TO:
Honorable Mayor and Members of the City Council
THROUGH:
Talyn Mirzakhanian, City Manager
FROM:
Mark Leyman, Parks and Recreation Director
Melissa McCollum, Senior Recreation Manager
Jesus Sandoval, Senior Recreation Supervisor
Libby Bretthauer, Finance Director
Gilbert Gamboa, Acting City Engineer
Masa Alkire, Community Development Director
Adam Finestone, Planning Manager
Patricia Matson, Senior Management Analyst
SUBJECT:Title
Consideration of Additional Findings Resulting from Further Exploration of the Existing Memorandum of Understanding with The Bay Club Company to Construct and Operate an Aquatic Facility (No Budget Impact) (City Manager Mirzakhanian).
(Estimated Time: 1 Hr.)
DISCUSS AND PROVIDE DIRECTION
Body
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RECOMMENDATION:
Staff recommends that the City Council receive and discuss the additional findings and provide direction on whether the City should continue pursuing the potential construction and operation of an aquatic facility by The Bay Club Company (Bay Club) on City-owned property currently leased to Bay Club.
FISCAL IMPLICATIONS:
Fiscal impacts are currently limited to staff time dedicated to evaluating the proposed project. Dependent upon City Council direction, any future fiscal impacts or required appropriations would be identified and brought to City Council for consideration, if the project moves forward.
BACKGROUND:
On August 20, 2024, the City Council approved an MOU with the Bay Club expressing an intent to construct and operate an aquatic facility and related project in cooperation with the City of Manhattan Beach on City-owned property currently leased to Bay Club.
On September 2, 2025, City Council received an initial update and potential next steps in regard to the abovementioned MOU (Web-link to report provided as an attachment). City Council provided direction to staff to continue to work with Bay Club to address programming and pool depth concerns as well as potential options to subsidize proposed user rates before determining whether to continue to pursue the proposed project.
DISCUSSION:
Staff met with Bay Club to solidify the requested information and sought out additional details to questions that arose during City Council’s prior discussion. Below are the findings:
Operations and Programming
As provided in the previous staff report and reconfirmed by Bay Club, if the project moves forward, Bay Club would have control over revenue streams, operating costs, and scheduling. While they can work with the City in developing the program experience, all programming and services would be provided directly by Bay Club staff and not City staff. Bay Club, as the owner and operator, would ultimately have control over the program schedule and would operate the facility with programming similar to their other aquatics facilities.
Bay Club has confirmed that they would provide adequately trained staff at the facility to fulfill their programming needs. City employees would not staff the facility unless they independently sought employment with Bay Club.
Community Usage
Competitions
Bay Club confirmed that while the proposed facility could accommodate swim team training, it would not be available for water polo competitions or swim meets, primarily due to known parking constraints and noise impacts they would have on the surrounding area.
Begg Pool Usage
During the previous City Council discussion, staff was asked to provide data on resident participation at Begg Pool.
• Resident registration ranges anywhere from 52%-100% depending on the class, with an average of 75% throughout all classes.
• Separate from the class data, on average, approximately 59% of lap and recreational swim participants are also residents.
Usage of Bay Club Properties by Manhattan Beach Residents
Bay Club has confirmed that across their beach city clubs (Manhattan Beach, El Segundo, and Redondo Beach), they have roughly 11,000 members that are
Manhattan Beach residents.
During the previous City Council discussion, Bay Club estimated that more than 60% of the members that utilize their El Segundo facility and 85% of the members that utilize Manhattan Country Club are Manhattan Beach residents.
It is worth noting that Bay Club is currently pursuing a separate project at Manhattan Country Club to add an additional pool. If that project moves forward, Bay Club provided that it would give their members more than enough water to meet the demand that they have at the Country Club.
Pool Depth and Length
Bay Club previously presented two conceptual designs to the City. One featuring two pools and another with a single pool. The following has been confirmed by Bay Club:
Bay Club’s preferred concept includes two pools. While having two pools would allow for more programming overall, the inclusion of a smaller shallower pool would allow for a significant amount of programming for seniors and children. However, if the project moved forward and ultimately only one pool would fit in the proposed area, Bay Club would utilize the provided length and maximum depth of the large pool mentioned below.
Small Pool
The length of the small pool would be approximately 20 yards; however, Bay Club would adjust the pool size accordingly for optimal utilization of the space. The small pool would have a depth of 2.5 - 3.5 feet with a gradual slope.
