City of Sacramento
Budget and Audit Committee Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2025-01040 5/27/2025 Item 4.
SAFE Credit Union Convention & Performing Arts District Promoter Incentive Program File ID: 2025-01040
Location: District 4
Recommendation: Review, comment and provide direction.
Contact: Megan Van Voorhis, Director, (916) 808-5979, [email protected]; Jonathan Wiser, Interim Convention Center General Manager, (916) 808-8220, [email protected]; Sid Garcia-Heberger, Theater and Auditorium Manager, (916) 808-5917, [email protected]; Department of Convention and Cultural Services Presenter: Megan Van Voorhis, Director, (916) 808-5979, [email protected], Department of Convention and Cultural Services
Attachments:
1-Description/Analysis
2-Promoter Incentive Program - Draft Guidelines
Description/Analysis
Issue Detail: The Sacramento Memorial Auditorium is a historic civic venue that plays host to concerts, graduations, sporting events, naturalizations, galas, and more. The recently renovated SAFE Credit Union Performing Arts Center enjoys the residence of Broadway Sacramento, Sacramento Ballet, Sacramento Philharmonic & Opera and Sacramento Speaker Series, while also welcoming other theatrical productions, comedy, concerts and more. As part of Convention & Cultural Services’ broader efforts to increase activation of city facilities, we’ve implemented improvements to booking strategy and team structure at the SAFE Credit Union Convention & Performing Arts District to increase usage of the Memorial Auditorium and SAFE Credit Union Performing Arts Center. While meetings and events like galas and fundraisers are important, their economic spillover into the surrounding neighborhoods is more limited. In contrast, concerts and ticketed events stimulate greater activity in local businesses and are a vital component of any successful venue strategy.
Convention & Cultural Services is looking to increase ticketed event activity at these facilities through a structured set of sales strategies and incentives.
The goals would be:
File ID: 2025-01040 5/27/2025 Item 4.
· Increase the volume and frequency of live events at the Sacramento Memorial Auditorium and SAFE Credit Union Performing Arts Center;
· Attract regional and national promoters to Sacramento; · Support the growth of local and emerging promoters; and · Expand access to these facilities to non-profit organizations, schools and local groups that strengthen Sacramento’s position as a cultural and entertainment hub.
Unlike major operators like Live Nation or AEG, the SAFE Credit Union Convention & Performing Arts District does not promote its own concerts and lacks access to touring talent pipelines. Instead, the District relies on independent promoters who must absorb high financial risk without the benefit of supplementary revenue streams (ticket fees, merch, concessions, etc.). This deters promoter interest.
In discussing District venues with commercial promoters, the team is regularly asked to co-promote (partner with the promoter on the show’s expenses and revenue) or offer a per ticket rebate. Under a co-promotion model, the City would assume some amount of financial risk if the show does not sell well. The team believes the rebate model is a better avenue for the City to use to encourage usage of District venues. To that end, staff are proposing the following elements be incorporated into program guidelines as mechanisms to provide the rebate:
· Per Sold Ticket Rebate - not to exceed $10.00 per ticket sold. § This could come from a combination of rent, box office fees, revenue share from Ticketmaster and in-house equipment rentals.
· Convenience Fee - not to exceed $10.00 per ticket sold § Allow promoters to add an additional dollar amount on to the convenience fees charged through Ticketmaster then rebate this amount to the promoter. · Food and Beverage (Ticketed Events) - The District receives commissions from its exclusive in-house catering company, and in addition they can increase drink prices. § Commission - We may redirect some or all of the commission to the promoter to compete against other venues.
§ Surcharge on Drinks - not to exceed $3.00 per drink. This would be added to the price and paid to the promoter to compete with other venues.
Rebates need to be high enough to incentivize the promoter. $5 would be the minimum for the program to make a difference. To increase the volume of ticketed events, a scaled rebate would be offered - in other words, the more shows the promoters book in a fiscal year, the higher the rebate.
Nonprofit ticketed event producers represent additional opportunity to increase activation in District facilities, but they too face risks that must be mitigated. To that end, staff are proposing to waive or discount rent up to 100% per day to reduce barrier of entry. These types of groups typically don’t sell enough tickets to make rebate structure an incentive.
File ID: 2025-01040 5/27/2025 Item 4.
To gauge program success, the staff would measure event attendance, occupancy, diversity of program offerings, and overall economic impact to surrounding area businesses.
Convention & Cultural Services is seeking direction on the proposed incentive program and support to formalize the program guidelines for full council consideration and adoption.
Policy Considerations: The information presented in this report is to advise the Budget and Audit Committee of this proposed Promoter Incentive Program.
Economic Impacts: Commercial and Non-Profit Ticketed events generate significant economic impact in the surrounding communities, driving foot traffic and corresponding food, beverage and retail sales as well as parking and sales tax revenue for the City.
Environmental Considerations: This report is not a project pursuant to the California Environmental Quality Act (CEQA). This report is an informational item only. No action is being taken in connection with this report. As there is no potential for this oral report to result in a direct physical change in the environment or a reasonably foreseeable indirect physical change, this report does not qualify as a “project” under CEQA. (See CEQA Guidelines 15378(a)).
