Sep 14, 2016 - Follow Up On Cancellation. Thank You For Your Support:
I want to personally thank everyone who has sent a personal email, note, or phone call regarding the LA Triathlon at Torrance Beach. The support has been extremely gratifying and questions specifically on the cancellation by the City of Torrance have been many and insightful. As the owner of Pacific Sports it is important that I respond to those athletes, volunteers, spectators, sponsors and residents of Torrance (and neighboring cities) on more of the background and details that were not communicated in our letter from September 8, 2016 and posted to our website. In brief, I have included more of the specifics as noted below:
1. In a written email on August 31, 2016, the city of Torrance admitted the following, “The City of Torrance just completed an Audit of last year’s 2015 Triathlon and discovered you have a credit of $7024.12”. In a subsequent communication on September 7th, our legal counsel received a broad summary details after the City canceled the event.
The city of Torrance, in the same August 31st letter, stated they would send us a check for their admitted mistake. We requested that check immediately and specific details on the overcharge but as of September 14th, have received neither. The city of Torrance potentially sacrificed safety to the participants, residents, and our staff because of services we believed were in place that, in fact, were not for both 2015 and 2014. These include police, fire, emergency services, and ambulances that were admitted by Torrance to not be in place that we paid for, to the City of Torrance, in advance of the 2014 event.
2. Torrance has not audited the 2014 event, although they have been asked multiple times to do so. We believe the amount of overcharge in 2014 will be substantial based on our calculations and deployment records we have reviewed and audited internally, now 2 years following the event.
3. After the 2015 LA Triathlon, the city of Torrance publicly distributed (without our knowledge or any notification to Pacific Sports) a Request for Proposal ("RFP") to "Provide Professional Triathlon Production for the City of Torrance", stating:
“For the past two (2) years on a Sunday in the month of September the City of Torrance has successfully provided a Triathlon to the community. The event has been produced by a Professional Triathlon Company in collaboration with the City of Torrance and the County of Los Angeles Beaches and Harbors.”
We found out about the RFP from our colleagues in the industry who had received the RFP and called to inform us of its circulation.
4. In response to the RFP, our Pacific Sports legal counsel notified Torrance on February 8, 2016 of the illegality of its attempt to take an asset it did not own, stating in a letter to Community Services Director John Jones:
"Pacific Sports ... created and owns the asset “LA Triathlon at Torrance Beach,” including the logo, website and domain, entrant database, registration engine, permits, sponsorships, and ... the copyrighted competition courses included in the RFP .... Torrance is apparently attempting to commandeer this ... valuable asset. Pacific Sports has made a substantial investment of time and money in the event .... In early November, 2015, the event dates for 2016 were finalized and published (by Pacific Sports). The September 11, 2016, event date was communicated nationally to the public. Pacific Sports finalized additional strategic partners and sponsorships and sold participant entries committed to the LA Triathlon for 2016 ... sanctioned by USA Triathlon.”
In response to the letter, the City of Torrance abandoned its attempt to take over the event and Pacific Sports continued to move forward with the production and management of the 2016 event albeit significantly behind schedule due to the action by the City of Torrance. The Mayor personally told us to move forward with the triathlon and vowed his support.
5. We have, on multiple occasions, requested a copy of the agreement made by city staff with the City of Palos Verdes. In the 2014 City Council motion approved and signed by the City Manager and approved by the City Council and Mayor, there is no mention of Palos Verdes, nor frankly should there have been.
6. We informed the City of Torrance in February 2016 that we would not be paying Palos Verdes. We were told repeatedly this was our right and “our call” and no objections were at any time voiced by city staff or the police department. There was no mention made of a deal in place with Palos Verdes by the city or its staff. In offline conversations the police department and staff consistently said they did not agree the Palos Verdes position and we were told by city council members not to pay any fee to Palos Verdes. We considered it a closed matter and only on August 31st was the demand forced upon us at an ever-increased rate of $7200. We refused for several reasons, each of which were communicated, in writing, to the city attorney of Torrance.
The LA Triathlon at Torrance Beach has no footprint in nor any connection or relationship of any kind to Palos Verdes. Pacific Sports does not, nor have reason to have, a permit to conduct any part of the event in Palos Verdes. Pacific Sports does not have insurance coverage in an area outside of the city of Torrance. The unjustifiable and ever escalating fee of $7200 could establish a precedent for similar unjustifiable demands from other cities bordering any city where we have events. We are unaware of any event in triathlon, cycling, or running where an event producer in the United States has been required to pay such a fee. (Note: Redondo Beach made it very clear it required no such fee and never requested one).
7. County of Los Angeles. They County owes us $1331 from 2015 (that has not been paid) for overcharging on lifeguards for the LA Triathlon. We have also requested a refund for our already paid fees paid for the 2016 event. We were told it would take “4 to 6 weeks to process”. Following the 2015 LA Triathlon, we were one of 5 audited events out of over 600 permits granted each year on gross receipts charges from the County of Los Angeles. The County claimed it was “random” and asked to audit our events for a period of 5 years dating back to 2011. After months of discovery on the part of the county, we were informed they would “accept (our) reporting on gross receipts” and move forward with future events with Pacific Sports.
