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Item 4C - Memo4C ICITY OF SOUTHLAKE MEMORANDUM September 13, 2022 To: Shana Yelverton, City Manager From: Sharen Jackson, Chief Financial Officer Subject: Approve Revised City Sponsorship Policy Action Requested: City Council approval of revisions to the City Sponsorship Policy Background Information: Sponsorship is an effective method to boost visibility and enhance public sponsor recognition. Sponsorships for events and community programs have been a successful tool for the City in offsetting costs. On June 6, 2017, City Council approved the existing City Sponsorship Policy. Presented at this time are revisions to the Policy for your consideration. Proposed changes to the Policy include. • City Council approval would be required for all Naming Rights opportunities • City Manager would have the authority to approve all sponsorships above $50,000 • The Department Directors would have the authority to approve sponsorships from $10,001 - $49,999. • The Managers of the events or programs would have the authority to approve sponsorships up to $10,000. • Full payment would be required at the time of agreement unless otherwise specified. • Definitions added for clarification. Financial Considerations: Revenues generated by sponsorships would be deposited into the City's general revenue fund. Strategic Link: Quality Development, Partnerships and Volunteerism, Performance Management and Service Delivery Citizen Input/ Board Review: City council consideration for adoption — September 20, 2022. Legal Review: Pending review by City Attorney Alternatives: Approve, revise or deny the revised Policy. Supporting Documents: Supporting documents include the following items: ■ Proposed revised City Sponsorship Policy Staff Recommendation: Approval of proposed revised City Sponsorship Policy City of Southlake Policies and Procedures Policy: Sponsorship Policy Source: City Council Category: City-wide Purpose The purpose of the policy is to provide general guidelines for developing and managing sponsorships and naming rights for city facilities, events, programs, and parks. Policv Statement It is the policy of the City of Southlake to actively pursue sponsorships from individuals, foundations, corporations, nonprofit organizations, service clubs, and other entities to build, enhance and sustain community facilities, programs, services, and events. All such sponsorships shall comply with the guidelines established by this policy. The City Council, at its discretion, may grant variances to this policy. In reciprocation for the sponsorship, it is the policy of the City of Southlake to provide sponsors with appropriate acknowledgment of their contributions. III. Authority The City will maintain authority, management, operation, and control over the planning and execution of sponsorship naming and activities. Refer to Section IX for approval authority. IV. Definitions Director — the department director, Police Chief or Fire Chief. In -Kind Sponsorship - A type of sponsorship in which an individual, foundation, corporation, nonprofit organization, service club, or other entity provides a good or service in exchange for sponsorship recognition of a City event, program or service. There is no monetary exchange within this agreement. Firms agree to provide a good or service in exchange for sponsorship recognition. Manager — the employee assigned by the Director to run the program or event. Naming Rights Sponsorship - A type of sponsorship in which an individual, foundation, corporation, nonprofit organization, service club, or other entity V VI. purchases the exclusive right to name an asset or venue (i.e., athletic field, sports complex, parks and recreation amenity, or community facility) for a fixed period. Paid Sponsorship - A type of sponsorship in which an individual, foundation, corporation, nonprofit organization, service club, or other entity provides cash in support of a City event, program, or service. Title Sponsorship - A type of sponsorship in which an individual, foundation, corporation, nonprofit organization, service club, or other entity purchases the exclusive right to be named as the Title Sponsor of an event, program or service. City Responsibility The City is responsible for marketing sponsorship opportunities, and negotiating and administering all sponsorships and agreements. The authorized approvers (authorized in Section IX) reviewing sponsorship proposals must ensure that all relevant by-laws and policies are adhered to, appropriate consultation and approval authorities are respected, and where applicable, that insurance, indemnification, ethical scans, business good standing status, and permits have been obtained. The City shall maintain a log of all sponsorship contributions, per the guidelines established by the City's Chief Financial Officer, and issue a written agreement to each Sponsor. Guidelines for Establishing Sponsorship Relationships All proposed sponsorship relationships will be considered on an individual, case - by -case basis, and should be consistent with the City's Mission, Values, and/or Strategic Plan. A. The following criterion forms the basis of the City's consideration when establishing sponsorship relationships: Is the mission of the sponsor organization consistent with the City's Mission, Values, and/or Strategic Plan? 2. Are the products, services, and marketing goals of the potential Sponsor compatible with the City's Mission, Values, policies, and ordinances? 