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Quarterly State Committee of Vendors Meeting

Embassy Suites International Drive, Orlando - May 18-19, 2012

The meeting was called to order by Tom Spiliotis at 9:02 am on Friday, May 18, 2012.
John Klindtworth called the roll. The following persons were present:

Tom Spiliotis, Chairman; John Klindtworth, Vice Chairman

District Representatives:

District 1-Marcus Armstrong; District 2-Kurt Ponchak; District 3 -Don Tuell; District 4-Bill Perret; District 5-Dennis Horn; District 6-Bob Murray, Alternate ; District 7-Charles Hackney; District 8-Catherine Gyorke Alger; District 9-Joel Rose; District 10-Jesus Villeda

Bureau of Business Enterprise Staff:

William Bill Findley, Bureau Chief; Maureen Fink, Operations Manager; Alan Risk, Compliance Officer; Janet Chernoff, Administrative Services Consultant; Don Meloy, Marketing-Site Development Manager; John Ahler, Region 1 Consultant; Bernie Kaiserian, Region 2 Consultant; Gregory Coon, Region 3 Consultant; Stephen Holland, Region 4 Consultant; James Carper, Region 5 Consultant; Chadwick Duncan, Region 6 Consultant

Other Attendees:

Licensed Vendors:

David Kaplan, Tom Saunders, Shirley Smart, Troy Arthur, Mitzi Tyler

Rehabilitation Center for the Blind and Visually Impaired:

Steven Moss, Instructor

Trainees:

Jonathan Caudill, Phillip Hubbard, Tom Loveday, Woody Matthews, Diane Rowe, Raye McCoy, Louis Ritter, Brian Britt (in OJT)

Guests:

Dolores Lambert, Barbara Perret

Janet Chernoff read a summary of the minutes of the March Committee meeting. Kurt Ponchak moved to accept the minutes, seconded by Joel Rose. Passed without objection.

The first order of business is to replace the District 6 representative. Randall Crosby has resigned and is moving to Colorado. He will be replaced by the alternate, Bob Murray. The district will hold an election for a new alternate. Bob Murray will also serve on the budget committee. Janet Chernoff read Randall Crosbys letter of farewell.

The committee was introduced to the new consultant James Carper. James will be covering the northern half of Region 5. Chadwick Duncan will be responsible for the southern half. Chadwicks region will now be Region 6.

BBE updates - Bill Findley

Eglin AFB - Things seem to be running smoothly and complexities of the four contracts are being unraveled. Payments are being made to Blackstone.

US Customs and Border Patrol - After months of calls, letters and emails we were finally contacted by the county attorney who agreed that we had the right to be in this facility. The contract was signed by the Commissioner of Education today, Friday, May 18. We will be starting with 22 machines and are told that may double. This will be handled by Lilian Pemberton on a Type II until we obtain accurate numbers to determine if it should be one or two facilities.

TSA Orlando - We have received the permit and it will go out on a Type II next week. The chosen vendor will start in mid-June. There are only 7 machines but it will be a busy facility. Greg Coon has been working on this location since last summer. His contact, Ernest Chavez, is the GSA property manager for Florida and will be a good contact in our pursuit of additional locations.

VA facilities - Don Meloy and Bill Findley have been working on opportunities with the VA. We have been pursuing the VA complex in Orlando because it is under construction. Our attorney wrote a letter and they agreed that we have to right to go into this facility. We hope that this will lead to a presence in other VA facilities. In the past the VA has believed that their regulations have superseded the Randolph-Sheppard Act. Chadwick shared that a veterans group had moved machines into Jim Perrys location without informing us. They can only do this if there is no one else who can provide service. They removed their machines.

Tom Spiliotis indicated that we need to be looking at food court concepts as customers are moving away from the cafeteria model. Customers will pay more for a cup of coffee if it is a name brand.

