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Container: General Policies

Naming Rights Policy

28-May-2010 [263]

• Excerpts from Auditor's report on the backlog in Park, Forestry and Recreation capital projects.

  • The report notes that 95% of PFR capital project funding comes from debt. This can’t be sustained:* P.21 Naming rights and advertising

Certain of the City’s Boards have generated substantial revenues from naming rights such as BMO Field, the Direct Energy Centre and the Sony Centre. However, the City has not actively pursued similar arrangements for City facilities, particularly parks and recreation facilities. The City needs to develop a coordinated plan in pursuing private funding, giving consideration to the revenue-generating opportunities of naming rights, and identify potential projects that would be appropriate for such funding.

Parks and Recreation Naming and Naming Policy approved in 2002 restrictive

According to a Parks and Recreation Naming and Renaming Policy, approved by Council in 2002, a park or recreation facility can only be named after an individual or group. The policy states that names which may be interpreted as an advertisement must not be used. Therefore, naming a park or facility after a corporate sponsor would be viewed as an advertisement and would not be allowed.

Revenue potential from naming rights

There is a potential to generate additional infrastructure funding through naming rights although the potential is likely limited given the current economic climate. Various plans to expand or build new facilities represent opportunities to attract this type of private funding. We recognize the reluctance to granting naming rights on City facilities, generally due to negative public perception or fear of potential loss of public control and the appearance of “selling out”. Research also indicates that private partnerships can be risky if entered into without adequate assurance that the City’s and, by extension, the public’s interests are protected.

However, with proper policies and procedures that ensure transparency and consistency in dealing with private funding arrangements, while protecting the interests of the City and the public, the City could benefit from private funds for capital projects.

Toronto Office of Partnerships to develop a naming rights policy

The Toronto Office of Partnerships is currently in the process of developing a naming rights policy for Council’s consideration. Policies already exist for donations and unsolicited bids and should be considered when developing the naming rights policy in order to ensure consistency.

Management comments:

It should be understood that the types of facilities built and managed by PFR are neighborhood and community oriented and not on a similar scale as a BMO Field, Direct Energy or Sony Centre, as referenced in the AG’s report. Therefore the potential for naming rights for revenue purposes may be limited. Also, while revenue from corporate naming rights or philanthropic donations may be forthcoming, private funding to replace or enhance current infrastructure as a substitute for core funding is a policy issue that needs to be determined by Council.

The implementation will follow approval by Council of a comprehensive Naming Rights policy.