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12-07-09 Town Council Packet (2) MEMORANDUM TO: Snowmass Village Town Council FROM: Russ Forrest, Town Manager DATE: December 7, 2009 SUBJECT: Request for Support from Jazz Aspen Snowmass I. Purpose and Actions Requested of Council: At the November 16, 2009 Council meeting, representatives of Jazz Aspen Snowmass (JAS) requested that the Town increase their support/sponsorship of the event from $150,000 to $250,000. JAS also requested that the Town allow more tickets to be sold for the event. As an alternative to those requests, JAS asked that the Town support a change in venue to Buttermilk for greater capacity to support "A" level talent which would allow for increased attendance. Since various messages had been communicated from JAS over the last month, the Council and staff asked that JAS put their request in writing which is attached. II. Background The Town of Snowmass Village has sponsored JAS since 2003 through funding from the Marketing budget in exchange for tangible benefits such as inclusion in advertising, promotional support, discounted tickets for lodges to bundle with rooms, an onsite presence and GA Patron tickets. Below is the overview of this financial support: 2003 -2006: $162.5K sponsorship fee, plus $37.5K bonus to be earned based on every 1 K in attendance above the historical 24K up to 30K people. In 2003, JAS earned some of the bonus for a payout of $177.6K; the full bonus was realized in 2004 2005; and no bonus was paid out in 2006. 2007, 2008: Guaranteed $200K for significantly increased benefits including more ads and ads passed through to Snowmass Village, additional tickets, cross promotions and greater onsite presence. 2009: $175K for same benefits as 2007 and 2008 except elimination of JAS June tickets. Total financial support for JAS since 2003 is $1,315,100, which on average is $187,871/year, III. Options for Councils Consideration Based on the discussion that occurred with Council on November 16 staff has prepared the following options with potential implications for the Town Council's consideration. Option 1: Increase financial support for JAS This option would increase funding for JAS from $150,000 currently allocated in the Marketing budget to $250,000. Council discussed several options including purchasing tickets from JAS to sell and recoup some of the $100K incremental contribution as well as a loan. Another option that was explored was the Town finding additional sponsors for the event. JAS responded that if the Town purchased tickets it would create confusion for guests, multiple fulfillment issues, and cannibalization of tickets sales between the Town and JAS. If the Town could help increase sponsorship of the event that could help meet JAS's expectation. However, increasing sponsorship in this economy would be uncertain at best and would not meet JAS's expectations. Additionally, it would simply move any potential sponsorship dollars from events the Town is trying to fund to JAS. This option could be done in a number of ways. First, the Town could donate its municipal services (Transportation, Police, Public Works ect) that have been historically charged back to JAS. That would have a value of approximately $60,000 that would need to be budgeted in the General Fund leaving an additional $40,000 that would need to come from the Marketing Fund. Another way would be to fund an additional $100,000 from the Marketing budget. There are consequences of further diluting the Marketing budget by spending a quarter of a million dollars on one weekend, which may include foregoing a new Saturday concert and a new culinary arts event with the potential to become a signature summer weekend program for Snowmass Village. Another request made of the Town was to evaluate whether additional tickets could be sold for the existing venue in Snowmass Village. Based on a meeting with JAS, the Police Department, Wildcat Fire District, and the Snwomass Village Transportation Department, it is the Town's understanding that for Jazz Aspen Snowmass to look favorably on continuing to produce their Labor Day concerts in Snowmass Village they would need an increase in funding from the Town's Marketing Board and an increase in the Town Park site capacity from 11,000 persons to 12,000 persons. The 11,000 person limit was established two years ago after many years of real life experience with different size crowds and site configurations for this event. It should also be noted that JAS played an integral role in establishing this capacity and at that time, indicated that this was a number that would work well for them into the foreseeable future. The