Kennedy Space Center - Bill Findley, Greg Coon

Discussions on the BBE presence at KSC have been ongoing on since last year. Currently there are four snack bars and two vending routes. The contract with Lackman, who runs the cafeteria, ends on September 30 and they have elected not to renew. KSC did a draft RFP and we have been monitoring it to determine our involvement. NASA Exchange had indicated that they wanted the current BBE facilities to stay, but later sent an email that indicated that they were recommending that some of the snack bars be converted to vending. The BBE wants to maintain a presence in KSC and are working with American Food and Vending to accomplish this goal. KSC has three opportunities - the cafeteria, a branded franchise, and the food court. The cafeteria has a collective bargaining agreement which lasts a year after the current company leaves. AFV will not take on a facility with a collective bargaining agreement in place. There is a bid in place for the branded franchise. BBE put a statement of abilities and capabilities together for the food court. There are two options: one that would include the branded products Uno pizza, Starbucks coffee, and Nathans hot dogs; the other option would include four AFV branded restaurants. The initial plan is to have two operators overseeing two operations each. We had approached Chick-Fil-A but they felt that they did not have enough time to adequately determine if a blind vendor could maintain their standards. They suggested that we may wish to have trainees do work experience in a local operation in Daytona Beach and we hope to pursue a relationship with Chick-Fil-A in the future. The BBE hopes to keep our four snack bars and the vending routes in addition to adding the food court. DOE has given the green light and the statement of abilities and capabilities will be finalized and submitted this Monday, May 21.

Brian McKenney took over Facility 150, a snack bar at KSC on Monday, May 14. The head of safety and sanitation of NASA stopped by at lunch and then had his entire staff of four inspecting the facility. A staff member apologized to Brian. Currently there is an investigation under way concerning the handling of this inspection.

Our ultimate goal is to keep the same number of vendors in KSC as we have now. Mitzi Tyler and Jose Formoso have the two vending routes on a Type II. Bob Murray informed us that they will not be taking the fence at his facility down. NASA said it is a security issue and tourists visiting the area on tour buses will be carefully monitored.

Budget-Kurt Ponchak

Kurt Ponchak emailed the budget committee report to all the committee members. Kurt reported that bonding vendors to reduce our exposure to loss was not a feasible solution.

Suggestions from the budget subcommittee:

Create a risk assessment tool for each contract which would advise consultants which facilities may require more attention.

Working Capital - Kurt recommended a working capital formula that is consistent but acknowledges that every location is different. We need to be cautious about requiring repayment of working capital, as it could cause cash flow problems for the Division. Tom expressed concern about repayment of the working capital if a vendor should pass away. Consultants should be aware of what is happening at their facilities and keep an eye out for red flags. Kurt recommended creating a small group made up of committee members and agency personnel that would determine working capital needs and associated risks.

Budget - the budget subcommittee recommended that a budget be created for each region. The recommended allocation is as follows: Cafeteria $10,000; snack bar $9,000; non highway vending $6,000, and highway vending $4,000. The bureau will provide a report of reimbursements by manager to the committee members. Kurt Ponchak moved that the committee accept the budget subcommittee report, Dennis Horn seconded. Passed without objection.

Set Aside Funds -The committee agreed that the agency can use up to $300,000 from the set aside funds for site development at KSC contingent on an agreement being made with them. Motion by Kurt Ponchak, seconded by Joel Rose. Passed without objection.

BBE training at the Daytona Beach Rehab Center - Steven Moss

Steve Moss advised the committee that the 6th edition of the Servsafe manual will be in use as of July 1. He will update the training guide. There are no major changes in the new addition. The May 29th class will consist of Mary Ann Alexander, Cortney Bellande, Will Grignon, and Emmett Magee. Louis Ritter is also attending classes to retake the vending and recordkeeping modules.

The trainees introduced themselves and gave a little background information. Three trainees Phillip Hubbard, Thomas Loveday, and Jonathan Caudill will be finishing class on May 25th and will start OJT.

Currently we have five trainees in OJT - Bill McDermott and Junior Vega in Tallahassee, Brian Britt in Tampa and Daniel Ochoa in Miami. They will all finish the first of June. Wanda Feldsteen just started OJT in Tampa and will finish in mid-July.

New Licensees - Alan Risk

BBE has licensed a total of thirteen new vendors over the past twelve months. Nine of these are now operating a facility, two are bidding on current opportunities and two are no longer in the program due to non-agency issues. Four additional vendors will be licensed in June.

Type II Awards - Maureen Fink

We have a total of 26 Type IIs at this time. This includes the three that were recently awarded at KSC and the two in Miami that were awarded after a vendor was removed.

Selection Cycle Results - Alan Risk

Ten facilities are posted for the May Selection Cycle, including four cafeterias, two rest areas, three non-highway vending facilities, and one snack bar. The prison vending in Milton, the vending route in Bradenton, and the snack bar in Miami are all being reposted from the January Selection Cycle.

