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CITY COUNCIL STAFF REPORT
DATE: December 19, 2007 NEW BUSINESS
SUBJECT: PROPOSED SPONSORSHIP AGREEMENT FOR THE KRAFT NABISCO
CHAMPIONSHIP IN THE AMOUNT OF $26,000 FUNDED WITH
COMMUNITY PROMOTIONS' BUDGETED UNALLOCATED FUNDING
FROM: David H. Ready, City Manager
SUMMARY
Attached is a letter from the Tournament Director of the Kraft Nabisco Championship
requesting financial support for their Golf Tournament. The actual golf event is held in
Rancho Mirage. Yet, the host hotel has been in Palm Springs since the Tournament's
inception in 1972. Additionally, functions such as the Gala Dinner are held at the
Convention Center and the "dine-a-rounds" are at various Palm Springs restaurants.
The Tournament Director has included a detailed list of event expenditures in the City of
Palm Springs which illustrates the potential return on investment for any financial
support.
RECOMMENDATION:
1. Consideration of the event sponsorship request and/or direct staff to prepare a
Sponsorship Agreement with Kraft Nabisco Championship for a specific amount.
FISCAL IMPACT:
In the current year's budget, Council funded $50,000 in an Unallocated Council
Priorities Special Contributions line item. Based upon other anticipated events
throughout the year which Council historically has funded, approximately $26,000
remains available for this request.
David H. Ready, City Ma
Attachments:
1. Request Letter
KRAFT NA
ABISCO
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October 25, 2007
Mr. Steve Pougnet
Mayor, City of Palm Springs
3200 East Tahquitz
Palm Springs, CA 92262
Dear Mayor Pougnet,
As you know, the Spa Hotel and Hilton Hotel have been the host hotels for the KNC
since the inception of the tournament in 1972. All of the tournament pro-am functions
such as the Gala Dinner, the dune-a-rotmds and the opening and closing dinners are held
at the Palm Springs Convention Center or at local hotels and restaurants. In addition, the
KNC is responsible for many other visitors who come to Palm Springs for the tournament
or related functions. Kraft invites over 150 top executives from the food industry each
year, many visiting the desert for the first time. It is a fact that several of these executives
have returned to Palm Springs with conventions and/or conferences with their own
companies and therefore support the economy of the city. The Kraft Nabisco
Championship, alone, spends approximately $1,200,000 in the City of Palm Springs each
year.
Even though the site of the tournament has always been Mission Bills Country Club in
Rancho Mirage, Palm Springs has received most of the benefit from the tournament. Last
year, the City of Rancho Mirage entered a three year agreement with the tournament to
show their support. Because of the impact of the tournament on Palm Springs, it is felt
that the 1£NC should receive support in this manner from the City of Palm Springs.
HHAF NASISC0 CHAMPIONSHIP
Two HOCQUN CIUU Drive
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Steve Pougnet
October 25, 2007
Pagetwo
The city currently benefits directly from TOT at the hotels, the fees and food costs at the
convention center, a percentage of the sales tax and from the airport displays purchased
from Palm Spring Life. At the same time many local businesses are benefiting from
KNC's direct purchases as well as those from the many visitors that visit the city as a
result of the tournament. Rather that trying to direct a percentage of this income to the
KNC, it seems the city could best show their support and appreciation with a direct
sponsorship of the tournament. Based on our participation in the city and other
agreements between golf tournaments and municipalities in the desert and beyond we feel
a sponsorship of$50,000 would be most appropriate. We would also ask the city to assist
with the security at the hotel and convention center and with their 50% of the signage
income from airport displays purchased by the tournament. For this participation, in
addition to the existing benefits to the city, the toumament would offer the city a page in
the tounrarnent program, a table of 10 for the Gala Dinner and special recognition at the
dinner.
Thank you and the members of the city council for your consideration of this proposal
and for your support of the Kraft Nabisco Championship. Please contact me if you have
any questions regarding the tournarnent or our activities in the city.
Sincerely,
Terry Wilcox
Tournament Director
TtR�F� NAzs�o KNC Expenditures
City of Palm Springs
Social
Sunday Welcoming Party- Hilton S102,203
Monday Dine-a-rounds-Various Restaurants 78,519
Tuesday Gala Dinner-PS Convention Center 175,000
(` 11 11Decorations 89,000
Wednesday Theme Party-PS Convention Center 52,000
Total $496,622
Hotel
Rooms-Hilton, Spa, Wyndham $450,000
Incidentials 28,000
Food & Beverage 52,000
Pamper & Exercise 32,283
Room Set-ups 5,000
Hospitality Suite (Food) 67,933
Total $636,566
Miscellaneous
Gasoline-Downtown Shell S 2,670
Rental Vehicles (Linn Lines) 76,069
The Desert Sun 30,000
Palm Springs Life 5,000
Total $ 111,739
Summary
Social* S496,622
Hotel** 636,566
Miscellaneous 11 L739
Total $1,244,927
*Social-Palm Springs Restaurants: Melvyns', Spencers, Le Valleruis, L G's
Prime Steakhouse, Riccios, Johannes, Copley's,
"Hotel-Palm Springs Hotels-Palm Springs Hilton, Spa Hotel, Wyndhatn-
TOT Collections, 2007-$60,975
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5.C. PROPOSED SPONSORSHIP AGREEMENT FOR THE KRAFT NABISCO
CHAMPIONSHIP IN THE AMOUNT OF $26,000 FUNDED WITH COMMUNITY
PROMOTIONS BUDGETED UNALLOCATED FUNDING:
RECOMMENDATION: 1) Approve an Event Sponsorship Agreement for the Kraft
Nabisco Championship in the Amount of $26,000 pursuant to the terms and conditions
in the Term Sheet; 2) Authorized the Director of Finance/City Treasurer to allocate
$26,000 from budgeted Community Promotions Unallocated Priorities; and 3) Authorize
the City Manager to execute the Agreement in a form acceptable to the City Attorney.
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MATERIALS TO BE PROVIDED
Item No. 5 • V