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Home My WebLink About5/4/2005 - STAFF REPORTS (22) CITY COUNCIL May 4, 2005 NEW BUSINESS SUBJECT: FIFTH AMENDMENT TO THE AGREEMENT FOR OPERATION OF THE PALM SPRINGS INTERNATIONAL FILM FESTIVAL FROM: David H. Ready, City Manager SUMMARY: I ! Since 1992, the City has had an agreement with the Palm Springs International Film Festival for the organization, management and production of an annual film festival. The original term of that Agreement was for five (5) years expiring on June 30, 1997. The City Council has amended the term of the agreement several times in year increments. The Film Festival's Board of Directors has requested that the City consider renewing its sponsorship for an additional five (5) years at the current level of $350,000. STAFF RECOMMENDATION: i 1. Approve Minute Order No. approving the Fifth Amendment to Agreement No. A3090 with the Palm Springs International Film Festival extending the term to June 30, 2010. i 2. Authorize the City Manager to execute all necessary documents to effectuate the Amendment. I STAFF ANALYSIS: I The Palm Springs International Film Festival which achieved an admissions level of 105,000 in 2005 is one of the largest film festivals in North America, second in attendance only to the Seattle Film Festival with 157,000 admissions. By comparison, ! the San Francisco Film Festival 95,000 admissions and the Sundance Film Festival has only 45,000 admissions. As our festival has grown, so has the extensive national, state and local media coverage which highlights Palm Springs as a "brand" which contributes to our local tourist economy. Attached is a sample of the print exposure from the film festival and during the Council Meeting, a presentation will be made by Festival Board I Members regarding the electronic media publicity the city receives. I I Further, the Palm Springs festival has an attractive film sales and distribution record and because it is held in January, it is seen by many as a prelude to the Academy Awards. As such, this year's festival screened more than 190 films from 65 countries, including 79 premieres (13 World, 44 U.S., and 22 North American). I I Item No. 5 . D . City Council Month Day, Year I Page 2 I I Originally, the City has contributed $250,000 to the festival to organize, manage and i produce the event. Over the past couple of years, Nortel, the Film Festival's title sponsor, reduced its contribution terminating its sponsorship. In response to Nortel's decision, the City Council agreed to increase its contribution to $350,000 a year to become the title sponsorship of the event. This amount is payable in several installments throughout the year. The existing agreement with the Film Festival was for a one year term expiring on June 30, 2005. The Film Festival's Board of Directors would like a longer commitment from the City in order to expand the event and has requested that the City Council consider a five (5) year term at $350,000 per year. The proposed amendment extends the term of the agreement through June 30, 2010. In addition, staff is recommending several changes to Exhibit "A" Scope of Services. While most of these changes are relatively minor and are intended to clarify existing language, staff believes that the following provisions should be added to the Scope of Services. • A requirement that the City be recognized as Title Sponsor in the Film Festival's Daily Newspaper (CINE/file). • Distribution of at least 300 free weekday passes to local clubs and organizations to view films being screened at the Film Festival. • Have at least one free public screening. • A requirement that the Film Festival provide the City twenty (20) screening passes allowing access to all film screenings and seminars and events as is necessary in order for City to fully enjoy the benefits of sponsorship. • A requirement that the Film Festival provide City two (2) tables of ten seats each to the Awards Gala. FISCAL IMPACT: This cost is a General Fund expenditure and has been included in the recommended 2005/2006 budget proposal by the City Manager. David H. Ready, City I i FIFTH AMENDMENT TO AGREEMENT FOR OPERATION OF PALM SPRINGS INTERNATIONAL FILM FESTIVAL This Fifth Amendment to Agreement for Operation of Palm Springs International Film Festival ("Fifth Amendment" or "Amended Agreement") is made and entered into this 20th day of April, 2005, by and between the CITY OF PALM SPRINGS, a municipal corporation ("City") and the PALM SPRINGS INTERNATIONAL FILM FESTIVAL ("Festival") and amends that certain "Agreement for the Operation of the Palm Springs' International Film Festival" (the "Original Agreement") dated April 1, 1992 between the same parties, as amended on February 19, 1997 ("First Amendment"), September 18, 2002 ("Second Amendment"), September 30, 2003 ("Third Amendment") and May 5, 2004-("Fourth Amendment"). The Original Agreement, the First, Second, Third and Fourth Amendment are