breakdown for the permitted capacity is 1000 patron tickets, 9000 general admission tickets and 1000 for support staff. The recent economic down turn was not part of JAS's foreseeable future and they are now requesting the ability to sell 500 more patron tickets and 500 more general admission tickets while retaining a support staff of up to 1000 people. After a preliminary discussion with the Fire Department, Transportation Department and JAS management, staff is open to considering this increase in capacity with the understanding that the following conditions will be met: The revised site capacity for all of the areas within the grounds will continue to be in compliance with all Code requirements. QUM JAS will propose changes to the configuration of the site that will increase the usable square footage of the grounds for the general admission audience. JAS will propose changes to the site configuration that will improve the smooth flow of patrons during egress from the site. JAS will continue to work with the Police Department on procedures designed to periodically determine the actual number of persons on the site as the event day progresses. Option 2: JAS moves to Buttermilk Council also asked that staff look at the option of JAS moving to Buttermilk and the business implications of that for the Town. Attached is a sponsorship proposal from JAS to the Marketing Board Staff reflecting increased benefits at a significantly lower sponsorship fee of $75,000 (note: the proposal has not been fully negotiated). With the theory that moving to Buttermilk would allow JAS to book "A" level talent which would increase event attendance, and given competitive level lodging in Aspen is virtually sold out over Labor day weekend, Staff would propose the $75K be earned based on occupancy performance. In this scenario, Snowmass is positioned as'the' lodging host for the event in all JAS marketing, including further discounted tickets for lodges to bundle with rooms and 1- 800 SNOWMASS promoted as the call to "action. JAS After Dark would also be programmed in Snowmass Village to encourage people to head to the mall and base after the event on two of the JAS evenings. The $75K+ savings in the Marketing budget would then be proposed to support additional summer events and activities. Option 3: Take no action: This option involves maintaining the sponsorship level at $150,000 for JAS and taking the position that the Town looks forward to hosting the event in Snowmass Village in 2010. JAS would then need to accept the $150,000 or determine if they have an alternative location for the event. The risk of this option is that they may find an alternative location in which case the Town may or may not have an opportunity to assume the sponsorship program outlined in option 2. If the venue changes and there is no sponsorship agreement as discussed in option 2, the $150K savings in the Marketing budget would be proposed for additional summer events activities as well as summer marketing promotion. It should be noted that the Aspen Skiing Company has maintained the position that Buttermilk is only available as a venue if the Town of Snowmass Village consents to a move to that venue. jazz aspen snowmass 20' Anniversary Season JAS Program Profile The mission of Jazz Aspen Snowmass is to present and preserve jazz, American, and popular music through world -class festivals, performances and education programs. PROGRAM 2010 JAS Labor Day Festival OVERVIEW: In a effort to explore all options to maximize opportunities of sustainability, 501c3 organization JAS is looking for a general "understanding" from TOSV officials concerning the location of the 2010 Labor Day Festival, which has become a signature, world -class entity for the Aspen Snowmass market. With cost escalating to produce such an event (talent production expectations) to $2,300,000. it has become vital for JAS to protect this event by identifying potential revenue streams that will off -set such a risk. The following are other points of general consideration in the analysis of these proposed options: Title Sponsor Calamos Investments ended with 08 season (Janus Funds before that since mid nineties). The current climate for corporate sponsorship is dismal across the board (no less for a "title sponsor"- looking to Fall 2010 before some movement (will hopefully) initiate. Currently, JAS does not have the fortune of an "endowment" or other reserve fund to digest a "loss" for such an expensive production that is needed to attract the attendance that "moves the needle" for hotel, retail, bar restaurant categories. The LD Festival represents the best opportunity for JAS to sustain itself