San Diego is boosting the transparency and conflict-of-interest policies of its corporate marketing program, which city officials say has generated $27 million since 1999.
The changes are in response to a county grand jury report that said it’s impossible to evaluate the program because of poor record-keeping and a failure to distinguish actual revenue from other contributions by businesses, such as providing equipment.
For example, the city doesn’t receive any revenue from its highest-profile partnership, a deal with Toyota to provide lifeguard trucks to the city at no charge.
But city officials say the agreement has an estimated $1 million annual value because it eliminates the need to buy and service lifeguard vehicles.
The revised policy will distinguish between partnerships that generate actual revenue and deals that have an estimated value based on contributions that save money or help promote the city.
City officials will also begin calculating the “net benefit” of deals where the city receives money but also incurs costs.
And the new policy expands the definition of a marketing partnership to include all kinds of deals like licensing agreements and promotional campaigns.
The revisions also add a requirement that businesses proposing partnerships identify potential conflicts of interest, which is standard practice for other city contracts.
The new policy, which was endorsed last week by the City Council’s budget committee, will be presented to the full council for final approval this fall. The council must also approve a response to the grand jury report, which was released in June.
Launched nearly two decades ago, San Diego’s corporate partnership program has been called a model for generating revenue from marketing opportunities most cities don’t realize they have.
In addition to Toyota, the city’s ongoing partnerships include snack vendor Canteen, California Coast Credit Union, Discover Bike, Sharp HealthCare, Cardiac Science and Service Line Warranties.
The city also made a deal connected to the U.S. Open returning to Torrey Pines municipal golf course in 2021.
Turfstar is providing San Diego $7.5 million in cash and other contributions over 12 years, in exchange for the city agreeing to exclusively lease all mowers and other golf maintenance equipment from Turfstar.
Previous city partnerships have included deals with Sprint, Rainbow Vending, Car2Go and Zipcar.
September 26, 2018
The San Diego Union-Tribune
By David Garrick
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