HomeMy Public PortalAbout7.2.95 Sponsorship PolicyCity of Melfort Policy Manual
POLICY TITLE:
Sponsorship
Policy
POLICY NUMBER:
7.2.95
EFFECTIVE DATE:
April 11, 2016
ORIGIN:
Community Services
Committee
ADOPTED BY COUNCIL ON:
April 11, 2016
DATE:
1. PURPOSE
To provide policy guidelines which facilitate and support opportunities for entering into
sponsorship agreements and naming rights agreements for City -owned and civic partner
controlled assets for the purpose of enhance financial sustainability.
2. DEFINITIONS
2.1. Sponsorship — a mutually beneficial business arrangement or partnership between
the City of Melfort and an extemal party (individual, company, organization, or
enterprise) where in the external party contributes funds, goods, or services to a
civic facility, public park, open space, program, event, or activity in return for
recognition, acknowledgement, or other promotional consideration.
2.2. Naming Rights — a type of sponsorship where a sponsor purchases the exclusive
right to name an asset (e.g. event, facility). Naming rights are considered a
commercial opportunity whereby the naming right is sold for significant cash or
other revenue support. This arrangement is documented in an agreement signed
by the interested parties and has a specified end date to the contractual obligation.
2.3. Civic Partner — an arms -length, not -for-profit organization that has a formal and
legal relationship to provide services, programs and/or manage and care for City
assets in conjunction with, or on behalf, of the City of Melfort.
2.4. Value Assessment — a determination of the value that a sponsor will receive as a
purchaser of specific naming rights and may include tangible and intangible
benefits.
2.5. Asset Analysis — a comprehensive review of an asset's overall value as it relates to
sponsorship or naming opportunities.
2.6. Naming Rights Agreement — the sale of the right to name or re -name City -owned
facilities or land is documented in a written contract that contains terms acceptable
to the City.
7.2.95 - Sponsorship Page 1
2.7. Sponsor — a corporation or organization that enters into a sponsorship agreement
and pays cash or value -in -kind in return for access to exploitable commercial
potential associated with the asset.
2.8. Value -in -kind — a sponsorship received in the form of goods and/or services rather
than cash.
2.9. Letter of Intent — a non -binding commitment from a potential prospect to undertake
a sponsorship for a proposed term, at a proposed fee, in exchange for a defined
list of rights and privileges.
3. POLICY
3.1. General principles
a) An external party may contribute, in whole or in part, funds, goods, or services
to an approved City facility, public park, open space program, event, or
activity where such sponsorship is mutually beneficial to both parties and in a
manner consistent with existing guidelines and policies set by the City.
b) The sponsorship arrangement must support goals, objectives, policies, and
bylaws of the City of Melfort and be compatible with, complementary to, and
reflect the City's values and mandate.
c) The City will select the most appropriate sponsors using the following criteria:
i) Quality and timeliness of product and service delivery;
ii) Value of product, service, cash provided to the City;
iii) Cost to the City to service the agreement;
iv) Compatibility of products and services with City policies and standards;
v) Marketplace reputation of the sponsor; and
vi) Record of sponsor's involvement in community projects and events.
d) Recognition provided to sponsors is subject to negotiation (i.e. advertising,
signage, product sampling, brand name) and must meet the following
criteria:
i) Be an acceptable standard and in good taste;
ii) Not present demeaning or derogatory portrayals of individuals or
groups; and
iii) Not contain anything which, in light of generally prevailing community
standards, is likely to cause deep or widespread offence.
e) A specific type of sponsorship arrangement called naming rights may occur
when an external party may become the namesake of a future or existing
7.2.95 - Sponsorship Page 2
municipal facility in recognition for its financial support where such support is
mutually beneficial to the City, external party, and the community. If the
name is intended for an existing facility name, the City should take into
consideration the history and legacy of the current facility name. Concept
approval will be received from City Council for these sponsorship
arrangements.
f) The sponsorship arrangement must be limited in scope and application to the
City or project under consideration, and shall not involve any form or risk -
sharing venture.
g)
The role of the City as owner and operator of its assets shall be ensured
throughout the sponsorship arrangement.
h) The City reserves the right to customize or decline any sponsorship
arrangement.
