PREAMBLE RATIONALE. WHEREAS, the College currently administers and pays for all aspects of the Yavapai College Community Events Program; and

Transcription

1 Memorandum of Understanding Between Yavapai College Foundation And Yavapai County Community College District For the Operation of Yavapai College Community Events Programs PREAMBLE This renewal of this Memorandum of Understanding (the MOU ) is effective as of the 1st day of July, 2010 by and between Yavapai College Foundation (the Foundation ), an Arizona nonprofit corporation, and Yavapai County Community College District (the College ), a political subdivision under the laws of the State of Arizona. RATIONALE WHEREAS, the College currently administers and pays for all aspects of the Yavapai College Community Events Program; and WHEREAS, The College and the Foundation desire to collaborate to provide certain administrative and financial services in conjunction with the Yavapai College Community Events Programming (the Program ) without significantly increasing the Foundation s exposure to cash-flow deficits; and WHEREAS, the College and the Foundation desire to define the terms and conditions, under which the Program is financed, administered, operated and maintained; AGREEMENT NOW, THEREFORE, in consideration of the promises, covenants, and conditions contained herein, the College and the Foundation agree as follows: ARTICLE 1 Responsibilities 1.1 Except as otherwise provided in this MOU, the Foundation will receive all ticket sales (both Program and Rental Contract ticket sales), outside grants to Community Events and cash sponsorships (other than from the Performing Arts Charitable Endowment ( PACE ), and pay all Program Talent Fees and other direct cash talent costs (lodging, meals and transportation) as well as the other expenses described in Article 1.6 below. A separate Foundation bank account(s) will be established for use in the above transactions of the Program. No intermingling of funds with other Foundation activities or accounts will occur.

2 1.2 The College will provide the facilities for the daily operations of the Program including office space and performance space. The College will continue to maintain the Yavapai College Performance Hall at current standards during the term of this MOU. 1.3 All College services will continue to be available in support of the Program at current standards, (e.g. mailing, I.T.S. support, custodial and maintenance services, and office space, et. al.). 1.4 The College will perform all payroll functions for all Program employees (tax withholdings, etc.) and will submit a monthly invoice to the Foundation for reimbursement of the cost of College staff working on behalf of the Foundation. 1.5 The College will fulfill the following responsibilities: Oversee the daily operations of the Program, and continue to follow its accounting and contract approval practices for expenditures incurred in conjunction with the Program and performances associated therewith. The College will continue to employ the Program staff as employees of the College, with the benefits and privileges established by the College Establish a committee (the Community Events Financial Review Committee ) composed of 1) the Vice President of College Development & Foundation 2) the Treasurer of the Foundation, 3) the Supervisor, Community Events 4) the CFO of the College, as Chairman, and 5) the Foundation s Director of Finance & Operations to review quarterly the financial operations of the Program Supervise all full-time employees and part-time employees of the Program, including but not limited to ticket sales staff, accounting staff (other than Foundation employees), event staff, and the Supervisor, Community Events Transfer to an account established and managed by the Foundation, all proceeds from all advanced ticket sales for all Program events. 1.6 The Foundation will fulfill the following responsibilities: (a) At the completion of each Performance Hall Rental Contract, pay to the College the gross amount of ticket sales for such contract; (b) pay all Program Talent Fees and other direct cash talent costs (lodging, meals and transportation) After receiving approval from appropriate College officials, the Foundation will enter into contractual agreements for all Program events and be financially responsible for the payment of all fees and performers compensation incurred in conjunction with an event. In conjunction therewith, the College shall seek input from the Community Events 2

3 Financial Review Committee at its regular quarterly meeting, and shall consult with the Community Events Financial Review Committee in regard to the pricing of tickets for any performance contracted in furtherance of the Program Collect all ticket sales and outside grants and cash sponsorships (other than from PACE) and deposit such funds into a separate account maintained solely for the Program Invest funds received from ticket sales, outside grants and cash sponsorships (other than PACE) into secure short-term investments, consistent with the Foundation s Investment Policy After approval of College officials in accordance with the College s policy, pay all Program Talent Fees and other direct cash talent costs (lodging, meals and transportation), which will be substantiated through bills, invoices, receipts, contracts, and letters of agreement Establish adequate internal controls, including requiring two Foundation officers signatures on all disbursements of more than $1, Allow the College full access to all Program records for its review or audit Present to appropriate members of the College and Foundation, quarterly reports reflecting income, expenses and liabilities of the Program for which the Foundation is responsible Provide for an annual independent audit and a separate schedule to be issued within the Foundation s annual audit showing the cash receipts and disbursements for which the Foundation is responsible Be responsible for 1) managing all net profits and 2) all losses of the Program cash receipts and disbursements as defined in Section 1.1 above and in Section 1.8 below The Foundation shall receive as compensation an administrative fee equal to one and one-half percent (1.5%) of the Program ticket sales and outside grants and cash sponsorships (other than from PACE) received from the College under the terms of this MOU, payable quarterly upon completion of the reports in above. The attached Exhibit is a pro forma computation of the administrative fee, demonstrating the calculation of the administrative fee for December 31, The Artistic Programming Coordinator will plan the schedule of events for each Program season, which shall include a broad range of entertainment, consistent with the College s policy commitment made to provide cultural and entertainment value to the public as established as part of the justification for financing during 3

