Staff Report - Study Session on Solicitation and Donation PolicyN 0,MEETING DATE: 10/1/2007
STUDY SESSION
s COUNCIL AGENDA REPORT
Og GASO
DATE: SEPTEMBER 24, 2007
TO: MAYOR AND TOWN COUNCIL
FROM: PAMELA JACOBS, INTERIM TOWN MANAGER
SUBJECT: STUDY SESSION ON SOLICITATION AND DONATION POLICY
RECOMMENDATION:
Discuss the attached draft Council Policy Committee Solicitation and Donation Policy
(Attachment 1) and provide direction to staff concerning the proposed policy.
BACKGROUND:
On September 17, 2007, the Council Policy Committee presented a draft Solicitation and
Donation policy for Council consideration. This policy was in response to Council direction to
develop a policy that addresses solicitation of goods, services, and contributions to support Town
services, acceptance of donations, and recognition of donors.
DISCUSSION:
Following public input and Council discussion at the September 17t" meeting, Council directed
staff to schedule a Study Session to further explore several of the issues raised concerning the
solicitation and donation policy. To assist Council, staff has summarized comments made by
the Council Policy Committee, public, and Council during the policy discussion (Attachment 2).
During the discussion, there were several reoccurring policy issues raised by the public and
Council. These issues include the following:
Continuation of direct solicitation by the Arts Commission to support Music in the Park
Appropriateness of direct solicitation by other appointed officials (i.e., members of Town
boards, committees and commissions).
Options for other types of donor recognition and for naming of Town facilities
PREPARED BY: JENNY HARUYAMA
Administrative Programs Manager
N AMGR\P.lacobs\Council Reports\Solicitation and Donation Policy.doc
Reviewed by: Assistant Town Manager -blown Attorney
Clerk Administrator VVA Finance Community Development
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: STUDY SESSION ON SOLICITATION AND DONATION POLICY
SEPTEMBER 24, 2007
Council requested a Study Session to discuss these issues in particular, as Council expressed
different views about how these issues should be addressed in the policy. Staff is seeking
direction from Council as to if and how to modify the proposed policy regarding these, and any
other policy considerations.
FISCAL IMPACT:
Depending on Council direction, there may be fiscal impacts associated with the solicitation and
donation policy. Any significant fiscal impacts will be brought forward to Council during the
FY 2008/09 budget development discussions.
Attachments:
Attachment 1: September 17, 2007 Council Agenda Report - Consideration of Proposed
Solicitation and Donation Policy
Attachment 2: Summary of September 17, 2007 Solicitation and Donation
Policy Discussion
Distribution:
Executive Team
Town Boards, Commissions, and Committees
Friends of the Library
Police Foundation
t° N °F
~QS Gat°S COUNCIL AGENDA REPORT
DATE: SEPTEMBER 13. 2007
TO: MAYOR AND TOWN COUNCIL
FROM: COUNCIL POLICY COMMITTEE
VICE MAYOR BARBARA SPECTOR
COUNCIL MEMBER DIANE MCNUTT
MEETING DATE: 9/17/2007
ITEM NO. 10
SUBJECT: CONSIDERATION OF PROPOSED SOLICITATION AND DONATION
POLICY
RECOMMENDATION:
It is recom nded that the Council consider and adopt the proposed Solicitation and Donation
Policy (Attach ent 1).
BACKGROUND:
In November 2005, Council approved a Policy Focus Area Matrix which identified several key
Council policy issues for consideration. Priority was given to the development of a policy work
plan that addressed the solicitation of goods, services, and other contributions on behalf of the
Town, acceptance of donations, and recognition of donors. Subsequent to this direction, Council
requested that the Committee pursue policy matters related to the development of Code of Conduct
disciplinary procedures. Upon completion of this policy issue, the Committee refocused its
discussions on solicitations and donations.
With the objective of building pride in our community and trust and confidence in Town
government, the Committee presents for Council consideration its recommended draft Solicitation
and Donation Policy.
DISCUSSION:
Understanding that the Los Gatos community is known for its generosity and desire to improve its
quality of life, the Committee developed the draft solicitation and donation policy to achieve the
following objectives:
N MGR\Adminwo Fi(es\2007 Council Reports\Couneil Commi tee Solicitation and donation policy report doc
Reviewed by:. Interim Town Manager Town Attorney
~t , Administrative Programs Manager Revised: 0911312007 12:58 PM
Reformatted: 5/30102
ATTACHMENT I
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: PROPOSED SOLICITATION AND DONATION POLICY
SEPTEMBER 13, 2007
■ Ensure the ethical and consistent solicitation, acceptance, and recognition of donations.
■ Enhance and expand community awareness of donation opportunities.