3.2. Application
a) This policy applies to all City owned facilities, land, equipment, services and
programs.
b) This policy does not apply to:
i) Gifts and memorials which are covered under a separate policy.
ii) Sale of advertising or signage on City -owned facilities and printed
materials, which involves only the straight purchase of advertising
space sold at marketplace rates, and does not imply any reciprocal
partnership arrangement.
iii) With the exception of naming rights, this policy shall not apply to
Boards.
iv) Gifts or unsolicited donation to the City of Melfort.
v) Third parties who lease City property or hold permits with the City of
Melfort for activities or events (Community Associations).
4. THE SPONSORSHIP ARRANGEMENT
4.1. Requests for sponsorship arrangement and any subsequent arrangements shall be
made in writing detailing the rights and benefits offered and, at a minimum, shall
include the following:
a) The value of all funds, goods, and services to be provided and the recognition
to be provided in return by the City.
b) A fixed term of up to a maximum of 10 years, unless otherwise authorized by
City Council.
7.2.95 - Sponsorship Page 3
c) The disposition and ownership of any assets resulting from the sponsorship
arrangement.
d) Maintenance of assets, ongoing capital, and taxes.
e) The responsibility for insurance, license/permits, safety, security, and public
health.
4.2. Revisions to the sponsorship arrangements are subject to the same approval as
the original sponsorship arrangement.
4.3. Long-standing sponsorship arrangements that pre -date this policy may continue
upon the review and approval of the appropriate Director.
4.4. Procedure for Naming Rights Agreement for City -owned, City -operated assets:
a) A written report to City Council for concept approval will include:
i) The list of assets for sale, value of the asset in the marketplace;
ii) Length of the term of the sponsorship (up to a maximum of 10 years)
iii) List of potential sponsors; and
iv) Benefits the sponsor will receive for their purchase.
City Council approval is required prior to sponsors being approached.
b) Once Council approval is received, Administration will seek out sponsors.
When successful, a Letter of Intent from the potential sponsor, which includes
the proposed term, proposed fee, defined list of rights and privileges, will be
reported to City Council for approval prior to proceeding with negotiation of an
agreement.
c) Administration will then enter into negotiations, and return to City Council for
approval of the final agreement.
5. BUDGET
All costs and revenues pertaining to a sponsorship arrangement will be included in the
approved department budget.
6. RESPONSIBILITIES
6.1. City Council
a) Approve this policy and all amendments.
b) Approve all sponsorship arrangements that are of a sensitive nature or with a
total value in excess of $100,000.
c) Approval all naming rights arrangements.
d) Council approval for all sales of naming rights before sponsors are
approached or agreements made.
7.2.95 - Sponsorship Page 4
6.2. Senior Administration
a) Assess all sponsorship proposals that are sensitive or of a value in excess of
$100,00 confirming:
i) Date of duration of the sponsorship arrangement;
ii) Sponsor contribution to the project;
iii) Market Value estimate of the contribution; and
iv) Form of recognition the City is making available to the sponsor.
b) Compare proposals and ensure there is consistency between sponsor
arrangements.
c) Recommend for City Council approval those projects with a value of revenue
to the City of over $100,000.
d) Seek concept approval from City Council prior to initiating negotiations with a
potential sponsor for those projects that may be sensitive and all naming
rights.
e) Ensure the process for tracking and reporting all sponsorship arrangements
held by City departments are documented.
6.3. Department Director — approve sponsorship arrangements with a total value of less
than $100,000.
6.4. Solicitors — provide legal advice regarding agreements arising from sponsorship
arrangements.
7.2.95 - Sponsorship Page 5