The Corporation of the TOWN OF MILTON

Transcription

1 The Corporation of the TOWN OF MILTON Report To: From: Council Kristene Scott, Director, Community Services Date: May 9, 2016 Report No: Subject: Recommendation: COMS Corporate Policy Amendments THAT the Policy, attached as Schedule A be approved; EXECUTIVE SUMMARY AND THAT Council endorse By-law No to amend Schedule C of User Fee By-law No to reflect changes in Advertising and rates and fees. This report provides the recommendation of updating the existing Corporate Partnership Policy for the Town. The current policy, last revised in 1998, requires more detailed considerations of sponsorship activity as is now currently executed in the marketplace. The purpose of the policy is to create a clearly defined environment for entering into sponsorship agreements. This policy was drafted with the following considerations in mind: a) Intended to replace Corporate (No. 082: Program Corporate ) that is currently in place and which historically has addressed sponsorship and advertising. This does not include donor-related policies which should be kept separate. b) Having a more centralized, unified approach to offering Milton businesses marketing options in the best interest of the Town. c) The policy applies to all sponsorships received by the Town of Milton, solicited or unsolicited. Government contribution agreements, grants and contracts and grants from independent foundations are not classified as sponsorships and need not be evaluated through this specific sponsorship lens. The revised policy now contemplates the numerous elements which sponsorship now encompasses, while also providing a unified, centralized approach for the Town.

2 The Corporation of the TOWN OF MILTON Report #: COMS Page 2 of 4 REPORT Background There is an existing policy regarding Corporate (No. 082: Program Corporate ) that has not been updated since The business of sponsorship, particularly in the municipal setting, has changed significantly during this time and is the purpose for the new policy. Discussion The intent of this policy revision is to align our approach with current industry standards. The updated policy takes into account best practices while ensuring that the Town s interests are protected in the process. There is an expectation that the Town will seek to maintain a non-discriminatory approach. Our intent will be, moving forward, that the partnerships which we develop and foster continue to be in the best interests of the Town. A sponsor s interest in associating themselves and their brand, with the Town of Milton, is that it can improve the sponsor s relationship with its stakeholders, shareholders, staff and customers. In addition it can, and will, provide the opportunity for the sponsor to present its name and products to a wider market. From the Town s perspective, there are additional benefits to these relationships. Many of these sponsors can assist in profiling our programs and venues through their own promotional and marketing channels. In addition, The Town would be expected to experience increased revenues without any negative impacts on service delivery to the community. As part of this new approach we are also striving to differentiate between donations and sponsorship. A key part of that approach is to ensure that, in terms of sponsorship, there is value delivered to a sponsor which allows them to demonstrate a return on their investment through provision of a marketing business solution for them. This ultimately breeds renewals, and with that; long-term partnerships and a continued revenue stream for the Town. Donations, on the other hand, would continue to be sought by individual departments when required. A key example of where both sponsorship and donations will coexist and be differentiated is the Mattamy National Cycling Centre. There are many naming area donations now in place at the venue and these were important to the capital financing model. They are in place for a specified term and have signage promoting their associated named spaces. There are many sponsorship opportunities being explored in this world class facility that will materialize including signage, branding, named areas, promotions, programming, etc.

