Use of Property for Commercial Activities ______________________________________________________________________________

Summary of Policy This policy provides guidance for the use of property by the public for eligible commercial activities. The policy establishes criteria for obtaining a permit or contract to use our property, and it creates several objectives, which include generating revenue that will offset capital and operating expenses, increasing transit ridership, and providing additional activities at stations so that transit patrons will feel safe. It is also intended to make goods and services easily accessible to transit riders and provide opportunities for the business community.

Subject to certain rules and regulations regarding time, place, and manner, we permit certain commercial and non-commercial activities on its property that may provide revenue. The use of property for commercial and non-commercial activities must be authorized in writing and signed by the appropriate department head or acting department head.

Any authorized commercial activities must be compatible with the construction, operations, maintenance, security, safety, and esthetic treatment of the transit system, as well as the surrounding community.

This policy does not apply to transit related uses, joint development, leasing agreements, advertising, special events, or filming.

Historical Perspective Before this policy, there was no formal process that permitted vendors and concessionaires to sell items at public transit facilities. However, there was a pilot vending program, initiated in 1995, which allowed several vendors to open kiosks at two Red Line stations. In 2001, staff evaluated the pilot program and concluded that it had met all expectations.

In September 2001, a management audit firm recommended in its report that we should permit vendors and concessionaires to offer their services at rail stations. The consultants opined that vendors and concession stands would make traveling more convenient for passengers and produce revenues for the agency.

Last Board Action April 25, 2002 – Use of Property for Commercial Activities

The Board approved on consent calendar the Use of Property for Commercial Activities Policy as guidance in the use of transit facilities for commercial activities.

Attachment General Management: Use of Property for Commercial Activities

See Related Joint Development of Real Property

Defeased Lease

Film Production Public Utilities Code § 130051.14

Public Utilities Code § 30600

POLICY STATEMENT

~Subject toreasol1able roles and regulations regarding time, place and manner,certain"Los~Angeles County M-etropolitan Transportation Authority ("MT A ') property maybe used for.certain commercial andnon-commercial activities that may provide revenue to MTA. The use ofMT A property for commercial.and non-commercial activities shall be authorized only by writtenpermit or contract signed by the appropriate department head oroacting departmentcbead.

PURPOSE

This policy describes the type of activities that maybe conducted on MTA Property by non-MTA~nnel or by the public. The:policyalso establishes criteria under which a pennit or contract- maybe obtained.~t will-enable'the requestor to,use the~propertyfor one of the allowed

purposes. This 'Wlicy is necessary to preserve ,the facilities of ,MT A for their dedicated purpose,::toprovide for safe.and efficient operation ofthe~it system and to further the~uitableAistribution .of licenses and :contracts to the public for the allowable activities.

.The purpose of this Policy is to establish criteria forvending'Bnd concession facilities on MT A:1property. This Policy will be implemented to meet~e following objectives:

. camerate reveI1:ue ,to help offset MT A's capital ~d operating expenses.

Increase transit ridership to reduce air quality impacts, energy consumption and trafficcongestion.

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Generate additional activity at stations that enhances use of the transit service ~dimproves patron perception of safety and security.

Provide services to transit patrons that will reduce the amount ()f travel needed topurchase goods and services.

Provide development and business opportunities to the private sector.

EX OFCR ADM: Carolyn Flowers APPRVD: Co1Dlty Counsel ADOPTED: CEO OR DCEO

Adopted by Board of Directors:

Use of MT A Property for Co~ial Activities

APPLICATIONThis policy applies to requests for use of MT A property by non-ill A personnel or by the publicfor eliglole commercial or non-commercial activities after the effective date of this policy. Thispolicy does not apply to transit related uses, joint development, leasing agreements, advertising,special events or filming.

