SR-07-14-2015-8ACity Council Meeting: 14 July 2015
Agenda Item: ---A
To: Mayor and City Council
From: Elaine M. Polachek, Assistant City Manager
Subject: Santa Monica Pier Governance Recommendations, Board Appointment
Schedule and Proposed New Corporation Services Agreement
Recommended Action
Staff recommends that the City Council:
1. Receive and file the Santa Monica Pier Board Governance Recommendation;
2. Extend the terms of the existing interim Board of the Santa Monica Pier Corporation
until December 31, 2015;
3. Authorize the City Manager to negotiate and execute a new Service Agreement
with the Santa Monica Pier Corporation;
4. Set November 10, 2015 for Consideration of Pier Board Appointments for terms
beginning January 1, 2016.
Executive Summary
At its November 22, 2011, December 6, 2011, and February 28, 2012, meetings, the
Council approved a series of changes to the governance and management of the Santa
Monica Pier. The Pier Restoration Corporation board was dissolved in favor of an interim
board renamed the Santa Monica Pier Corporation (SMPC) which was refocused to a core
mission of Pier events, marketing, and fundraising and provided the new Board a two -year
term.
Several specific tasks were set for the interim board:
Prepare a Pier Vision Statement and Guiding Principles;
Make recommendations on Pier governance;
Prepare Pier Leasing Guidelines, Pier Marketing, Sponsorship, Event Guidelines; and
Assist the City with a Pier planning process and public outreach.
The Vision Statement and Guiding Principles were reviewed and accepted by Council July
23, 2013. Pier Leasing Guidelines were accepted on April 8, 2014.
At its July 23, 2013 meeting, Council extended the term of the SMPC service agreement
and Board Members to June 30, 2015. The SMPC recommends the current governance
structure for the operation of the Pier be maintained under a new Services Agreement,
and the current Board's terms be extended until December 31, 2015 (attachment A). If
Council approves the continuance of the existing governance structure under a new
Services Agreement a new Pier Corporation Board would be scheduled to be appointed.
The Board is recommending staggered terms for Board Members and the reappointment
of five of the seven existing Board to provide continuity. Members of the Santa Monica
Pier Lessees Association have requested that the new Board also include a tenant
member (attachment D). If Council approves this request it could designate one regular
position to be a tenant member or could add an Ex Officio member.
The Pier Board is currently working with Housing and Economic Development Department
staff on a Pier economic and use study that is anticipated to be completed by September
of this year. Included in the study is an examination of Pier requirements and opportunities
related to the Expo line, the Esplanade, the replacement of the Pier Bridge and event
activities, including Twilight Concert Series and strategies for sustainability. The Board
drafted and approved Events, Marketing and Sponsorship Guidelines last fall but would
like to incorporate any pertinent findings from the study before presenting the Guidelines
for Council's consideration. The Board is requesting that Council extend the Board terms
to December 31, 2015 to allow for completion of the study and a revised Events,
Marketing and Sponsorship Guidelines (attachment B).
Background
In 2011 the City of Santa Monica, with the cooperation of the Santa Monica Pier
Restoration Corporation (PRC), initiated a study to evaluate the governance and
management of the Santa Monica Pier in order to maximize organizational and budgetary
effectiveness. Recommendations outlined in the Study called for changes to both the
City's and PRC's roles and responsibilities.
The study identified the need for the City to take a stronger role in the management of this
major public resource, and recommended the establishment of an on -site Office of Pier
Management to consolidate and better coordinate the City's many Pier - related functions.
Recommended changes included modifying the PRC Boards size (from 11 members to 7)
and composition to enhance decision - making while broadening representation, as well as
renaming and refocusing the PRC from an organization whose original mission was to
restore the Pier to an organization with a renewed focus on marketing, promotions, the
production of community events and as a forum for public outreach on Pier related
projects. Leasing was transferred to the Office of Pier Management.