Sustainability: Not applicable.
Commission/Committee Action: Not applicable.
Rationale for Recommendation: Creating and establishing a Promoter Incentive Program will help our facilities respond to industry dynamics and stay competitive with other entertainment venues.
A small-scale incentive model completed at our facilities where rebates were tied to show count and food and beverage revenue saw that a promoter went from one show in seven years to seven shows in one year. Additionally, similar types of these incentive programs have occurred in entertainment venues in Stockton, Fresno and Los Angeles.
The objective is that establishing this Promoter Incentive Program will entice promoters to hold more than one event at our facilities which will help increase the occupancy rate at these facilities. That in turn impacts other city revenues such as parking and sales tax, while also increasing activity with local businesses.
Financial Considerations: The Promoter Incentive Program will represent a strategic reinvestment of potential venue revenues in order to:
· Increase overall usage and earned revenue.
· Promote economic activity through job creation, tourism, and nightlife.
File ID: 2025-01040 5/27/2025 Item 4.
· Lower barriers for diverse and independent producers. · Support local food and beverage sales through increased audience traffic.
If the program is implemented, any reductions in revenue in providing a rebate or waiver will be offset by an increase in ticket sale revenue and/or commissions received. The program will be evaluated annually to ensure financial solvency and each event applying for this program will be reviewed individually and on a case-by-case basis to ensure there is value to the City in providing such rebate or waiver.
Local Business Enterprise (LBE): Not applicable.
Promoter Incentive Program – Draft Guidelines
1. Program Overview
The Promoter Incentive Program is designed to attract and retain high-quality promoters by reducing financial risk and rewarding volume and consistency. It supports both national and local partners, with incentives that promote repeat business, local cultural development, and increase activation of our performance venues.
2. Eligibility Criteria
To qualify for any rebate incentives, a promoter must:
Be paid in full to all partners for previous engagements. Provide favorable references from other venues including demonstrating a track record of consistent ticket sales of 70%+ of capacity.
3. Incentive Tiers
A. Introductory Rebate
To mitigate risk for new partners:
$3 per ticket sold for first-time or infrequent promoters who meet eligibility criteria.
Examples: Promoters new to the venue, or those presenting sporadically.
B. Standard Rebate Tiers (Volume-Based)
For promoters who are currently using our venues 2+ times per year consistently who will likely increase the volume of shows they promote in our venues if some of their risk is mitigated.
$5 per ticket sold for the first five shows per fiscal year. $6 per ticket sold once a promoter reaches five shows in a fiscal year. Examples: Amplified Entertainment, LJ Presents, Illusion Touring, Martin Media, Magicspace
C. Premium National Promoters
Established, high-volume national partners (e.g., Outback, Live Nation, Nederlander, AEG):
$6 per ticket sold, starting from show one.
Per Drink Rebate: Eligibility after presenting five shows per fiscal year at the Performing Arts Center and all shows at Memorial regardless of number of shows presented in a fiscal year.
D. Local Commercial Promoters
For locally based promoters who meet eligibility criteria. $6 per ticket sold regardless of number of shows presented per fiscal year. Per Drink Rebate: Eligibility on show one.
Examples: Life Entertainment, Dinora Presents, Crest Sacramento E. Local Presenting Nonprofits
To reduce entry barriers and support mission-driven work:
Venue rent reduction instead of per-ticket rebate.
This protects nonprofits from high upfront risk and provides a buffer if ticket sales are low.
4. Incentive Tools
Tools Used to Provide Rebates:
Per-ticket rebates: This can either be paid by the ticket buyer in the form of a promoter rebate added to the convenience fees paid at the time of ticket purchase or from any of the following revenue streams. Rent, equipment rental, box office charges, revenue share or any combination thereof. Per-drink rebates added to the cost of beverages sold at the shows and paid for by the patron through their drink purchase.
Venue rent reductions or waivers for non-profit presenters.
Why Rebates May Vary:
Promoter history with the venue.
Type of event and expected draw.
Seasonality and venue availability.
Strategic objectives (e.g., incentivizing use of underutilized venues or dates).
5. Evaluation and Review
The rebate program will be reviewed annually, with adjustments made based on:
Fiscal performance and attendance data.
Promoter feedback.
Operational costs and strategic priorities.
6. Rebate Processing
A. Promoter Per Ticket Rebate Processing
The per ticket rebate will be calculated at the time of settlement based on final ticket sales.
Per ticket rebate is entered as a credit on the settlement document.
B. Per Drink Rebate
This rebate will be calculated by our food and beverage partner, Sodexo, and will be remitted directly to the promoter approximately 30 days after the event.
Rebate information will be captured in our booking system in the show document folder.
7. Exclusion From The Program
Promoters who are in arrears with the City or venue partners will be excluded from participating in the program until all obligations are met. Promoters whose events have consistent security issues or are not meeting venue requirements will be excluded from participating in the program. Promoters who have been authorized to use their own Ticketmaster contract terms for ticket sales at our venues.