CC - Item 6A - Rosemead Chamber of Commerce Funding Request P o S E E -,
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ROSEMEAD CITY COUNCIL
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I STAFF REPORT
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TO: THE HONORABLE MAYOR AND CITY COUNCIL
FROM: BILL R. MANIS, CITY MANAGEI
DATE: JUNE 27, 2017
SUBJECT: ROSEMEAD CHAMBER OF COMMERCE FUNDING REQUEST
SUMMARY
The Rosemead Chamber of Commerce is requesting funding from the City. At the February 14,
2017, City Council meeting, the Chamber of Commerce presented a PowerPoint presentation of
their proposed business plan. The Chamber of Commerce was asked to come back with
additional details to address the City Council's questions and comments. They have enclosed an
addendum to the summary presentation(Attached).
STAFF RECOMMENDATION
It is recommended that the City Council discuss and provide direction to staff.
FISCAL IMPACT
This item has an impact of the Fiscal Year 2017/18 Annual Budget. If the City Council approves
the funding requested by the Chamber of Commerce, the approved funding amount will be added
to the General Fund appropriations.
STRATEGIC PLAN IMPACT-None
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
Prepared by
At/rah
Linin
Marc Donohue, City Clerk
Attachment: Addendum to Summary Presentation /'
ITEM NUMBER: GA
Attachment
Addendum to Summary Presentation
Rosemead Chamber of Commerce
Addendum to Summary Presentation to the City of Rosemead
June 27, 2017
Chamber Purpose 2017
Show partnership in ways valued by the City of Rosemead.
Identify goals and objectives.
Justify our support by the City of Rosemead and the greater Rosemead community.
Build awareness of Rosemead Chamber programs and initiatives.
Show leadership and commit to sustained action.
Be accountable.
What is asked of the City of Rosemead
The Chamber is growing in membership and services. But we need to increase
membership significantly to regain financial stability and serve our purpose of
supporting Rosemead businesses and economic opportunity throughout the city.
The Chamber respectfully requests a one-time grant of $200,000 as an investment in
economic partnership and a shared a vision of a strong community - one that
creates and retains jobs and businesses, and provides incentives for our young
people to build their lives here.
What success means for the City and Chamber
When we are successful together, Rosemead business activity will be measurably
improved by objective criteria, including sales tax receipts, fees and TOT revenue.
The Chamber will have eliminated its annual budget deficit by 2020, created a
Business Improvement District for Garvey Avenue, and operationalized digital media
marketing initiatives supporting our Hospitality and Restaurants sector. We will have
conducted objective economic research applicable to growth and job creation.
Rosemead Chamber of Commerce Board of Directors 1
June 2017
Rosemead Chamber of Commerce
Addendum to Summary Presentation to the City of Rosemead
June 27, 2017
The Chamber today and vision of the future
Financial Stability
The Chamber previously received support of approximately $45,000 a year (up to
2009) from the State Community Development Fund. The Chamber no longer has
received these moneys, when this State -funding program was withdrawn due to the
financial crisis. Subsequently, the City has supported the Chamber with $10,000
annually, funded from operating funds. The difference of $35,000 represents an
annual structural operating deficit ranging from $25,000 to $50,000. The Chamber's
2016-17 FY budget deficit is $29,200.
The Chamber funded these deficits by taking on debt, now approximating $130,000
and costing approximately $6,000 annually in interest. The Chamber has reduced its
operating base to one full-time executive. Nonetheless, the Chamber has gradually
increased membership annually, extended member services, and supported City
priorities. The Chamber has focused on generating new revenue -generating events,
with limited cash positive success.
The Chamber in 2017 is limited in scale, scope and effectiveness by funding that is
insufficient to achieve expectations and needs.
Renewed Vision
The City of Rosemead and its businesses need an effective Chamber of Commerce to
represent existing and new businesses, nurture opportunity and build social equity.
The way forward begins with a citywide commitment to economic improvement,
with the City, Chamber and private employers mobilized to improve business
conditions in sectors that have the greatest potential.
The Chamber recognizes the need to expand membership and services.
We need to close our budget deficit.
We see achievable opportunities in Rosemead's hospitality and restaurant
industries, supported by a revitalized Visitors Center.
We will seek smart and innovative guidance from objective community research.
And as a top goal and organizing principle, we need to prepare, establish and
manage a Garvey Avenue Business Improvement District.
Rosemead Chamber of Commerce Board of Directors
June 2017
Rosemead Chamber of Commerce
` Addendum to Summary Presentation to the City of Rosemead
June 27, 2017
Goals and Objectives 2017-2020
We set two goals for 2017-2020
• Increase membership to 360 dues -paying businesses, up from current 170.
• Eliminate the deficit through membership dues and program revenues.
To earn this support, the Rosemead Chamber of Commerce must improve its
leadership to the business community, operations and programs.
Objectives
• Staffing: Enhance Chamber activity and effectiveness by increasing its
professional staff from one currently to three employees (additional salary
and operating expense of $105,000).
• Membership: Double membership by 2020 by value increase and innovative
membership marketing.
• Create a needed Business Improvement District along Garvey Avenue.
This critical goal will require feasibility study ($5,000) and eventual allocation
of about $70,000 for development and ongoing governance.
The Chamber will seek new sponsor funding, including grants.
• Digital Media: The Chamber must create modern digital media for Web
and mobility applications, for purposes of effective marketing of our
city to internal and external audiences.
Initial expenditures estimated at $10,000.
• Promotion and nurturing of Hospitality and Restaurant industry. The
Chamber prioritizes these bases as front-line opportunities for growth
and employment. Expenditures are allocated to Staffing and Digital
Media.
