10-116 Agreement, Amendment No. 5 to Implementation Agreement for Transit Shelter Advertising Program, Santa Clara Valley Transit Authority (VTA) AMENDMENT NO. 5 TO
IMPLEMENTATION AGREEMENT FOR
TRANSIT SHELTER ADVERTISING PROGRAM
This Amendment No. 5 to Implementation Agreement ( "Amendment ") for Transit
Shelter Advertising Program is made this 1st day of November, 2010 (hereinafter referred to as
the "Effective Date "), by and among the Santa Clara Valley Transportation Authority ( "VTA ")
(formerly known as the Santa Clara County Transit District); Clear Channel Outdoor (formerly
known as Eller Media and Patrick Media Group, :[nc.) ( "Contractor "); and the following
California county and cities: the County of Santa Clara and the Cities of San Jose, Sunnyvale,
Santa Clara, Mountain View, Milpitas, Gilroy, Cupertino, Los Altos, Morgan Hill, Campbell,
and Palo Alto (the foregoing county and cities are hereinafter sometimes referred to collectively
as the "Participating Entities" and individually as a "Participating Entity" or the "County" and/or
a "City," as the case may be).
RECITALS
A. VTA and Contractor entered into that certain Transit Shelter Advertising Program
Agreement dated June 9, 1994 (the "Advertising Agreement "). The Advertising Agreement
provides for the construction by Contractor of up to 564 new bus shelters at bus stop locations
throughout the County of Santa Clara, with three- fourths (3/4) of all bus shelters to contain
advertising panels, as part of a transit advertising program ( "Program ").
B. On October 31, 1995, VTA, Contractor and nine local jurisdictions, consisting of
the County of Santa Clara and the Cities of San Jose, Sunnyvale, Santa Clara, Mountain View,
Milpitas, Gilroy, Cupertino, Los Altos, entered into an Implementation Agreement for Transit
Shelter Advertising Program ( "Implementation Agreement "), which amended the Advertising
Agreement to, among other things, include the local jurisdictions in the Program and transferred
certain rights that were granted to VTA under the Advertising Agreement to the local
participating jurisdictions.
C. On September 8, 1997, VTA, Conxactor and the participating jurisdictions
entered into Amendment No. 1 to the Implementation Agreement, to add the City of Morgan Hill
as a participating entity in the Program.
D. On March 23, 1997, VTA, Contractor and the participating jurisdictions entered
into Amendment No. 2 to the Implementation Agreement, to add the City of Campbell as a
participating entity in the Program.
E. On March 23, 1999, VTA, Contractor and the participating jurisdictions entered
into Amendment No. 3 to the Implementation Agreement, to establish a schedule of liquidated
damages to be assessed in the event Contractor fails to comply with certain requirements of the
Implementation Agreement.
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F. On July 1, 2003, VTA, Contractor and the participating jurisdictions entered into
a fourth amendment to the Implementation Agreement, erroneously entitled "Amendment No.
5 ", to add the City of Palo Alto as a participating entity in the Program.
G. VTA, Contractor and the Participating Entities now wish to extend the term of the
Implementation and Advertising Agreements for two years, reduce advertising space on the
shelters by no more than 50 %, and reduce the collection and disposal of trash from the shelters
by Contractor, as more specifically set forth herein;
NOW, THEREFORE, for valuable consideration, the parties agree to amend the
Implementation Agreement, as follows:
(1) The term of the Implementation Agreement, and the Advertising Agreement, is hereby
extended for two years, through October 31, 2012.
(2) Advertising space on the shelters shall be reduced by no more than fifty percent (50 %).
Contractor shall have the authority to designate which shelters will continue to be posted
with commercial advertising. The remaining non - commercial advertising space may be
utilized by VTA and the Participating Entities to display public service announcements.
Contractor will post the announcements at no cost to VTA or the Participating Entities,
and shall contribute the sum of $15,000 per month of in -kind services to cover costs
associated with the production and printing of the announcements and related
materials. These in -kind services shall be available to VTA and the Participating Entities
on a first -come, first -served basis until exhausted.
(3) Collection and disposal of trash from the shelters by Contractor shall be reduced from
1,034 pickups per week to 375 pickups per week. VTA, in consultation with the
Participating Entities, shall determine which shelters will retain trash containers and the
frequency of service each week at those shelters.
(4) The first sentence of Section 9.b. of the Implementation Agreement is hereby amended to
read:
"SCCTD shall pay each Participating Entity fifty percent (50 %)
of all Shared Advertising Revenue received by SCCTD for advertising
shelters located in each Entity's respective jurisdiction as of November 1,
2010."
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(5) Except as hereby amended, each of the terms and conditions of the Implementation
Agreement, and Advertising Agreement, shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have signed this Amendment as of the date first set forth
above.