for the future through revenue based on "potential gross capacity" which is hand in- hand with of tickets sold per festival day. This event represents our only opportunity to raise these funds in a significant way (based on capacity rock pop format), to establish a foundation for endowment, as well as for our education programs (JAS Academy Local Education Initiative (LEI) Programs- over $5 million spent on music education programs since 1996). FIRST OPTION: LOCATION: SNOWMASS VILLAGE, SEPT. 3 -4 -5, 2010 SPONSORSHIP FEE: $250,000. (Sponsorship package attached). Festival remains in Snowmass Village for 2010 in the current 3 -Day festival format. JAS will work with TOSV officials (Police Fire) to determine if an add'1 It capacity of 1,000 (500 Patron 500 General Admission) can be included in overall site capacity. SECOND OPTION: LOCATION: BUTTERMILK MOUNTAIN, SEPT. 3 -4 -5, 2010 SPONSORSHIP FEE: $75,000. (Sponsorship package attached). Snowmass Village remains the "Preferred Partner" promoted in all advertising, marketing and PR- "800- SNOWMASS and will utilize discounted festival tickets to cluster with travel packages. JAS will initiate add'1 promotional ops including an After Dark Series and a merchant /retail discount program (Summer -long promotion). NEXT STEPS: By December 10 2009 Determine option TOSV would like to proceed with. JAZZASPENpremier festivals since 1991 entertain educate preserve 2010 SPONSORSHIP PROPOSAL VALUE $250,000 Presenting Sponsor —Town of Snowmass Village Location Snowmass Village VISIBILITY Marketing Logo in all JAS print advertising, posters, special supplements, direct mail, etc. One full page, 4 -color ad in the Official JAS June Labor Day Programs published by the Aspen Times Opportunity to purchase one additional full page, 4 -color ad at a discount Acknowledgement in all radio promotion as hosted by Snowmass Village, CO On -stage acknowledgment, all performances (both festivals) Category Exclusivity Inclusion in press launch or any other pre -event promotional functions planned for Labor Day 1- 800 SNOWMASS presented as exclusive lodging call -to- action for June and Labor Day festivals in all print, radio and television advertising where lodging mention is appropriate JAS to produce email postcard highlighting Snowmass lodging specials for both festivals, to be distributed to all relevant contacts in the JAS data base upon artist announcements www.snowmassvillage.com will be featured on JAS website as online lodging option Media Package $80,000 in in -kind radio media promotion to include: 0 1500 Comcast Spots to promote the Chili Pepper Brew Festival o 100 NRC Broadcasting Spots on Mountain Stations o 50 NRC Broadcasting Spots on JACK FM, Denver 0 800- SNOWMASS presented as exclusive lodging number on KBCO promotion (80 spots) o Relix.com email newsletter to feature Snowmass lodging specials for the Labor Day Festival, to be distributed to all regional jambase.com contacts o Plum TV: weekly promotion of Free Concert Series during Thursday JAS Interview o TOSV to produce :15 -:30 spot to be featured on the three JAS Labor Day LED Screens prior to and in between each festival act Banners /signage Two (2) logo banners, prominently placed stage left right (Labor Day only) Two (2) banners outside Patron tent (Labor Day only) Three (3) banners on Patron tent fencing (Labor Day only) Eight (8) additional banners throughout Festival grounds including entrance (Labor Day only) JAS to produce stage banners for June Festival featuring Snowmass logo JAS to produce entrance banners for June Festival featuring Snowmass logo Web page link on Jazz Aspen Snowmass website Web page banner ---40 Wb ENTERTAINMENTITICKET Four (4) Gold Passes with backstage access (Labor Day only) Fifty -six (56) Patron premier season passes with Patron tent access (Labor Day only) Fifty (50) Labor Day festival general admission tickets Opportunity for a private hospitality tent for your guests (both festivals) 25% discount on tickets for employees and customers General admission tickets made available for promotions that support JAS Labor Day event 25% discounted general admission event tickets for June and Labor Day for Snowmass lodges to bundle with discounted room rates for attractive JAS /lodging packages (these discounted tickets will be used solely by lodges for guest special lodging /event packages) Two (2) event posters signed by as many festival artists as feasible PROMOTIONS JAS to provide 10'x20' tent for TOSV promotions at the Labor Day Festival Right to distribute promotional materials at exit of main stage shows. TOSV may stuff program guides in advance with flyers that promote related mall