Rosemead Chamber of Commerce Board of Directors 3
June 2017
Rosemead Chamber of Commerce
Addendum to Summary Presentation to the City of Rosemead
June 27, 2017
• Rosemead Opportunity White Paper: We will explore commissioning a
Rosemead Economic Targets of Opportunity White Paper. As a starter,
we will seek formal research and analysis of redevelopment of the
former Auto Auction Lot; assess values, potential uses, job creation and
tax increments.
Timeline of objectives over 18 months
• Budget
Eliminate Chamber budget deficit by 2020.
• Staffing:
o Director of Membership:
Recruitment, membership relations. Hire July 2017.
o Director of Marketing and Special Projects:
Projects/BID. Hire February 2018.
• Membership: to increase from a current 170 to 225, 275, and 360 (2020)
• BID: Conduct survey of businesses per needs and benefits of BID.
Survey start February 2018. Hire specialized consultant May 2018.
Form Business Improvement District, September 2018.
Plan activities/operations into 2019.
• Digital: Assess peer chamber digital initiatives, web and mobility,
September 2017. Develop digital Rosemead map.
Relaunch web site, February 2018. Integrate digital map.
• White Paper: Form a Chamber professional committee to study,
discuss with stakeholders and contact university researchers.
Begin committee process October 2018.
Rosemead Chamber of Commerce Board of Directors 4
June 2017
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Rosemead Chamber of Commerce
` Addendum to Summary Presentation to the City of Rosemead
June 27. 2017
Defining Success
Business activity will be measurably improved by objective criteria.
• We target an increase of at least $300,000 in sales tax receipts, licensing fees
and TOT revenue to the City.
• The Chamber will eliminate its $28,000 annual budget deficit by 2020, with
membership dues increasing by $62,000 --not withstanding the increase in its
expense base with the staff additions, etc.
• We will achieve new fee income of $20,000, including advertising revenue
from digital mapping and other digital projects; an increase in event net
revenue of $30,000; delegation fees of $10,000, and BID management fee
income of $20,000 annually.
• Total annual Chamber expense will increase from approximately $170,000 to
$300,000, while total revenue will increase from approximately $140,000 to
$300,000 or more.
Chamber Key Performance Indicators
Phased approach over coming three fiscal years
• Business activity will be measurably improved by objective criteria, including
minimum increase of $300,000 in sales tax receipts, licensing fees, and TOT
revenue to the City.
• The Chamber will have meetings in May to develop anew Three -Year
Strategic Plan, leading to creation of annual budgets each year.
• The Chamber Board and CEO will set specific goals and priorities within an
annual Business Plan and Budget.
Rosemead Chamber of Commerce Board of Directors 5
June 2017
ry
Rosemead Chamber of Commerce
Addendum to Summary Presentation to the City of Rosemead
June 27, 2017
• The Chamber and Staff will review progress: CEO and Staff weekly, reporting
progress, variances and opportunities as often as needed, to the Chamber
President and, at least monthly, to the Executive Committee and full Board.
Management by objectives
• CEO: Increase membership from current 170 to 360 businesses by 2020.
Increase member dues from $34,000 to $96,000, including sponsorship
revenue ($10,000). Increase event revenue from $40,000 to $60,000 by 2020.
• Director/Memberships: Achieve membership goals. Increase Business
Financial Services revenue from $15,000 to $30,000 by 2020.
• Director/Marketing and Special Projects: Drive key projects in Hospitality,
digital media marketing and Business Improvement District, in accordance
with the Chamber Business Plan, Budget, and CEO measurable directives.
Financial targets Discussion
Following are financial indicators for the Chamber Board and the City, containing
financial highlights through FY2019-2010. These assume receipt of the $200,000
grant request for deliberative purposes and are preliminary at this time. These
indicators would form the basis of the upcoming Chamber strategic planning,
budgeting, and management goals development activity.
Rosemead Chamber of Commerce Board of Directors 6
June 2017
Rosemead Chamber of Commerce
Addendum to Summary Presentation to the City of Rosemead
June 27, 2017
Highlights
Current
Budget
FY 17-18
FY 18-19
FY 19-20
# Members
170
225
275
360
Avg.Dues
$200
$224
$240
$240
Total Dues
$34,000
$50,400
$66,000
$86,400
Corporate sponsorships
5 000
$7,500
$10,000
Total Membership Income
$34,000
$55,400
$73,500
$96,400
Current
FY 17-18
FY 18-19
FY 19-20
Business Services:
$17,000
$18,000
$22,000
$25,000
City Contract
$10,000
$10,000
$10,000
$10,000
Event Net Income
$34,700
$55,000
$60,000
$65,000
Membership
$34,000
$55,400
$73,500
$96,400
Rent
$7,500
$8,000
$9,000
$10,000
BID feasibility and mgt. fees
$0
($5,000)
$10,000
$20,000
Rosemead Report Net
($8,500)
($7,000)
($5,000)
$0
Web & Digital Product Net Inc.
($2,500)
($10,000)
$15,000
$20,000
Staff Expenses
($75,800)
($150,000)
($175,000)
($180,000)
Corp. Exp's./ insur., taxes, interest, etc.
($36,000)
($36,000)
($38,000)
($38,000)
Equipment / Software Expense
($6,000)
($8,000)
($8,000)
($8,000)
Marketing Expense
($3,600)
($6,000)
($5,000)
($4,000)
Total Net Income
($29,200)
($75,600)
($31,500)
$16,400
Current
FY 17-18
FY 18-19
FY 19-20
Grant Cash Balance
$200,000
$170,800
$95,200
$63,700
Net Income
($29,200)
($75,600)
($31,500)
$16,400
Net cash
$170,800
$95,200
$63,700
$80,100
(Contains no allocation for debt reduction)
Rosemead Chamber of Commerce Board of Directors 7
June 2017