►J
The Office of Pier Management began operation on January 2, 2012. On February 28,
2012 Council approved a Service Agreement with the newly reconstituted Santa Monica
Pier Corporation and appointed the current SMPC interim Board (attachment C).
The division of responsibilities recognizes the inherent City legal and fiscal responsibility
for the management, maintenance and uses of public property. The non - profit Pier
Corporation provides a complementary entity to oversee event production and
management, marketing, sponsorships and to assist the City with community outreach for
matters involving the Pier.
Discussion
Office of Pier Management
The Office of Pier Management (OPM) serves as the City's on -site coordinator of Pier
services and programs as well as being responsible for community, tenant, and visitor
relations. Primary focus areas for OPM coordination and support are Pier maintenance,
facilities, capital improvements, policing and safety, planning, and outreach. OPM, in
cooperation with the Housing and Economic Development Department (HED), has
responsibility for leasing and licenses on the Pier and oversight of the Pier Fund. OPM
also oversees contract services at the Pier, such as the Carousel and administration of the
Service Agreement with the SMPC. The Pier Manager, in partnership with the SMPC Pier
Administrator, is staff to the SMPC Board.
The presence of OPM on the Pier allows for frequent interaction with the public and
tenants, regular inspections, and consistent monitoring of operations and activities on the
Pier.
Santa Monica Pier Corporation
The currant Pier Corporation Board took office in March 2012. The Corporation has
3
renamed itself, hired an administrator who is an expert in marketing, and has worked to
establish a strong program of community outreach. The outreach program works to advise
the community of projects and events on the Pier; gets input on what works and what
needs improvement at the Pier; and defines the unique character and role of the Pier. The
outreach and community forum function was very important to the Phase IV Pier
Reconstruction Project and to the development of the Pier Vision Statement and Guiding
Principles. Board outreach continues to be very important to the Pier Bridge Replacement
project and ongoing capital improvement discussions.
The Board has established a number of study groups within its membership to work with
OPM and Pier Corporation staff on the development of the specified deliverables for City
Council including the Vision Statement and Guiding Principles; Leasing Guidelines;
Governance Recommendations; Event, Sponsorship and Marketing Guidelines and an
Economic and Uses Study.
The Board and its staff have increased both the number and range of events and activities
and have sought to ensure the long term provision of diverse year round programing for
the Pier. The Pier Corporation has defined five strategic categories for its events and
activities programing and has established curators for each. They are music, film, arts,
education, and active lifestyle. Additionally, the Pier Corporation has opened its visitor
center and store in the Carousel building, providing visitor information, historical
presentations, a gift shop and a place to book Carousel parties. Allied with these efforts
have been substantial efforts in marketing and fundraising.
The Board is currently working with City staff on an examination of the Pier's economic
sustainability and use mix to set forth a strategy for the Pier's continued success in light of
the opportunities and challenges associated with the construction and completion of the
Expo line, the Colorado Esplanade, and the Pier Bridge reconstruction. The Board intends
to revise the draft Events, Marketing, and Sponsorship Guidelines it had earlier prepared
to incorporate recommendations from the study. Results of the study and the revised
D
guidelines are anticipated to be presented to Council in November.
Approval of a New Services Agreement
The current interim Services Agreement will terminate on January 1, 2016. The
Corporation is constrained in making commitments in developing its schedule beyond next
winter. This situation prevents multiyear agreements for events and activities or for any
contractual services or programs. The proposed action is to direct the City Manager to
enter into negotiations for a new multiyear Service Agreement with annual renewals at the
City's option. The agreement shall be consistent with the existing division of governance
responsibilities.
