City Council
Report
City Council Meeting: July 9, 2024
Agenda Item: 5.C
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To: Mayor and City Council
From: David Martin, Director, Administration
Subject: Approval of the Pier Corp Fiscal Year 2024-25 Budget and Work Plan Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines;
2. Approve the Santa Monica Pier Corporation Fiscal Year 2024-25 Budget and Work Plan; and
3. Authorize the City Manager to execute a fifth modification to Services Agreement No. 10101 between the City and the Santa Monica Pier Corporation.
Summary
The Santa Monica Pier is an iconic landmark drawing millions of visitors each year to enjoy one-of-a-kind experiences while strolling above the ocean waves. The City contracts with the Santa Monica Pier Corporation (SMPC) through a Services Agreement to manage certain programs and services at the Pier including marketing, production of community programming such as the highly popular Locals’ Night series, as well as coordination of filming and private event rentals and proctoring the daily street performer lotteries. The Council-appointed SMPC board is also charged with the development of policy guidelines pertaining to sponsorship, marketing, events and leasing, subject to Council approval.
The SMPC is required to prepare an annual budget and business work plan to set forth its goals and objectives for the ensuing fiscal year. In accordance with the Services Agreement, the SMPC is submitting its FY 2024-25 work plan and budget to Council for its 2 of 5
review and approval. If approved, the SMPC’s Services Agreement will be extended to June 30, 2025.
Discussion
The SMPC FY 2024-25 Budget (Attachment A) and Work Plan (Attachment B) describe in detail the activities and programs SMPC will undertake in the upcoming fiscal year.
SMPC Budget
The SMPC’s main sources of income are event rentals, filming, corporate promotions and partnerships, followed by the City’s annual grant. SMPC’s FY 2024-25 Budget projects total revenues in the amount of $2,127,000 and estimated total expenditures in the amount of $2,123,000. This will result in a projected surplus of $4,000. The SMPC’s budget comparison from the previous year indicates that FY 2023-24 year-end budget was projected to close with a $33,000 deficit. However, SMPC year-end actuals for FY2023-24 project that the budget will end with a surplus of $42,000.
Revenues
Projected revenues include: City funding of $150,000; revenues of $1,735,000 from deck and carousel rentals, filming, corporate promotions and partnerships; $170,000 from donations and grants (including a one-time $50,000 grant from Cirque du Soleil); and $72,000 from licensing, guided tours, registration fees and food/beverage and merchandise sales. FY 2024-25 projects an 11% growth in revenue from the prior year’s budget.
Expenditures
Projected expenses include: $1,005,000 for personnel expenses comprised of salaries, benefits and related services; $451,000 for expenses related to facility charges (e.g. Pier Deck and Carousel rentals) including payments to the City; $550,000 for SMPC-produced Pier programming such as Pier 360, Locals' Night series, Wellness & Waves, Dia de Los Muertos, Save the Pier play, Samo PRIDE and an inaugural fundraising gala; $47,000 for marketing; $10,000 for merchandise; and $60,000 for contingencies.
SMPC Work Plan
The attached FY 2024-25 Work Plan describes SMPC’s accomplishments for the prior fiscal year and details the new and continuing activities SMPC plans to perform during the new fiscal year.
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FY 2024-25 efforts will focus on engaging with the community in new ways, while also continuing to provide and build upon existing programs and traditions. The new fiscal year will include the Pier Corporation’s first-ever fundraising gala, and the development of new free public programming including a Santa Monica Pier Birthday Celebration in partnership Street Food Cinema for a free movie screening, additional multi-cultural celebrations and holiday sandcastle sculpting. The Pier Corporation will continue to develop and sell merchandise including a new edition of the Santa Monica Pier history book and participate in committees related to large scale projects and events such as the upcoming Pier Bridge Reconstruction and the 2028 Olympics.
In addition, the Work Plan calls for the organization to develop a new Mission Statement, Vision Statement, Company Values, and a three year strategic plan that would identify the organization's goals and objectives for the future and may explore modifying the current governance for Council’s consideration, in an effort to provide the organization with more revenue, fiscal sustainability and oversight of certain operations currently overseen by the City. Once this visioning and strategic planning effort has been completed, staff will conduct a review and evaluation and will return to Council with an assessment.
On May 20, 2024, the SMPC Board approved the following Mission Statement:
“The Santa Monica Pier Corporation curates the pleasure pier experience for locals, visitors, and admirers.”
Extension of Service Agreement
The Service Agreement between the City and SMPC (Contract No. 10101 CCS) will expire on June 30, 2024. Staff seeks authorization to extend the Service Agreement term through June 30, 2025, to coincide with the 2024-25 Fiscal Year.
Commission Action
The SMPC Board of Directors approved the FY 2024-25 budget and Work Plan on April 29, 2024, and Mission Statement on May 20, 2024.
Environmental Review
The approval of the SMPC FY 2024-25 budget and work plan is exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) (Common Sense Exemption) of the CEQA Guidelines, which states that CEQA does not apply, “where it can 4 of 5
be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment”. The work plan provides activities and programs that would not result in a significant adverse physical impact on the environment, and therefore, is exempt from CEQA.
Past Council Actions
Meeting Date Description
6/13/2023
(Attachment C)
Approval of FY 2023-24 Budget and Work Plan and
extension of Services Agreement through 6/30/2024
6/14/2022
(Attachment D)
Approval of FY 2022-23 Budget and Work Plan and
extension of Services Agreement through 6/30/2023
6/22/2021
(Attachment E)
Approval of FY 2021-22 Budget and Work Plan
and extension of Services Agreement through 6/30/2022
7/14/2020
(Attachment F)
Approval of FY 2020-21 Budget and Work Plan and
extension of Services Agreement through 6/30/2021
7/14/2015
(Attachment G)
Council Authorization of five-year Services Agreement with SMPC. Contract No. 10101 (CCS)
Financial Impacts and Budget Actions
Staff seeks authority to extend the agreement term by one year. The available funding from the Pier Fund for the Services Agreement with the SMPC is included in the FY 2024-25 Adopted Budget in the Community Development Department. No additional financial impact or budget action is necessary. Future year funding is contingent on Council budget approval.
Annual Services Agreement Extension
Agreement FY 2024-25
Amount
Account Number Annual Agreement
Amount
10101 150,000 53700002.540150 $150,000
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Prepared By: Elana Buegoff, Pier Administrator
Approved Forwarded to Council
Attachments:
A. SMPC Budget 2024-25
B. SMPC FY2024-2025 Work Plan
C. 6/13/2023 Staff Report
D. 6/14/2022 Staff Report
E. 6/22/2021 Staff Report
F. 7/14/2020 Staff Report
G. 7/14/2015 Staff Report
H. SMPierCorpLevine2024
I. SMPierCorpOaks2024