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HomeMy WebLinkAboutItem 13 - Award an Agreement for Managment of Ad Services at Bus StopsPublic Works Agency www.santa-ana.org/pw Item # 13 City of Santa Ana 20 Civic Center Plaza, Santa Ana, CA 92701 Staff Report February 17, 2026 TOPIC: Award an Agreement to Creative Outdoor Advertising of America, Inc., for Management of Advertising Services at Bus Stops AGENDA TITLE Award an Agreement to Creative Outdoor Advertising of America, Inc., for Management of Advertising Services at Bus Stops (Specification No. 25-107) (General Fund) RECOMMENDED ACTION Authorize the City Manager or designee to execute an agreement with Creative Outdoor Advertising of America, Inc., to sell space to advertisers at bus stops throughout the City for a term beginning February 17, 2026, and expiring February 16, 2029, with provisions for two, one-year extensions (Agreement No. A-2026-XXX). GOVERNMENT CODE §84308 APPLIES: Yes EXECUTIVE SUMMARY On January 18, 2022, the City entered into an agreement with Focus Media Group, Inc. (FMG) for bus stop maintenance and advertising, with provisions for the City to receive revenue after deduction for maintenance costs. FMG generally performed contract maintenance well, however, it failed to generate sufficient advertising revenue, resulting in no revenue share to the City. After FMG was acquired by Creative Outdoor Advertising (COA) in June 2024, COA demonstrated strong advertising expertise but limited maintenance capacity. Efforts to increase sales have been successful, yet insufficient to fully cover the maintenance costs. As a result of a competitive procurement process, Staff recommends the City enter into a new agreement with COA to solely provide advertising at City bus stops throughout the City. The agreement would replace the existing advertising and maintenance agreement with FMG. Staff recommends terminating the existing agreement with FMG (now COA) because: 1) the maintenance service levels provided did not result in sufficiently clean locations, 2) none of the expected revenue materialized because the revenue share was net of FMC's maintenance costs, and 3) resulted in additional expenditures by the City to pay for enhanced maintenance services. The new agreement with COA would allow COA to advertise at bus stops in the City and provide the City with guaranteed minimum revenue of $160,000 per year, however, it will Agreement for Bus Stop Advertising February 17, 2026 Page 2 not include a maintenance function. Maintenance at the City's bus stops will be provided separately through the Clean Cities Program; a more comprehensive program provided through the City's existing refuse agreement with Republic Services, which includes bus stop cleaning services at no additional cost to the City. Separating advertising services from maintenance responsibilities represents a change from the prior contract structure, however, this approach aligns with industry practice among comparable municipalities and allows each contractor to focus on its core expertise. Under this structure, the City receives guaranteed advertising revenue that is no longer offset by maintenance costs. DISCUSSION The City of Santa Ana is a major user of Orange County Transportation Authority (OCTA) bus services, with 24 active bus routes and 648 bus stops located throughout the City. These routes support an estimated 29,000 average weekday passenger boardings. The Public Works Agency (PWA) is responsible for maintaining all bus stop amenities, including shelters, benches, and trash receptacles. Maintenance activities include routine trash collection and power washing, as well as the repair or replacement of damaged furniture, lighting, and decorative or artistic elements at bus stops. Maintenance needs are not uniform across the City, as certain routes or corridors require more frequent or enhanced maintenance due to higher usage levels and incidents of vandalism. On January 18, 2022, the City Council awarded an agreement to Focus Media Group, Inc. (FMG) for bus shelter maintenance and advertising services. In June 2024, FMG announced that it had been acquired by Creative Outdoor Advertising (COA), which subsequently assumed all of FMC's contractual agreements, including the agreement with the City. Under the agreement, advertising revenue was intended to fully offset the cost of bus shelter maintenance with any net revenue being remitted to the City on an established revenue -sharing structure. The revenue share agreement would provide the City 25% of gross revenue advertisement sales minus the cost of maintaining the bus stops. However, actual maintenance costs exceeded the level of service that could be supported by the advertising revenue alone, and to date, the City has not received any advertising revenue under this agreement. At the time of the original procurement, the Request for Proposals sought a single contractor to provide bus shelter maintenance, advertising sales, and installation and management of billboards. Under that procurement structure, FMG was effectively the only proposer willing to assume responsibility for the maintenance obligations in addition to advertising services. Major outdoor advertising and billboard companies expressed limited interest in submitting proposals because the solicitation required firms to provide both maintenance and advertising services to bus stops as well as to billboards, whereas many advertising firms specialize