SANTA CLARA VALLEY CLEAR CHANNEL OUTDOOR
TRANSPORTATION fCI aL t THORITY
By:12 h By:
Name: Michael . Burns "
Title: General Manager Title: C. j h'
COUNTY OF SANTA CLARA CITY OF SAN JOSE
By: By:
Name: Name:
Title: Title:
CITY OF SUNNYVALE CITY OF SANTA CLARA
By: By:
Name: Name:
Title: Title:
CITY OF MOUNTAIN VIEW CITY OF MILPITAS
By: By:
Name: Name:
Title: Title:
3
CITY OF GILROY CITY OF CUP RTINO
By: By: CU
Name: Name: )qJ c p AP
4- Pp
Title: Title: C..)6-1
CITY OF LOS ALTOS CITY OF MORGAN HILL
By: By:
Name: Name:
Title: Title:
CITY OF CAMPBELL CITY OF PALO ALTO
By: By:
Name: Name:
Title: Title:
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r A S A N T A C L A R A K oue: 1+ ( C6 ! { p
e Valley Transportation Au thority ' _ pi ve•,;ct,, c ,,4 C ,
November 1, 2010 lit Tr •w •
Mr. David Knapp "`t`
City of Cupertino R__._.. ____ -
10300 Torre Avenue
Cupertino, CA 95014
Dear Mr. Knapp:
Last December I wrote to advise that VTA was issuing a request for proposals (RFP) to obtain a
new contractor for Transit Shelter Advertising Program to provide new shelters, maintenance,
and revenue sharing starting November 1, 2010. The RFP was issued February 12, 2010;
however, due to advertising market conditions, restricted credit availability for capital
investment, and the overall economic climate, VTA received only two proposals and both were
unacceptable. Clear Channel Outdoor (CCO), the present contractor, did not submit a proposal
during the RFP process.
The current agreement with CCO ended October 31, 2010. To provide for ongoing shelter
maintenance and advertising sales and allow time for the market and economy to recover
sufficiently to obtain reasonable proposals, VTA entered into discussions with CCO on the terms
of a short-term agreement. This hopefully provic -es ample time for the advertising market to
improve so that acceptable proposals will be received once an RFP is issued again.
CCO expressed an interest in a short-term (two -year) extension with some changes to the current
agreement to account for lower- than- expected advertising sales of only about 50 percent of the
available ad space, and the cost of garbage collection and disposal, which has soared since the
initial agreement in 1994.
Having shelters provided, cleaned, and maintained at no cost to VTA and the cities and county
that it serves is the goal of the program. CCO and VTA have negotiated an extension to the
agreement through October 31, 2012 with some changes, including reducing advertising space
by up to 50 percent, with an according reduction in the revenue share. CCO would designate
which shelters will continue to have commercial advertising. The actual advertising panels will
not be removed from the shelters that will no loner carry commercial advertising; rather, VTA
and the participating cities /county will be able to use this ad space for public service
announcements. Clear Channel will post the materials at no cost and also provide up to $15,000
per month in in -kind services towards production costs of the public information. VTA will
continue to share half of the proposed revenue w:th participating agencies based on the current
percentage of advertising shelters in their jurisdiction, per the terms of the Implementation
Agreement.
Collection and disposal of trash from the shelters would also be reduced by approximately two -
thirds, from 1,034 to 375 pickups per week. VTA, in conjunction with the cities /county, will
determine which shelters will retain trash containers and the frequency of service each week.
The cost of this activity has become prohibitive a s the amount of garbage has increased. During
the last 10 years, both VTA bus stop and CCO shelter trash receptacles have been increasingly
3331 North First Street • San Jose, CA 95134 -1927 • Administration 408.321.5555 • Customer Service 408.321.2300
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Mr. David Knapp
November 1, 2010
Page 2 of 2
filled with illegal dumping and household garbage. It is not the normal trash expected from
VTA passengers, but large quantities dumped by neighbors or passers -by.
VTA staff believes the proposed amount of trash collection can sufficiently work. Some low -
ridership locations will not have a trash can and other locations are adjacent to existing city trash
receptacles. All VTA buses have trash containers at the front entrance. CCO will still be
responsible for picking up litter within a 15 -foot radius of the shelter. They will also still
maintain, clean, remove litter and graffiti, and make necessary repairs to the shelters in
accordance with the agreement.
VTA does not have the financial capability or staff resources to take over maintenance and trash
collection at 564 shelters. Negotiating an agreement extension with CCO for the near future is
the best option available at this time. Less revenue will be received (about $125,000 annually),
but the amount is relatively small. Trash collection servicing will be reduced, but VTA staff
believes it can be implemented without many issues.
During this two -year extension, VTA will look into new ways of improving and expanding the
Transit Shelter Advertising Program when the economy recovers and as program dynamics
change. On September 9, VTA staff presented this information to our Technical Advisory
Committee, on which you are represented. Subsequently, the VTA Transit Planning and
Operations Committee approved this course of action on September 16, and on October 7 the full
Board of Directors authorized the extension. The Amendment to the Implementation Agreement
for a two -year extension is attached for your necessary approval and signature. I realize you will
not be able to approve this amendment by the end. of October. but given CCO's execution of it,
we have ensured continued shelter maintenance and revenue sharing.
If you have questions about the Transit Shelter Advertising Program, please contact Jim Unites,
Deputy Director of Service and Operations Planning, at (408) 321 -7032 or james.unites@vta.org.
Thank you for your consideration.
Sincerely,
Michael T. Burns
General Manager
Enclosure
c: VTA Board of Directors
VTA Technical Advisory Committee
Donald A. Smith, Jr., Chief Operating Officer
James B. Unites, Deputy Director of Service and Operations Planning