HomeMy WebLinkAboutCSD-003-20Clarftwn
Staff Report
If this information is required in an alternate accessible format, please contact the Accessibility
Coordinator at 905-623-3379 ext. 2131.
Report To: Joint Committee Report Number: CSD-003-20
Date of Meeting: April 6, 2020 By-law Number:
Submitted By: George Acorn, Director of Community Services
Reviewed By: Andrew C. Allison, CAO Resolution#: JC-021-20
File Number:
Report Subject: Sponsorship, Naming Rights and Advertising
Recommendations:
1. That Report CSD-003-20 be received;
2. That staff prepare corporate -wide guidelines for the solicitation and administration of
a consolidated Sponsorship, Naming Rights and Advertising program;
3. That staff be authorized to issue a Request for Proposal (RFP) to seek competitive
pricing for the provision of services related to the solicitation and administration of
sponsorships, naming rights and advertising for municipal buildings, parks and sport
fields;
4. That staff report back on the results of the RFP, seeking approval to award to a
successful vendor; and
5. That all interested parties listed in Report CSD-003-20 and any delegations be
advised of Council's decision.
Municipality of Clarington Page 2
Report CSD-003-20
Report Overview
Across Ontario many municipalities are facing aging infrastructure, rising operating costs
and growth -related costs while at the same time wanting to remain affordable places to live;
Clarington is no different. In order to address these challenges, staff are seeking approval
from Council to develop a corporate wide sponsorship, naming rights and advertising
program that will build on some of our existing programs and formally introduce a naming
rights component. We are also seeking approval to contract an outside vendor to provide the
necessary administrative services to best maximize revenues.
Working with the private sector we can generate funding to support the capital and operating
investments needed to continue to provide infrastructure, programs and activities that are
vital to the quality of life we seek to provide to our residents.
Corporate Sponsorship has been increasingly popular in the municipal sector over the past
few years. 66% of municipalities are involved in some form of corporate engagement.
Corporate Sponsorship is an effective way to maintain or enhance services with a minimal or
zero impact to the tax levy. Working with community -based corporations, this type of
program builds a positive reciprocal relationship by increasing brand awareness, while
supporting community events and buildings. It also brings new sources of revenue into the
Municipality. This Report will formally document the current practice in terms of program,
special event sponsorship and advertising as well as introducing building naming rights.
1. Background
1.1 With the ever-increasing costs to provide basic municipal services to residents, many
municipalities, including Clarington, are looking to find new and creative funding
sources. In addition to the ever-increasing annual operating costs, most municipalities
are also faced with a significant infrastructure renewal and replacement backlog. It is
important that Clarington consider alternative funding sources to help ease the burden
on our taxpayers.
1.2 Corporate Sponsorship (including Naming Rights) and advertising has been a popular
source of funding in the private sector, especially for large venues and events for many
years. In recent years there has been more uptake from the Public Sector. There are a
few reasons for this trend over the past few years. There has been a shift from
traditional media buying to digital and sponsorship/event marketing. Municipalities are a
positive place for a company to enhance their brand awareness and to better associate
their image with a community focused facility, park or event. We have seen recent
examples of Durham area municipalities entering into naming rights contracts.
Municipality of Clarington
Report CSD-003-20
Page 3
1.3 There are many examples where Clarington is currently successful in the areas of
special event and program sponsorship as well as the selling of advertising. By
formalizing our existing programs and expanding into the area of naming rights, the
Municipality will be able to attract new revenues that can be used to offset operating
costs and/or capital costs for new construction or major repairs and replacements.
1.4 The concept of off -setting municipal costs was introduced through Report CSD-009-19,
South Bowmanville Recreation Centre. Specifically, that consideration would be given
to alternative sources of funding, including facility naming rights and sponsorships.
2. Current Situation
Naming of Municipal Buildings and Facilities
2.1 In 2004, Council approved the Naming of Municipal Buildings/Facilities Policy to assist
in approving names of new and existing municipal buildings. The policy outlined criteria
that recognized individuals or organizations that have made significant contributions to
public life or significant local geographical or historical features or events.
2.2 In 2017, Council also approved the renaming of the Newcastle & District Recreation
Complex to the Diane Hamre Recreation Complex.
2.3 It is not the intention of this program to impact any previous decisions of Council with
regards to naming of municipal buildings and any requests for issuing naming rights will
be specifically reported to Council to seek their approval.
Sponsorships
2.4 The Municipality currently has an event sponsorship program that generates revenue to
fund several events and activities. The list includes many of our major events including
the Mayor's Love of Art Gala, Mayor's Golf Tournament and the Clarington Sports Hall
of Fame Ceremony. As well, we do several community level events that would include
corporate sponsorship of public swimming and skating dates. An example of this would
be Tim Hortons Christmas public skates and summer public swims.