3 The Corporation of the TOWN OF MILTON Report #: COMS Page 3 of 4 Additionally, there is the potential, with relationships nurtured, that some of the initial donors to the capital campaign may upon expiry turn into sponsors with more integrated elements other than named space at the venue. For example, a naming rights donor may be interested entertaining a sponsorship opportunity which may include multiple elements including facility usage, program branding, community guide advertisement, etc. A key factor in sponsorships is undoubtedly the customization element. Not every sponsor is the same and even if they are in the same industry or business category they are unlikely to have identical and shared business objectives top to bottom. s should offer a solution to a vendor s business problem. Regardless of whether they are a new business looking for brand awareness or a mature company looking for employee engagement opportunities at town events, it is crucial to have flexibility in how the sponsorship packages are constructed. This includes the ability to recognize significant investments with some element of discounting. With the above in mind, those in sponsorships have moved away from stock-type packages offering identical elements in varying investment levels, e.g. Gold, Silver and Bronze and no longer tend to publicize their benchmarked rates. This new approach to our sponsorship program will afford us the following benefits: 1. Allow us to offer market-base rates to the sponsorship community with assurance that we are delivering value for their investment. 2. Provide a consistent, centralized approach to the marketplace where we are able to offer one-stop shopping whether it is a Learn to Swim program presenting sponsor, a rinkboard, a naming rights partner for Sherwood Community Centre or an advertisement in the Community Services Guide. Our recent survey of local area municipalities confirms that indeed many have moved or are going in this direction. The development of fees will be based on key metrics such as visibility, impression numbers, level of exposure, etc. The added component, however, that is unique to sponsorship in these calculations, are those key intangible factors that set sponsorship apart from simple advertising buys. Many properties deliver this element of value to their sponsors. In the face of economic uncertainty and corporate mistrust, sponsors are looking to link up with such examples as elements of goodwill, borrowed prestige, audience loyalty, positive media coverage, how integrated the event is into the fabric of the community, and what positive values does the event or program represent to their target audience.

4 The Corporation of the TOWN OF MILTON Report #: COMS Page 4 of 4 The revised policy states that sponsorship rates would not be posted and would be used solely as a starting point in the development of customized packages. It is important to note that posted rates would remain for individual opportunities in the traditional forms of advertising (rink boards, ad space, etc.) but elements of discounting would be permitted when creating packages and incorporating these advertising properties. Amendments are being recommended to the User Fee By-law to reflect this change. Financial Impact There is no financial impact associated with this report. The revised policy will streamline the sponsorship process which will assist staff in meeting applicable revenue targets. Respectfully submitted, Kristene Scott Director, Community Services For questions, please contact: Chris Reed x2252 Attachments Schedule A: Policy CAO Approval William Mann, MCIP, RPP, OALA, CSLA, MCIF, RPF Chief Administrative Officer

5 COMS Schedule A Policy POLICY: POLICY NO.: TBD EFFECTIVE DATE: May 9, 2016 REVISED: Reference: Staff Report COMS POLICY STATEMENT The Town of Milton recognizes sponsorship as a means to profile individual or corporate partnerships supporting, but not limited to, programs, facilities, parks, events and operations along with the opportunity to provide the Town with an additional revenue stream and, in some cases, offset the costs of municipal infrastructure, programs, and operation. is an opportunity that can be sought and used in a variety of ways by different divisions within the Town of Milton to obtain additional resources with which to support specific activities, programs or the overall bottom line of the municipality. In addition, the success and public exposure of an activity can be enhanced by sponsorship. can be provided as cash or as value-in-kind, where the sponsor provides a product or a service. In terms of value-in-kind opportunities it must be offsetting a previously budgeted line item or it is not directly seen as a cash equivalent. 2.0 SCOPE OF POLICY This Policy applies to collaborative arrangements with the Town in which sponsorship agreements are used as a funding mechanism (i.e. in which an external organization provides resources such as direct funding, in-kind services or a combination of both) in support of, but not limited to, those programs, facilities, parks, events and operations for which the Town is directly responsible for Purchase of Service Agreements. The Policy should be reassessed after one year and thereafter as necessary with authority delegated to staff to make minor modifications to minimize the need to return to Council annually. It applies to all sponsorships received by the Town of Milton, solicited or unsolicited. Government contribution agreements, grants and contracts, and grants from independent foundations are not classified as sponsorships and need not be evaluated through this specific sponsorship lens.

