In FY 18/19, the City of Miami Beach issued sponsorships and fee waivers in the amount of $1,954,128.52. In view of the significant amounts allocated each year for sponsorships, the Administration has proposed Revised Special Event Guidelines that include a more specific evaluation process for review of sponsorship applications. The Tourism and Culture department believes that the City of Miami Beach's Sponsorship Request Process should have a clear mandate that all applications should serve one of three public purposes:
(1) To increase Resort Tax collection, by supporting experiences that can verify Tourism initiatives with large hotel room blocks or confirmed tourist attendance.
(2) To sponsor events that serve as a marketing/branding opportunity for the City, to generate favorable media impressions on the international stage via partnership and media / PR exposure.
(3) To promote quality of life for the City’s residents, by promoting events that City’s residents would want to attend.
I. Revised Special Event Guidelines
The Administration recommends the Revised Special Event Guidelines to accomplish the following:
(1) Update the definition of “sponsorship” to also include requests for rental waivers and other fees associated with those rental waivers at City facilities (such as the Miami Beach Convention Center, Colony Theater, North Beach Bandshell, etc.).
(2) Approve a “Sponsorship Score Card” with the weighted criteria for all aspects of an event and the proposed sponsorship.
(3) Provide for sponsorships to be approved on an annual basis, with limits on multi-year sponsorships, as well as a “step down” for multi-year sponsorships, to reduce City’s financial contribution over time.
(4) Approve a maximum annual budget line item for sponsorships.
Each of the foregoing revisions is discussed more fully below.
(1) Sponsorship Definition
A sponsorship will be considered any cash payment to an applicant via this process, but will also include Special Event Permit Fee Waivers, as well as rental waivers for use of City of Miami Beach properties (Miami Beach Convention Center, Fillmore Miami Beach or the Colony Theater).
(2) Sponsorship Score Card and Eligibility Criteria
(a) Score Card
In an effort to structure the sponsorship review process and save time and resources associated with evaluation of sponsorship proposals, the Administration recommends approval of the proposed “Score Card,” attached as Exhibit ___ hereto, as well as the Score Card Explanation attached as Exhibit ___ hereto.
This score card will only apply to sponsorships of $25,000 or greater, as sponsorships of less than $25,000 would need to be secured via the Cultural Arts Council or the VCA grant system.
For all sponsorships with a value of $25,000 or greater, applicants would need to submit their proposals bi-annually for the following fiscal year (Example: if funding is needed for an event between October 1, 2021, an applicant would need to apply by March 2021 to be considered as part of the FY 21/22 budget process).
Based on the criteria and points allocated in the Score Card, the City’s Tourism Department will score each sponsorship proposal, based on a maximum possible score of 100. The final score will form the basis for the Administration’s recommendation for funding of a sponsorship application on a percentage basis. For instance, if an applicant requests $100,000 in sponsorship funding, and receives a total score of 85 out of 100 points, the Administration’s recommendation would be for that applicant to receive a maximum of 85% of its sponsorship request, or $85,000.
The Administration further recommends that no sponsorships be pursued from applications who score less than 65 points on the Score Card. Applicants would be notified of their score and would be given the chance to increase their score (i.e., in order to receive a higher score for public benefits, applicant could offer a higher resident discount or other benefit).
The Score Card and the dollars recommended would formalize the Administration’s review process, and would serve as useful guidance to the City Commission with respect to its final review of sponsorship requests.
(b) Eligibility Criteria
In addition to basic scoring, the Revised Sponsorship Guidelines specify additional eligibility criteria for City sponsorships, so that only those applications meeting the criteria would go through the process of getting scored and recommended for a City sponsorship. The criteria include:
· Applicants must have previously applied to the CAC or VCA for funding. If funding was denied, then the applicant could 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.
· Applicants must demonstrate a 1:1 financial sponsor match in a value equal to or greater than the amount being requested (this includes fee waivers).
o If the entity is not able to clearly identify a 1:1 match, no sponsorship award would be recommended.
o The 1:1 match cannot be a sponsorship, or in-kind donations from the CAC, VCA, it must be a private entity or third-party governmental grant (i.e., from a source other than the City of Miami Beach, City of Miami or Miami Dade County).
o The City of Miami Beach should not be the sole supporter of any event, unless that event is being produced by a City of Miami Beach department (Tourism and Culture, Parks and Recreation, etc.)
· No cash sponsorship from the City of Miami Beach can be spent on event infrastructure such as staging, barricades or security. Cash sponsorships must be spent on items that will enhance attendee experience (entertainment/programming, art installations, rides, etc.).