2.5 For most of our smaller events, sponsorships are managed through our Facility Booking
Office and/or our Community Development staff. Clarington's larger event sponsorships
are managed through a contract with a third party. The remuneration for these services
is based on a sales commission model. This contract will be expiring in September
2020.
2.6 Clarington recently received a $410,000 donation from Toyota Canada that provided for
the construction of a multi -use trail in Bowmanville adjacent to their plant location. In
recognition of this donation, the trail will be named after the company.
Municipality of Clarington
Report CSD-003-20
Advertising
Page 4
2.7 The Municipality currently has revenue -generating advertising programs in place. These
include the sale of advertising space on arena rink boards and lobby monitors in our
recreation facilities. Additionally, advertising is sold on three outdoor digital display signs
located at the Municipal Administrative Centre, Tourism Office and Courtice Community
Complex.
2.8 A third party contractor is responsible for all activities related to sales, production,
programming, installation and maintenance. The Municipality, in turn, receives annual
revenues that include minimum guarantees. These programs, in place for many years,
have been competitively secured through our public procurement process. This contract
is in its final year and is set to expire August 31, 2020.
2.9 Advertising revenue is also secured through the sale of advertising space in municipal
publications, the most significant being the quarterly Clarington Recreation & Leisure
Guide. This program provides another third party commission based on the amount of
advertising revenue sold. The current contract will also expire in 2020.
2.10 There is a contract in place for advertising on various recycling containers located in
multiple areas of Clarington. As this contract is not scheduled to expire until 2024, this
contract will remain in place and will be added to any program we have in place when it
expires.
Clarington Public Library Sponsorship Program
2.11 The Clarington Public Library has a corporate policy that outlines a sponsorship
program that provides the business community and other organizations the opportunity
to provide products and resources as well as sponsoring of events or other activities.
This can take the form of revenue and/or in -kind contributions.
2.12 This program has been in place since June 2019 and is administered by the
CEO/Library Director. The Director is required to report larger value sponsorships to the
Library Board.
2.13 The proposed municipal program will be limited to municipal operations and is not
intended to impact the current sponsorship program. To date the Library has not
entered into any naming rights agreements but may be considering this in the future.
Municipality of Clarington
Report CSD-003-20
3. Financial Consideration
Page 5
3.1 The total approximate budget for all current sponsorship and advertising opportunities,
as identified in the 2020 operating budget is $265,000. These revenues are included in
accounts in both Community Services and Administration — Communications.
3.2 While these revenues are significant, staff are confident that a consolidated corporate -
wide program would better leverage our value to potential corporate interest. This could
result in an increase to revenues, either on an annual basis or by one-time upfront
payments.
3.3 With a formalized program in place, staff are confident we will be able to generate new
revenue. It is expected these new revenues will be reflected in future operating and
capital budgets.
4. Proposed Program
4.1 This program will provide a comprehensive, corporate -wide approach to sponsorship,
naming rights and advertising opportunities that will build on the existing individual
programs and most importantly formally expand into the area of assigning name rights
to municipal buildings and sport fields.
4.2 The program will set out requirements and guidelines to be adhered to by all parties.
This will ensure that all services covered will meet all standards, as determined by the
Municipality of Clarington, and will not compromise or undermine the integrity of the
Municipality, elected officials, staff or the community.
4.3 It is our intention to secure a single vendor, if possible, to provide all professional
services relating to the solicitation and administration of sponsorships, naming rights
and advertising for the various areas of the Municipality.
4.4 It is proposed that Community Services will assume the management of this program on
behalf of all participating Departments. They will act as the liaison between the
successful vendor and the appropriate Department. This will provide a consistent
application of all requirements and guidelines. Staff will also work with the potential
client, through the successful vendor, to best determine if the revenue is best served to
offset annual operating costs or to contribute to the capital construction of the asset.
4.5 Through the adoption of this Report and the attached Policy, the Municipality will be
better positioned to capitalize on an underutilized revenue stream to help offset annual
operating costs and/or capital construction costs. A coordinated program that will
include sponsorship of programs and events, naming rights for municipal facilities, and
Municipality of Clarington
Report CSD-003-20
Page 6
sport fields, as well as various advertising opportunities, will provide a more attractive
set of opportunities for our business community to consider.
5. Concurrence
5.1 This Report has been reviewed by the Acting Director of Engineering Services and the
Acting Director of Operations who concur with the recommendations.
6. Conclusion
6.1 It is respectfully recommended that Council approve this Report to allow staff to
consolidate our various existing sponsorship and advertising programs and to further
expand the program to formally introduce municipal building naming rights. By seeking
the expertise of an outside agency to administer the entire portfolio, Clarington is better
positioned to maximize these revenues that will help offset cost to our taxpayers
through their property taxes.
Staff Contact: Lee -Ann Reck, Client Services Manager, 905-623-3379 ext. 2508 or
Ireck@clarington.net.
Interested Parties:
The following interested parties will be notified of Council's decision:
Stuart Smith, Futuresign Multimedia
Jacqui van Belleghem