We offered, on September 8, 2016, the City of Torrance a fee of $5,000 in good faith, that we would pay in advance of the event for police and city services, despite Torrance having not repaid the 2015 overcharge it had admitted and failing to provide the requested audit of 2014 city charges where we have strong evidence of being overcharged. Torrance admitted failure in honoring its commitments on the 2015 event and refused to execute a permit for the 2016 event designed to clearly establish and document its obligations and those of Pacific Sports in a singular document.
The City of Torrance unilaterally canceled the 2016 LA Triathlon at Torrance Beach scheduled for September 16, 2016, causing significant financial losses to our firm and our reputation. It damages the participants, spectators, sponsors, and its own residents as clearly evidenced by the overwhelmingly positive communications we have received since the cancelation.
I want to give a personal thanks for all of your letters and emails and because of them, we felt it important and necessary to give you a more complete picture.
I look forward to seeing you in Long Beach, Newport Beach, or Dallas for our upcoming triathlons.
Sep 8, 2016 - To all participants of the LA Triathlon at Torrance Beach:
Yesterday, the city of Torrance canceled the 2016 LA Triathlon at Torrance Beach. With much regret, we are forced to announce this cancellation to our participants and sponsors only 4 days prior to race day. We understand that the cancellation will come with great disappointment to those of you who have worked hard and prepared for months toward this year’s triathlon. We are disappointed by the unexpected and unprecedented circumstances and demands that have unfolded to cause this cancellation.
We have listed the key points that led to the city’s cancellation of our event in an effort to offer some immediate transparency to all participants:
- On August 31st, the City of Torrance sent to Pacific Sports an email demanding advanced payment, in full, to the city, prior to the event, for city services. There was no detail of the charges, simply amounts in total and the requirement to bring two cashier’s checks by 5pm. This is not standard practice in other municipalities and certainly not in those where all previous invoices had been paid in a timely fashion.
- In the same email on August 31st, we were informed that a significant separate payment was also required to be paid to the neighboring City of Palos Verdes, a city in which we have no footprint, no permit, no participants enter their city as part of our course, no liability coverage, and no relationship of any kind. This demand is unprecedented in our 36 year history as an event production company, and to our knowledge unprecedented in the event industry in the United States. This payment is demanded by Torrance (to be paid to Palos Verdes) although we have never been made aware of the apparent business relationship (although it has been requested) between Torrance (where we do have permits) and the city of Palos Verdes.
- Also in this email, it was finally revealed by the City of Torrance, after an audit requested by Pacific Sports, the city had significantly overbilled us by an amount in excess of 30% to the total in 2015 for city services. We have strong evidence that the 2014 invoice may have been overbilled as well. Importantly, we have no reliability that the advance payment demanded for 2016 (without detail of its calculation) is backed up by verifiable charges which will only be available after the event has occurred.
- Since August 31st, we have worked tirelessly with all levels of the city government including the city council and Mayor’s office in an attempt to bring resolution. We offered a structured and fair written compromise on these issues in attempt to insure the event went on as planned on September 11th. Ultimately, the city offered no compromise or proposed solution and informed us they had unilaterally canceled the event.
We are upset and deeply disappointed by the cancellation, but the requirements were unreasonable and excessive. Accepting the terms would have compromised the entire event and were untenable for us to continue at the current site for the LA Triathlon.
We are now moving positively forward to our 15th Annual Long Beach Triathlon on September 18th and the 38th Newport Beach Triathlon on October 2nd. We want you to join us. We realize this is not the perfect solution for a cancelled event in Torrance, but these are races we are very proud of and we hope you will be able to race in one of them if you happen to not be already registered.
Our partners at Active Network have made it possible to transfer your entry from the LA Triathlon to either the Long Beach Triathlon (September 18th), Newport Beach Triathlon (October 2nd), or our U.S. Open Triathlon in Dallas (October 16th) or alternatively any event on our calendar for 2017.
The procedure is simple and straightforward. Simply go to your Active registration and select “Transfer to Another Event” and pick your selected event. Or, if it is easier for you, email us your full name and the event you would like to transfer to at email@example.com and we will make the change for you.
If transferring to another event will not work for you, please let us know by sending an email to firstname.lastname@example.org and we can process a refund through Active.
We want to thank our very loyal sponsors, Triathlon LAB, ROKA, Clif Bar, Arrowhead, Herbalife, Erdinger, Active Network, MarkAllenCoaching, Tri-FAQ, South Bay Triathletes and all of our crew and volunteers who were ready to produce the event this weekend.
I personally apologize for the inconvenience this cancellation causes to both you and your families. If you would like to reach me directly, please email me at email@example.com.
President, Pacific Sports LLC