Manual Update - Alan Risk

The new BBE manual, which was approved by the committee in December 2011 is now available in audio format on the BBE website and is also available on cassette tape. Anyone interested in obtaining a cassette tape should notify Alan. Updates not in the audio manuals are available on the BBE website.

Alan also proposed the following clause be added to Section 2, Application Process of the BBE manual; Applicants who have previously been licensed in the Business Enterprise Program whether in Florida or in another state, must have left that program in good standing with no outstanding debts. Kurt Ponchak questioned the validity of adding an application requirement that was not included in the Florida Administrative Code, 6A-18. A motion was made by Gyorke Alger and seconded by Joel Rose to adopt the statement as read pending approval by our legal department. The motion passed by 8 - 2 vote.

Grievance and Legal Actions - Alan Risk, Bill Findley

There were no new grievances filed since the last committee meeting. A chapter 120 hearing was held on May 3, 2012 and we are awaiting the courts decision. An arbitration hearing is scheduled for July 16, 2012 in Tallahassee.

Lonnie Wilcox was awarded $70,000 from the US Postal Service. The cafeteria in his facility had installed vending machines in direct competition with his vending.

Our legal department is working on getting back working capital from vendors that have left the program. Recently we received a check for $13,665.99 from Frank Obremski. Legal had sent a number of letters and finally we served him with a court order. It cost $350 to do the court order. The Bureau staff will check to see if he is still licensed.

Joel Rose is on the grievance subcommittee and has information on how to file a grievance in English, Spanish and in large print. He is available to advise any potential grievant.

Monitoring Update - Alan Risk

BBE has conducted an additional 22 monitoring reviews since the last committee meeting resulting in a total of 54 reviews since they began in June, 2011. Vendors are being encouraged to begin on-line reporting, take readings in their vending machines, and conduct periodic inventories. Vendors are also being made aware of the vending machines compliance rule and advised that supplier rebates are to be shown as a reduction of purchases on their monthly report.

Statewide Workshops - Alan Risk

It was stressed that many vendors are in jeopardy of losing their facilities if they do not comply with the requirement of earning three CEUs prior to the 2013 Biennial Seminar. The agency is planning to conduct regional workshops that will allow vendors to earn .5 CEU. Additional credit opportunities have been offered through Crane National and AMAF. It was pointed out that one vendor achieved the full amount of CEUs this week by completing a course offered by the Hadley School for the Blind. The agency will continue to make opportunities available and notify vendors of their status.

Inventory Requirements - Best Practice v. Contractual Requirement/ Working Capital- Bill Findley/Maureen Fink

Bill Findley reported that overall revenues are down about $111,000 for the period of Oct 1 - March 31 of 2011-2012 as compared to the same period in 2010-2011. This may be due in part to a loss in revenue at the Kennedy Space Center, increased cost of merchandise and inflation. Kurt Ponchak requested information on previous years. Generally revenues are better in the second half of the year. Five vendors are currently repaying outstanding working capital. Three of these vendors were in place prior to the current policy and two owe working capital from a Type II.

The consultants have been recommending a monthly inventory. Many vendors are using the cost of goods purchased in a month rather than the cost of goods sold and this can skew a monthly report. There was a discussion amongst the committee and bureau staff about the best way to make sure vendors are accurately reporting cost of goods on their monthly reports. Charles Hackney said that if a vendor is maintaining their inventory at a certain level then they should know the value of their stock. Tom Spiliotis said that if a vendor has the same beginning and ending inventory every month that an audit may be in order. The LOFA states that the vendor accepts full responsibility for the amount of working capital and agrees to maintain that level of working capital until he/she leaves that facility.

The question was asked how a consultant would know if a vendor was maintaining their working capital especially since part would be in cash. The committee determined that this is a work in progress and it may be a training issue. Recommendations include suggesting a periodic inventory and that consultant advise vendors how to properly fill out the monthly report. Consultants could train operators on how to do an inventory. An experienced vendor could assist the consultants with this training.

Meeting ended for the day at 4:35pm.

The meeting was called to order by Tom Spiliotis at 8:32am on Saturday, May 19th.

John Klindtworth called the roll.

Regional/District Updates

Region 6 - Chadwick Duncan

Current Facilities

Facility 294 has been converted from a snack bar to all vending.

Facility 294 & 227 - Willer Dieuveille was removed from his two facilities. Facility 294 has been taken over on a Type II by Shirley Taylor and Facility 227 was taken by Jesus Villeda on a Type II.