solely in advertising sales and asset management at bus stops or at billboards and do not operate maintenance programs. Agreement for Bus Stop Advertising February 17, 2026 Page 3 As a result, competition for the contract was limited, and the City's options were constrained by market realities at the time. Staffs subsequent experience demonstrated that combining maintenance and advertising responsibilities under a single vendor reduced competition and ultimately contributed to performance challenges. Maintenance service levels ultimately proved insufficient to meet community expectations. On April 1, 2023, the City Council approved a supplemental agreement with FMG to provide expanded maintenance services at a cost not to exceed $250,000 over a two-year term ending on April 1, 2025. Despite these efforts, the City continued to receive more than 200 service requests annually, most related to excessive trash accumulation and unsanitary conditions. As a result, no additional funding was granted to continue this service model, and the supplemental agreement was allowed to expire. In response to these lessons learned, the current procurement intentionally separated maintenance from advertising services. This approach allowed firms specializing in advertising sales to compete without assuming maintenance risk and resulted in proposals better aligned with each firm's operational strengths while ensuring that maintenance services are provided separately through the City's existing maintenance programs. COA will be responsible for labor associated with replacing plexiglass panels, while the City will supply the replacement materials, remove graffiti, service the refuse bins, and ensure the bus stops are in clean and sanitary condition. PWA subsequently implemented a revised maintenance strategy focused on improving service delivery while reducing costs. Bus stop maintenance responsibilities were absorbed by existing public works programs, namely, the Clean City Program under the existing refuse agreement with Republic Services at no additional cost to the City, resulting in approximately $125,000 in annual savings. With maintenance services reassigned, PWA issued a Request for Proposals focused solely on bus shelter advertising sales in order to maximize the revenue to the City. Request for Proposals (RFP) No. 25-107 was issued on August 4, 2025 on the City's online bid management and publication system, PlanetBids. A summary of vendor participation and results is as follows: 859 Vendors notified 1 Santa Ana vendor notified 21 Vendors downloaded the RFP packet 2 Responsive proposals received 0 Responsive proposals received from Santa Ana vendors Proposals were solicited, opened on August 19, 2025, and evaluated. Two proposals were submitted by the RFP deadline and were determined to be responsive to the specifications and they met the City's requirements. Agreement for Bus Stop Advertising February 17, 2026 Page 4 Local Outreach Efforts The Purchasing Division advertised RFP No. 25-107 on the City's online bid management and publication system, which directly notified two Santa Ana vendors. No Santa Ana vendors downloaded the RFP or submitted a bid for consideration. An evaluation committee reviewed and rated the proposals based on qualifications, experience with bus shelter advertising, proposed profit-sharing structure, and references. Based on this evaluation, the firms were ranked as follows: Firm City Rank Creative Outdoor Advertising of Sherman Oaks, California 1 America Inc. My Emerald Hands LLC San Diego, California 2 Staff recommends awarding an agreement to the highest ranking firm, Creative Outdoor Advertising of America, Inc. (COA) (Exhibit 1). COA, a privately held company established in 1984, employs approximately 120 full- and part-time staff and operates public amenity advertising programs across more than 300 municipalities in North America. The company manages over 45,000 advertising units and serves thousands of clients across local, regional, and national markets. Company materials and investor statements indicate that COA has expanded significantly over the past decade, managing tens of thousands of advertising units across more than 300 municipalities and achieving notable financial performance improvements under previous ownership, including an increase in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). COA's proposal emphasizes maximizing advertising revenue through data -driven sales strategies. The firm will proactively identify and pursue potential advertisers and provide auditable monthly reports detailing advertising sales, occupancy rates, and total revenue generated. In addition, COA will implement a comprehensive digital management system to oversee advertising operations, including the use of barcodes and scanners to uniquely identify and track each advertising location and asset citywide. COA's revenue projections are based on 160 advertising units with 320 advertising faces. Staff reviewed the assumptions supporting these projections, including anticipated occupancy rates, market advertising rates, and COA's demonstrated experience selling advertising in comparable municipal markets. Staff also evaluated current utilization of advertising space in Santa Ana and determined the projections to be reasonable and achievable under current market conditions. Most importantly, the agreement provides the City with a Minimum Annual Guarantee (MAG) of $160,000 regardless