6 COMS Schedule A Policy 3.0 POLICY PURPOSE: The purpose of the Policy is to create a clearly defined environment for entering into sponsorship agreements. This Policy is intended to protect the integrity of the Town and support its revenue generating efforts as the Town of Milton continues to search for incremental external financial resources. The Policy was designed to work in the best interests of the Corporation as a whole and ultimately assist in coordinating multiple departments engaging with businesses for the Town of Milton with a centralized approach, ideally with a single internal point of contact. Ideally, many internal groups along with Town assets enterprise-wide (e.g. Transit, Economic Development, etc.) can be served by the Policy and allow for a cohesive approach to revenue generation in line with Destiny Milton 3 objectives. 4.0 POLICY APPLICATION: This Policy applies to all sponsorships associated with the Town of Milton. It does not apply to: Government contribution agreements, grants and contracts, and grants from independent foundations; Independent foundations or registered charitable organizations that the Town of Milton may receive a benefit; Gifts or unsolicited donations to the Town of Milton; Funding obtained from other orders of government through formal grant programs; Town of Milton sponsorship support of external projects where the Town of Milton provides funds to an outside organization; s for the Town of Milton will not be accepted from: Tobacco / e-cigarette companies; Organizations whose purpose and/or facility is related to religious and belief system activities; Companies that sell or promote pornography; Companies that present imaging that is derogatory, prejudicial, harmful to or intolerant of any specific group or individual; Companies whose program delivery and products that are in direct competition to Town programs (e.g. private swimming instruction);

7 COMS Schedule A Policy Companies that could conceivably create fiscal hardship for the Town of Milton and/or its residents; In the event that the sponsor corporation is part of a corporate conglomerate with ties to an exclusionary noted company, the sponsor corporation as well as the relationship between the sponsor corporation and the conglomerate will be reviewed by the Manager, Sport & Corporate Partnerships. 5.0 CORPORATE SPONSORSHIP PRINCIPLES The Town of Milton will focus on purposes consistent with its strategic priorities and comply with the following Principles for Corporate in soliciting and managing all sponsorships. These Principles should be discussed with all sponsors during the early stages of discussions. Principles for s The Town of Milton will ensure that: It will only solicit and accept sponsorship support for projects and activities that are consistent with the Town s objectives. It will be vigilant at all times to avoid any real or apparent conflict of interest in accepting sponsorships. A sponsorship agreement cannot grant a personal benefit, directly or indirectly, to a Town of Milton employee or Elected Official. of any Town of Milton property or asset will not entitle any sponsor to influence any Policy position or business decision of the Town. Sponsors conform to all applicable federal and provincial statutes as well as all applicable municipal bylaws, policies and practices. In addition, the Town of Milton will refrain from entering into sponsorship agreements where there is evidence the sponsor has engaged in unlawful actions against individuals or groups based on race or ethnic origin, religion, disability, gender, age, status, or sexual orientation/gender identity. It will also refrain from entering into sponsorship agreements with organizations that profit from the sale or distribution of dangerous products and goods or prohibited services. A sponsorship agreement must recognize and/or not contravene any existing commitment or contract held by the Town of Milton. To protect the privacy of the Town of Milton s residents, business partners, sponsors cannot obtain access to personal information held by the Town of Milton.

