City Council
Report
City Council Meeting: November 11, 2024
Agenda Item: 5.G
1 of 4
To: Mayor and City Council
From: Anuj Gupta, Director of Transportation, Department of Transportation, Finance & Administrative Services
Subject: Award Agreement to Vector Media, Inc. to Sell and Display Advertising on Big Blue Bus and Culver City Buses
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. Award RFP# 417 to Vector Media, Inc. for sales, administration and the installation and maintenance of advertising on Big Blue Bus and City of Culver City buses;
3. Authorize the City Manager to negotiate and execute a revenue share agreement with Vector Media, Inc. for two years with three, one-year renewal options.
Summary
Big Blue Bus (BBB), a division of the Santa Monica Department of Transportation (DOT), operates 194 transit buses across 69 square miles of greater Los Angeles providing more than 800,000 rides each month. BBB has offered exterior commercial advertising on its fleet of buses since the 1970’s. The advertising program currently provides annual calendar year revenue of $4 million. The revenue offsets operating expenditures to support revenue service delivery. As the current agreement with Vector Media, Inc. (Vector Media) expires on December 31, 2024, staff released a Request for Proposals (RFP) for the provision of advertising sales and posting services for BBB.
Based on a thorough review of the proposals submitted, the evaluation team recommends Vector Media to provide advertising sales and posting services, with a 2 of 4
preference for the Revenue Share Plus Minimum Guaranteed Payment option within Vector Media’s bid.
Discussion
Big Blue Bus maintains a revenue-generating advertising program selling advertising space using a contractor to provide the sales and ad posting function. Commercial advertising revenues are an important supplemental revenue source supporting BBB’s transit operations.
On July 14, 2011, to maximize inventory and increase revenue, the City entered into a Memorandum of Understanding (MOU) with the City of Culver City wherein BBB became the advertising sales concessionaire for Culver CityBus. The MOU with Culver City was extended in 2016 and will continue through this new arrangement. Staff now manages advertising for a fleet of 194 Big Blue Buses and 56 Culver City buses.
Currently, the advertising program produces revenues of $4 million for the 2024 calendar year.
With the existing contract expiring on December 31, 2024, City staff issued a Request for Proposals (RFP) to sell and display advertising on Big Blue Bus and Culver CityBus buses. The City received two responses to the RFP. The proposals were evaluated based on criteria established in the RFP. Vector Media received the highest score. Staff recommends that the contract be awarded to Vector Media.
Since the COVID-19 pandemic, bus advertising revenues have been down industrywide. As a result, the estimated advertising revenues in the proposal are less than the expiring agreement which was signed in 2019. Vector offered two payment proposals, one with a Minimum Annual Guarantee (MAG) payment and one with a Revenue Share Plus Minimum Guaranteed Payment (REV). The revenue share guarantees BBB a certain percentage based on the amount of advertising dollars sold.
The minimum guaranteed payment connected with the revenue share is lower than the MAG proposal, but staff expects that sales projections from the revenue share will far 3 of 4
exceed the MAG total. The REV option is the better choice in order to keep advertising sales revenues close to the existing budgeted level.
Vendor Selection
Bidder Recommendation
Best Qualified Firm Vector Media
Evaluation Criteria
(include all that apply)
Experience, competence/skill, capacity/ability to perform services promptly, sufficiency of financial resources, reputation, ability to provide future services as needed and price.
Municipal Code SMMC 2.24.190
RFPs Received (do not list cost/prices; add rows as needed for additional vendors) Intersection Vector Media
RFP Data
Posted On Posted On
Advertised In
(City Charter & SMMC)
Vendors
Downloaded
Date Publicly
Opened
8/12/2024 City's Online
Bidding Site Santa Monica Daily Press 14 9/9/2024
Justification to Award
Staff interviewed two shortlisted firms. Based on this criteria and criteria in SMMC
2.24.190, staff recommends Vector Media as the best qualified firm to provide the selling and posting of advertising for Big Blue Bus and Culver CityBus. This based on the firm’s experience working as the City’s existing contractor, positive references from Vector Media clients nationwide, and its relevant staff experience. Additionally, the Vector Media team is technically skilled, which is highlighted by their hands-on approach and proven track record growing advertising revenue with BBB. Finally, their revenue proposal was the most robust of all the proposals.
Past Council Actions
Meeting Date Description
5/24/16 (attachment A) Agreement to Manage Culver City Bus Advertising Sales Program 11/12/19 (attachment B) Award Request for Proposal and enter into Agreement with Vector Media to Sell and Display Advertising on Big Blue Bus and Culver City Buses
4 of 4
Environmental Review
The contract for bus advertising services is exempt from the California Environmental Quality Act (CEQA) pursuant to section 15061(b)(3) (Common Sense Exemption) of the CEQA Guidelines. The contract is covered by the commonsense exemption which states that CEQA does not apply “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” The agreement will provide the City with advertising for its buses. Therefore, it can be seen with certainty that there is no possibility that the activity in question may have significant impact on the environment.
Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action. However, staff will monitor revenues under this new agreement and will make any appropriate adjustments during the FY2025-27 Biennial Budget process.
Prepared By: LaRhonda Staggers-Erwin, Finance & Grants Manager Approved Forwarded to Council
Attachments:
A. Attachment A Agreement to Manage Culver City Bus Advertising Sales Program (Web Link)
B. Attachment B Award Request for Proposal and enter into Agreement with Vector Media to Sell and Display Advertising on Big Blue Bus and Culver City Buses (Web Link)
C. OAKS_INITIATIVE_FORM
D. Levine_Act_Disclosure_Form_2.6.24
E. FY24-25_Living_Wage_Certification_Fillable