of actual advertising performance, ensuring predictable revenue even if projections are not fully realized. The proposed revenue -sharing structure provides the City with either a MAG of $160,000, paid in equal monthly installments, or 55% of gross advertising revenue, whichever is greater, regardless of advertising performance, provided the minimum inventory of 160 advertising units and 320 advertising faces is maintained. Agreement for Bus Stop Advertising February 17, 2026 Page 5 Unlike the prior agreement, the proposed agreement does not allow maintenance costs to be deducted from advertising revenues, nor does it reduce payments to the City if COA's revenue projections are not met, provided the minimum inventory of 160 advertising units and 320 advertising faces is maintained. The City currently meets the minimum inventory and has more bus shelters planned for installation this year, further strengthening our capacity to maintain minimum advertising faces. At minimum, the City will receive $160,000 annually with the potential for higher revenues if advertisement sales exceed the guaranteed amount (MAG). The proposed agreement structure establishes clear financial incentives for COA to actively pursue advertising sales and maximize program revenue. Under the agreement, COA is responsible for all advertising sales activities and is compensated through advertising revenue, while the City receives either a MAG or a percentage of gross advertising revenue, whichever is greater. Because COA's financial return increases only when advertising occupancy and rates increase, the agreement inherently incentivizes the contractor to actively market available advertising space, pursue higher -value advertising contracts, and maintain high occupancy rates. The agreement also requires regular reporting of advertising activity, occupancy rates, and revenue performance, allowing Staff to monitor program performance and address any issues promptly. The contractor's continued success under the agreement depends on maintaining strong relationships with advertisers, demonstrating reliable service delivery, and consistently filling advertising inventory with paying clients. By separating maintenance responsibilities from advertising operations, the revised structure allows the contractor to focus exclusively on advertising performance. This focused responsibility, combined with guaranteed payments to the City and performance transparency, creates ongoing motivation for the contractor to innovate marketing approaches, pursue premium advertisers, and maximize revenue generation throughout the term of the agreement. ENVIRONMENTAL IMPACT There is no environmental impact associated with this action. FISCAL IMPACT Revenues from this agreement will be budgeted in the General Fund -Public Works Revenues, Bus Shelter Fees revenue account (No. 01117002-51004). Future revenues will be budgeted in the General Fund -Public Works Revenues, Bus Shelter Fees revenue account (No. 01117002-51004) and appropriated in the General Fund -Bus Shelter Program -Service Enhancement expenditure accounting unit (No. 01117621). Agreement for Bus Stop Advertising February 17, 2026 Page 6 Fiscal Accounting Fund Accounting Unit, Amount Year Unit- Description Account Description Account # FY 25-26 01117002- Public Works Bus Shelter Fees $65,000 (Feb -June) 51004 Revenues FY 26-27 01117002- Public Works Bus Shelter Fees $160,000 51004 Revenues FY 27-28 01117002- Public Works Bus Shelter Fees $160,000 51004 Revenues FY 28-29 01117002- Public Works Bus Shelter Fees $95,000 (July -Feb) 51004 Revenues Subtotal $480,000 Optional Two, 1-Year Extensions FY 28-29 01117002- Public Works Bus Shelter Fees $65,000 (Feb -June) 51004 Revenues FY 29-30 01117002- Public Works Bus Shelter Fees $160,000 51004 Revenues FY 29-30 01117002- Public Works Bus Shelter Fees $95,000 (Jul -Feb) 51004 Revenues Subtotal $320,000 TOTAL $800,000 EXHIBIT(S) 1. Agreement with Creative Outdoor Advertising of America Inc. Submitted By: Rodolfo Rosas, P.E., Acting Executive Director— Public Works Agency Approved By: Alvaro Nunez, City Manager AGREEMENT BETWEEN CREATIVE OUTDOOR ADVERTISING AND THE CITY OF SANTA ANA THIS AGREEMENT is made and entered into on this 171h day of February, 2026, by and between Creative Outdoor Advertising of America, Inc., a Florida corporation ("Vendor"), and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California ("City"). RECITALS A. City issued Request for Proposal ("RFP") No. 25-107 seeking to retain a vendor having special skill and knowledge in the field of managing advertising programs at designated bus stops and bus shelters in the City. B. Vendor submitted a responsive proposal to RFP 25-107 that was selected by the City. C. In undertaking the performance of this Agreement, Vendor represents that it is knowledgeable in its field and that any services performed by Vendor under this Agreement will be performed in compliance with such standards as may reasonably be expected from a professional firm in the field. NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the parties agree as follows: 1. SCOPE OF SERVICES Vendor shall perform during the term of this Agreement, the tasks and obligations including all labor, materials, tools, equipment, and incidental customary work required to fully and adequately complete the services described in the Exhibit A, attached hereto and incorporated by reference. 