Fairgrounds and KAABOO settle concessionaire dispute

KAABOO and the Del Mar Fairgrounds have come to tacit albeit tenuous terms in their fiery dispute over the music festival’s concessionaire contract—an agreement that was nearly derailed by the back-channel machinations of a KAABOO lobbyist in Sacramento, according to 22nd District Agricultural Association (DAA) board members. The DAA is the the state agency that runs the fairgrounds.

The now-sprawling dispute stems from KAABOO’s dissatisfaction with how Premier Food Services—which has supplied the fairgrounds with bartenders, waiters and hospitality workers for more than 30 years—handled concessions over the festival’s first two years. KAABOO last year gave Premier a buy-out and brought in Spectrum Staffing Services, which counts several music festivals and top-tier events among its clientele.

Impressed by Spectrum’s performance, KAABOO has since December been pressing the DAA to ratify Spectrum’s contract for the 2018 and 2019 festivals. But Premier employees have pushed back, refuting KAABOO’s depiction that concessions ran smoothly under Spectrum’s command.

Tensions grew even more fraught after KAABOO failed to win the talent-booking contract for the fairgrounds’ Surfside Race Place, which is set to begin a $20 million transformation in a matter of weeks thanks to a loan from iBank. The DAA awarded the talent-booking contract to Belly Up in December. KAABOO disputed the legality of the bidding process, which led the DAA to scrap the contract and book Surfside’s performers through DAA staff.

Meanwhile, the impasse over KAABOO concessions came to full froth at the DAA’s February meeting, with several board members saying they had lost faith with KAABOO and one going so far as to argue that the DAA had cause to terminate the festival altogether.

In the wake of that meeting, representatives from KAABOO and Premier set themselves to working out a compromise in which Premier handles the festival’s catering contract—talks that culminated last month when two DAA board members met with KAABOO leadership and believed to have buried the hatchet.

However, DAA board members said that the next day, word quickly spread from Sacramento to Del Mar that a KAABOO lobbyist was disparaging the DAA to iBank’s board of directors as well as Sen. Toni Atkins and Rep. Todd Gloria.

The firestorm sent DAA board member Russ Penniman scrambling up to Sacramento to assuage the iBank board. Penniman and the DAA’s financial officer have spent most of the ensuing weeks “trying to undo the damage that was done up there,” he said.

In response, Bryan Gordon, KAABOO’s founder and CEO, came to Del Mar to apologize to DAA board members in person and sent iBank a letter clarifying that KAABOO had no intention of torpedoing the Surfside loan. DAA board president Steve Shewmaker said Gordon was adamant that the lobbyist had not been told to interfere with the loan.

“She went rogue and she went off and did things she wasn’t asked to go do,” Shewmaker said Gordon told him.

Despite the dust-up, the DAA board on March 13 approved a Memorandum of Understanding in which Premier will handle the festival’s catering contract for KAABOO staff and festival workers this year. The contract is the festival’s largest catering component, with more than 14,000 meals served over 19 days, and employing 43 kitchen staff and 624 front-of-house staff for more than 2,500 hours and $55,000 in wages.

If all goes well, KAABOO and Premier will discuss expanding their relationship for 2019.

“We are extremely pleased with the results,” said Nathan Prenger, KAABOO’s senior vice president of operations.

KAABOO had “strongly” preferred to go even further: to use Premiere as this year’s caterer, create a revenue-sharing agreement and ratify Spectrum’s contract for 2018 as well as 2019. But the DAA, wary of KAABOO’s intentions, approved only a one-year Spectrum contract.

Still smarting from what she described as KAABOO representatives having “falsified facts to government officials,” DAA Director Lisa Barkett pointed out that the agreement is merely a piece of paper.

“I’m going to take a very critical look at next year,” she said. “… This went so wrong, and I really caution KAABOO to work closely with Premier, work closely with their employees. This is an MOU; it really means nothing, it’s not enforceable. We all know that. It’s not a binding contract. We’re going to be looking at what you do from now on.”