collectively referred to in this Fifth Amendment as the "Agreement". RECITALS A. On or about April 1, 1992, City and Festival entered into an Agreement for Operation of the Palm Springs International Film Festival pursuant to which Festival agrees to organize, manage and produce an annual Palm Springs International Film Festival in January of each year during the term of said agreement and the City agreed to compensate Festival for such services. B. The original term of the Agreement was five (5) years expiring on June 30, 1997. C. The Agreement was amended on February 19, 1997, by the First Amendment, which among other things extended the term for an additional five (5) years to June 30, 2002. D. The Original Agreement was again amended on September 19, 2002, by the Second Amendment, which among other things extended the term of the Agreement to June 30, 2003. E. The Original Agreement was further amended on September 30, 2003, by the Third Amendment, which among other things extended the term of the Agreement to June 30, 2004. F. The Original Agreement was further amended on May 5, 2004, by the Fourth Amendment, which among other things extended the term of the Agreement to June 30, 2005. G. City and Festival desire to amend the Agreement to extend the City's financial support for an additional five (5) years as set forth in this Fifth Amendment. " AGREEMENT The Agreement is hereby amended as follows: 1. Section 2.2 of the Agreement is amended to read, in its entirety, as follows: "2.2 Method of Payment. Provided Festival is not in default under this Agreement, the Contract Sum shall be paid as follows: (i) the sum of $50,000 on or before August 1st of each fiscal year; (ii) the sum of $50,000 on or before November 1st of each fiscal year; (iii) the sum of $200,000 on or before December 1st of each fiscal year; and (iv) the sum of $50,000 on or before April 1st of each fiscal year. City shall have no obligation to make the payment to Festival due April 1 st of each fiscal year unless Festival has provided to City an audit of the previous year's Film Festival, which audit shall be performed by a certified public accountant and shall be in a form approved by the Contract Officer, which approval shall not be unreasonably withheld." 2. Section 3.2 "Terms" is amended to read as follows: "3.2 Term. The term of this Agreement shall is hereby extended to June 30, 2010, provided that this Agreement shall terminate on the occurrence of an event of termination as specified in Section 3.3 below." 3. Section 3.3 is hereby added to read as follows: "3.3 Event of Termination. The parties to this Agreement recognize and acknowledge that City is a political subdivision of the State of California. As such, City is subject to the provisions of Article XVI, Section 18 of the California Constitution and other similar fiscal and procurement laws and regulations and may not expend funds for products, equipment or services not budgeted in a given fiscal year. It is further understood that in the normal course of City business, City will adopt a proposed budget prior to a given fiscal year, but that the final adoption of a budget does not occur until after the beginning of the fiscal year. Notwithstanding any other provision of this Agreement to the contrary, City shall give notice of cancellation of this Agreement in the event of adoption of a proposed budget that does not provide for funds for the services subject herein. Such notice shall become effective upon the adoption of a final budget, which does not provide funding for this Agreement. Upon the effective date of such notice, this Agreement shall be automatically 2 terminated and the parties shall have no liability one to the other, but they shall be free to enter into any subsequent agreements as they feel appropriate." 4. Except as expressly provided herein, all other terms and conditions of the Agreement shall remain in full force and effect. 5. The City waives Festival's obligation to pay banner fees associated with each annual Palm Springs International Film Festival of Short Films and the Palm Springs International Film Festival that occurs during the term of the Agreement. IN WITNESS WHEREOF, the parties hereto executed this Fifth Amendment to be effective as of the Date first written above. CITY OF PALM SPRINGS, a municipal corporation By: City Manager ATTEST: City Clerk APPROVEl i�XSTO FORM: // City/Attorney PALM SPRINGS INTERNATIONAL FILM FESTIVAL By: Name: Title: 3 EXHIBIT "A" SCOPE OF SERVICES Festival shall organize, manage and produce an annual Palm Springs International Film Festival ("Film Festival") in January of each year during the term of this Agreement. The Film Festival shall include the screening of motion pictures and holding related events, such as opening ceremonies, closing ceremonies, and awards banquets. i The Film Festival shall, at a minimum, meet the following criteria: 1. Sell a minimum of 20,000 tickets. 