Dear City Council Members,
Thank you for your attention to the Team Sheeper agenda item last night. I am the CFO for Team Sheeper, and have been for the last 21 years. I would like to clear a few things up as they were not clarified factually in the meeting last night.
1. Team Sheeper gave notice of "renegotiation and/or termination" as required by the contract on Feb 28th, when it was received via certified mail to Justin Murphy and Sean Reinhart. This was not done on May 12 as was indicated last night. A renegotiation implies that a party is not happy with the terms of the current agreement and wants to change the terms to move forward, and therefore also implies that if no agreement is made, the contract will terminate not just keep renewing. In any case, termination was expressly indicated in the letter to ensure clarity.
1. After Feb 28th, Team Sheeper waited 2 months for city staff to start any negotiations. When there was no initiative made, Team Sheeper took the initiative and sent a starting terms sheet to city staff on May 2, 2022. This was the beginning point and then with additional delays, explains why we are discussing this so close to the contract termination. Team Sheeper has made every effort to move things forward and made its intentions knows clearly back in Feb.
1. At that time, city staff set up a meeting with Team sheeper on May 10. At that meeting, the termination clause was discussed and city staff decided to take it off line to discuss and set up another meeting for a couple of weeks away. This meeting occurred on Tuesday 5/23. The city went through responses to the terms and Team sheeper then took those responses to discuss as a team. Team sheeper sent responses to negotiate on 5/26. At this time, Team sheeper had removed the management fee request. This was not done just prior to the council meeting last night but back in May.
1. After this point, city staff did not get back to Team Sheeper as to a continuation of the negotiations, other than periodically indicating that they are working on it.
1. Last week, on Wednesday June 22, we were notified that city staff was not going to negotiate any further but that they are bringing it to council for direction, to be held last evening. This is why we were "surprised" that it was being brought forward at this meeting. There was very little notice given and last we had heard city staff was going to get back to us for renegotiations. Team sheeper did not "remove themselves from the negotiation table". Team sheeper did not see the agenda packet until Thursday. City staff directed Team sheeper that we could prepare comments to the council, which we started working on, with short notice.
1. On Friday of last week, Team sheeper was notified by city staff that the council meeting was going to be long and that we should prepare written comments via email instead of expecting to talk at the meeting, which took us a few days to get together. This explains why council received those comments so late prior to the meeting and why we were not available for comment last evening.
1. To clarify, the City has not offered a one year contract. The contract that has been offered is to be the earlier of the term offered OR the completion of construction on the new facility and the choice of a new operator. So this leaves complete uncertainty and instability not knowing exactly when the contract would actually terminate. IT is not guaranteed to last through another cycle. We are looking for some stability and commitment.
1. History of a 5 year contract -Last night it was stated that there is no history for a five year contract with Team Sheeper. The first two contracts that Team sheeper had with the city of Menlo park were both for 5 year terms. One dated in May 2006 and one dated in May 2011. The city then kept giving temporary renewals until the next contract rendition could be negotiated and agreed on. The next contract after that was put under a one year term because it changed drastically and both parties wanted the opportunity to revisit. This was signed in 2018. The intention at that time was not to continue having one year contracts year after year but to give time to see how the new contract was going, revisit after a year and then potentially go to a longer term. There has been much turnover with the parties involved on the city side of things so the contract just kept getting pushed.
1. Team Sheeper has ZERO contractual obligations beyond the contract termination date of August 31. All contracts with outside parties state that the contract will terminate on the earlier of December 31, OR the termination of the contract with the City. Team sheeper does not sell ANY long term memberships anymore. Monthly memberships are the only memberships available at this time.
Thank you for your attention to these matters. We felt it necessary to clear up a lot of confusion that arose last night.
Sincerely,
Carole Hayworh
