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Item 9CCITY OF SOUTHLAKE MEMORANDUM September 12, 2012 To: Shana Yelverton, City Manager From: Chris Tribble, Director of Community Services Subject: Consider Approval of City Sponsorship Policy Action Requested: City Council approval of the City Sponsorship Policy Background Information: Interest in sponsorships is increasing as an extremely effective method to boost visibility and enhance public sponsor recognition. Corporate sponsorships for events and community programs have been a successful tool for the Community Services Department in assisting with offsetting City costs for events. In June 2011 staff presented a Sponsorships White Paper to City Council and discussed the need for a Sponsorship Policy at the June 2011 Retreat where the Council directed staff to begin work on the policy. Having sponsorship success with the Stars & Stripes, Home for the Holidays and Southlake Tailgate events, staff began researching how other cities handle sponsorships not only for events, but also for naming rights, title sponsorships, cash sponsorships, and in- kind sponsorships to provide an additional revenue stream to sustain and enhance City programs, events, services and facilities. The City anticipates continued growth of sponsorship opportunities as City programs and facilities are expanded. The City has received interest from local, regional and national corporations, businesses, civic groups, individuals, non - profit organizations and service clubs interested in sponsorships in return for naming rights, title sponsorships, cash sponsorships and in -kind sponsorships. These types of sponsorships have the potential to provide a revenue source to sustain and enhance the parks & recreation system, community facilities, events, programs and services. To capture and enhance sponsorship opportunities, the proposed City Sponsorship Policy has been developed to provide specific guidelines for developing and managing sponsorships. City of Southlake Values: Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork Shana Yelverton, City Manager Meeting Date — September 18, 2012 Page 2 of 3 On May 1, 2012, staff presented an overview of the proposed City Sponsorship Policy for feedback from the City Council. In addition, staff has received feedback from the City Council- appointed committee of Mayor Pro Tern Brandon Bledsoe, Deputy Mayor Pro Tern Pamela Muller, and Council Member Carolyn Morris on the proposed policy. A copy of the proposed Policy is attached to this memo for your review. An overview of specific provisions of the Policy will be provided at the meeting. Adoption of the City Sponsorship Policy will result in a comprehensive guideline for the City to develop and manage sponsorships for City parks, facilities, events, programs and services. Financial Considerations: Approval of the City Sponsorship Policy has no financial impact on the current FY 2012 Budget or the Proposed FY 2013 Budget. Revenues generated by sponsorships are proposed to be deposited into a City special revenue fund for sponsorships. Allocation of sponsorship funds are proposed to be allocated during the City's annual budget approval process by the City Council. Strategic Link: This item is linked to the City's Strategy May related to the Focus Areas of Quality Development, Partnerships and Volunteerism, and Performance Management and Service Delivery. The item also delivers on the Corporate Objectives to Promote Opportunities for Partnerships and Volunteer Involvement, to Collaborate with Select Partners to Implement Service Solutions, and to Adhere to Financial Management Principles and Budget. Citizen Input/ Board Review: June 2011 June 2011 Retreat May — Aug 2012 September 18, 2012 Legal Review: City Attorney to revie Sponsorship White Paper City Council Discussion & Feedback City Council Work Session and City Council Appointed Work Group City Council Consideration for Adoption , w prior to consideration by City Council Alternatives: City Council alternatives may include the following: • Approve Policy as presented • Approve Policy with input as desired City of Southlake Values: Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork Shana Yelverton, City Manager Meeting Date — September 18, 2012 Page 3 of 3 • Decision not to approve the Policy Supporting Documents: Proposed City Sponsorship Policy Recommendation: City Council approval of the City Sponsorship Policy City of Southlake Values: Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork City of Southlake Policies and Procedures Policy: Sponsorship Policy Source: City Council Category: Community Services Department Purpose The purpose of the policy is to provide specific guidelines for developing and managing sponsorships for City parks, facilities, events, programs and services. Policv Statement It is the policy of the Southlake Community Services Department to actively pursue sponsorships for City parks, facilities, programs, services, and events from individuals, foundations, corporations, nonprofit organizations, service clubs, and other entities in order to enhance and sustain Southlake's parks and recreation system, community facilities, community programs, community services, and community 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 Southlake Community Services Department to provide sponsors appropriate acknowledgement of their contributions. All such recognition must adhere to the aesthetic values established within the Southlake 2030 Parks, Recreation & Open Space / Community Facilities Master Plan, and by the Southlake City Council. III. Authority The City will maintain authority, management, operation and control over the planning and execution of sponsorship activities. IV. Community Services Department Responsibility The Community Services Department is responsible for marketing City sponsorship opportunities, and for soliciting, negotiating and administering all sponsorships and agreements. Staff approving 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 Department shall also maintain a log of all sponsorship contributions, as per the guidelines established by the City's Finance Director, and issue a written acknowledgement of the agreement to each sponsor. V. 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 form the basis of the City's consideration when establishing sponsorship relationships: 1. 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 conditions of the sponsorship consistent with the standards, aesthetic values, and visual integrity of City property and expectations of users? 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 day -to -day operations of the City? 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: 1. Agreements shall not limit the City's ability to seek other sponsors. 2. The sponsorship cannot be made conditional on the City's performance 3. 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 enter into an agreement. 4. 