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HomeMy WebLinkAboutDSD-2024-259 - Delegated Authority for Talent Purchases and Agreements Development Services Department www.kitchener.ca REPORT TO: Planning and Strategic Initiatives Committee DATE OF MEETING: June 3, 2024 SUBMITTED BY: Cory Bluhm, Executive Director, Economic Development (ext. 7065) PREPARED BY: Jeremy Dueck, Director, Culture & Entertainment (ext. 5264). WARD(S) INVOLVED: ALL DATE OF REPORT: March 16, 2024 REPORT NO.: DSD-2024-259 SUBJECT: Delegated Authority for Talent Purchases and Other Agreements RECOMMENDATION: That the Director of Culture & Entertainment, Manager of Special Events, Manager of Arts & Creative Industries, and Manager of Downtown Development and Innovation be authorized to execute legal agreements relevant to the business functions of the Culture & Entertainment division, in accordance with the approval parameters set out in DSD-2024-259, with said agreements to be to the satisfaction of the City Solicitor; and further, That the Director of Culture & Entertainment be authorized to execute sponsorship agreements, pertaining to Culture & Entertainment, in accordance with the approval parameters set out in DSD-2024-259, with said agreements to be to the satisfaction of the City Solicitor. REPORT HIGHLIGHTS: The purpose of this report is to modify existing delegated authority provisions related to executing legal agreements relevant to the Culture & Entertainment division Arts & Creative Industries, Special Events, and the Centralized Service Provider (i.e., supporting City-owned culture and entertainment venues). The key finding of this report is that the Director of Culture & Entertainment and various managers within Economic Development should be added to the roster of authorized individuals to execute the following agreements within the scope of the Culture & Entertainment division: talent offers and purchase agreements, special event and performer agreements, and sponsorship agreements. All said agreements to be to the satisfaction of the City Solicitor. Extending authority for these key legal agreements ability to lead and set expectations with venue operators, arts organizations, and community partners, secure live entertainment, improve business operations, create revenue generating opportunities, operate with transparency and accountability, and align with standard *** This information is available in accessible formats upon request. *** Please call 519-741-2345 or TTY 1-866-969-9994 for assistance. operating procedures that are considered best practice in the culture and entertainment industry. This report supports the delivery of core services. BACKGROUND: Culture & Entertainment is a newly formed sub-division that sits within Economic Development and includes 3 units: Arts & Creative Industries, Special Events, and the Centralized Service Provider (CSP), whose team is tasked with providing business services and operational support to the City-owned culture and entertainment venues (i.e., The Centre In The Square, The Registry Theatre, The Conrad Centre for the Performing Arts and The Aud). Collectively, these teams also support numerous City-owned facilities and their operators, including the 44 Gaukel Creative Hub, Victoria Park Pavilion, THEMUSEUM, and the Homer Watson House & Gallery. As staff review current business practices and work with internal departments to improve operational efficiencies, it is evident that delegated authority for a defined scope of legal agreements will provide clarity for staff as well as for invested groups who interact with the Culture & Entertainment team and conduct business with the City. Signing authority for the agreements described in this report have already been delegated to staff. The proposed changes refine which staff member is delegated to sign agreements. REPORT: Culture & Entertainment staff have identified the following agreements for which modified delegated authority would allow the team to function more efficiently and create the necessary infrastructure to scale up business services and operational supports: 1. Talent offers and purchase agreements; 2. Special event and performer agreements; and, 3. Sponsorship agreements. 1. Talent Offers and Purchase Agreements: The Culture & Entertainment division currently purchases major performers/entertainment, often associated with festivals and events, such as Canada Day. These are often procured through talent agencies. The process for purchasing a show usually consists of two steps: a) Submitting a talent offer sheet to the agent, and then, b) Signing a talent purchase agreement after the agent accepts the talent offer. Note: The terms of the talent purchase agreement align with the talent offer sheet. In these instances, purchase agreements have been prepared by third parties (e.g., agents, promoters, artists, etc.) for the City to sign. Talent agencies consider the offer sheet to be a binding proposal. The offer sheet outlines the basic financial deal points, and the purchase agreement adds additional terms and conditions, such as the technical/production rider. Given the expanded mandate to support all performing arts venues, it is likely that the requirement to purchase talent will increase. Having delegated authority clarity will allow staff to act when talent offer and talent purchase opportunities arise. Talent Offers and Purchase Agreements Current Delegated Authority Proposed Delegated Authority July 4, 2000 Add: Purchasing be Manager of Arts & Creative Industries designated to sign contracts generated by Director of Culture & Entertainment performers or their agents providing Legal Note: On November 9, 2021, Manager of Purchasing designated Manager of Special Events and Manager of the Kitchener Market to sign as well. All Agreements are to the satisfaction of the City Solicitor Like the delegated authority process recommended and approved in CSD-2023-233, Execution of Talent, Suite, and Sponsorship Agreements at The Audhe Manager of Arts & Creative Industries or Manager of Special Events would execute the talent offer sheet and subsequent talent purchase agreement upon receipt of approval from one of the following persons based on the risk value of the show (i.e., the artist guarantee): Artist Guarantee Delegated Authority Approval Required Less than $150K Manager, Arts & Creative Director, Culture & Entertainment CDN Industries Manager, Special Events Greater than Manager, Arts & Creative One of the following: $150K CDN Industries Executive Director of Economic Manager, Special Events Development, GM of Development Director, Culture & Services, or CAO Entertainment For free festivals and events, the upset limits of performer costs are often determined by the event budget. Where staff may seek to host a ticketed event (such as those that currently occur at The Aud), managers in the Culture & Entertainment division will complete a pro forma/business case to assess the breakeven point for ticket sales and ancillary revenue generation opportunities with each talent purchase. 