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HomeMy WebLinkAbout12/13/2006 - STAFF REPORTS - 5.B. 1 7ZO 345 6379 BOB 1-I01-C CHRYSI RR BOR HOI C CI IRYSI-FR CLASSIC 05 01 23 p rn 12 12-2006 214 iQr r arM s'* �y`�is 1�lrq�1s BOB HOPE CHRYSLER CLASSIC •c�IInORH�p• - .. - SPONSORSHIP TERM SHEET The Following is a draft of a proposed Term Sheet, for discussion purposes, to outline a Sponsorship Agreement to be entered into between the City of Palm Springs and the Bob Hope Chrysler Classic, General Terms: Three (3)year, $725,000 ugr[ernent with option z renew, at City's request, / for an additional __(?r;' �"' rtva f r(r� �� S(o,Uj ap 4L M, ! a!/� SPONSORSHIP BENEFITS TO CITY 41P�i / �t YEAR ONE (2007) —Sponsorship Amount ONE — Amount 5125 000 • Palm Springs name to be strategically positioned with the Official Tournament Logo and utilized in all marketing,promotional and product merchandise as agreed to by the parties to the sponsorship agreement- • All newspaper datelines for the Tournament will be Palm Springs. • All PGA TOUR releases and schedule postings will indicate Palm Springs. • All local newspaper ads Include City of Palm Springs logo. (975" schedule with Desert Sun) • All out of town newspaper ads include City of Pahn Springs logo (Multiple 1/4 page ads in the Orange County Register(circ,300,000), San Bernardino Sun (circ. 80,000) and LA County News) • Out of town radio schedule includes City of Palm Springs in spot—KFRG schedule/promotion and name inclusion on their website- • All television ads include City of Palm Springs logo. • Golf Channel will produce a :60 vignette on Palm Springs, which will be shown each day of the telecast (5 days live) and during the taped coverage each evening (total of 10 times). • Anytime tournament is replayed later in the year, :60 vignette will be included in coverage. (date to be determined) • On-air mentions by Golf Channel announcers would be Classic Club, Palm Springs. /.21 1,312 o a Cv I 7=i0 34B 5320• BOB HOPE CHRYSLER BOB HOPE CHRYSLL=h CLASSIC 05 01 40 p m 12-12-2006 314 • Residents of Palm Springs would receive free admission Friday at the Classic Club with proof of residence and a $5 Saturday discount voucher Available at the Classic Club gate only—no advance tickets. 125 rounds of golf at the Classic Club annually to be used at the City's discretion based on availability. Rounds valid Sunday-Thursday. Must have 24 hours prior notice and approval by Director of Golf. • Collateral material on the City of Palm Springs for media partners. Estimate 250+ members of the media. • Inclusion ofbyperlink to PS Tourism website frorn the Classic website to encourage members of the public to book hotel rooms in Palm Springs. • Opportunity for Palm Springs hotels to be included on list of hotels and rates provided to pros, amateurs and celebrities by the Classic office. • Option for hospitality tent at the Classic Club at no cost to City(food and beverage services at additional cost of$60.00lper person). • One complimentary table for ten (10) at the Bob Hope Chrysler Classic Ball. • 10 Bob Hope Club memberships. • 25 Clubhouse badges for use at the City's discretion. • Inclusion of Palm Springs with Classic Club marketing materials, if, and when possible, • Option for a City of Palm Springs tent for residents—available at net cost. YEAR TWO (2008)—Sponsorship Amount $250,000 • All sponsorship benefits as provided in Year Ornez- 04 1{� • Inclusion of Palm Springs name in all outdoor advertising,. • Option for two-page four-color advertorial on Palm Springs in Official Tournament Program at no cost to City. (�• Option for % page horizontal spread in etrtpmab}e publication as the parties determine at no cost to City. • Bob Hope Chrysler Classic Ball to be held at the Palm Springs Convention Center pending agreement on terms. 2 1 /40 346 6329 BOB HOPE C:HRYSLER BOB I TOPE CHRY51-ER CLASSIC 05 01 55 p m 12.12-2006 414 • Two complimentary tables for ten (10) at the Bob Hope Chrysler Classic Ball. • Option for 40-seat Skybox Suite at the Classic Club at no cost to City(replaces hospitality tent). • Option for Palm Springs exhibit area for businesses, development projects and hospitality partners at no cost to City. • Option for a Palm Springs representative to serve on the Bob Hope Classic Charitable Committee. YEAR THREE (2009) —Sponsorship Amount $330,000 • All sponsorship benefits as provided in Years One and Two. • Option for a PGA sponsored golf clinic or other type of event for youth to be held in City (bate and Location to be, determined)- Term Sheet Not Binding- Nothing herein shall constitute a legally binding obligation of i either party to enter into a Sponsorship Agreement, and no party shall be legally bound to the other unless and until a definitive agreement shall have been duly authorized, executed and delivered by the parties- IN WITNESS WHEREOF, the parties hereto have caused this Term Sheet to be executed by their respective duly authorized officers or representatives this_day of December, 2006: CITY OF PALM SPRINGS By: City Manager BOB HOWCHRER CLASSIC By C" ) A afire Name: Title: This Agreement must be signed in the above space by one of the following: Executive Director, Secretary, Chief Financial Officer or any Assistant Treasurer. 