Staff recommends that the City Council adopt a Resolution authorizing the City Manager to execute a First Amendment to the Adventure Park Operating Agreement dated March 12, 2019 and approving an Appropriation of $166,000 in General Funds for FY 2019/20.

Pursuant to the proposed First Amendment to the Adventure Park Operating Agreement, the City will make a financial contribution to the operation of Quarry Park Adventures in the amount of $166,000.  The City will make four equal installment payments to Adventure Operations in the amount of $31,500 in February, March, April and May.  In addition, the City will contribute an additional $40,000 to the City's Short Fall Account for the Park, increasing the City's total Short Fall Account contribution to $240,000.  The Adventure Park Operating Agreement requires Adventure Operations  to replenish the City's Short Fall Account when net revenue at the Park is achieved. 

Quarry Park Adventures (“Park”) was originally opened by former operator, Legacy Family Adventures (LFA), in September of 2018.   The City terminated its agreement with LFA in January 2020 and sought new solutions for the operation of the Park. On March 12, the City entered into an agreement with Adventure Operations, LLC (AO), to become the new operator of the Park.  AO is affiliated with Bonsai Design, LLC, which designed and built the Park.

AO re-opened the park to the public on April 12, 2019, just one month after entering into the operating agreement with the City.   Despite numerous challenges, most of which were inherited from the former operator, AO has successfully operated the Park for the past ten months.

Re-Opening Accomplishments and Challenges

In 2019, 36,622 visitors redeemed tickets for the Park elements. Approximately 20% of the tickets redeemed were presented by guests who purchased tickets from the prior operator and provided no revenue to AO. These customers were also generally frustrated with the inability to use their tickets during the park’s closure from January-March 2019. AO worked diligently to turn these guests into satisfied customers and online feedback paints a positive picture of the professionalism and customer service displayed by staff. From opening day in April to the end of 2019, average online satisfaction ratings rose from 4.2 stars in April, to 4.8 stars in August-December. AO also increased customer satisfaction by working with State regulators to lower the weight limit on several of the rides, allowing children (at or above 45 pounds) to enjoy more attractions.

AO has also faced customary operating challenges associated with the first year of operating a new business, such as (1) finding, hiring and training high level, age appropriate and reliable staff to fill seasonal positions; (2) determining the impact of weather on attendance trends; and (3) setting the most efficient staffing levels to accommodate walk-up and reservation-based customers.

From April through December of 2019, the Park operated at a financial loss of approximately $297,000. The loss can be attributed largely to problems inherited from the prior operator, and financial liabilities created by the former operator. To meet the demands of operations, AO has drawn upon the $200,000 Short Fall Account earlier than anticipated and has taken on personal debt to keep the Park operating. AO is in need of additional funding to keep the Park operational during the winter months and has requested City assistance with a portion of the current financial burden.

Staff believes AO has performed well in operating the Park over the past ten months and has demonstrated the ability to make it financially successful in the future. AO has and continues to develop a strong customer base that is highly satisfied with their experience at the Park. Furthermore, AO has proven itself to be a good partner with the City through regular communications, exemplary maintenance of the Park, and working collaboratively to solve operational problems, among other items.

Quarry Park Adventures is also an important economic driver within the Quarry District of downtown Rocklin and the City is committed to its success. With the enhanced use of Quarry Park Amphitheater through the City’s new amphitheater management agreement, and the pending Brentwood Developments project adjacent to the Adventure Park, the success of Quarry Park Adventures is expected to grow. The park will continue to not only provide residents and visitors with unique recreation, but also draw customers to the surrounding business community for many years to come.

Staff believes AO will be successful in all areas of operation in 2020, and recommends providing the requested assistance.