activity Exclusive privilege to use Jazz Aspen Snowmass name and logo in corporate marketing and promotion JAS to provide TOSV with an end of season wrap -up package with complete marketing PR information, audience profiles, etc. Snowmass promotion at Sonoma Jazz to include Snowmass banners on -site, Snowmass logo inclusion on Festival LED screens, logo inclusion in festival program and distribution of Snowmass gift bags to Sonoma Jazz Patrons Inclusion of text sign in option in one JAS email to entire data base of 10,000+ JAS TO RECEIVE $250,000 cash to be paid to Jazz Aspen Snowmass in 2010 JAZZASPENpremier festivals since 1991 entertain educate pfeserve 2010 SPONSORSHIP PROPOSAL VALUE $150,000 COST $75,000 Presenting Sponsor —Town of Snowmass Village Location Buttermilk Mountain VISIBILITY Marketing Logo in all JAS print advertising, posters, special supplements, direct mail, etc. One full page, 4 -color ad in the Official JAS June Labor Day Programs published by the Aspen Times Opportunity to purchase one additional full page, 4 -color ad at a discount Acknowledgement in all radio promotion as hosted by Snowmass Village, CO On -stage acknowledgment, all performances (both festivals) Category Exclusivity Inclusion in press launch or any other pre -event promotional functions planned for Labor Day 1- 800 SNOWMASS presented as exclusive lodging call -to- action for June anq Labor Day festivals in all print, radio and television advertising where lodging mention is appropriate JAS to produce email postcard highlighting Snowmass lodging specials for both festivals, to be distributed to all relevant contacts in the JAS data base upon artist announcements www.snowmassvillage.com will be featured on JAS website as online lodging option Media Package $50,000 in in -kind radio media promotion to include: o 1000 Comcast Spots to promote the Chili Pepper Brew Festival 0 100 NRC Broadcasting Spots on Mountain Stations o 50 NRC Broadcasting Spots on JACK FM, Denver o 800 SNOWMASS presented as exclusive lodging number on KBCO promotion (80 spots) o Relix.com email newsletter to feature Snowmass lodging specials for the Labor Day Festival, to be distributed to all regional jambase.com contacts o Plum TV: weekly promotion of Free Concert Series during Thursday JAS Interview o TOSV to produce :15 -:30 spot to be featured on the three JAS Labor Day LED Screens prior to and in between each festival act Banners /signage Two (2) logo banners, prominently placed stage left right (Labor Day only) Two (2) banners outside Patron tent (Labor Day only) Three (3) banners on Patron tent fencing (Labor Day only) Eight (8) additional banners throughout Festival grounds including entrance (Labor Day only) JAS to produce stage banners for June Festival featuring Snowmass logo JAS to produce entrance banners for June Festival featuring Snowmass logo Web page link on Jazz Aspen Snowmass website Web page banner lob ENTERTAINMENT/TICKET Four (4) Gold Passes with backstage access (Labor Day only) Fifty -six (56) Patron premier season passes with Patron tent access (Labor Day only) Fifty (50) Labor Day festival general admission tickets Opportunity for a private hospitality tent for your guests (both festivals) 25% discount on tickets for employees and customers General admission tickets made available for promotions that support JAS Labor Day event 25% discounted general admission event tickets for June and Labor Day for Snowmass lodges to bundle with discounted room rates for attractive JAS /lodging packages (these discounted tickets will be used solely by lodges for guest special lodging /event packages) Two (2) event posters signed by as many festival artists as feasible PROMOTIONS Initiate After Dark Series following two (2) festival dates and a merchantiretail discount program (Summer long promo focused on Front Range Denver markets). JAS to provide 10'x20' tent for TOSV promotions at the Labor Day Festival Right to distribute promotional materials at exit of main stage shows. TOSV may stuff program guides in advance with flyers that promote related mall activity Exclusive privilege to use Jazz Aspen Snowmass name and logo in corporate marketing and promotion JAS to provide TOSV with an end of season wrap -up package with complete marketing PR information, audience profiles, etc. Snowmass promotion at Sonoma Jazz to include Snowmass banners on -site, Snowmass logo inclusion on Festival LED screens, logo inclusion in festival program and distribution of Snowmass gift bags to Sonoma Jazz Patrons Inclusion of text sign in option in one JAS email to entire data base of 10,000+ JAS TO RECEIVE $75,000 cash to be paid to Jazz Aspen Snowmass in 2010 r