3 RESOLUTION NO. OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING THE BUDET FOR THE 2006-07 FISCAL YEAR WHEREAS Resolution 21611 approving the budget for the fiscal year 2006-07 was Adopted on June 7, 2006; and WHEREAS the City Manager has recommended, and the City Council desires to approve, certain amendments to said budget; NOW THEREFORE BE IT RESOLVED that the Director of Finance is authorized to record inter-fund cash transfers as required in accordance with this Resolution, and that Resolution 21611, adopting the budget for the 2006-07 fiscal year is hereby amended as follows: SECTION 1. ADDITIONS Fund Activity Account Amount 112 Special Events 2018-xxxx $125,090 Purpose To provide funding for the Bob Hope Chrysler Classic SECTION 2. SOURCE Fund Activity Account Amount 112 Fund Balance 112-29301 $125,000 ADOPTED THIS 13th day of December, 2006 David H. Ready, City Manager ATTEST: James Thompson, City Clerk /Cf�l� KS�c b77amj F PAL/H S phi u ko4 y-' -FORN,P City Council Staff Report DATE: December 13, 2006 New Business SUBJECT: SPONSORSHIP AGREEMENT WITH BOB HOPE CHRYSLER CLASSIC FROM: David H. Ready, City Manager BY: Assistant City Manager--Administrative Services SUMMARY The Bob Hope Chrysler Classic, which had its start in Palm Springs back in the 1950's, has submitted a benefits package and has asked for City sponsorship of this prestigious golf tournament. This action would approve a three-year sponsorship agreement with the Bob Hope Chrysler Classic for the 2007 through 2009 golf tournament. RECOMMENDATION: 1. Adopt Minute Order No. , approving, in a form acceptable to the City Attorney, an agreement with the Bob Hope Chrysler Classic for sponsorship of the 2007-2009 Bob Hope Chrysler Classic Golf Tournaments. 2. Adopt Resolution No. "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA AMENDING THE BUDGET FOR THE 2006-07 FISCAL YEAR." 3. Authorize the City Manager to execute all necessary documents STAFF ANALYSIS: The '""Bob Hope Chrysler Classic"' is a PGA Tour golf tournament played each January. It is part of the Tour's early season West Coast swing and is also well known for its celebrity pro-am- Founded as the "'Palm Springs Golf Classic"' in 1960, the tournament evolved from the Thunderbird Invitational that was held in Palm Springs from 1954 to ITEM NO. City Council Staff Report December 13 -- Page 2 Sponsorship Agreement with Bob Hope Chrysler Classic 1959. The tournament format remains unique among PGA Tour events, being played over five days and four different courses. The Bob Hope Chrysler Classic is best known for the array of celebrities it attracts each year. Besides Hope, some of the celebrities have included: Jackie Gleason, Sammy Davis, Jr., Frank Sinatra, Jack Benny, Dean Marlin, Bing Crosby, Phil Harris, Desi Arnaz, Burt Lancaster, Kirk Douglas, James Garner, Joey Bishop, Robert Stack, Randolph Scott, Clint Eastwood, Robert Goulet, Cheech Marin, Jack Lemmon, Tennessee Ernie Ford, Bill Murray, Glenn Frey, Kevin Sorbo, Kevin Costner, Vince Gill, Amy Grant, astronauts Gene Cernan and Alan Shepard, Vice President Dan Quayle, and Speaker of the House of Representatives Tip O'Neil. Some of the top sports stars include: Willie Mays, Joe Louis, Johnny Bench, Merlin Olsen, John McKay, Mike Ditka, Lou Holtz, Bear Bryant, Joe DiMaggio, Dizzy Dean, Eddie Arcaro, Tom Harmon, Otto Graham, Michael Jordan, Charles Barkley, John Elway, Troy Aikman, Emmitt Smith, Jeff Gordon, Maury Wills, Sandy Koufax, Don Drysdale and Ann Meyers Drysdale. Celebrity participants for the 2007 Classic include: Yogi Berra, Michael Bolton, Glen Campbell, Roger Clemens, Alice Cooper, Carson Daly, Tom Dreesen, Andy Garcia, Huey Lewis, Trini Lopez, Cheech Marin, Ed Marinaro, Craig T. Nelson, Ray Romano, Kurt Russell and Sterling Sharpe. Chrysler has supported the Bob Hope Chrysler Classic since 1965 and been title sponsor since 1085, the longest sponsor/event association on the PGA TOUR and one of the longest in sports. Chrysler's sponsorship has enabled the Bob Hope Chrysler Classic to distribute over $43 million to the Eisenhower Medical Center and a total of 112 charities throughout the Coachella Valley. Recently, officials from the Bob