■ Recognize the benefit of independent, non-profit organizations to support Town services
and activities.
■ Build community pride and trust and confidence through collaboration among residents,
businesses, and non-profit and other community organizations.
Prior to developing the attached draft policy, the Committee carefully examined the Town's current
practice and other local government processes and policies, including but not limited to the cities of
Costa Mesa, Cupertino, Gilroy, Lafayette, Mountain View, Palo Alto, San Diego, San Jose, and
Sunnyvale, and out-of-state communities such as Atlanta, Georgia and Seattle, Washington. The
analysis revealed a need to develop a comprehensive policy and process to guide Town solicitation
and donation activities in an equitable manner consistent with existing California ethics laws and
Town policies and procedures.
Proposed Solicitation and Donation Policy Overview
In 2005, the State Legislature passed AB 1234, a bill requiring elected and appointed officials who
are compensated for their services or receive reimbursement for their expenses to receive training
on complex ethics laws and principles. This mandatory requirement has raised awareness of the
ethical expectations of public officials - both elected and appointed - in terms of their
responsibility to serve as stewards of the public's resources and trust. The public holds local
officials to high standards of ethical conduct. In this context, the Committee evaluated the
appropriateness of the Town's current solicitation practices, which involve the direct solicitation of
individuals, companies, foundations, and other entities by Town elected and appointed officials and
staff to support Town-sponsored events and programs.
The Committee determined that the Town's current practices which have evolved over time
without structure have the potential to create conflicting interests and loyalties that could
undermine the community's perception, of the fairness of the Town's processes. Examples of these
ethical concerns include creating a "pay to play" or special treatment expectation as it relates to
donors that might come before the Council. Direct solicitation by elected and appointed officials
and staff may also pressure potential donors who feel obligated into making contributions.
The recommended policy does support the continuing solicitation of goods, services, and
contributions, but through a broad outreach approach that communicates donation opportunities to
all segments of the community. Under the proposed policy, funding may come from the Town and
donations from an expanded base of individuals and businesses and/or existing and potential non-
profit organizations.
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MAYOR AND TOWN COUNCIL
SUBJECT: PROPOSED SOLICITATION AND DONATION POLICY
SEPTEMBER 13. 2007
Lastly, the proposed policy establishes donation acceptance and recognition guidelines. These
guidelines would create a consistent and equitable process for determining the appropriateness of
donations and acceptable forms of donor recognition. The Town currently does not have an
established donation acceptance and recognition practice.
Policy Implementation
Implementation of the proposed policy would modify the way in which the Town currently
communicates its donation needs to individuals, businesses.. and non-profit organizations. Instead
of direct solicitation, donation opportunities would be conveyed through a Town-wide broad
outreach program. The Town has successfully used this approach with the Adopt-a-Planter and
Adopt-a-Bench programs, which now have waiting lists. Broad outreach to the community would
involve using communication methodologies such as the Town's website, e-mail subscription
notification systems, Vista Newsletter and other Town publications, brochures, inserts, and articles
published in local media resources.
Prior to implementing the policy, donation opportunities would be identified in collaboration with
residents, businesses, and other community organizations and brought before Council for
consideration. The identification of these donation opportunities would result in a Council-
approved list of needs that could be developed in parallel with the annual operating and capital
budget process. Given that the Town's service needs may changeover time. Council would haye
discretion to modify the donation list as necessary.
Other Considerations
The Committee recognizes that implementation of the proposed policy would affect the way in
which the Town currently solicits for goods and services. However, alternate communication
approaches as described earlier in this report would be used to convey donation opportunities to
individuals, businesses, and non-profits. Staff has tested this policy approach against the Town's
current practice of direct solicitation and anticipates that through education and awareness.
department service goals can be reached and expanded.
Below is an overview of the value and type of goods, services, and other contributions currenti_v
received by Town Departments that support various services and programs. Also included is a
discussion of the Town's relationship with non-profit organizations.
General Town Services - Currently, the Community Services, Library, and Police Departments
directly solicit for goods, services, and contributions to offset expenses for Town programs. It is
estimated that the value of these contributions average between $200 - $5,000, with the exception
of the Police Department that received an annual donation of $10,000 to support the Canine
program. Types of programs supported by donations include, but are not limited to: senior
activities, special events, such as 4"' of July and the Annual Volunteer Recognition program, library
book collections, furniture, equipment and program supplies, public safety equipment and canine
program support.
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MAYOR AND TOWN COUNCIL
SUBJECT: PROPOSED SOLICITATION AND DONATION POLICY
SEPTEMBER 13. 2007
Under the policy, these general Town services could be funded by expanded donation
opportunities, the Town, and existing and potential non-profit organizations.
