City Council
MEETING DATE: 6/22/2015
TITLE:
Title
Chamber of Commerce Service Provider Agreement and Lease Agreement for FY15/16
End
FROM:
Leisa Lukes, Economic Development Manager
RECOMMENDATION:
Recommendation
Staff recommends the City Council approve the Chamber of Commerce Service Provider Agreement and Lease Agreement; authorize the City Manager to sign the Agreements; and approve an appropriation and necessary budget transfers in the FY15/16 budget of $60,000 for the agreed upon services.
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BACKGROUND:
The Cathedral City Chamber of Commerce serves to represent the community's business interests and to advocate on behalf of the business community. It is a non-governmental entity, but acts as a partner with the City for purposes of retaining and attracting businesses to Cathedral City. It can also benefit the City through cooperative marketing programs and by providing Visitor Center services. Staff is requesting that the City Council allocate funds from the general fund to the Chamber to accomplish the scope of work identified in the attached Service Provider Agreement. Staff is also requesting that the lease agreement for office space be renewed with the Chamber for a limited period of time at a specified lease rate.
DISCUSSION:
The Cathedral City Chamber of Commerce, in operation for 75 years, has been a partner with the City since the city's incorporation in 1981. It is served by a 15-member board of directors and it currently employs a President/Chief Operating Officer and one additional staff person. Volunteer ambassadors supplement the work of the board and staff. The Chamber currently has approximately 330 members.
The Service Provider Agreement entered into each year between the City and the Chamber includes a Scope of Services that specifies the work to be performed by the Chamber on behalf of the City. It also includes requirements for reporting the Chamber's activities and budget performance on a quarterly basis. In exchange for the services provided, the City's annual support of the Chamber has ranged between $21,000 and $75,000 over the past 20 years. Since 2012, the annual amount has been $50,000.
In January 2015, the City Council adopted its annual Strategic Plan, which included reviewing and evaluating the Chamber's current Service Provider Agreement. That process began at the City Council Study Session on March 25, 2015, where Staff provided a brief presentation of the history of the Chamber, the City's annual support over the years, an overview of the Chamber's current Service Provider Agreement, and the varied obligations and support received by other chambers within the Valley.
Public comments during the Study Session supported the ongoing need for a chamber of commerce and its work with the business community. There was also general consensus that timely review of the current service provider agreement was needed to better align the work of the Chamber with the Council goals. In particular, the need for the Chamber to reach out to existing businesses and gather information to facilitate business retention and growth within the city was identified. It was noted that the services to be provided by the Chamber on behalf of the City should have measurable results to enable them to be quantified within the Chamber's quarterly reporting. Growing the Chamber's membership to enable the Chamber to become self-supporting was also identified as an overall goal of the Council.
The location of the Chamber office was also discussed at the March Study Session. The current office is a significant upgrade from the previous one, and having the Chamber in a location suitable for providing Visitor Center services is desirable. Statements were also made to indicate that the Chamber's adjacency to City Hall blurred the lines of separation with regard to the Chamber's role as an advocate for private business.
The Council directed that a committee be formed to recommend amendments to both the service provider agreement lease agreement for the upcoming fiscal year (FY15/16). The composition of the committee included City representatives: Mayor Henry, Mayor ProTem Pettis, City Economic Development Manager Leisa Lukes, and Chamber representatives Board Chair Valerie Ward and Board members Lesa Bodner, Todd Hooks, and Andy Jessup, Jr.
The committee held meetings on April 13 and April 27, with the first meeting also attended by City Manager Charlie McClendon and Chamber President/CEO Lynn Mallotto. Over the next several weeks a draft Scope of Services was prepared, reviewed and discussed by the Committee members, both jointly and in separate Chamber and City subcommittees, as were the lease terms and potential office relocation options. The culmination of these meetings and discussions is reflected in Exhibit B, Scope of Services, of the proposed Service Provider Agreement (Attachment 1) and Lease Agreement (Attachment 2), and summarized below.
SERVICE PROVIDER AGREEMENT
The four categories included in the FY15/16 Agreement consolidate several of the categories in the prior agreement and include:
-Visitor Center
-Community Outreach
-Chamber Events
-Promotions and Marketing
Two categories from the prior agreement (Commercial Space Inventory and Workforce Development) could remain within the purview of the Chamber; however, they will no longer be within the realm of the City's sponsorship.
