Item No.
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: OFFICE OF THE CITY MANAGER
BY: MARLON RAMIREZ, ASSISTANT TO THE CITY MANAGER
DATE: JUNE 11, 2024
SUBJECT: DISCUSSION OF FEE WAIVER, DONATIONS, SPONSORSHIPS FOR NON-
PROFIT ORGANIZATIONS
EXECUTIVE SUMMARY
The City Council will discuss and provide direction to staff regarding establishing a Fee Waiver, Donation, and Sponsorship policy for non-profit organizations applying for special event/street closure permits, use of the City’s showmobile, request for donations, and table sponsorships for fundraising efforts.
RECOMMENDATION
That the City Council:
Discuss and provide staff with direction regarding the establishment of a Fee Waiver, Donations, and Sponsorship Policy for non-profit organizations.
BACKGROUND
The City of Downey has a history of supporting nonprofit organizations as they provide much needed services to the community.
Examples include facility and shelter rental discounts, fee waivers for special events, foursome donations to golf event fundraisers, use of the City’s showmobile, and table sponsorships. Additionally, in 2023, the City Council approved the creation of a Community Based Organization (CBO) grant program. This program allocates $100,000 per year for non-profits to apply for funding to assist with programs and services provided to the Downey community. Since its inception in October 2023, the CBO program has assisted five non-profit organizations.
On April 9, 2024, the City Council requested that staff research and present options for a policy addressing fee waivers, donations, and table sponsorships for non-profit organizations due to the increase in the number of requests for fee waivers and table sponsorships that the City receives.
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Request 2021 2022 2023
Table Sponsorships $2,500 - $3,400
Fee Waivers – Special Events - - $19,062
Foursome of Golf $800 $1,300 $983
Snowmobile Requests - $1,234 $1,234
The establishment of a fee waiver, donation, and sponsorship policy for Downey non- profit organizations will provide an administrative process for staff to follow to help ensure a transparent and equitable waiver process, and to effectively review and manage the volume of requests, without the need for numerous reports to Council for discussion and consideration.
ANALYSIS
Staff conducted outreach to various cities to gather information regarding their policies on fee waivers, donations, and sponsorships. The responses provided a broad spectrum of practices and requirements that could inform the City’s policy development. Some examples of what cities provide and/or require include:
• Events and programs applying for fee waivers adhere to non-discriminatory practices and submit formal special events applications. These organizations must show proof of tax-exempt or non-profit status, along with supporting financial documentation.
• Events requesting fee waiver should not be for-profit, political activities, candidates, ballot measures, or other political initiatives. Fees eligible for fee waivers include: application, participant, permit, and rental fees for parks and facilities, while costs related to staffing, labor reimbursement, security, utilities, refuse, custodial services, and maintenance are usually.
• Applicants must demonstrate no previous violations of event permits.
• Provide discretionary funding to support community events that benefit the community at large where the City Council may donate to each request at their discretion if it is deemed a public benefit.
• Offer special events grants that offset city fees for meritorious community, social, or athletic events, reducing costs for organizers and increasing benefits from fundraising efforts. Where special event grants are offered, the City Council establishes budget thresholds and an administrative policy for these grants.
Funding may be divided into categories to ensure fair comparison among different types of events, with the City Council considering and approving special event grant allocations for each recipient.
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The following are options for the City Council to consider for the development of a administrative program for fee waivers, donations, sponsorships for non-profit organizations
Fee Waiver- Special Events/Street Closure
Currently, non-profit organizations can request a fee waiver through the special event/street closure permit process. When event organizers apply for a special event permit and/or parade and street closure permit, the application is reviewed by the Development Review Committee (DRC), which consists of the Community Development, Police, Fire, and City Manager Departments. These departments issue conditions of approval and establish City-related fees for necessary City services associated with a special event.
More recently, a number of non-profit organizations have requested fee waivers for their events. These requests are then presented to the City Council for approval each time one is made. Approval of the fee waiver voids certain City-related fees associated with a special event as approved by the City Council. In the event a fee waiver request is not granted, the City will invoice the applicant for fees that reflect the actual costs expended by the City associated with the necessary services for that event.