Pier Corporation Responsibilities In the Existing Service Agreement
The 2012 Service Agreement between the City and the Pier Corporation set out the
responsibilities of the Corporation as follows: "SMPC shall use commercially reasonable
best efforts in performing the following specific functions:"
• Sponsorships and Event Underwriting Programs
• Marketing and Promotion
• Special Events
• Filming at the Pier
• Marks (Licensing of Pier sign trademark)
• Street Performer Monitoring (Lottery)
• Community Outreach
• Carousel Special Event Rental
New Board Appointments
The Pier Board has recommended staying with seven members as it has been an effective
size. It is also consistent with the size of many other City Boards and Commissions. They
also recommend that terms be for staggered four years, again as is the case with other
Boards and Commission. They suggest however that in this one instance some terms be
set for four years and some for two years so that in the future not all members' terms
9
would come up at the same time. Council, in making their appointment, could designate
three seats to be for four year terms and four to be for two year terms. Subsequent
appointments would all be for four year terms ensuring an ongoing diversity of Board
member term lengths. The Board asks that Council consider reappointing at least five of
the current members to provide for continuity associated with Pier Corporation operations,
and the public process currently underway for Expo planning and the Pier Bridge
replacement project.
The Santa Monica Pier Lessees Association has requested in an attached letter that the
Council also provide for the inclusion of a Pier tenant on the Pier Board (attachment D).
The Council if it concurred could designate one of the seven positions for a Pier tenant or
add a non- voting - Ex Officio - eighth member to Pier Board.
Staff Recommendation
Staff recommends that Council extend the current terms of the interim Pier Corporation
Board until December 31, 2015; direct the City Manager to enter negotiations for a new
multi -year Service Agreement with the Santa Monica Pier Corporation with annual
renewals at the City's option; set November 10, 2015 to appoint seven Santa Monica Pier
Corporation Board members for the new terms that will commence January 1, 2016 (four
of two years and three of four years) and consider the request of the SMPLA for the
appointment process to include a designated Board member or ex officio member from the
Santa Monica Pier Tenants Association.
SMPC Board Action
The Pier Corporation Board approved its attached Governance recommendations at its
December 15, 2014 meeting. The Pier Corporation, at its March 16, 2015 meeting,
approved a request to Council to extend Board Member terms until December 31, 2015.
Financial Impacts & Budget Actions
Funds in the amount of $494,257 for the Santa Monica Pier Corporation Service
Agreement are included in the FY 2015 -16 Budget in the City Manager's Department.
C.
The agreement will be charged to account 30209.577300. Future year funding is
contingent on Council budget approval.
Prepared by: Rod Merl, Pier Manager
Elaine M. Polachek
Assistant City Manager
Attachments:
Rick Cole
City Manager
A. Pier Corporation Board Letter to Council on Governance
B. Pier Corporation Board Letter Requesting Extension of Board Member
Terms.
C. Current Interim SMPC Board of Directors
D. Santa Monica Pier Lessees Association Letter
VA
Attachment A
DATE:
December 15, 20,14
TO:
Mayor and City Council
VROM:
Santa Monica Pier Corporation Board
SUBJECT:
Pier Governance recommendations
BACKGROUND
In the fail of 2011, the City Council reviewed the governance structure for the Santa Monica Pier.
In December of 2012 the Council approved a new shared governance structure by creating the
City Office of Pier Management to coordinate all City departments, manage the Pier Fund, and
oversee capital project Implementation and operational activities oil the Fier. The Council in
tandern renamed and reehartered the Pier Restoration Corporation with an emphasis on
programming public events and activities, marketing, sponsorships, developing event, sponsorship
and leasing guidelines for the Pier and being the public forum for pier related projects and Issues.
The Council also emphasized the need for a public process to Pita" for future Pier enhancements,
Including visitor uses, and for an economic analysis of strategies to generete revenues to support
the Pier as a premier public venue.
In February of 2012, the City Council appointed a new seven member interim Pier Board after
interviews and recommendations by the City Manager. A revised service agreement between the
City and the Corporation was approved, The original Board appointments and service agreement
were for two years. Since then, the City Council extended the term of the Pier Board and
reconfirmed the activities to be completed by the Board. The terms of Board members were
extended to June 80, 2015,
The Council directed at that time that governance recommendations be brought back in February
of 2015 along with consideration of a process to select Board members to follow the existing
terms. In the meantime, the City Council approved the Pier Board's overarching Goals, Objectives
and Strategies (see attached) as well as the Pier teasing Guidelines. The recommended Pier
Event and Sponsorship Guidelines have been completed and are being reviewed by City staff.