Facility 469- The remodel inside Don Gerschicks facility is finished and the lobby remodel has started.

Facility 359- Brickell Plaza will be converted to vending.

New Facilities

Chadwick is working with the Palm Beach County to add their parks and senior centers. We were recommended because of our presence in the Palm Beach County Courthouse. It is the county policy that if they use DBS vendors they do not have to go through the bid process.

The Commissioner of Education signed the contract for the Miami Airport Customs facility on Friday, May 18th. Lilian Pemberton has it on a Type II. We will start will 22 machines but that may double with the addition of another area. We will be monitoring it to see if it should be one or two facilities.

District 10 - Jesus Villeda

OJT trainee Daniel Ochoa is interested in applying for the Miami Snack Bar, Facility 455. Daniel will take the licensure exam the first of June.

Region 5 - James Carper

Current Facilities

352 - Rose Guillaume took over the end of March and the business is increasing.
Joel Rose and David Kaplans post offices are scheduled to be closed by the end of the year.
He is working with Don Meloy to add to routes.

District 9- Joel Rose

Joel confirmed that he expects the post offices to close eventually.

Region 4 - Stephen Holland

New and Current Locations

Florida Fish and Wildlife Conservation Commission - is up and running, previously there were equipment problems.

Immigration building in Tampa -we added 2 machines and we may be able to move into the lobby area. Currently it is being served by Richard Draper. Stephen needs to make sure that Richard understands that this location may have the potential to be a stand-alone facility.
Longboat Key Post Office - was investigated and determined not to be a viable location.
Plant City Post Office - added 3 machines and an ice cream machine.

Post offices - Tarpon Springs, Punta Gorda and Sarasota were added to the Manasota route. We will adjust this once we get an operator for the Bradenton route.

Steve is investigating opportunities in the immigration office in Ft Myers and Sarasota and at Southwest Water Management District in Tampa.

Collier County Courthouse, Naples - we increased our presence in this facility by adding two more machines.

District 7 - Charles Hackney

Tom Saunders updated the committee on the status of machines at his location. After the snack machine used up three coin mechs he finally replaced it and it is working fine. Jeff Shubert reconfigured a frozen machine that was missing ten motors. Location is not profitable but the customers are happy.

There was a discussion amongst the committee members on the pros and cons of different frozen and refrigerated machines.

Debbie Hietala is in competition with another BBE vendor who has a facility in a building that is connected to hers by a catwalk. The other vendor has lower prices on some products. Tom Spiliotis does not want to mandate pricing. The other facility is on the bid sheet and it was suggested that Debbie coordinate prices with the new vendor. A similar thing happened in the KSC. Pricing was mandated by NASA. Bob Murray felt that vending routes should be able to charge higher prices because they have higher costs.

Charles Hackneys facility was burglarized. Although the thief only got $87 the theft caused $600 in damage. Charles believes this has been happening regularly since March. The burglar used tools and it was not readily apparent that a theft had occurred. Security at the rest area has been reduced to the hours of 8pm - 6am and there is one guard for both rest areas. Charles Hackney will be using an internet protocol surveillance system to prevent future thefts.

District 8 - Gyorke Alger

All is quiet in her area. She makes sure that her district gets a copy of the committee meeting minutes.

Region 3 - Gregory Coon

Current Facilities

Facility 150- KSC Snack Bar was award to Brian McKenney on a Type II. He started on

Monday, May 14th.

Facility 499 - KSC Vending Route was awarded to Jose Formoso on a Type II.

Facility 497 - KSC Vending Route was awarded to Mitzi Tyler on a Type II.

Facility 431 - St Lucie County Rest Area - Genny Greene will be starting there shortly. She was awarded this facility in the last selection cycle.

Facility 378 - Orlando Cafeteria is being offered during this selection cycle. New licensee Gary Ernneus is interested along with trainee Bill McDermott. The cafeteria will need a hands on operator. It is located in Gregory Coons building so he will be available to help. The current operator Victor Rosario will also be a good resource for the new operator.

Facility 827 - Orlando vending route operated by Jose Formoso is doing well. The Lake Mary facility will be closing which will affect the route. Jose will need to find additional storage when it closes. Greg is working to identify other locations to add to the route to offset the closure.