A listing of fees includes:
• Police Department (Cost vary based on number of Police Officers and number of event hours)
• Fire Department (Special Event Permit - $232)
• Public Works (Encroachment Permit - $65, labor and material costs to provide street closure and traffic control using City staff, vehicles, and barriers – fee varies by event, showmobile rental - $434, showmobile labor - $800) • Planning Division (Permit Application Fee for non-profits - $117, plus an additional $117 for non-profits if Planning Commission approval is required) • Building & Safety Division (Permits & Special Inspection - $532)
The City Council may consider the following criteria when considering a fee waiver policy for non-profit organizations:
Options Example
1. Set a fee waiver limit per special event
application/street closure application
Up to $4,000 waiver
2. Set a percentage of the total cost that
non-profits would pay
50% of total costs
3. Set criteria and limits of fees to be
waived.
Only the following fees to be waived:
application, permit, and/or facility use
fees, and rental fees only.
Additionally, the City Council could include the following limitation in the policy:
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• Set yearly or one-time limits per organization;
Decision #1: Does the Council wish to provide fee a waiver to nonprofits?
If yes:
Decision #2: What fee waiver mechanism is preferred?
• Recommendation: Set a percentage of total cost of 50 percent. This is easily maintained for all nonprofit groups, and requires no tracking by staff.
Table Sponsorships
The City Council may consider the following criteria when considering a table sponsorship policy for non-profit organizations:
Options Example
1. Set a donation limit per table
sponsorship
Up to $3,500
2. Set a table sponsorship level Bronze Level or equivalent
3. Set a yearly budget for all table
sponsorships, supporting
organizations based on available
funds
Allocate $10,000 annually for table
sponsorships
Additionally, the City Council could include the following limitations in the policy:
• Set yearly or one-time limits on table sponsorships per organization (e.g., maximum table sponsorship per year is $5,000);
• Use a combination of per-table limits and an annual budget to manage sponsorships (e.g., $15,000 annual budget awarding a maximum of $5,000 per organization in table sponsorships per year).
In addition to fee waivers and table sponsorships, the City has also received voucher donation requests for a foursome of golf as well as requests for the use of the showmobile.
Incorporation of these items into the policy will help streamline the request process.
Decision #1: Does the Council wish to set a tables sponsorship policy?
If yes:
Decision #2: What table sponsorship mechanism is preferred? • Recommendation: Set a sponsorship level for each event of bronze or equivalent. This is consistent with past practices. Higher levels could be considered by Council on a case-by-case basis when desired.
Foursome of Golf Voucher Donations
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Foursome golf donations at the Rio Hondo Golf Course are requested by local non-profit organizations from time to time and typically range around $236-$275. The City Council may consider the following criteria when considering a foursome of golf donation for non- profit organizations:
Options Example
1. Set yearly or one-time donation limit
per non-profit organization
Each eligible non-profit can receive up 2
rounds of foursome golf annually
2. Limit donations to organizations that
haven't received fee waivers or
other sponsorships from the City
Only non-profits without previous City
sponsorships, fee waivers, and donations
are eligible for golf donations
3. Maintain the status quo Staff will continue to bring actions to the Council for consideration on a case-by-
case basis.
Decision #1: Does the Council wish to set a voucher of golf donation policy? Recommendation: Staff recommends maintaining the status quo.
If yes:
Decision #2: What donation limitation is preferred?
Showmobile Used by Non-Profits
It has always been the City’s practice to only allow Downey non-profits to: 1. use the City’s showmobile and 2. to use it free of charge. The fees associated with the use of the showmobile includes a rental fee and labor/delivery costs. Staff recommends formalizing this practice into the fee waiver, donations, and sponsorships for non-profit organizations policy. Additionally, the City Council can include in the following limitations in the policy:
• “Non-profits” would be defined as a Downey non-profit in good standing and/or “active” status with the Secretary of State of California and the Federal Internal Revenue Service (IRS).
• Event must have a direct impact to the Downey community.
After the City Council provides direction on the policy items listed herein, staff will return at a future City Council meeting with a policy for final adoption.
CITY COUNCIL PRIORITIES
Fiscal Responsibility
Economic Vibrancy
Quality of Life, Safety & Infrastructure
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FISCAL IMPACT
There is no fiscal impact with this report. Approval of a policy will result in a reduction of City revenues.
ATTACHMENTS
None