The Pier enhancement planning process is underway to fulfill the remaining major responsibility of
the interim Board. This planning effort brings with it the expertise of City staff as well as of the
existing Board rnerabers who were selected to lend their experience and perspectives to this
Important endeavor.
In evFluatirig the current governance structure, the Board reviewed current responsibilities of the
Banta Monica bier Corporation and the City's Office of Pier Management:
The current governance structure is aligned as follows;
SMPC
Marketing and Communications
Filming Permit and Shoot Coordination
Programming Development and Execution
Event Management for hock and Carousel
Corporate Promotions
Visitor Center and Merchandise
jtreat Performer Management
Public t` �utreach/Forurn for Pler Projects and activities
Cat {P>fi
kl
+aintonanco, Facilities and Infrastructure
Leasing, Contracting and Tenant Support
Safety, Security, legal and Insurance
Coordination of City Departments
Capital Improvement Projects
Intergovernmental Coordination
Pier f=und Management
The Board evaluated the effectiveness of this governance structure, using the following criteria: (1)
the lack of duplication of duties, (2) the completion of deliverables, (3) the development of creative
branding and tarketing, (4) an increase in Visitor uses, (5) the ability to respond quickly to new
variables in planning such as the new Pier Bridge, the Esplanade and the coming of Expo, (6)
increased transparency of Fier operations through reports and agendized iterns at Fier Corporation
Board meetings, (7) increased communication and constructive relationships with icier lessees, (H)
ongoing communication with the Landmarks Commission to ensure coordinated planning, and (9)
ongoing and supportive relationships with both the Pier Corporation and City staff.
RECOMMENDATIONS
The evaluation of and recommendations for an ongoing governance structure were discussed at
the Board's November 17, 2014 meeting and acted upon at its December 165, 2014 meeting.
Public comment was also heard as input to the Board's deliberations, the following are
recommendations for Council consideration.
(1) Based on the evaluation criteria noted above, the Board recommends that the current
governance structure remain in place. hoard members especially noted the Increased
communication and positive relationships with Fier lessees, the ability to produce deliverables with
minimal consultant support, the ability to innovate and provide compelling public events, and the
ability of each entity to deliver services based on staff expertise without an overlap in
responsibilities. It is the experience of board members that recruitment of innovative marketing
professionals is most successful in smaller organizations that allow for a high degree of creativity.
(2) The Board also recommends that as an operational plan be developed for performers on the
Esplanade, consideration be given to a unified management structure for the Pier, Esplanade: and
Promenade performers districts that would be overseen by the relevant a vity'departments and that
at that time the performer oversight role of the Pier Corporation be eliminated or diminished due to
the absence of the Pier Corporation's enforcement capabilities.
(3) The Pier Board has benefited from its members' unique r.* of expertise. The importance of this
was established by the City Council in its selection through the City Manager's interview process to
ensure this broad expertise, stressing relevant knowledge and experience, The Board noted that
this range of expertise strengthens both operational and enhancement planning activilies and that
the City Council adopt a similar process for the future Board. The seven member board has
worked well, something remarked an by community members and lessee,, seven seem, s to be
the optimum size for effectiveness and the size of the Board was one of the key changes made ire
2012 by the Council and should be retained.
(4) The importance of Institutional memory and continuity should also be noted and It is
recommended that a number of current Board members be considered for reappointment, while
rotating in at most two new members with relevant skill sets in July 2015. The appointments would
have initial staggered terms ®- such as four for two years and three for four years, with all
subsequent appointments being for four years. The expertise of new appointees should
complement the reappointed board members and reflect diverse community perspectives.