4 the original construction of the performance hall. In conjunction therewith, the Artistic Programming Coordinator shall seek input from the Community Events Financial Review Committee, and shall consult with the Community Events Financial Review Committee in setting ticket prices for each event contracted for each Program season. The College shall approve the contracts entered into in conjunction with the Program, and expenses incurred in furtherance thereof, consistent with the College s established approval process. 1.8 Effective July 1, 2010, the Foundation will maintain an annually audited fund balance, not to exceed $150,000, to provide financial reserves for the operations of the Program. All amounts generated above this amount as of June 30 of each year will revert to the College. In January of each year, the College and the Foundation will agree upon the method of returning to the College the amount above the $150,000 fund balance, if any. In the event that the Program s annual audit reflects a balance below $150,000 or a negative balance, no funds will be returned to the College until the audited fund balance exceeds $150,000. The fund balance to be maintained pursuant to the terms of this paragraph (1.8) shall be reevaluated by the College and Foundation, each year. Upon termination of this MOU, said fund balance shall be returned to the College. The attached Exhibit is a pro forma computation of the fund balance for the fiscal year ended December 31, The Foundation will continue to support the Program through the Performing Arts Charitable Endowment (PACE) program, which will remain separate from the operation of the Program. ARTICLE 2 INDEMNIFICATION AND INSURANCE 2.1 Each party shall be responsible for the negligent or willful acts or omissions of its directors, employees and agents, and to the extent permitted by law, each Party shall defend and hold harmless the other Party against the same. 2.2 Insurance Coverage The College agrees to procure, at its expense, and maintain during the term hereof, A policy of general public liability insurance in the amount of not less than $5,000,000 per occurrence, against claims for bodily injury, death and property damage occurring in connection with the College s use of any portion of the Performance Hall. The insurance shall include the Foundation as an additional insured, if permitted under the term of its general liability policy, and shall provide the Foundation with a certificate evidencing such insurance coverage is in effect. 4

5 Workers compensation for all Program employees employed by the College and the Foundation In the event that the Foundation is no longer an additional insured as described in above, the Foundation agrees to procure, at its expense, and maintain during the term hereof, a policy of general public liability insurance in the amount of not less than $5,000,000 per occurrence, against claims for bodily injury, death and property damage occurring in connection with the Foundation s use of any portion of the facility. The insurance shall include the College as an additional insured and be primary and non-contributing to any coverage maintained by the College. The Foundation shall provide the College with a certificate evidencing such insurance coverage is in effect. The College will reimburse the Foundation for any costs associated with providing the insurance Notice of any possible injury, loss or damage which may involve either Party must be given, in writing, immediately to the College and the Foundation, respectively. ARTICLE 3 TERM 3.1 The initial term of this MOU shall commence on July 1, 2010 and continue through June 30, 2015; provided, however, that in the event that the Foundation or the College has not fulfilled its duties or obligations under this MOU, this Agreement may be terminated by either party upon ninety (90) days written notice. Either party may terminate this Agreement, without cause, with one (1) year s prior notice to the other. In that event, the Foundation shall continue to be responsible for the expenses of any contract executed by the Foundation prior to the termination of this MOU, unless such obligation is assumed by the College, with its consent. In addition, the College may terminate this MOU in accordance with the requirements of A.R.S At the expiration of the initial term, the parties may negotiate a renewal of this MOU, for an additional five (5) year term. 3.2 In the event of termination of this MOU, a special independent financial audit or review will be conducted at the College s expense. All advance ticket sale revenues and all financial records will be returned to the College. All amounts accumulated by the Foundation for financial reserves as described in Article 1.9, based on the results of the independent audit, will be returned to the College. 5

