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Home My WebLink About15.A.3. Renewal of Arena Advertising Agreement Js:A.2J . CITY OF SHAKOPEE CONSENT MEMORANDUM To: Mayor and City Council Mark McNeill, City Administrator From: Joshua Barrick, Recreation Supervisor & Arena Operations Meeting Date: December 16, 2003 Subject: Renewal of Arena Advertising Agreement INTRODUCTION City Council is asked to consider renewal of the Arena advertising agreement with Shakopee Hockey Association for two additional years. BACKGROUND AND DISCUSSION In 2002, City Council authorized a on~year agreement with Shakopee Hockey Association to have the Association coordinate the advertising in the arena. Prior to this time, the Shakopee Hockey Association had a two-year agreement from 2000-2002. It was negotiated to provide a revenue source for Shakopee Hockey Association that would help control per participant costs for ice rented at the Arena, while ensuring the City met its budgeted advertising revenue projections. In addition, it required that SYHA conduct the majority of administrative work associated with the program. Terms of the agreement include a minimum annual payment of $5,000 in the event that (25%) of gross sales is to be less than $5,000. In the previous contract there was no minimum payment. The City will still retain full control over approval of the ad content and design. The Association is responsible for all sales, design, production, and billing. The current agreement ends on December 31, 2003. The advertising program has the potential to generate significant revenue. Depending on the design and number of ads, we estimate that this program could produce over $30,000 annually. As stated previously, this revenue would provide an opportunity for the Hockey Association to generate funds that will be applied toward ice rental, ultimately keeping costs down for participants. AL TERNA TIVES 1. Extend the revised agreement with Shakopee Hockey Association for two additional years. 2. Allow the current agreement to expire and direct City staff to assume the advertising program. RECOMMENDATION I would recommend Alternative #1, that the agreement be renewed for two additional years. REQUESTED ACTION If Council concurs, move to authorize a two-year agreement with Shakopee Hockey Association for Arena Advertising. ~~ J~ua Barrick Recreation Supervisor & Arena Operations SHAKOPEE HOCKEY ASSOCIATION ADVERTISING AGREEMENT 2003-2005 This agreement made and entered into this day of ,2003, by and between the City of Shakopee, a Minnesota municipal corporation, located at 129 Holmes Street, Shakopee, in the County of Scott, State of Minnesota (hereinafter referred to as "CITY") and Shakopee Hockey Association, a nonprofit corporation in the County of Scott, State of Minnesota (hereinafter referred to as "SHA"). WITNESSETH: Whereas, the City of Shakopee is desirous of generating revenue through the use of dasher board and banner advertising; and Whereas, SHA wishes to sell dasher board and banner advertising at the Shakopee Ice Arena in order to raise funds for the ongoing support of youth hockey in the community; and Whereas, SHA uses dasher board and banner advertising revenue to rent ice time at the Shakopee Ice Arena, which is a benefit to the CITY. Now, therefore, in consideration of the promises, terms and conditions stated herein, the parties agree as follows: I. DUTIES AND RIGHTS OF SHA A. SHA shall use its best efforts to locate advertisers for available advertising space in the Shakopee Ice Arena and to negotiate advertising contracts for the arena, provided that all the advertising contracts are subject to the following: (1) advertising rates shall be at the rates approved by the CITY; (2) the advertiser is satisfactory to CITY. All advertisements shall be based on the Shakopee Ice Arena Advertising Program (Exhibit A). B. SHA shall designate one representative that will act as the association's liaison in coordinating activities with the CITY. C. SHA agrees to pay the CITY an amount equal to Twenty Five Percent (25%) gross annually from the sale of dasher board and banner advertising. SHA shall project total revenue for the calendar year and report the total projected annual CITY payment on June 30. A minimum annual payment of $5,000 is to be made to the City in the event that (25%) of gross sales is to be less than $5,000. It is understood that SHA will invoice all advertisers, and advertisement payments will be made to SHA at its mailing address. Payments due to the CITY will be made to the CITY on a bi-annual basis on