3. Does the sponsorship enhance the City's community facilities, community programs, community events, community services, and/or the parks and recreation system? 4. Are the tangible and intangible benefits balanced for both the sponsor and the City? 5. Are the sponsorship conditions consistent with the standards and visual integrity of City property and users' expectations? 6. Does the sponsorship commit the City to additional responsibilities, legal liability, operations, and maintenance costs? 7. Does the sponsorship create a conflict of interest for the City? 8. Does the sponsorship in any way invoke future consideration, influence, or perceive to influence the City's day-to-day operations? 9. Is the sponsorship opportunity appropriate to the target audience? 10. Will the results of the sponsorship relationship deliver a positive and desirable image for the City? B. Additional considerations when establishing sponsorship relationships include: Agreements shall not limit the City's ability to seek other sponsors. The sponsorship cannot be made conditional on the City's performance. There shall be no actual or implied obligation to purchase the product or services of the Sponsor. The Sponsorship must not result in, or be perceived to result in any competitive advantage, benefit, or preferential treatment for the Sponsor outside of the sponsorship agreement. The evaluation of the potential Sponsor shall include, but not be limited to the individual's or the organization's: values and principles; products and services offered; record of environmental stewardship and social responsibility; rationale for its interest in partnering with the City; expectations; and ability, timeliness, and readiness to agree. Ineligible Sponsorships include but are not limited to any potential sponsor whose primary products or services are substantially derived from the sale of alcohol, drugs, tobacco, gambling, firearms, or sexually explicit or inappropriate materials. The City will not accept sponsorship from individuals, foundations, corporations, nonprofit organizations, service clubs, or other entities whose reputation is adverse to the City's values. The City will not allow advertising, either directly or through third -party arrangements, which presents demeaning or derogatory portrayals of individuals or groups or contain anything, which, in light of generally prevailing community standards, is likely to cause deep or widespread offense. The City may, at its discretion, bring any proposals to City Council for their approval even if they do not meet the guidelines of this Policy. The City Council may also consider any proposal or direct staff to pursue any opportunities for sponsorship that do not strictly adhere to this Policy. C. The City retains the right to accept or reject any sponsorship submitted for approval. If the application is rejected, a notification of refusal will be sent outlining the reasons. VII. Types of Sponsorships Sponsorships are negotiated and tailored to each event, program, facility, or service. A hierarchy of benefits may be associated with the different types of sponsorships, often providing more branding and visibility with higher levels of support. Each type of sponsorship will have specific levels detailing the value of the sponsorship. A. Naming Rights Sponsorship Usually naming rights are considered in a commercial context, in which the naming right is sold or exchanged for significant cash and/or other considerations under a long-term arrangement. This arrangement is usually documented in a written agreement signed by the interested parties and has a specified end date for the contractual obligations. The following guidelines shall be applied when entering into a naming rights agreement for city -owned, city -operated assets, such as an athletic field, athletic complex, parks and recreation amenity, playground, pavilion, gymnasium, or community facility. The proposed naming rights purchaser must support the image, values, and corporate objectives of the City of Southlake and the Southlake community. 2. The City shall not relinquish to the purchaser any aspect of the City's right to manage and control the asset or facility. 3. Signage, branding, publicity, and advertising shall conform to all applicable City policies, ordinances, and plans. 4. The name should advise the purpose of the facility. 5. The name should consider historical and community significance. 6. The Sponsor shall have ongoing responsibilities to adhere to the standards set forth herein and the agreement shall have termination provisions in the event of the failure to comply. 7. Names that are similar to existing parks, properties, or facilities within the City should not be considered to minimize confusion. 