6 ARTICLE 4 DISPUTE RESOLUTION 4.1 The College and the Foundation desire to resolve any and all disputes between them as quickly, inexpensively and efficiently as possible, avoiding the expense and delay of court proceedings. Consequently, the Parties agree to the following sequence of procedures to resolve such disputes: Negotiation. As a condition precedent to litigation, when either Party feels a dispute has arisen, that Party shall notify the other, in writing, of the nature and details of the dispute. Within 14 calendar days, a meeting shall be held between the College CFO (or his/her designee) and the Executive Director of College Development (or his/her designee) to begin a good-faith attempt to negotiate a resolution. During this procedure, the Parties shall communicate directly with each other in an effort to reach an agreement that serves the interests of both Parties Committee. If negotiation as provided in Section does not resolve the dispute, the parties shall submit the matter to a two-person committee composed of the President of the College (or his/her designee) and the Foundation President (or his/her designee) (collectively, the two-person committee ). The role of the two-person committee shall be to facilitate further negotiation between the Parties and, if possible, to resolve the dispute upon mutual consent of the Parties. If the two-person committee is unable to resolve the dispute between the Parties, the Parties agree to submit the dispute to binding arbitration Binding Arbitration. Claims not resolved by Committee shall be decided by arbitration, which, unless the parties mutually agree otherwise, shall be determined by each party selecting an arbiter of their choosing, and those arbiters shall select a third. As appointed, the three arbiters shall establish a date, in consultation with both parties, and hear any dispute or claim standing as between the parties Timeliness of Demand. A demand for arbitration shall be made within a reasonable time after the claim has arisen, and in no event shall it be made after the date when institution of legal or equitable proceedings based on such claim would be barred by the applicable statute of limitations Limitation on Consolidation. No arbitration shall include, by consolidation or in any other manner, parties other than the Foundation and College. No person or entity other than the Foundation and College shall be included as an original third party or additional third party to an arbitration whose interest or responsibility is insubstantial. Consent to arbitration 6

7 involving an additional person or entity shall not constitute consent to arbitration of a claim not described therein or with a person or entity not named or described therein. The foregoing agreement to arbitrate and other agreements to arbitrate with an additional person or entity duly consented to by the Parties to this Agreement may be specifically enforceable under applicable law in any court having jurisdiction thereof Claims and Timely Assertion of Claims. The party filing a notice of demand for arbitration must assert in the demand all claims then known to that party on which arbitration is demanded Judgment on Final Award. The award rendered by the arbitrator or arbitrators shall be final, and judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof. ARTICLE 5 MISCELLANEOUS 5.1 Notice. All notices, requests, demands, or other communications (collectively Notice ) required as permitted under this MOU should be in writing and may be personally delivered, sent by fax, , or by certified mail, return-receipt requested, prepaid, addressed as follows: The College: Phone: Fax: Yavapai College Attn: 1100 East Sheldon Prescott, AZ _ The Foundation: Phone: Fax: Yavapai College Foundation Attn: 5.2 Authority. Upon the College s District Governing Board and Foundation s Board of Directors approval of this MOU, it shall become binding on the College and the Foundation. 5.3 Assignment. Neither party shall assign, convey, encumber or otherwise dispose of its right or obligations under this MOU for any provisions thereof, except with the consent of the other party. 7

8 5.4 Governing Law. This MOU shall be governed by the laws of the state of Arizona. IN WITNESS WHEREOF, the Parties hereto have executed this Memorandum of Understanding on the dates set forth below. YAVAPAI COLLEGE FOUNDATION YAVAPAI COUNTY COMMUNITY COLLEGE DISTRICT By: By: Name: Howard Moody Name: James F. Horton, Title: President Title: President Date: Date: _ 8

9 EXHIBIT TO MOU Dated, 2010 Pro Forma Computations of Fund Balance and Administrative Fee Using Fiscal Year Actual Amounts Calculation of Fund Balance & Administrative Fee December 31, 2009 FUND BALANCE Cash Receipts Grant Income 4,875 Contributions/Sponsorships 30,037 Sales 441,307 Ticket Handling Fees 4,326 Investment Income 522 Miscellaneous - Less: Grants & Gifts Receivable - Total cash receipts 481,067 Program cash disbursements Talent fees 361,000 Other professional fees 500 Food costs 3,971 Travel 514 Lodging - Advertising expenses 2,310 Administrative fee (see below) 7,216 Bank fees & service charges 10,451 Total program cash disbursements 385,962 NET ADDITION TO FUND BALANCE 95,105 Fund balance at beginning of year (see note below) 175,000 Current fund balance 270,105 Maximum fund balance 175,000 PAYABLE TO YAVAPAI COLLEGE $ 95,105 ADMINISTRATIVE FEE Total cash receipts 481,067 Applicable percentage 1.5% YTD Administrative fee 7,216 Less: amounts previously paid PAYABLE TO FOUNDATION $ 7,216