· No application will be considered until all City application forms are completed and all information requested in the application forms have been provided to the Administration.
(c) Administrative Review of All Applications Prior to City Commission Action
The proposed Score Card and evaluation process will be effective only if all applications are required to go through the sponsorship review process prior to City Commission action. The Administration proposes that applicants must submit their request in writing to the Director of the Tourism and Culture Department. The Administration recommends that only sponsorship requests that have been evaluated and scored by the Administration be placed directly on the agenda,
(3) Sponsorship Term Limit / “Step Down” of Sponsorship Amounts Over Time
No sponsorship agreement can exceed one (1) year. Applicants that have received sponsorship for three (3) years, prior to application, may be eligible for a multi-year sponsorship agreement, not to exceed three (3) years.
All sponsorship agreements, regardless of term and/or dollar amount, must require post-event audit and data consistent with the Sponsorship Score Card weighted criteria, before additional funding can be reviewed and approved.
If a sponsorship is for a multi-year agreement, the applicant must prove, via audited statements, that all targets and goals were achieved. If not, the Administration reserves the right to re-evaluate the score, and reduce the sponsorship or terminate the agreement.
In addition, for multi-year cash sponsorships, or for applicants who have previously received annual sponsorships, the Administration recommends a step-down process, to be applied over a three year period, so as to reduce an event’s dependence on the City for sponsorship.
$25,000 sponsorship over 3 years would have the following step-down:
Year 1 - $25,000 Year 2 - $20,000 Year 3 - $15,000
Applicants who have been producing their events for a minimum of three (3) years within Miami Beach, and who maintain a minimum sponsorship score card of 90% every year via verified documents, may be recommended for continued funding.
(4) Maximum Annual Budget for Sponsorships
In FY 18/19, the City of Miami Beach has sponsored events (cash sponsorships and permit fee waivers) out of the Resort Tax Fund in the amount of $1,503.000.00, in addition to fee and permit fee waivers in the amount of $451,128.52. This has resulted in a total of $1,954,128.52 in sponsorships and waived fees for FY 18/19.
In order to better control and structure sponsorship requests through the above annual process, the Administration further recommends that a maximum annual budget of $1,500,000.00 be set for the award of sponsorships each year.
II. FY 2021-2022 / 2022-2023 Budget and Application Schedule
The Event Sponsorship application submission process would be as follows:
FY 21/22 Standard Schedule
Events held between January 1, 2021 and September 30, 2022
Submission period opens September 1, 2021 and closes on October 30, 2021. Sponsorships presented to Commission on or before December 2021 Commission meeting.
FY 22/23 Standard Schedule
Events held between October 1, 2022 – September 30, 2023
Submission period opens January 1, 2022 and closes on February 28, 2022. Sponsorships presented to Commission on or before April 2022 Commission meeting.
FY 23/24 Standard Schedule
Events held between October 1, 2023 - September 30, 2024
Submission period opens January 1, 2023 and closes on February 28, 2023. Sponsorships presented to Commission on or before April 2023 Commission meeting.
III. Concept of Mayor and Commission Discretionary Fund – NOT RECOMMENDED BY THE ADMINISTRATION
In an attempt to allow the Mayor and Commission more ability to sponsor the experiences they feel are important to our community, the NQLC considered, and declined to recommend a discretionary fund for each Commissioner and the Mayor, which will allow each elected official to support any event requesting cash sponsorships or fee waivers, up to the annual amount allocated to each elected official.
The allocations would be as follows:
Mayor - $25,000.00 fund
Commissioners - $12,500 fund x 6 Commissioners
Total - $100,000.00 budgeted sponsorship dollars and fee waivers for smaller, community-based events.
Once these funds were exhausted, applicants would need to go through the CAC or the VCA to receive support for sponsorships under $25,000.00 as the Administration will no longer consider sponsorships, or in-kind donations of less than $25,000.00.
This discretionary funds would allow the Mayor and Commission to award sponsorships up to the annual allocation, , without taking up significant time preparing agenda items, agreements, etc., for minimal sponsorship amounts.
The Administration does not recommend the proposed Discretionary Fund, as it is unlikely to lead to any material reduction in sponsorship requests. In addition, by creating a different process that would permit event organizers to reach out to individual Commissioners and bypass the procedures in place for grant awards by the CAC, VCA, and the Administration, the proposed Discretionary Fund is inconsistent with, and could potentially undermine, the efforts to create a formalized review process, as set forth in this Commission Memorandum. As such, the Administration does not recommend the establishment of the discretionary fund.
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 approximately 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) 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.
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:
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.
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.