POLICY IMPLEMENTATION1.0

Allowable Uses

Any authorized commercial activities must be compatible with the construction, operation,maintenance, security, safety and aesthetic treatment of the transit system as well as thesurrounding community. Individuals or business entities, who by the issuance of a pennit orcontract pursuant to this policy, are granted limited use access to MTA's Property for the purposeof engaging in allowable activities. Access will only be authorized when the safety of MT Aemployees and transit patrons can be assured, ingress and egress of patrons accommodated, andnonnal transportation services operated without disruption. The following are examples of thetypes of activities and services for which pennits or contracts for limited use may be granted:

Retail items such as jewelry, sundries and similar items.Newsstands to sell newspapers, magazines, paperback books, candy, and related items.

. Photography

Mail collection boxes on a controlled basis at passenger station plazas.Flower Stands.Food Kiosks (food dispensed in closed or resealable containers).Shoe Shine Stands.

. Self-service postal units

Automatic Teller Machines (ATMs).Dry Cleaners Services (Drop off and Pick Up only).Film Development, (Drop off and Pick Up only).

2Use of MT A Property for Co~ial Activities

~n)hibited Use and Unauthorited Activities- -- --. . Sale or use of alcoholic beverages, tobacco products, gums, or nuts in a shell.

. .Sale of hot food items'in the station areas (excluding the plaza level).

. ~QB~-aiSef5 !=f pelitieal ew;eot6BBd e~-:tt.:le e:-gaBi~eB9.

. Other activities that are deemed by MT A to be incompatible (or unsafe) with the constructionoperation, maintenance, security and aesthetic treatment of the transit system.

-Pennittin2 Process

~MT A shall detemtine&e number of vending, concessions or other uses that may take place on-:any specific MT A location at any given time. The availability of any MT A Property for:rommercialactivity is at the sole discretion ofMTA.

Selection of individuals 'Or business entities to occupy space in selected MT A transit facilitiesmay be on the basis of either of :the following processes:

. Issuance of a Request for Proposal for commercial activities at selected MT A properties.This process will be used -to select a master tenant.to manage multiple spaces in MT A

,. properties. An individual 'Or business selected under this process will enter into,a Contract toccaperate a;COmmercial activity for a specified period of time not to exceed five (5) years.~ontracts will be entered into between MT A and~dividuals or business entities inaccordance with-:MTA's procurement regulations.

. Review of a Request to Use MT A Property fonn submitted by an individual or business"entity for a specified,use of a particular MT A Property for a 1imited time. This process willbe applied on a "first come, first serve" basis and shall be limited in duration in accordancewith 'the demand schedule for the requested property. An individual or business selectedunder this processwiU be issued a PerInit to Use MT A Property for a limited period of timenot to exceed one (I) year.

Any individual, business entity or other organization requesting the use of a MT A Property for acommercial activity must submit a request to use MT A property on a fonn designated by MT A.

~ees. IndemBi~: aDd InslIFBBee ReolliFemeBts

:Fees.- Fees. In consideration for use ofMTA Property for commercial activity, the individual orbusiness entities shall pay MT A a fee as determined by the MT A.

Use of MT A Property for Convnercial Activities

!:::!:::::":~'. Indemnitv. Each individual or business entity who undertakes an approved activityon MT A Property shall agree to indemnify and save harmless the MT A against any and allliability arising out of its activities.

!::"'.-::"ee; Insurance. Prior to commencing activities on MTA Property, each individual orbusiness entity that undertakes an approved activity shall provide an acceptable policy ofinsurance coverage appropriate to the activity in accordance with the insurance lev~ls establishedby MT A's Risk Management Department. Insurance coverage shall include the n]lnimum levelsestablished for General Liability insurance and Workers' Compensation insurance.

1:,;.;.:"".;:; ."tt: _D.:rmit::. Licenses and Permits. Any individual or business entity operating onMT A Property must obtain and provide a copy to MT A of any and all required licenses andpemlits before commencing operation on MT A Property.

De6;~:: c.-:~.:.-:::. Desien Criteria

MT A may at its discretion provide kiosks, vending carts or built out retail space at certain MT Aproperty that will be available to rent or lease for commercial activity. IfMTA facilities are notprovided, all vending and concession spaces located at transit stations shall be designed andcons1mcted to comply with MT A' s Vending and Concession Design Guidelines.