Music in the Park - The Arts Commission actively solicits funds to support the Town's Music in
the Park (MIP) program. Community contributions collected for MIP are anticipated to be $40.000
annually. As with other Town events, the Town provides funding to cover associated staff costs.
Under the policy, MIP could be funded by expanded donation opportunities, the Town, and
existing or potential non-profit organizations.
Solicitation of N"on-Profit Organizations - The Library and Police Department have established
relationships with non-profit organizations that fundraise on their behalf or seek donations for
specific goods and services. Currently, the departments make direct service requests of these non-
profit organizations.
Under the policy, these existing non-profit organizations could be made aware of expanded
donation opportunities benefiting the Library and Police Departments and could continue to seek
donations on behalf of the departments.
CONCLUSION:
The recommended Solicitation and Donation Policy supports the continued solicitation of goods.
services, and contributions, but through communication mechanisms that broadly outreach
donation opportunities to all segments of the community. This policy provides a comprehensive
approach and process that address direct solicitation in a manner that has been proven successful
through similar Town programs and, more importantly, builds pride in the community and trust and
confidence in Town government.
Attachments:
Proposed Solicitation and Donation Policy
Distribution:
Executive Team
Town Boards, Commissions, and Committees
Friends of the Library
Police Foundation
DRAFT SOLICITATION AND DONATION POLICY
FOR DISCUSSION PURPOSES ONLY
POLICY PURPOSE
The purpose of this policy is to effect Town donations and solicitations in a manner that
complies with both the letter and spirit of California ethics laws and, within that that
framework, to expand the potential for community donations by establishing a
mechanism by which individuals and organizations may be more readily advised of
donation opportunities.
SOLICITATION GUIDELINES
Targeted Solicitation
Targeted solicitation is defined as the direct petition or contact of specific individuals,
companies, foundations or other entities initiated by the Town Council and other elected
officials, Council advisory bodies, and Town employees herein called "Town Officials"
for the purpose of receiving goods, services, or other contributions for the Town.
Targeted solicitation excludes the direct petition for government, private, or non-profit
grants for Council-approved programs, projects, and services. Unless otherwise stated
in this policy, Town Officials shall not engage in targeted solicitation activities on behalf
of the Town.
BROAD OUTREACH GUIDELINES
Broad Outreach
Broad outreach is defined as the process of informing a broad spectrum of individuals,
companies, foundations, non-profit organizations, or other entities of donation
opportunities through various communication vehicles, including but not limited to
written, electronic, or internet-related publications, flyers, brochures, news releases, and
television or radio announcements. Broad outreach is permitted by the Town Manager
or designee subject to the guidelines provided in this policy.
The following broad outreach guidelines apply when communicating a Town need for
goods, services, or other contributions:
■ Broad outreach must relate to a Town Council-approved purpose, service, project,
or program.
■ Broad outreach for goods, services, or other contributions should be made by
using a variety of communication methodologies to ensure outreach to the entire
community.
■ Donations shall not, be made under the guise, pretense, or presumption of
receiving official Town endorsement or approval of the donating party, product,
project, or activity.
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PROCEDURE FOR ESTABLISHING COUNCIL APPROVED TOWN NEEDS
The Council shall direct the Town Manager to develop a list of recommended Town
needs for donation opportunities. Council consideration and approval of the list of Town
needs may occur as part of the annual operating and capital budget development
process and can be amended by Council at any time.
DONATION ACCEPTANCE GUIDELINES
All goods, services, or other contributions offered by individuals, companies,
foundations, non-profit organizations, or other entities will be considered for acceptance
or rejection, including items offered for donation that are identified on a Council
approved list of needs. The acceptance of all donations to the Town will be based on
the following guidelines.
■ Purpose of the donation.
■ Community or municipal need for the donation.
• Compatibility of the donation with Los Gatos Municipal Code, policies, programs,
and other applicable laws.
■ Timeliness of the donation as it relates to implementation.
• Level of benefit and financial impact to the Town.
All donations should be reviewed by the Town Manager or designee in advance of
acceptance to ensure consistency with established policy guidelines.
AUTHORITY TO ACCEPT DONATIONS
The authority to accept all donations is based on the market value of the donation as
reasonably determined.
Donations $25,000 and Under
The Town Manager or designee is authorized to accept or reject all minor donations that
have a market value equal to or less than $25,000.
Donations Over $25, 000
The Town Council shall consider and accept or reject all major donations that have a
market value greater than $25,000.
PROCEDURES FOR ACCEPTING MAJOR DONATIONS
For all major donations, a staff report, containing analysis based on the donation
acceptance guidelines established in this policy, will be written to guide the Council
when considering major donations. The report will also provide donation recognition
alternatives for Council consideration should the donation be accepted. The Council will
determine on a case by case basis if the donation should be accepted or rejected.