Hope Chrysler Classic approached the City with a proposal to sponsor the 2007 golf tournament for $150,000. Over the course of several meetings, staff was able to negotiate a three (3) year sponsorship package. Under the proposed sponsorship package, the City will pay $125,000 in 2007, $250,000 in 2008 and $350,000 in 2009, for a total of $725,000, The City retains the option to extend its sponsorship of the tournament after the third year for an additional 7 years at a cost of $350,000 a year. The key benefits of this sponsorship package include: • The name Palm Springs to be strategically positioned with the official tournament logo and used in all marketing materials, tournament documents and merchandise. • All television and newspaper ads to include the City of Palm Springs logo. • All newspaper datelines for the tournament to be Palm Springs. Free admission to the tournament for Palm Springs residents on Friday, January 19th at the Classic Club and a $5 Saturday discount voucher. City Council Staff Report December 13 --Page 3 Sponsorship Agreement with Bob Hope Chrysler Classic • The Golf Channel to produce a :60 vignette on Palm Springs to air each day of the telecast (5 days live) and during the taped coverage each evening (total of 10 times). • The tournament gala will be held at the Palm Springs Convention Center beginning in 2008. • Out-of-town radio schedule to include Palm Springs. • 125 rounds of golf at the Classic Club to be used at the City's discretion. • Inclusion of hyperlink to Palm Springs Bureau of Tourism website from the Classic website. A complete list of benefits that will be provided under the sponsorship package is attached. The sponsorship package was presented to the City's Finance Subcommittee (Mayor Oden and Council Member McCulloch) on November 20' - The Finance Subcommittee has reviewed and recommends approval of the proposed sponsorship package. Staff has also discussed the proposed sponsorship package with the new Director of Tourism. She has reviewed the proposal and has suggested that the following benefits be added to the sponsorship package: • Use of a hospitality tent at the Classic Club during the tournament. • A complimentary golf foursome in the Pro-Am event. Although these additional benefits have been discussed with the Bob Hope Chrysler Classic, staff has not yet been informed that they have been accepted and made part of the sponsorship package. Staff will provide a verbal report at the Council meeting on the status of these additional benefits. The proposed sponsorship package has an estimated value of well over $300,000 and provides many marketing opportunities the City could not afford on its awn. For example, the Golf Channel, which currently reaches 80 million households, and by 2009 plans to reach 110 million households, would typically be outside the City's financial means. However, through this sponsorship, the City will now have the opportunity to air a :60 vignette which showcases the community to millions of households throughout the country. Although the direct value of this type of advertising is difficult to measure, staff believes that it will far exceed the City's sponsorship investment. City Council Staff Report December 13 -- Page 4 Sponsorship Agreement with Bob Hope Chrysler Classic The 48'h Annual Bob Hope Chrysler Classic will be held January 16-21, 2007. The tournament will be played on several area golf courses, including Bermuda Dunes Country Club, La Quinta Country Club, Arnold Palmer Private Course at PGA WEST and the new Classic Club. Although the tournament is not played in the City, there are several reasons why the City should sponsor this event including: • The opportunity to showcase Palm Springs through an established world class golf tournament. • The ability to enhance the City's domestic and international media exposure. • The opportunity to strengthen the brand identity of the Palm Springs name to a large audience. The actual sponsorship agreement is still being drafted and is not yet available for public review. However, due to time constraints, staff recommends that if the Council approves the proposed sponsorship package that the final agreement be prepared in a form acceptable to the City Attorney. FISCAL IMPACT: The actual economic impact of this tournament is difficult to ascertain. However, according to an economic impact study commissioned by the Bob Hope Chrysler Classic in 1998, the tournament brought in an estimated $32 million in direct economic benefits to the Coachella Valley. Based on more recent information, the economic impact of this tournament has increased and is now believed to be between $40 to $45 million a year. If the City Council approves the proposed sponsorship