For FY 18/19 (last fiscal year), the data in regards to Sponsorships and Fee Waivers were:
Resort Tax Sponsorships - $1,593,000.00
Waived Permit Fees (Non Profits) - $15,500.00
Waiver Permit Fees via Commission - $235,018.73
Waived Permit Fees via Sponsorship Contract - $200,609.79
i. Total Unrecognized Revenues (Fee Waivers) - $451,128.52
ii. Total Cash Sponsorships - $1,593,000.00
Attached you will find a detailed line by line break out of these amounts in the documents "Resort Tax Sponsorships 01.30.20" and "FY18.19 Fee Waivers".
For FY 19/20 (current fiscal year) the data in regards to Sponsorships and Fee Waivers (as of January 8, 2020) were:
Resort Tax Sponsorships - $1,668,893.25 (only to date – Jan 8 2020)
Waived Permit Fees (Non Profits) - $10,160.00 (only to date – Jan 8 2020)
Waiver Permit Fees via Commission* - $224,896.30 (only to date – Jan 8 2020)
i. Total Unrecognized Revenues (Fee Waivers) - $224,896.30
ii. Total Cash Sponsorships - $1,668,893.25
The administration believes that we have a financial responsibility to ensure that a cash sponsorship or City of Miami Beach (CMB) venue rental waiver in any amount, and every fee waiver request be evaluated against a set of approved criteria that sets forth a clear and transparent way in which the administration can adjudicate and recommend each request.
To outline the time savings, on average, a sponsorship item of less than $25,000.00 takes appx 12-16 hours of administration time to execute:
Researching initial agenda item - 3-5 hours (calls, emails, company research)
Preparing Commission Agenda Item - 1-2 hours (writing, approving, revising, resolution)
Preparing / Presenting Committee Agenda Item - 2-3 hours
Preparing / Presenting Final Commission Item - 1 hour (if no revisions required from Committee)
Execution of Item - 3-5 hours (calls with entity to inform of Commission decisions, writing contract / agreements, revisions, execution of contract).
Total: 12 – 16 hours per item
PROPOSED WAY TO MOVE FORWARD
The Tourism and Culture department believes that the City of Miami Beach's Sponsorship Request Process should have a clear mandate to ensure that all requests serve one of the following purposes:
1) To serve as an investment in our Resort Tax collection practices, by supporting experiences that can verify an increase in tourism, with hotel room blocks (contracts) or confirmed tourist attendance (ex: ticket sales).
2) To serve as a marketing / branding initiative by supporting experiences that place Miami Beach on the international stage via partnership and media / PR exposure.
3) To serve as a way to engage residents by providing unique and engaging experiences that increase their quality of life.
4) To serve to strengthen our cultural tourism initiatives.
In order to achieve the above, the Tourism and Culture Department would like to further elaborate on our existing guidelines, by implementing the following considerations:
1) Update Sponsorship Definition
2) Implement Sponsorship Score Card
3) Implement Sponsorship Term Limits
4) Implement Sponsorship Step Down
5) Implement Sponsorship Financial Limit
1) Updated Sponsorship Definition:
A sponsorship will be considered as any cash payment or CMB venue rental waiver to an applicant via this process, but will also now include any Fee Waivers in excess of $25,000.00. The administration also believes that these requests should be submitted during bi-annual submission deadlines (April and October), to ensure that requests are submitted at least ninety (90) days prior to the date needed to allow for proper administrative tracking and review. Requests may not be made retroactively.
All applicants for a City of Miami Beach cash sponsorship would need to identify a 1 to 1 financial match in a value equal to or greater than the amount being requested. The City of Miami Beach cannot be the sole financial provider.
If the applicant were not able to clearly identify a 1 to 1 match, via signed contracts or a Letter of Intent with a sponsor(s) or other source, the administration would recommend that this is not an event the City should be sponsoring, or that the applicant has not done the legwork required to produce a successful event.
The 1 to 1 match cannot come from the CAC, VCA, or other City of Miami Beach department (as these are all the same funding sources).
2) Implement Sponsorship Score Card:
For all cash sponsorships and CMB facility rentals, and for permit fee waivers of $25,000 or greater, applicants would need to submit their proposals during one of the two submission periods for each year.
This sponsorship score card outlines the initiatives of the City of Miami Beach as it pertains to event sponsorship and fee waivers and will score applications accordingly to ensure they meet the guidelines of funding.
In order to qualify for funding via the City of Miami Beach Sponsorship Ordinance, you must meet the following criteria:
- Have applied to the CAC or VCA for funding. If funding was denied, then the applicant would qualify for a CMB Sponsorship with proof of denial, however, if funding was received via the VCA or CAC, the applicant would not be considered for a cash sponsorship, but WOULD be eligible for fee waivers.
