Senators Top Sponsors Protected

As reported yesterday by Neco Cockburn of the Ottawa Citizen, five major corporations won’t have to worry about seeing competitors’ logos at Ottawa’s new Rink of Dreams, after the city agreed to protect and recognize sponsors of the Sens Foundation and Ottawa Senators hockey club. An agreement giving the companies exclusive sponsorship rights at the refrigerated ice pad outside City Hall resulted from the city’s negotiations with the Sens Foundation, which approached the city with a proposal for the project and covered most of the costs. Now, if the city wants a “pizza fast-food” company to sponsor something at the rink, it must ask PizzaPizza, the Sens Foundation’s partner, if it’s interested. For banking, Scotiabank. For beverages, Coke. For credit cards, MBNA. For telecommunications, Bell.

The city can market to businesses in other categories at any time, but if the five companies don’t want to provide sponsorship when offered an opportunity, competitors in the same category may not be approached until after March 31, 2016, when the agreement expires. “There was a negotiation and a give-and-take, and language that we settled on does give exclusivity to these five, and we’re happy to live with that and we will govern ourselves accordingly,” said Dan Chenier, the city’s general manager of parks, recreation and cultural services. “Where these five are not interested or where there’s other opportunities that better suit another area of business, we’ll pursue that and I think we’ll have some success there.”

The city is responsible for and is to receive all of the revenue from sponsorship programs at the rink, where the ice surface featured logos of the Senators and city when it opened in January. The city contributed $250,000 to the project, and the Sens Foundation covered the remaining costs. The bill for the rink grew to about $2 million before it opened. (The city is also providing $200,000 a year in maintenance and operating fees.)Exclusivity clauses for the Sens Foundation’s partners aren’t expected to affect the city’s ability to generate sponsorship revenue, Chenier said. “This is a limited range of five areas who may very well, because they’ve already shown interest in the site … be interested in working with us to do something anyway, but there are plenty of other opportunities,” from submarine sandwiches and hamburgers to hotels, retail businesses and car dealerships, he said.

Sens Foundation president Danielle Robinson said “category exclusivity” sponsorship arrangements are common in the sporting world. The foundation and hockey club it’s attached to “just wants to make sure that we’re honouring and respecting those big corporate partners of ours because they’re really supportive of everything and the work we do all year long, and certainly have been contributors to the rink,” she said. The five companies, Robinson said, are overall sponsors of the hockey club and foundation, “but because of the kind of work that they do with us all year long, some of the money that they would be giving to us would have been directed into this project. “It’s not that any one of those corporate partners penned an individual cheque for the rink, but certainly provide significant corporate sponsorship to the Sens Foundation to underwrite a lot of our fundraising costs (so) that we maximize the amount that we’re then able to raise to give back into the community to support projects like this,” she said.

A full sponsorship program has not yet been developed, Chenier said, and it’s not known how much revenue the city might expect from the popular rink. City staff believe there are sponsorship opportunities for promotions and special events or theme nights, and for advertising on the rink boards or ice surface. Through their agreement, the city will also allow the SensFoundation sponsors to “have a presence” during special events organized by the foundation, and will recognize sponsors who contributed to construction by installing a plaque at a “mutually agreeable” location. In addition, for the first year of the agreement — and longer if agreed to by the parties — the foundation can apply small logos or names of their partners to benches around the rink or the rink boards, the agreement says. (The contract says exclusivity restrictions won’t apply to events or activities at the rink put on by outside organizations. “The city recognizes that third-party permit holders of events on the rink may have their own sponsorship agreements,” the agreement states.) What amounts to a five-year exclusivity arrangement was a “fair compromise with the city,” Robinson said.

“We also know that once we turn this property over to the city it really is theirs to own and manage and operate, and certainly I think that they’re going to be wanting to look to make some monetized value on the rink as well, to make sure that they’re covering some of their operation costs. From our perspective, we just wanted to make sure that we were managing our relationships that we have in place effectively and fairly.” Sponsorship wasa key discussion point during negotiations that started last year as the city and Sens Foundation worked on a memorandum of understanding while the project was underway, according to documents released to the Citizen under access-to-information legislation.

In an internal summary of issues that remained outstanding in November, city staff wrote that the Sens Foundation wanted to vet all potential city partnerships in order to protect their partners’ investment and prevent “ambush marketing.” In a recommendation and response to that, an internal city team wrote that “in order to protect the investment of the SensFoundation partners who have contributed to the project, the City will provide those partners with the first opportunity for additional partnership(s) to improve the experience on the rink as those opportunities become available.” At the same time, however, “if those Foundation partners do not wish to partner with the City, the City requires the flexibility to freely market those opportunities to other interested companies,” the team advised. Draft wording for the agreement contained in a city staff email dated Nov. 23 suggested that if the Sens Foundation sponsors did not want to partner with the city on a specific opportunity, then the city would be free “to solicit and secure partnership agreements with other companies in that commodity category.” Deputy city manager Steve Kanellakos wrote that day in a response to the email that “I agreed at our meeting that the City would not be free to seek and secure partnership agreements with other companies in these commodity categories for the five-year period,” and asked for the draft to be amended “to reflect what we agreed to.”

The city’s contract with the Sens Foundation also includes an agreement that the ice pad must be called the Rink of Dreams until March 31, 2021, unless both parties agree to change the name. Robinson said the foundation has so far raised enough money to cover about “98 per cent” of its costs for the rink and is working toward building its next planned ice pad later this year, possibly in October. The organization has planned to build 19 more outdoor rinks in needy neighbourhoods, starting with Jules Morin Park inLowertown. Future rinks are to be NHL-size — larger than the Rink of Dreams — and will not be refrigerated, Robinson said, and there are plans to set up basketball nets that can be used on the concrete or asphalt surface during the summer. Separate agreements are to be made with the city for each additional rink, Robinson said.

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