or before (June 1 and December 31). Cash flow reports and inventory lists will be forwarded to the CITY at time of payment. D. SHA shall be responsible for working with advertisers on design and production of advertising panel and/or artwork. SHA shall review all artwork and ensure that it meets the standards set forth by the CITY. SHA shall obtain CITY approval of artwork prior to production. The CITY reserves the right to reject any copy, pictorial, or graphic, that (1) is inappropriate for children or young adults (no sex, drugs, alcohol or tobacco are permitted); (2) is a violation of existing laws; or (3) in any way reflects negatively on the character, integrity or standing of any individual, group, firm or corporation. E. On or before April 1 of each year, SHA shall provide the CITY with a copy of the year-end Advertising Sales financial report prepared by SHA for its Board of Directors. F. SHA or the CITY may terminate this agreement upon thirty (30) days written notice to the other party, except as outlined in II.A. In the event of such termination by either party, SHA agrees to pay the CITY the full remittance owed as of the date of termination. G. SHA agrees to comply with Minnesota Statutes 181.59 and other related state and federal laws prohibiting discrimination in performance of this agreement on the basis of race, color, creed, religion, national origin, sex, marital status, disability and status with regard to public assistance, age or familial status. SHA agrees to hold harmless and indemnify the CITY from costs including but not limited to damages, attomey fees and staff time in any action or proceeding alleging illegal discrimination. H. SHA agrees to comply with the Americans With Disabilities Act and not to discriminate on the basis of disability in the admission or access to, or treatment of employment in its services, programs, or activities. Upon request, accommodation will be provided to allow individuals with disabilities to participate in all services, programs, and activities. The CITY has designated coordinators to facilitate compliance with the Americans Disabilities Act of 1990 (ADA), as required by Section 35.107 of the U.S. Department of Justice regulations, and to coordinate compliance with Section 504 of the Rehabilitation Act of 1973, as mandated by Section 8.53 of the U.S. Department of Housing and Urban Development regulations. SHA agrees to hold harmless and indemnify the CITY from costs including but not limited to damages, attorney fees and staff time in any action or proceeding alleging a violation of the ADA. II. DUTIES AND RIGHTS OF THE CITY OF SHAKOPEE A. The CITY may immediately terminate this agreement in the event that SHA fails to locate advertisers, or otherwise fails to perform its duties under this agreement. B. The CITY will coordinate installation of advertising within agreed upon time frame. In the event that specialized skills, equipment, or tools are needed for installation, it is understood that SHA will be responsible for these costs. III. JOINT DUTIES AND RIGHTS A. SHA and the CITY agree to prepare, or have prepared, advertising and promotional materials to be used by SHA in the solicitation of advertisers. Any costs for professional design or printing services shall be responsibility of SHA. 2 B. SHA and the CITY agree to coordinate the administration of advertising contracts, including production, and securing signatures. C. SHA and the CITY agree to mutually research, interview, and select a business (or businesses) to produce advertisements. It is understood that all costs associated with the design, production, installation (when beyond the ability of CITY staff), and repair/upkeep of advertisements shall be the responsibility of SHA. D. It is mutually understood and agreed that this Agreement represents the entire agreement between the parties and supersedes all prior agreements or proposals, written or oral, and that no alternation, modification or addenda to the terms of this Agreement shall be valid unless made in writing and signed by the parties hereto. E. This Agreement shall not be assignable except by the written consent of the CITY. F. This Agreement shall be governed by the laws of the State of Minnesota. G. The term of this agreement shall be from date of signature by both parties through December 31, 2005. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their proper officers, thereunto duly authorized, as of the day and year first above written. CITY OF SHAKOPEE SHAKOPEE HOCKEY ASSOCIATION Mayor President City Administrator City Clerk 3