~~As a public transportation agency, the MTA is committed to promote safety in all activitiesoccurring on all MT A Property. Therefore, to comply with the requirements of the Drug-FreeWorkplace Act of 1988, third parties utilizing MT A Property are prohibited from the use, sale,distribution, consumption and the receipt of any alcohol, controlled or illegal substances. Allpersons operating a commercial activity in or around a transit facility shall attend an annual RailSafety Training session for both light and heavy rail operating lines.

~mall Business Participation

A program to encourage and facilitate small businesses shall be developed to assure that smallbusiness entrepreneurs are afforded an opportunity to participate in the vending and concessionsprogram at rail and bus transit facilities. The program will require that a certain percentage ofvendor space be designated for small businesses and that assistance be provided by MT A ifnecessary to offset the investment that may be required to participate in the program.

Vendors who have participated in the Vending Demonstration Project shall be permitted toparticipate in the Small Business Program if they meet the minimum requirements established for

the program.

2.0 RESPONSIBilITIES

4

Use ofMTA Property for Commercial Activities

Facilities En2:ineerin2: - responsible for developing, reviewing and approving cOmpliance withthe Design Criteria for kiosks, vending carts and built..out spaces used for commercial activity.

Facilities Maintenance Deoartment - responsible for providing maintenance services at MTAfacilities and to detennine compliance with maintenance standards by approved vendors.

Plannln2: Deoartment --Rr-sponsible for determining the number'and location of commercialactivities pennitted at transit stations. Review, along with Facilities Engineering, thearchitectural compatibility of any proposed vending/concession facilities. Also responsible fordeveloping the Small Business Participation Program.

Procurement Deoartmentresponsible for issuing Requests for Proposals when required to.;identify and select vendors and concessions that will bepennitted to occupy space in MT Afacilities.

:~RiskMana2ement Deoartment responsible for deteintining insurance requirements to be-:provide by individuals or business entities occup~gMTA Property.

:~ReaIEstate Deoartment - administers this policy and is responsible for developing,.. implementing issuing and monitoring pennits, lease agreements or management agreeihents with~ndividuals;business entities.and'vendors occupying space inMTA facilities. The 'Real Estate- Department is also the central--contact for all requests under this policy and the liaison for

coordinating with appropriateMT A departments.

Security Deoartment responsible for assuring the'iSafety and security of patrons, employees and:the public occupying MTAiacilities.

3.0 DEFINITIONS (All definitions are limited to the purpose of this policy)

Advertisine: - a printed or electronic media display for the purpose of conveying a message.

Automatic TeUerMachine - electronic banking equipment that permits patrons' access toroutine banking functions.

Small Business - a business with less than five employees, inclusive of the owner. The businessis usually a sole proprietor with a nominal investment in the equipment necessary to operate thebusiness.

Commercial Activitv - any enterprise or venture by groups or individual for the purpose ofpromoting or selling products or services to transit patrons or the public.

5Use ofMTA Property for Commercial Activities

Emolovee - any part-time or full-time, temporary or permanent, exempt or non-exempt,represented or non-represented individual including interns who is compensated by the MT A forhis or her services by wages, salary or other compensation.

Joint Develonment Use or Joint Develonment - is defined as the close physical integration oftransit facilities with real estate development, and the disposition and/or development or MTA-owned or controlled real property interests at or near mass transit facilities that have significantdevelopment potential.MT A Pronertv - refers to operating bus and rail transit facilities.

Newso8oen - any publication, intended for general circulation, published regularly or at shortintervals, and containing information and editorials on current events and news of generalinterest.

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ef eftiee seekef.

Public Service - the objects and enterprises that specifically serve the needs of the generalpublic or are conducive to the comfort and convenience of the entire community.

Space Available - when sufficient square footage is available so that the activity will notadversely affect the safety or security afforded the general public nor will the activity interfere inthe nonna! operation of the public transportation system.

4.0 REFERENCES

California Penal Code Section 602.7

Use of MT A Property for Special Events Policy

5.0 PROCEDURE HISTORY

04/18/02 New Policy

Use of MT A Property for Conunercial Activities