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DONOR RECOGNITION GUIDELINES
Acceptance of donations shall be acknowledged by the Town. Donation recognition
practices shall be implemented in a consistent manner and adhere to Town Municipal
Code, all applicable laws, regulations, and policies. Recognition of donations will be
determined by the Council or Town Manager and shall be consistent with acceptance
requirements of this policy and the guidelines set forth below:
Donations accepted by the Town may be acknowledged through one or more of the
forms of recognition as indicated below. Other forms of recognition may be approved
by the Town Council via resolution if compelled by special circumstances which shall be
specified in the resolution.
• Written and/or verbal recognition.
• Public recognition at Town Council meetings.
■ Inclusion in Town public communication materials, such as electronic media and
selected publications.
• Plaques.
Plaques may be used to commemorate donations accepted by the Town from persons,
businesses, and organizations according to the following standards:
Plaques used for recognition purposes may be affixed to an appropriate Town facility,
which includes, but is not limited to a building or any portion thereof, structure,
equipment, furniture or natural asset. Plaques shall include the name(s) of the
person(s) being recognized and applicable date, with standard wording limited to:
• The Town of Los Gatos recognizes and appreciates _
his/her family] for [his/her/their] donation to [identify facility].
• The Town of Los Gatos recognizes and appreciates
[business or organization] for its donation to [identify facility].
■ The Town of Los Gatos recognizes and appreciates
[his/her/its] donation to [identify facility] in the name of _
■ Or language acceptable to the Town Council.
[and
for
The size of the plaque shall not exceed 8"x10," unless the number of donors exceeds
the allowable space. For multiple donors, the names of the donors should be
proportioned thereto, and the size of -the plaque shall not exceed four (4) square feet.
The location, materials, size and color of plaques shall be consistent with acceptance
requirements of this policy or by Council on a case by case basis should special
circumstances exist, which shall be specified in a resolution. Town facilities shall not be
named after an individual, group, organization or business as a result of any donated
good, service, or other contribution to the Town.
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SUMMARY OF SEPTEMBER 17, 2007
PROPOSED SOLICITATION AND DONATION POLICY DISCUSSION
Council Policy Committee Comments
■ The purpose of the proposed policy is to build pride in the community and
establish trust and confidence in Town Government.
• The recommended solicitation and donation policy guidelines are
proactive, minimize potential conflict of interest issues, and increase
awareness of ethical decision making.
• The proposed policy expands donation opportunities for the entire
community.
■ The proposed policy supports the direct solicitation of goods and services
by existing non-profit organizations to fund Town services and encourages
the establishment of new non-profit organizations to fundraise on behalf of
the Town.
Pubic Comments
■ Questioned if there is evidence demonstrating a "pay to play" environment
regarding Music in the Park (MIP).
• Consideration should be given to expanding recognition guidelines to
include naming rights for those who contribute sizable donations.
■ The elimination of direct solicitation would significantly reduce sponsor
donations, impacting the quality of the event.
■ The restriction of direct solicitation would jeopardize existing relationships
built as a result of MIP.
■ The Arts Commission should be the exception to the rule regarding direct
solicitation.
■ There are clear contractual arrangements between the Town and
sponsors; no special treatment is given.
■ Questioned how the proposed policy will impact fundraising for the skate
park.
■ Donation recognition guidelines should be less restrictive.
Council Discussion
• The proposed policy has flexibility built into it to allow for other forms of
recognition; Council could modify the policy via resolution.
■ The Town should pay for MIP and encourage the establishment of a
"Friends of the MIP" non-profit organization.
■ Arts Commissioners should not be burdened with the responsibility of
raising funds for Town events.
■ Volunteers who wish to solicit for funds to support Town events such as
MIP should be supported.
N:AMGR\AdminWorkPiles\2007 Council Reports\Solication and Donation Policy Summary.doc ATTACHMENT 2
■ It is inappropriate for elected officials to directly solicit individuals,
businesses and nonprofit/community organizations for goods, services, or
other contributions.
■ The lack of naming rights will seriously impact the skate park and other
recreational fundraising.
■ Consideration should be given to expanding the types of donation
recognition outlined in the proposed policy.
■ Arts Commission could be exempt from the direct solicitation rule given its
involvement in MIP fundraising. Consideration could be given to other
commissions.
■ The Town should consider the importance of public-private partnerships
and examine "best practices" employed by other communities.
Council Direction
Schedule Study Session for further discussion.
MIP can continue its current funding raising approach for 2008 until a
Council policy is in place.
Town Council Members stated that they would not participate in the direct
solicitation of goods, services, and other contributions to support Town
services, programs, or events.
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