The Chamber will continue to serve as the city's "Visitor Center." Cathedral City businesses will be given priority in referrals and be included along with any referral for businesses that are Chamber members but not located within the city. In an effort to grow Chamber membership, non-Chamber businesses will not be promoted. The Chamber will maintain a log to record the quantity and type of inquiries received to assist the City in understanding what visitors are seeking.
The City will continue to provide the Chamber with a bi-weekly listing of new and renewing business license applicants to enable the Chamber to contact these businesses within 30 days to thank them for being a member of the business community. The Chamber can also be proactive in growing its membership by personally informing the businesses of the benefits of Chamber membership. To strengthen its connection with the business community, the Agreement calls for the Chamber to conduct monthly business walks, visiting a minimum of 10 businesses per walk, and seeking input on 2 to 3 questions per visit. The inquiries are intended to determine the current business climate in the city and whether a business is seeking to expand or if there are concerns to be addressed. This is particularly important during road construction projects, or other instances when City growth and improvement activities may be disruptive to daily business activities. The results of these inquiries are to be included in the quarterly Activity reports, with timely information conveyed, as appropriate.
In addition to site visits, the City is seeking Chamber assistance in obtaining business input on new or modified guidelines and programs, such as shopping cart regulations, through a limited number of short (3-4 question) e-surveys sent to members. These inquiries, which could have a direct impact on future activities, could be perceived as an added value of Chamber membership.
The Chamber hosts a number of events throughout the year, including the monthly event (i.e., Chamber lunches), the annual community recognition event (i.e., Orion Awards), and the State of the City. These "Chamber Events" are an extension of community outreach. The City's role and support are addressed in the "Chamber Events" section.
The Chamber's role in "Promotions and Marketing" is a key element of the City's support. In addition to growing and marketing its own membership and events, the Chamber is also a key participant and supporter of City events. To assist in this, a Chamber representative is to attend the City's Parks and Special Events Commission meetings to learn first-hand about City events. For three of the City's largest events, the City will provide the Chamber with a booth at no cost to further promote Visitor Center materials.
As a priority for FY15/16, the Chamber will create a "Local First Cathedral City" Program in cooperation with the City's Economic Development Manager. The goal of the Program is to drive customers to Cathedral City businesses. It may include a number of cost-effective tools, such as social media campaigns, Channel 17 and e-reader notifications, on-line coupons, frequent dining cards, and giveaways. Closely aligned with this Program is the Chamber's development of at least one working group representing a Cathedral City business cluster, such as the consignment cluster. In partnership, the City will use weekly social posts to convey Chamber information as appropriate upon receipt of the information from the Chamber. To continue to stay involved and supportive of Chamber activities, the Chamber Board will include one ex-officio, non-voting City representative.
The proposed sponsorship for the Chamber's provision of services on behalf of the City for the upcoming fiscal year is $60,000. In accordance with the Service Provider Agreement, the Chamber is to submit by January 1, 2016, a business plan for increasing membership and increasing non-City revenues.
LEASE AGREEMENT
The Lease Agreement allows for the Chamber offices to remain in their current location encompassing 1,040 square feet in Civic Center through September 1, 2015, at a lease rate of $0.85 per square foot for a total of $884 per month payable upon termination of the lease. There is a provision for a one-time extension of up to 3 months, with an increase in rent during the extension period of $1.25 per square-foot for a total of $1,300 per month plus triple net. A rent incentive is provided should the Chamber not exercise the lease extension option.
FISCAL IMPACT:
The FY15/16 funding request for the Chamber for providing services to benefit the City is $60,000, which is a $10,000 increase from the adopted budget amount, for FY 15/16, of $50,000. The Service Provider Agreement, Exhibit B, provides for quarterly allocation from the general fund upon the City's receipt of the Chamber's quarterly Activity and Budget Report and upon completion of a quarterly meeting between Chamber representative(s) and City representatives (Council subcommittee and staff).
ATTACHMENTS:
1. Chamber Service Provider Agreement
2. Chamber Lease Agreement