2. Have annual revenues of at least $100,000.00, excluding revenues from sponsorships. 3. Screen a minimum of 80 films. At least fifteen (15) of such films shall be national premieres and five (5) shall be world premieres. 4. Be financially viable with the $350,000 contribution by the City. The Film Festival's responsibilities shall include, but not be limited to, the following: 1. Planning the Film Festival and developing the annual schedule, budget and theme in consultation with the City. The proposed schedule, budget and theme shall be submitted to the City on or before October 15 of each year. 2. Soliciting sponsorships in an effort to defray the cost of the Film Festival. 3. Securing the necessary facilities for the Film Festival, including theaters, in consultation with the City. 4. Promoting the Film Festival in consultation with the City's Bureau of Tourism. 5. Coordinating security for the Film Festival in consultation with the City. 6. Providing financial and progress reports on the status of the Film Festival to the City on a quarterly basis. 4 i 7. Distributing at least 300 free weekday passes to local clubs and organizations I to view films being screened at the Film Festival. I I 8. Have at least one free public screening. In exchange for sponsorship compensation, the Film Festival shall provide City the following benefits: 1. The City shall be recognized as the "Title Sponsor" in all advertising. For promotional purposes the Film Festival shall include the following credit line in all paid media (advertising), publications, and signage: "Presented by the City of Palm Springs." 2. The City shall be recognized as the Title Sponsor at or near the entrance(s) of the primary venue site. 3. The City shall receive name recognition on the media interview backdrop placed in the media room for the Film Festival. 4. The City shall be identified on a credit line prominently presented on the Film Festival's website page which features exhibit information. There shall be a hyperlink from the Film Festival's web site to the City's web site at www.ci.palm-springs.ca.us. The parties agree that said link may be "Framed" whereby material or pages from the linked web site appear in a frame on the site which creates the link. The parties expressly recognize their individual obligations and responsibilities for the content, quality, accuracy or completeness of materials contained on their respective web sites and agree to hold each other harmless from any special, indirect, incidental or consequential damages that may arise from the use of, or the inability to use, the respective sites and/or the materials contained on either site whether the materials contained on the site are provided by the City or the Film Festival. 5. The Film Festival shall provide City twenty (20) credentials allowing access to all film screenings, seminars, and receptions including but not limited to the Opening and Closing Night Screening, Awards Gala and VIP Reception. 6. The Film Festival shall provide City twenty (20) screening passes allowing access to all film screenings and seminars as the parties agree is necessary in order for City to fully enjoy its benefits. 5 7. The Film Festival shall provide City two (2) tables of ten seats each to the Awards Gala. 8. The City shall be positioned as Title Sponsor in all advertising. Examples of advertising include, but are not limited to: a. Program — City shall receive space to place one (1) full-page four-color advertisement on the inside front and back cover of the Film Festival's official program for marketing and promotion purposes. In addition, City shall receive space to place one (1) "Welcome Letter" from the Mayor within the Official Program. b. Film Festival Daily Newspaper — City shall be positioned as the Title Sponsor in the banner of the Film Festival Daily Newspaper (CINE/file). c. Newspaper Advertising —City shall receive each day during the Festival a one-quarter (1/4) page black and white advertisement in the film section of the Desert Sun or other newspaper as the parties agree. d. Radio/Television advertising — City shall be mentioned as Title Sponsor in all radio spots and television ads relating to the Film Festival. 6 MINUTE ORDER NO. 7670 APPROVING AMENDMENT 5 TO AGREEMENT 3090 WITH THE PALM SPRINGS INTERNATIONAL FILM FESTIVAL EXTENDING THE TERM TO JUNE 30, 2010 FOR THE ORGANIZATION, MANAGEMENT AND PRODUCTION OF THE ANNUAL FILM FESTIVAL AT THE CURRENT LEVEL OF $350,000.00 A03090 I, James Thompson, City Clerk of the City of Palm Springs, California, hereby certify that this Minute Order approving Amendment 5 to Agreement 3090 with the Palm Springs International Film Festival extending the term to June 30, 2010, for the organization, management and production of the annual film festival at the current level of $350,000.00, was adopted by the City Council of the City of Palm Springs, California, in a meeting thereof held on the 4th day of May, 2005. James Thompson, City Clerk