Large Pool
The large pool would be 25 yards with a depth of 4.5-6 feet and a gradual slope. While Bay Club is flexible with the starting shallow depth, they would not go deeper than six feet as programming and usage would become limited if the depth is increased. Most, if not all of their programming, (ex. senior programming, beginner swim lessons, and water aerobics) requires a user to touch the bottom of the pool. In regard to the length of the pool, they do not recommend making the pool any longer than 25 yards, as the proposed length meets high school requirements. Additionally, there is not enough space to accommodate an Olympic-sized pool (approx. 54 yards) at the proposed site.
City Council previously discussed a desire for a deeper pool to include water polo programming. High school competitive water polo requires a pool depth greater than six feet, but Bay Club does not intend to host competitions in the new facility, as mentioned above. A depth of six feet is sufficient for water polo training.
Lanes
Subject to Bay Club’s daily programming, the large pool would have a minimum of six lanes, and the small pool would have a minimum of three.
Begg Pool Dimensions
For reference, Begg Pool is 25 yards long, six lanes wide, and approximately four feet deep.
Resident Access and Fees
Priority Access for Manhattan Beach Residents
Bay Club previously ensured that Manhattan Beach residents would have priority access to the proposed facility before their Bay Club members for daily use and aquatics programs. Currently, Manhattan Beach residents receive two weeks of priority lead time for class registration and three days priority for lap swim and recreational swim at Begg Pool. Bay Club has confirmed that while they do not reserve lanes, they would match the City’s lead times for their facility for their for-fee programs and the programs included in the daily fee.
Since the September 2, 2025, meeting Bay Club has provided that non-residents would have access to the facility as well but would be subject to higher rates. Manhattan Beach residents would have priority access, followed by Bay Club members, and then non-residents.
Daily Use
Bay Club has confirmed that Manhattan Beach residents could either pay a daily use fee (which acts as a guest fee for the day), or they could choose to purchase a Bay Club membership to gain access to the facility. Payment of the daily fee allows the resident:
• Access to select complimentary Bay Club programs for the entire day, subject to availability. These programs include: masters swim, water aerobics, lap swimming, recreational swim, and family swim.
• Access to the El Segundo or Redondo Beach Bay Club facilities only after utilizing the proposed facility that same day. The user would have access to that location’s complimentary programs or services for the day, subject to their availability.
The resident daily fee would be set at $15.00. However, Bay Club has provided that they would offer a reduced daily fee of $10.00 to seniors (70 years of age and over) and youth (12 years of age and under) with the same complimentary benefits as the $15.00 fee. These fees would be memorialized in a future lease.
Bay Club has confirmed that they would not accommodate an hourly rate.
Spectators
Bay Club has provided that they would not charge a daily fee to caregivers that are supervising an individual participating in their programming (ex. a parent monitoring their child during recreational swim). The caregiver would need to pay the daily fee if they chose to take part in the programming. As the owner and operator of the facility, Bay Club would be responsible for enforcing this practice.
For-Fee Programs
Outside of the programs included in the daily fee, Bay Club would have a variety of for-fee programs as well. Bay Club has estimated that pricing for programs centered around team instruction (ex. swim team) would be less than $20.00 per class, while programs with private or specialized instruction (ex. 1:1 lessons, swim school, junior guards) would be $40.00 and up per class. Bay Club has provided pricing for the Manhattan Country Club and the El Segundo location as a sample (Attachment). The attachment also includes pricing for Begg Pool programs for reference.
Fee Increases
Bay Club has indicated that they typically do not raise fees annually. Fee increases would be included as part of future lease discussions.
Begg Pool Fees
City Council inquired about the last time City fees were assessed for the class offerings, recreational swim, and lap swim at Begg Pool. The City’s Parks and Recreation team evaluates these fees annually and adjustments are made, as needed, to account for the costs of providing the services as well as market rates. The attached spreadsheet shows the last time the fees were increased (Attachment). For example, recreational and lap swim fees were last increased in summer 2020 to stay competitive with other municipal pools, while adult swim lessons were increased in summer 2025 to reflect increased staffing costs for providing the lessons.
Financial Considerations
Subsidy
City Council requested that staff return with potential options to subsidize the costs associated with Bay Club’s daily fee. As mentioned earlier in the report, Bay Club has since agreed to a resident daily fee of $15.00 and a reduced daily fee of $10.00 for seniors and youth.
