HomeMy WebLinkAboutCAO-14-029 - Removal of Leisure Guide Advertising Rates From Fees & Charges Schedule Staff Report
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REPORT TO: Finance and Corporate Services Committee
DATE OF MEETING: June 23, 2014
SUBMITTED BY: Jana Miller, Executive Director, Office of the CAO
(519-741-2200, ext. 7231)
PREPARED BY: Laura Johnston, Director, Corporate Communications & Marketing
(519-741-2200, ext. 7395)
WARD (S) INVOLVED: All
DATE OF REPORT: June 2, 2014
REPORT NO.: CAO-14-029
SUBJECT: REMOVAL OF LEISURE GUIDE ADVERTISING RATES
FROM FEES AND CHARGES SCHEDULE
RECOMMENDATION:
That the Fees and Charges Schedule be amended to remove Leisure Guide Advertising
Rates.
BACKGROUND:
In December 2013, Council received the City's Municipal Sponsorship Strategy which focused on
opportunities to leverage municipal assets to generate non-tax based revenue through sponsorship
agreements in areas such as advertising, private sector sponsorships and naming rights.
In February 2014, City Council approved a new Municipal Advertising Policy and in May it approved a
list of municipal assets available for future advertising opportunities. Included on that inventory is the
city's Leisure Guide publication, for the purposes of expanded advertising opportunities.
REPORT:
Leisure Guide is a seasonal publication that lists recreation and leisure activities offered by the City of
Kitchener. The Guide currently contains private sector advertisements as well as ads promoting city
services and program. Advertising rates —for both commercial and non-profit agencies - have been
part of the City's Fees and Charges Schedule and are approved annually during the budget process.
Increases in advertising rates are also subject to council approval and traditionally, increases range
from one to two per cent.
Leisure Guide is the only city publication on the Fee Schedule. The rates for Leisure do not reflect
current market rates. Given Leisure Guide is the only magazine in Kitchener that is delivered free to
every household throughout the city, the only other comparable publications that sell advertising and
have similar distribution are community newspapers. Leisure Guide rates are far lower than the current
market rate. For example, a full page, colour advertisement in Leisure Guide is $1,100, while an
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equivalent ad in a community paper is approx. $3,600, and an equivalent ad in Grand Magazine is
closer to $6,000.
The current ad rates are an obstacle for using Leisure to generate increased amounts of non-tax based
revenue for the city.
Three key benefits would be achieved by removing Leisure from the Schedule:
- enable the publication to compete in the marketplace and potentially generate substantially
higher revenue for the municipality;
- flexibility to offer incentives for long-term advertising contracts and
- the ability to quickly and regularly adjust rates to reflect market comparators and/or negotiated
advertising agreements.
Non-profit ad rates
It is important to note that currently there are two rate structures for advertisements in Leisure:
commercial rates and a reduced rate for non-profit groups. The original intent of the non-profit rates
was to ensure community organizations are able to purchase affordable advertising to promote their
programs. Under staff's proposal to remove the Leisure ad rates from the fee schedule, this system of
two ad rates would continue as a way of ensuring affordable rates continue to be offered to not-for-
profile and charitable organizations.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
The Municipal Partnership Program will assist in creating a more efficient and effective government
through the strategic management of city assets and will reduce municipal reliance on taxes through
the exploration of new sources of sustainable revenue.
FINANCIAL IMPLICATIONS:
In the 2013 budget process, Council set a target of$20,000 in new advertising revenue based on
increased ad rates for Leisure ($5,000) and new advertising opportunities in all of the City's publications
($15,000). Removal of Leisure from the Fees and Charges Schedule will provide the flexibility to set ad
rates based on market conditions and provide staff with a better ability to negotiate advertising
agreements and costs. This will generate the additional revenue for the municipality that is anticipated
through the Municipal Partnership Program.
COMMUNITY ENGAGEMENT:
As part of the Agenda process, this report has been posted to the City's website: www.kitchener.ca
ACKNOWLEDGED BY: Jeff Willmer, CAO
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