2. Special Event and Performer Agreements: When supporting festivals and events on City property, the City often requires two types of contracts to be signed: i) special event agreements, signed by a third-party organization seeking to host/partner on an event on City lands; and, ii) performer agreements, signed by artists who the City has contracted to perform. Unlike Talent Offers, these agreements are generated by City staff. Following a similar process used at The Aud (Community Services Department Report CSD- 02-208), staff have been working with Legal Services to revise an outdated event partnership agreement template previously approved by Council in 2006. The resulting revised special event agreement can be used for Culture & Entertainment events. This report recommends that the Director of Culture & Entertainment, Manager of Arts & Creative Industries, or the Manager of Special Events be authorized to sign the Agreement on behalf of the City. Staff have also been working with Legal Services to revise an outdated performer agreement template which was initially approved by Council in 1999. In 2000, Council delegated authority to sign same to the Manager of Purchasing or designate, to a monetary limit of $7,000. In 2000, Council also delegated signing authority to Facilitators in Community Programs and Services, the Facilitator of Special Events, and the Director of Community Programs and Services, with the same $7,000 monetary limit. In 2006, Council increased The proposed changes would authorize additional Managers within Economic Development to sign said agreements. Current Delegated Authority Proposed Delegated Authority Pre-Approved Special Event Agreement Template September 25, 2006 Add: ment Manager of Arts & Creative Industries template, as attached to Community Director of Culture & Entertainment Services Department report CSD-06-098, be approved; and further, That the Manager of Special Events be authorized to execute the pre-approved Event Partnership Agreements, subject to the Pre-Approved Performer Agreement Template May 8, 2006 Adjust/Add: Facilitator of Special Events be Manager of Special Events authorized to execute the pre-approved Manager of Arts & Creative Industries Entertainment and Service Provider Manager of Downtown Development & contracts, to a limit of $20,000, subject to Innovation the satisfaction of the City Solicitor and Director of Culture & Entertainment All Agreements are to the satisfaction of the City Solicitor 3. Sponsorship Agreements: On various occasions, City staff have been able to secure sponsorships for festivals and events. These are often one-time sponsorships, and typically relate directly to the programming delivered at an event. Sponsorship Policy (GOV-COR-2000) which grants the CAO or DCAO the delegated authority to enter into agreements for amounts up to $125,000 for the term of the agreement, subject to the satisfaction of the City Solicitor. As most sponsorship agreements are often for lesser amounts (e.g., sponsorship agreements worth $5,000) it is more appropriate that signing authorities be delegated from the CAO and DCAO to the appropriate Director and Manager as noted in the table below. The delegated authority recommended would be exercised upon the approval set out below, and : Delegated Authority Value of Sponsorship Agreement pertaining to Culture & Entertainment Manager of Arts & Creative Industries Less than $50,000 for the term, less than Manager of Special Events 10 years in duration and not for naming Manager of Downtown Development & rights of an entire complex. Innovation Director of Culture & Entertainment Less than $125,000 for the term, less than 10 years in duration and not for naming rights of an entire complex. City Council based on Greater than $125,000 for the term, Sponsorship Policy (GOV-COR-2000) longer than 10 years, and naming an entire complex. All Agreements are to the satisfaction of the City Solicitor Updating this delegation of authority will allow for sponsorship agreements pertaining to Culture & Entertainment to be expedited, creating a better customer experience through efficient business operations. All sponsorship agreements will continue to abide by the Conclusion Approving these delegated authority recommendations will allow the Culture & Entertainment division to achieve greater operational efficiency and provide an improved ability to respond to emerging, time-sensitive opportunities. STRATEGIC PLAN ALIGNMENT: The recommendation outlined in this report supports the achiev vision through the delivery of core service. FINANCIAL IMPLICATIONS: No direct impact. Purchasing of performances for free events are made within the scope of approved budgets. The financial risks of solely purchasing a show or buying cooperatively with a promoter include event cancellation, low ticket sales, and negative publicity. In these instances, staff will complete a pro forma/business case for each event and ensure there is appropriate budget capacity to cover any losses. The direct financial liability of cancelling a show is outlined in the offer sheet and talent purchase agreement with the agent (i.e., the COMMUNITY ENGAGEMENT: INFORM ebsite with the agenda in advance of the council / committee meeting. PREVIOUS REPORTS/AUTHORITIES: CSD-2023-233, Execution of Talent, Suite, and Sponsorship Agreements at The Aud CSD-02-208, Licence to Operate an Event Agreement at the Kitchener Memorial Auditorium Complex GOV-COR-2000, Municipal Sponsorship Policy APPROVED BY: Dan Chapman, CAO ATTACHMENTS: NA