agreement, a budget resolution transferring $125,000 from Fund Balance to the Community Promotions Fund (Special Events) will be needed to cover the 2007 tournament. Staff will include the sponsorship amounts for the 2008 and 2009 tournaments as part of the City's annual budget process. �Z Tr Butzla s stant City Manager David H. Ready, Ci y r Atkac ents: 1. Minute Order 2. Budget Resolution 3. List of Sponsorship Benefits MINUTE ORDER NO. APPROVING, IN A FORM ACCEPTABLE TO THE CITY ATTORNEY, AN AGREEMENT WITH THE BOB HOPE CHRYSLER CLASSIC FOR SPONSORSHIP OF THE 2007-2009 BOB HOPE CHRYSLER CLASSIC GOLF TOURNAMENTS. --------------- I HEREBY CERTIFY that this Minute Order, approving, in a form acceptable to the City Attorney, an agreement with the Bob Hope Chrysler Classic for sponsorship of the 2007- 2009 Bob Hope Chrysler Classic Golf Tournaments was adopted by the City Council of the City of Palm Springs, California, in a meeting thereof held on the 13th day of December, 2006. JAMES THOMPSON City Clerk RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING THE BUDGET FOR THE 2006-07 FISCAL YEAR. WHEREAS Resolution approving the budget for the fiscal year 2006-07 was adopted on 2006; and WHEREAS the City Manager has recommended, and the City Council desires to approve, certain amendments to said budget,- NOW THEREFORE BE IT RESOLVED that the Director of Finance is authorized to record inter-fund cash transfers as required in accordance with this Resolution, and that Resolution adopting the budget for the 2006-07 fiscal year is hereby amended as follows: SECTION 1. ADDITIONS Fund Activity Account Amount 001 Special Events 2018-42691 ",000 Purpose: To provide additional funds for building repairs. SECTION 2. SOURCE Fund Activit Account Amount 001 Fund Balance 0000-29301 ($125,000) Adopted this day of 2006. AYES: NOES: ABSENT: David H. Ready, City Manager ATTEST: James Thompson, City Clerk lyelr, CST, i � � r BENEFITS TO THE CITY OF PALM SPRINGS • All newspaper datelines for the Tournament will be Palm Springs. (priceless) • All PGA TOUR releases and schedule postings will indicate Palm Springs. (priceless) • All local newspaper ads include city of Pahn Springs logo. (975" schedule with Desert Sun- $45,350 value) • All out of town newspaper ads include City of Palm Springs logo (Multiple 1/4 page ads in the Orange County Register(circ.300,000), San Bernardino Sun(circ_ 80,000) and LA County News—value to be determined) • Out of town radio schedule includes City of Palm. Springs in spot—KFRG $10,000 schedule/promotion and name inclusion on their website_ • All television ads include city of Palm Springs lobo. (S36,025 value) • Golf Channel will produce a -60 vignette on Palm Springs, which will be shown each day of the telecast (5 days live) and during the taped coverage each evening(total of 10 times). ($150,000 value) • Anytime tounrament is replayed later in the year, :60 vignette will be included in coverage. (date to be determined) • On-air mentions by Golf Channel announcers would be Classic Club, Palm Springs. (value of $2,000 3 mention) • Residents of Palm Springs would receive free admission Friday at the Classic Club with proof of residence and a $5 Saturday discount voucher. Available at the Classic Club gate only—no advance tickets. (S25 each resident on Friday+ S5 each resident on Saturday value) ■ 125 rounds of golf at the Classic Club annually to be used at the City's discretion based on availability. Rounds valid Sunday-Thursday. Must have 24 hours prior notice and approval by Director of Golf. • Collateral material on the City of Palm Springs for media partners. Estimate 250+members of the media_ ■ Inclusion ofhyperlink to PS Tourism website from the Classic website to encourage members of the public to book hotel rooms in Palm Springs. Opportunity for Palm Springs hotels to be included on list of hotels and rates provided to pros, amateurs and celebrities by the Classic office. (The Classic does not pay or book these rooms—each participant pays for his or her own). �• Table for 10 at the Bob Hope Chrysler Classic Ball. ($7,500 Value) 10 Bob Hope Club memberships. ($6,500 value) 25 Clubhouse badges for use at the City's discretion. • Bob lope Chrysler Classic Ball to be held at the Palm Springs Convention Center in 2008, pending agreement on terns. Further, after review of 2008 Ball and agreement of both parties the Ball would be also held in 2009. • Inclusion of Patin Springs with Classic Club marketing materials, if, and when possible. • Palm Springs exhibit area in 2008 and 2009. • Option for a City of Palm Springs tent for residents— available at net cost. • Three year initial agreement with two) three-year extensions, at a mutually agreed price.