearer set of incentive metrics that include room‑night targets so that hotel stays are reflected in performance payouts and additional emphasis on incentives for slower months; and (3) formalization of the tourism advisory committee’s role and a requirement that OVG provide marketing assets, calendars, and toolkits to local businesses. Council members asked that OVG’s annual business plan and client satisfaction surveys include both client and local community feedback, and that the asset inspection process (annual facility condition/asset management review) be used to build a multi‑year capital plan.

Funding and operational details: The contract contemplates a Bureau of Tourism operating budget (presented as approximately $2.1 million in staff materials and subject to council budget approval), a visitor services allotment and use of OVG’s investment for initial capital work. The city and OVG will continue to analyze existing vendor contracts; some will remain city contracts and others may be assigned to the contractor after review during the transition.

Ending: Council members said the contract modernizes the city’s convention‑center operations, creates a path for local hiring under the labor‑harmony language, and opens room to improve slow‑season programming. Council approved the agreement with direction to staff and the contractor to refine the nonprofit‑use policy, incentive metrics (to include hotel room nights and slow‑month emphasis), and community input mechanisms before incentive payouts are finalized.