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. 5. The City will not solicit nor accept sponsorship from individuals, foundations, corporations, nonprofit organizations, service clubs, or other entities whose reputation could prove detrimental to the city's public image. The City will not allow advertising, either directly or through third party arrangements, which present 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 proposal is rejected, a notification of refusal will be sent outlining the reasons. VI. Types of Sponsorships Sponsorships are negotiated and tailored to each event, program, facility, or service. A hierarchy of benefits is associated with the different types of sponsorships, often providing more branding and visibility with the higher levels of support. Each type of sponsorship will have specific levels detailing the value of the sponsorship. A. Naming Rights Sponsorship A type of sponsorship in which an individual, foundation, corporation, nonprofit organization, service club, or other entity 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 of time. 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 to the contractual obligations. The following specific 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. Staff will forward a report with recommendations to the City Council regarding the naming rights opportunity. 5. The name should advise the purpose of the facility. 6. The name should consider historical and community significance. 7. 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. 8. Costs for promotion of the renaming of a facility shall be incorporated into the naming rights agreement and not the City's annual operating budget. 9. Names that are similar to existing parks, properties or facilities within the City should not be considered in order to minimize confusion. B. Events, Programs and Services Sponsorships 1. 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. The following guidelines shall be applied when entering into a title sponsorship agreement for City events, programs and services: i. Recognition as Title Sponsor for a specific event, program or service ii. Mention in media releases and promotional material as Title Sponsor for the event, program or service iii. Title Sponsor signage /display at the event or program location for a period not to exceed the length of the event iv. Recognition as Title Sponsor on event/program website V. Category /product exclusivity for the event, program or service vi. Other possible benefits as negotiated 2. Cash 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. The following guidelines shall be applied when entering into a cash sponsorship agreement for City events, programs and services: i. Recognition as a Sponsor for a specific event, program or service ii. Appropriate mention in media releases and promotional material as a Sponsor for the event, program or service iii. Appropriate Sponsor signage /display at the event or program location for a period not to exceed the length of the event iv. Appropriate recognition on event /program website as a Sponsor for the event, program or service V. Other possible benefits as negotiated 3. 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. The following guidelines shall be applied when entering into an in -kind sponsorship agreement for City events, programs and services: Recognition as a Sponsor for a specific event, program or service ii. Appropriate mention in media releases and promotional material as a Sponsor for the event, program or service iii. Appropriate Sponsor signage /display at the event or program location for a period not to exceed the length of the event iv. Appropriate recognition on event /program website as a Sponsor for the event, program or service V. Other possible benefits as negotiated VII. Procedures for Establishing Sponsorship Relationships Sponsorship relationships are established primarily 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 Community Services Department at any time to discuss potential sponsorship opportunities. A completed Sponsorship application must be submitted 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. A 10% finder's fee may be given to the organization as compensation for their part in initiating the relationship. VIII. Approvals A. The City Council will approve all sponsorships related to: 1. Sponsorships that exceed $50,000 2. Naming Rights 3. Agreements that exceed three (3) years B. The City Manager will approve all sponsorships related to: 1. Sponsorships valued between $5,001 - $49,999 2. Community Facilities 3. Capital Projects 4. Service Delivery C. The Director of Community Services will approve all sponsorships related to: 1. Sponsorships up to $5,000 2. Community Events 3. Community Programs 4. Parks and Recreation System D. If the application is approved, the applicant will be contacted by the Director of Community Services, or his /her designee, to confirm the terms of sponsorship. The Community Services Department will work closely with successful applicants to ensure the sponsorship payment process progresses smoothly. E. 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. IX. Sponsorship Payment A. Long -Term Agreements ( >1 Year): 1. The City requires a 50% deposit on all long -term agreements. This deposit must be submitted with the signed Sponsorship Agreement. 2. The remaining 50% for year one payment should be paid within thirty (30) days of execution of the agreement. 3. For each year after, 100% of the annual payment should be received on the anniversary date of the establishment of the agreement. B. Short Term Agreements ( <1 Year): 1. The City requires full payment with the submittal of the Sponsorship Agreement. X. Revenue Allocation All revenues received from Naming Rights Sponsorships will be deposited into the City's special revenue fund for sponsorships. The City Council, as part of the City's annual budget process will determine how funds collected for Naming Rights sponsorships will be allocated. All revenues received from Events, Programs and Services Sponsorships will be deposited into the City's special revenue fund for sponsorships. The Community Services Department will utilize funds collected for Events, Programs and Services Sponsorships to offset City Events, Programs and Services expenses as they occur. XI. Recognition of Sponsors 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 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 or website, and must be stated in a manner that avoids an 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. XI 1. Termination of Sponsorships 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 not to fulfill the agreement if found to be in the best interests of the City. 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 thirty (30) days of execution of the agreement. However, no refund will be given on any funds received by the City prior to receipt of the notification of withdrawal.