(v) The Board recommends that, under this governance structure, the Fier enhancement planning
process continue. The focus should be on short -term, mid -temp and long terry visitor
enhancements, including,: strategies for the coming of Expo, the Esplanade rn rd Pier Bridge, with
OPM and Public Works, identifying needed capital improvements over time, ,ind conducting
periodic economic analyses of revenue generating opportunities to support pier operations.
(G) The Board should also focus on the revenue generating capabilities to minimize public supports
costs on an ongoing basis.
MO r Z4
w.. PIER -3
March 16, 2015
Dear Council,
k...y_... ...f_
The Pier Board is currently embarking on a visitor enhancement planning process -
a major deliverable identified by the City Council upon appointment of the interim
Pier Board in February 2012. With support from the City's Economic Development
Division, a planning /economic consultant team is currently being retained to assist
in implementing a focused public planning process, resulting in the identification of
short -, intermediate -, and long -term strategies to enhance the visitor experience on
the Pier. This is especially critical given the coming of Expo, the development of the
Esplanade, and the replacement of the Pier Bridge.
Beginning in April, the Pier Board is scheduled to meet twice monthly to hear from
project consultants, engage community stakeholders and identify enhancement
strategies. It is anticipated that this study will be completed in October or
November 2015. The current Board terms expire on June 30, 2015. A change in
Board membership at this point would be disruptive to the planning process and
much needed continuity would be lost. Therefore, the Pier Board requests City
Council consideration of an extension of Board terms until December 31, 2015 in
order to give adequate time for the study process, including community input, to
take place.
" g
t
Judy Abdo, Board Chair
Attachment C
Santa Monica Pier Corporation Current Interim Board of Directors
Board Members:
Judy Abdo (Chair)
John Catoe (Vice Chair)
Barbara Stinchfield
Susan McCarthy
Ray Braun
Rae Archibald
Misti Kerns
1M_ M
July 1, 2015
Mayor Kevin McKeown
City of Santa Monica
848 -E 16th Street
Santa Monica, CA 90403
Dear Mayor McKeown,
I hope this letter finds you well. As I know you.are aware, Pier Governance is on your Council agenda for
discussion and approval in July of 2015.
On behalf of the Pier tenants, I am reaching out to you directly to request the Pier Governance dedicate
one board seat to be filled by a member in good standing of the Santa Monica Pier Lessees Association
( "Pier tenant").
It is the SMPLA's position that there are many times when Pier tenant Insight would benefit the Pier
Corporation Board's dialogue. A tenant Hoard member would inform the board from a "boots on the
ground" perspective and assist the Board to make better informed decisions. We envision that a tenant
Hoard member would be selected by the tenants. This process would also promote a cohesive message
from the Pier tenant group.
We believe that the addition of a Pier tenant would greatly facilitate achieving the goals the Board has
articulated for the operation of the Piet. For example;
®
PC Goal: Retain, preserve and enhance the historic character and eclectic, thematic
appearance of the Pier and Its aesthetic elements,
o Pier tenants make annual capital decisions that affect existing buildings and thus the
overall appearance of the Pier.
PC Goal: Enhance access to the Pier for the disabled.
o The majority of activities on the Pier are tenant operated. The Pier would be more
attractive and accommodating to guests with disabilities if tenants coordinate with the
PC and each other.
PC Goal: Pier restaurants, food services and retail merchants will provide high- quality, site
appropriate offerings at a wide range of price points.
o Clearly, the stakeholders that can make the greatest positive impact on this goal are the
existing restaurants on the Pier.
19:MPO gym:
E
® PC Goal Encourage exporimentaLion with new programming ideas..
The more the tenants are aligned with other stakeholders, the Board,
the City and each other; the. more fluid the engagement will be to
experiment with new programming.
As always, I sincerely appreciate your willingness to listen to our ideas and your support of the Pier. I
can be reached anytime on my cell at 310 - 4150414.
Sincerely,
b
Chris Volaski
Gf ,
President
Santa Monica Pier Lessees Association
Cc: Rod Merl
Reference:
Agreement No. 10101
(CCS)