New Facilities

Greg is working with Don Meloy to identify new facilities. He is looking at a number of postal locations. A local company is handling vending at the Ft. Pierce courthouse until it gets up and running. Currently no hearings have been held there. He is also looking at other locations near the courthouse to expand our presence in Orange County.

District 5 - Dennis Horn
Dennis will check on the facilities in Orange County to get information on past history and give it to Greg. In the past Orange County had a version of the Little Randolph-Sheppard but it was discontinued because there were not enough vendors. They might look at this again if they are assured that we have enough operators. Dennis will find out contact names and give them to Greg. Dennis thinks that we should look at county parks.

District 6 - Bob Murray

Bob is the alternate and will be replacing Randall Crosby. The district will need to hold an election for a new alternate.

Region 2 - Bernie Kaiserian

Current Facilities

Facility 423 - I-75 Hamilton County (Welcome Center) - Spencer Henderson is retiring. His facility has been listed on the business opportunities list for this selection cycle.

Facility 517 - I-95 St Johns - Daniel Angelicola is retiring and his facility is on the business opportunities list.

Facility 590 - Jacksonville Healthy Vending route operated by Bill Perret continues to grow.

Facility 33 - Duval County Courthouse - snack bar has moved to the new courthouse. The old location closed last Wednesday and the snack bar should reopen on May 29th.

New Locations

Jacksonville Electric Authority has issued an RFP so that outside companies can compete for their business. They have unrealistic expectations. We will submit a proposal that is competitive.

Vendor news

David Nelson has passed away.

AMAF event is available to vendors on May 23, 2012.

District 3 - Don Tuell

Don has nothing to add to Bernies report.

District 4 - Bill Perret

JSO has opted out of the healthy options on the healthy vending route. Bill has been looking at healthy products that are more appealing to the customers. He has been open to new products.

Region 1 - John Ahler

Facility 286 - We have gotten permits to add post offices to Ron Jones route. There is a snack and two drink machines in each location. There are 70 employees in each location.

Facility 470 - Kimberly Morris is working to build her facility. John is working with her on her vending machines.

Facility 545-Lacy Corker is doing well. Sales are increasing and he has good control of costs.

Facility 577 - Donna Galley is taking care of her facility and is being proactive. She likes the area.

Facility 580 - Andrew Lima had a break in. There was $1,100 worth of damage. A police report was sent to DOT.

Facility 587 - Blackwater River Correctional is on the business opportunities list.
New Facilities

We are still working on Saufley field. The vendor is willing to pay for utilities. We sent them a GSA permit and were informed that they did their own permits and there would be a cost of up to $2,000 to prepare one.

Richard Daley advised us of a new immigration facility that is being built on Commonwealth Blvd. in Tallahassee. It looks promising and we have expressed our interest.

We have given notice to Visinity that we intend to take four locations back. Quality Snacks, a subcontractor for Visinity, has refused our request. They are currently paying us a commission on these locations. Legal is preparing a letter.

Vendor news

Steve Docie will be getting a pacemaker next week.

District 1 - Janet Chernoff

Facility 273 & 320 Collins and Claude Pepper Buildings - Richard Stevens continues to run both locations. He currently has two trainees doing OJT with him. We will put the Claude Pepper building on the business opportunities list in September.

591- Douglas Building is on the business opportunities list.

441- Larsen Building- Martin Gadd is doing work experience for one of our trainees.

District 1 - Marcus Armstrong

He tries to call the vendors in his district but they are usually too busy to talk.

District 2 - Kurt Ponchak

Tallahassee route started in mid November 2011 with three machines and is now up to 31 machines in nine locations. Overall the customers have been happy with his service. He has found that population counts can be deceiving. This route has the potential to be a money maker.

Kurt has had a district meeting via conference call. He gets about 50% participation. Vendors in his area want to know when the Turlington building will be given over to a blind manager. The Turlington building can be lucrative but needs an extremely competent manager. BBE is still facing challenges in Tallahassee in over the counter locations.
There are concerns with Vistar. At the trade show last August vendors were told product would come from Orlando but it is coming from Atlanta. There was a suggestion that vendors meet with different purveyors and see what they can provide.
Round Table

Dennis Horn mentioned that the new ADA rule went in effect on March 15th. Dennis feels that we need to have a plan in place. He said that the Crane representative was unsure about the rule.

The meeting was adjourned by Tom Spiliotis at 10:35am.

Florida Bureau of Business Enterprise

Providing Tools and Support for Legally Blind Vendors in the Food Service Industry