To date, staff has not identified a municipality in California that subsidizes resident use of a private pool. However, there may be similar examples of subsidized resident rates for the use of golf courses. In addition, pursuant to our joint use agreement with the Manhattan Beach Unified School District, the City pays for the resident use of school-owned parks and sports fields. If City Council were interested in such a program, staff could further explore a discount program for residents who meet certain qualifiers (ex. verification of residency). This type of program would involve City staff resources in order to administer and manage.
Independent Cost Estimate - Conducted by Manhattan Beach
The City Council may choose to pursue an independent estimate to determine the cost to the City of constructing an aquatic facility at the same site. Staff estimates that this assessment would likely cost $5,000-$10,000 to complete. Staff would recommend contacting HMC Architects, the consultants that completed the Begg Pool Modernization Study, as they possess technical expertise related to pool construction.
If this option is selected, the City would obtain a high-level Rough Order of Magnitude conceptual estimate. This type of estimate is suitable for concept screening, study, or feasibility phases and reflects an understanding of approximately only 10% to 30% of the project's defined scope. The estimate would rely on Bay Club’s conceptual designs, and Bay Club has offered approval for the City’s use, if needed. If City Council decides to pursue this option, staff would return with an appropriation to cover the necessary costs in the next budget update report.
It is important to note that Bay Club’s estimated project cost of $8-$12 million reflects private-sector construction costs. A City-led public project would likely be higher due to requirements such as prevailing wage.
Funding
As noted in the previous staff report, Bay Club has indicated that they have a maximum expenditure threshold for the proposed project. If additional items are identified further in the review process that require extensive funding, the project itself may become cost prohibitive for Bay Club. Additionally, staff has confirmed that requests for a deeper or longer pool would increase the cost of the project by 15-20%, thereby pushing the project toward their expenditure threshold and leaving less availability of funds for unforeseen costs in the review process.
CONCLUSION:
In light of the information provided herein, staff recommends that the City Council discuss and provide direction regarding whether the City should continue to proceed with efforts to advance the potential construction and operation of an aquatic facility by Bay Club as described in the existing MOU.
As identified in the staff report from September 2, 2025, if City Council directs staff to proceed with the project in partnership with Bay Club, the following next steps are anticipated:
• Update the existing MOU, if required, to reflect the next phase of the project.
• Conduct a parking study to assess current and projected parking demand in the proposed site and surrounding area. (Bay Club to cover associated costs)
• Bay Club to submit a Planned Development Plan amendment, other applicable entitlements, and initiate the required CEQA review. (Bay Club to cover associated costs)
• Begin discussions related to lease terms.
• Potential relocation of monitoring wells.
• Complete additional public outreach.
Potential impacts at the proposed site and surrounding areas would be addressed via the parking study and through the submittal and review of the Planned Development Plan amendment, other applicable entitlements, and CEQA review. These studies would include impacts on factors such as parking, traffic, emergency vehicle access, and noise.
PUBLIC OUTREACH:
The City sent a notification out to approximately 1,500 individuals who requested updates about the Begg Pool project, and to the Manhattan Village Mall, Westdrift Hotel, Kinecta property at 1440 Rosecrans Avenue, Manhattan Village HOA and the Senior Villas, to inform them that this item would appear on the November 4, 2025, City Council meeting agenda. Staff followed the same practice when sending out notifications for the initial discussion that occurred on September 2, 2025. Additionally, the agenda was posted online and in physical locations in accordance with applicable law; and was sent via an e-notification to all individuals that request to be notified when a City Council agenda is posted.
Since the September 2, 2025, discussion, staff created a topic titled “Bay Club - Proposed Aquatics Facility” for interested parties to select when subscribing to the City’s enotifications list or when updating their notification preferences. These subscribers were also sent a notification regarding this agenda item.
ENVIRONMENTAL REVIEW:
The City has reviewed the discussion item for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines, the discussion item is not subject to CEQA. Thus, no environmental review is necessary. Should the City undergo any Planning Entitlements related to the efforts to advance the potential construction and operation of an aquatic facility by Bay Club as described in the existing MOU, applicable CEQA compliance would be evaluated and completed at that time.
LEGAL REVIEW:
The City Attorney has reviewed this report and determined that no additional legal analysis is necessary.
ATTACHMENTS:
1. September 2, 2025 Staff Report (Web-Link Provided)
2. Bay Club & Begg Pool Program Pricing
3. Begg Pool Programs - Fee Increases
4. PowerPoint Presentation