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Battle over Bazaar del Mundo not over yet

The battle over who will control the property that is now known as Bazaar del Mundo in Old Town continues with the filing of a lawsuit in Superior Court in earlier this month.

Currently, Diane Powers, president of Bazaar del Mundo, is waiting to hear whether or not a judge is willing to hear the case. If a judge refuses to hear the case, Delaware North, Inc. which won the right to take over the Bazaar del Mundo lease last year, could begin moving into spaces - possibly as early as October -- that have been controlled by Powers for a generation.

Powers, who transformed 16 specialty shops and four restaurants into one of the city's most visited tourist attractions, has invested more than 32 years into an area that currently employs about 550 people.

Powers notes that these shops and restaurants, by hundreds of dollars per square foot, far outperform neighboring businesses in the area. The restaurants, according to Bazaar del Mundo representatives, have regularly generated an average of more than $900 per square foot, "a figure that far exceeds the regional average of $500 per square foot, and puts Bazaar del Mundo's restaurant operations in the top five nationally for gross sales."

In what could be a last-ditch effort to save her $27 million annual revenue franchise, Powers filed her lawsuit -- her second court action -- against both the Delaware North Cos., which won the lease, and the California Department of Parks & Recreation (Department of Parks & Recreation), the entity that awarded the new lease to Delaware North Inc. After losing the first round, Powers then appealed her case to Administrative Law Judge Karl S. Engeman, who, finding nothing amiss, referred the case back to the California Department of Parks & Recreation. Parks & Recreation then reaffirmed its decision to award the lease to Delaware North.

Powers said that Bazaar del Mundo has paid more than $1 million in rent per year for the past 10 years, and also paid $1.9 million to the state in both 2002 and 2003, and expects to pay more than $2 million in rents this year.

Delaware North has offered to pay rent of 8.5 percent of sales under $18 million, and 9 percent of sales above that figure. Bazaar del Mundo offered a flat 7.3 percent in sales.

The two sides of the situation see their offers differently.

"Delaware North offered a minimum of $2 million (in rent). We're at that now," said Bazaar del Mundo spokeswoman Laura Walcher.

"Our proposal represents about $5 million in additional rent over a 10-year period, said Bruce Fears, president of Delaware North's parks division. Delaware North also said it would spend about $13.5 million in new improvements. Powers pledged improvements as well but, she said, hers were not as costly because she wouldn't make fundamental changes.

Fears, whose New York firm holds the concession rights for everything from the Sequoia and Yosemite national parks, to the Kennedy Space Center, said his firm won because it was the best plans overall. "We won by over 30 points," Fears said. "We were graded on the interpretation, the financials ... they (the Department of Parks & Recreation) analyzed everything."

Powers' recent lawsuit alleges that the Department of Parks & Recreation's methodology in evaluating the proposals was "arbitrary and capricious," and that Delaware North failed to adequately respond to the request for proposal.

Other claims involve the Department of Parks & Recreation's alleged failure to specifically analyze Delaware North's proposed operational costs for advertising, security and maintenance -- the costs for which Bazaar del Mundo annually undertakes, and which benefit the Department of Parks & Recreation and the Old Town community.

"Were these costs factored in, the Bazaar's proposal would show to be more than $11 million better than that of Delaware North," according to Bazaar del Mundo representatives.

Fears countered that those expenses were already factored in.

One thing that is not disputed is Powers and Delaware North have two very different visions for the future of this area.

Fears' plans include doing away with Lino's Italian restaurant in order to expand the Casa de Pico restaurant. Above the Casa de Bandini restaurant, where offices now exist, the Cosmopolitan Hotel would be resurrected as a nine-room bed and breakfast inn. The El Nopal restaurant would be renamed the Jolly Boy Restaurant and Saloon, and will include one or more pool tables and a seafood menu, with a Mexican menu served outside on the patio. La Panaderia bakery will be expanded to include a small grocery store as well.

As for the shops, Fears said he would like to see more artisans. This could include painters, pottery makers and rug crochet experts who all demonstrate their crafts. The shops would also display distinctive wares. Fear said titles in what is now the Libros bookstore will focus on the period from the 1820s to the 1870s. Powers, has received thousands of letters since news of her losing the lease was announced last year. "The overall attitude of the general public is they are appalled," Powers said.

Powers' proposed improvements to the site include removing a fountain and an arbor at the state's request. Water would then flow from a large hoya (pot) into a well and the mature trees on the property would be retained. She also plans to redo the fixtures in each of the stores.

While she fights, Powers has been making preparations to move the bazaar to an undisclosed location if she loses. Ideally, she would like to have two bazaars - with the second one possibly part of the old police station or perhaps in the East Village, not far from the ballpark. Meanwhile, if she is unsuccessful in finding a judge to hear her case, she may be out of time.

As for Delaware North, Fears says they are is in for the long haul, both for the legal process, and as a lessee in Old Town.

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