8 COMS Schedule A Policy By entering into a sponsorship agreement, the Town of Milton in no way endorses the products, services or ideas of any sponsor; likewise, sponsors are prohibited from implying that the Town of Milton sanctions their products, services or ideas unless explicitly agreed to in the sponsorship or Official Supplier agreement. It will accept sponsorships as an additional source of revenue generation, providing that all sponsorship alliances are developed and maintained within the framework of this sponsorship Policy. It will not provide clean venues (those venues that have no existing sponsorship exposure) unless mutually agreed upon which will increase the lease rate for the property to include loss revenue to the Town from existing partners, costs to remove and restore exposure for existing sponsors etc. Should an organization want a clean venue or partially clean property (perhaps only want fence signage down so they can sell or rink board down so they can sell etc.), it can be accommodated but the leasing costs will reflect such incremental costs to the third party. Such costs typically would show as a 25% increase in the lease rate. It accepts funds only when the Town of Milton has control of the content of the activity and when the Town has and maintains complete control of all funds (excluding associated activation funds used by the sponsor to leverage the sponsorship rights). It will be recognized for those facilities, programs, services, etc. where it makes an ongoing significant contribution to capital or operating costs. Clear and permanent identification of the Town of Milton will be displayed in adherence to branding guidelines established by the Town. It shall not relinquish to the sponsor any aspect of the municipality s right to manage and control the Town s assets and facilities. There is no obligation for the Town of Milton to accept a proposed sponsorship agreement it has reviewed. It will only allow Town of Milton affiliated groups that serve youth to put a venue banner, in a designated area, and in an approved size and manufactured quality, promoting their association in their home facility. The banner creative must promote their association itself and not have other advertisers as part of creative and the Town will maintain the ability to remove the banner should the operating status of the group change negatively with the Town. Other user groups not fitting the above criteria are able to purchase banner space at posted rates. Any obligations assumed by the Town of Milton through entry into a sponsorship agreement must not continue beyond the term of the agreement. Reserves the right to terminate an existing sponsorship agreement should any of the following occur:

9 COMS Schedule A Policy o The sponsor organization uses the Town s name outside the parameters of the sponsorship agreement, without prior consent; o The sponsor organization develops a public image inappropriate to the Town s values and/or objectives. The practices of the corporation must align with the adopted public policies of the Town of Milton. 6.0 SPONSORSHIP FEE FRAMEWORK Internal fees are established for sponsorship assets using a market-based approach combined with key metrics including visibility, number of impressions, level of exposure, etc. Each potential partner has unique business objectives and the fee process requires the flexibility to customize packages and apply bulk discounting where applicable. The fees in Schedule C of the Town of Milton User Fee By-law also require flexibility and discounting when included in customized packages where multiple advertising and sponsorship assets are being purchased. All negotiation of rates with potential external partners are completed through equal application of this framework in addition to Schedule C of the Town of Milton User Fee By-law. 7.0 Naming Rights: The following specific guidelines are separate from Policy No. 069 Naming/Renaming Town owned Facilities (Parks, Open Space, Storm Management Ponds, Municipal Buildings and Facilities) as they pertain solely to naming related to a sponsorship transaction and shall be applied when entering into naming right agreements for City/Town-owned property: i. naming is not necessarily available for all Town properties. Council will provide advance approval of those properties which are open for commercial naming and reserve its right for commemorative or historical naming of other Town assets as per Policy No. 069; ii. iii. iv. While the physical display of the naming right shall be negotiated or decided upon on an individual basis, such recognition must not unduly detract from the character, integrity, aesthetic quality, or safety of the property or unreasonably interfere with its enjoyment or use. As is outlined in Policy No Major Facilities, Council approval is required for all names associated with Major facilities. Naming rights agreements cannot be extended or automatically renewed without Council approval. The Town will consider naming rights for Town-owned facilities when there is a significant revenue opportunity for the Town and where the proposed naming does not detract from the description or proposed use of the facility;

10 COMS Schedule A Policy v. The cost and impact of changing existing signage and rebuilding community recognition must be considered before a property is renamed and any Town costs shall be incorporated into the naming rights agreement and not the Town s annual operating or capital budget; vi. The costs for promotion of the renaming of a facility shall be incorporated into the naming rights agreement. 8.0 POLICY MANAGEMENT The Director of Community Services manages the Policy and process outlined within the document. All sponsorships for the Town of Milton are managed by the Coordinator Corporate Partnerships once finalized. Any situation that may be seen as an exception to this Policy or these Principles will be reviewed by the appropriate departmental contact i.e. - Coordinator Corporate Partnerships and/or Manager, Sports & Corporate s in consultation with the Director, Community Services; Economic Development Senior Manager, Economic Development; Coordinator Transit Engineering Services, Manager, Purchasing & Risk Management. Together, they shall interpret this Policy in good faith. The Director of Community Services has authority to make minor modifications to the policy.