8. Any Naming Rights Sponsorship approved by City Council shall require a written agreement. All Naming Rights proposal submissions are subject to City Council review and approval. B. Events, Programs, and Services Sponsorships The following guidelines may be applied when entering a Title Sponsorship, Paid Sponsorship, or In -Kind Sponsorship Agreements for City events, programs, and services: 1. Recognition as a Sponsor for a specific event, program, or service 2. Appropriate mention in promotional material as Sponsor for the event, program, or service 3. Appropriate Sponsor signage/display at the event or program location for a period not to exceed the length of the event, or as determined by City staff 4. Appropriate recognition as a Sponsor on the event/program website 5. Category/product exclusivity for the event, program, or service (Title Sponsorship only) 6. Other possible benefits as negotiated VIII. Establishing Sponsorship Relationships Sponsorship relationships are established through initiation by the City informally or formally via a Request for Sponsors process, or through initiation by a potential sponsor. Interested sponsors are encouraged to contact the City at any time to discuss potential sponsorship opportunities. A completed Sponsorship application must be submitted that includes acknowledgment of reading, understanding, and agreeing with the City's Sponsorship Policy, along with a letter detailing the specifics of the proposed sponsorship. Additionally, sponsorship relationships for a specific park, facility, project, program, service, or event may be initiated by organizations that the City partners with via Community Services Agreements or Facilities Utilization Agreements; however, they must be turned over to the City for processing and negotiating once initiated. At no time shall the organization speak on behalf of or negotiate on behalf of the City. IX. Approvals A. The City Council will approve all sponsorships that are considered a Naming Right. B. The City Manager has the authority to approve all sponsorships valued at $50,000 or above. C. The Director (of the managing department) has the authority to approve sponsorships valued between $10,001- $49,999, or sponsorships considered to be a service delivery or agreements that exceed three (3) years in length; a XI D. The Manager responsible for issuing sponsorship opportunities has the authority to approve sponsorships valued up to $10,000 related to community events; community programs; festivals, and the Parks and Recreation system. A Letter of Understanding will be sent to the successful applicant setting out agreed terms, and the process of fulfilling the sponsorship agreement will begin. Sponsorship Payment The City requires full payment at the time of the agreement unless otherwise specified in the agreement. Revenue Allocation All revenues received from Naming Rights Sponsorships will be deposited into the City's special revenue fund for sponsorships and will be utilized in adherence to the agreement. All revenues received from events, programs, and services sponsorships will be deposited into the City's special revenue fund for sponsorships. The City will utilize funds collected for events, programs, and services sponsorships to offset City events, programs, and services expenses as they occur or utilize funds to enhance events, programs, and services. XII. Recognition of Sponsorship Sponsorship recognition messages may identify the Sponsor but should not promote or endorse the individual, foundation, corporation, nonprofit organization, service club, or its products or services. Statements shall not advocate, contain price information or an indication of associated savings or value, request a response, or contain comparative or qualitative descriptions of products, services, or organizations. Ordinarily, only the following content will be deemed appropriate: A. Legally recognized the name of the Sponsor. B. Sponsor's organizational logo and slogan if it identifies rather than promotes the organization or its products and services. C. Sponsor's product or service line, described in brief, generic, objective terms - generally, only one product or service line may be identified D. Brief contact information for the sponsor's organization, such as phone number, address, and/or website, and must be stated in a manner that avoids the implication of urging the reader to action The City will not make any statements that directly or indirectly advocate or endorse a Sponsor's organization, products, or services. No materials or communications, including, but not limited to print, video, internet broadcast, social media, or display items developed to promote or communicate the sponsorship using the City of Southlake's name, marks, or logo may be issued without written approval from the City of Southlake, or their designees. XIII. Termination of Saonsorshios A. The City of Southlake reserves the right to accept or reject any sponsorship proposal submitted for approval, and while every intention is to accept and fulfill all sponsorship agreements, the City reserves the right to terminate the agreement at any time if, in the City's sole discretion, the continuation of the sponsorship is determined not to be in the best interests of the City. If the City elects to terminate the agreement, any funds, unused materials or services, or other compensation received by the City before such termination will be refunded by the City unless such termination is due to a material breach of the agreement by the Sponsor, in which case the City may retain all or a part of the compensation if the City determines that such is necessary to compensate the City for any losses incurred by the City due to such material breach. B. The Sponsor reserves the right to withdraw the sponsorship proposal at any time during the approval process. C. The Sponsor may also withdraw from the agreement within ten (10) days of execution of the agreement. However, no refund will be given on any funds received by the City before receipt of the notification of withdrawal. Approval Date: September 18, 2012 Approved By: City Council 1. Revision Date June 6, 2017 Approved By: City Council 2. Revision Date September 20, 2022