- The applicant must submit their request in writing to the Tourism and Culture department who can properly research and ensure that all agenda items have been vetted and approved by the administration in a clear and accountable manner. As part of this written request, the applicant would clearly identify dollar amounts.
Example Sponsorship Request:
Cash Sponsorship - $50,000
Fee Waivers - $48,000 based on permitting departments estimates
Total Sponsorship Request - $98,000
Once the above has been submitted and approved, the administration will score the applicant with the "City of Miami Beach Sponsorship Score Card" and request supporting documents. Should an applicant not be able to fulfill any of the above requirements, the Tourism and Culture Department would notify the applicant that their application is marked as incomplete and no further processing can take place. Should an application remain incomplete up to 14 days before the submission deadline, it would be considered null and void and the application would be nullified.
Score Card:
Successful applicants will be adjudicated against the attached "City of Miami Beach Sponsorship Score Card" based on the following criteria (further explanation of each criteria can be found in attachment "Score Card Explanations").
- Proof of 501(c)3 status
- Length of Event (incentive to get producers to shorten load in / load out times)
- History of Event
- Hotel Room Blocks
- Attendance (Local, National, International)
- Resident Discount
- Community Benefits (Education, Small Business, Seniors, Veterans)
- Marketing / PR Exposure
- Utilization of Multiple CMB Venues
- Name / Brand Exposure
The administration recommends that no sponsorships be pursued from applications who score less than 65% of this score card, as it would not be seen as a beneficial sponsorship against the administration's initiatives. This notification would also allow applications that they need to increase their score with additional marketing efforts, resident benefits or hotel rooms contracted.
Based on the score received from the Sponsorship Score Card, applicants would receive that percentage of their Sponsorship request:
Example:
As per the example above, an approved applicant is requesting the following:
a. Cash Sponsorship - $50,000
b. Fee Waivers - $48,000
Total request - $98,000.00
After completing the sponsorship score card, the applicant received a 72% rating. The applicant could then not receive more than 72% of their ask:
Cash Sponsorship: $50,000.00 x 72% = $36,000.00 in approved cash sponsorships
Fee Waivers : $48,000.00 x 72% = $34,560.00 in approved fee waivers
Total Award - %70,560.00 total sponsorship
3) Implement Sponsorship Term Limit
No sponsorship agreement can exceed a five-year term and in order to be eligible for a five (5) year term, the event must have been produced within Miami Beach for at least three (3) years prior to the application. All sponsorship contracts, no matter the term or dollar amount must include verbiage that requires an audit of post event data as per the Sponsorship Score Card, before the next year’s funding can be approved.
If a sponsorship is for a multi-year agreement, the applicant must prove, via audited statements, that all targets and goals were hit each year. If not, the administration reserves the right to re-evaluate the score, and reduce the sponsorship or cancel the agreement.
4) Sponsorship Step Down
All cash sponsorships must have a step down over the course of their duration, divided equally across the duration. Example: a $25,000 sponsorship over 5 years would have the following step down:
Year 1 - $25,000
Year 2 - $20,000
Year 3 - $15,000
Year 4 - $10,000
Year 5 - $5,000
Applicants who have been producing their events for a minimum of five (5) years within Miami Beach and who maintain a minimum sponsorship score card of 90% every year via verified documents, can be considered to continue their funding without the required step down. These will be on a case by case basis.
5) Sponsorship Budget Line Item
The administration recommends that a budgeted amount of $1,500,000.00 be set in the annual budget process. This $1,500,000.00 would include all cash sponsorships, as well as all fee waivers and CMB venue rental requests.
INTENDED OUTCOMES:
The administration believes that the above methods will increase accountability and financial responsibility, while also allowing applicants to see how they can increase their funding by aligning their events to the overall objectives of the City of Miami Beach. This process is expected to have the following outcome:
1) Increased Resort Tax Collection:
a. Proper use of sponsorship funds will increase Resort Tax Collection by ensuring we are supporting events that will bring tourists to our city, and fill hotel rooms.
b. Economic Impact on local businesses and cultural institutions through increased tourism will also be recognized.
2) Increased Miami Beach Brand Awareness:
a. Supporting High Quality events with international marketing reach, will only increase the way in which the world sees Miami Beach, and will help increase tourism year-round.
3) Increased Resident Quality of Life:
a. Supporting experiences that our residents want to attend.
b. Supporting experiences that put tourists in hotel rooms, which will help to calm traffic and parking issues, as attendees will be able to explore our city on foot rather than by driving.