2. COMPENSATION a. Vendor shall pay the City the greater of (1) a minimum annual guarantee (MAG) of $160,000; or (2) Fifty-five percent of the gross advertising sales revenue, generated from the advertising program, as described in Exhibit B, attached hereto and incorporated by reference. As used herein, "gross advertising sales revenue" shall refer to all amounts billed and/or collected by Vendor without any deduction. b. Payment by Vendor shall be made to City on a monthly basis pursuant to direction provided by City. Payments shall be made payable to the City at the following address: City of Santa Ana, Public Works Agency, Attn: Administrative Services Manager, 20 Civic Center Plaza (M-21), PO Box 1988, Santa Ana, CA 92702. c. A charge often percent (10%) shall be applied to any late payments due to City. 3. TERM Page 1 of 8 This Agreement shall commence on February 3, 2026 for a three (3) year term, with the option for the City to grant up to two, one-year extensions upon a writing executed by the City Manager and City Attorney, unless terminated earlier in accordance with Section 15, below. 4. INDEPENDENT CONTRACTOR Vendor shall, during the entire term of this Agreement, be construed to be an independent Vendor and not an employee of the City. This Agreement is not intended nor shall it be construed to create an employer -employee relationship, a joint venture relationship, or to allow the City to exercise discretion or control over the professional manner in which Vendor performs the services which are the subject matter of this Agreement; however, the services to be provided by Vendor shall be provided in a manner consistent with all applicable standards and regulations governing such services. Vendor shall pay all salaries and wages, employer's social security taxes, unemployment insurance and similar taxes relating to employees and shall be responsible for all applicable withholding taxes. 5. OWNERSHIP OF MATERIALS This Agreement creates a non-exclusive and perpetual license for City to copy, use, modify, reuse, or sublicense any and all copyrights, designs, and other intellectual property embodied in plans, specifications, studies, drawings, estimates, and other documents or works of authorship fixed in any tangible medium of expression, including but not limited to, physical drawings or data magnetically or otherwise recorded on computer diskettes, which are prepared or caused to be prepared by Vendor under this Agreement ("Documents & Data"). Vendor shall require all subcontractors to agree in writing that City is granted a non-exclusive and perpetual license for any Documents & Data the subcontractor prepares under this Agreement. Vendor represents and warrants that Vendor has the legal right to license any and all Documents & Data. Vendor makes no such representation and warranty in regard to Documents & Data which were provided to Vendor by the City. City shall not be limited in any way in its use of the Documents and Data at any time, provided that any such use not within the purposes intended by this Agreement shall be at City's sole risk. 6. INSURANCE Insurance requirements are attached hereto as Exhibit C. 7. INDEMNIFICATION Vendor agrees to defend, and shall indemnify and hold harmless the City, its officers, agents, employees, contractors, special counsel, and representatives from liability: (1) for personal injury, damages, just compensation, restitution, judicial or equitable relief arising out of claims for personal injury, including death, and claims for property damage, which may arise from the negligent operations of the Vendor, its subcontractors, agents, employees, or other persons acting on its behalf which relates to the services described in section 1 of this Agreement; and (2) from any claim that personal injury, damages, just compensation, restitution, judicial or equitable relief Page 2 of 8 is due by reason of the terms of or effects arising from this Agreement. This indemnity and hold harmless agreement applies to all claims for damages, just compensation, restitution, judicial or equitable relief suffered, or alleged to have been suffered, by reason of the events referred to in this Section or by reason of the terms of, or effects, arising from this Agreement. The Vendor further agrees to indemnify, hold harmless, and pay all costs for the defense of the City, including fees and costs for special counsel to be selected by the City, regarding any action by a third party challenging the validity of this Agreement, or asserting that personal injury, damages, just compensation, restitution, judicial or equitable relief due to personal or property rights arises by reason of the terms of, or effects arising from this Agreement. City may make all reasonable decisions with respect to its representation in any legal proceeding. Notwithstanding the foregoing, to the extent Vendor's services are subject to Civil Code Section 2782.8, the above indemnity shall be limited, to the extent required by Civil Code Section 2782.8, to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Vendor. 8. INTELLECTUAL PROPERTY INDEMNIFICATION Vendor shall defend and indemnify the City, its officers, agents, representatives, and employees against any and all liability, including costs, for infringement of any United States' letters patent, trademark, or copyright infringement, including costs, contained in the work product or documents provided by Vendor to the City pursuant to this Agreement. 9. RECORDS Vendor shall keep records and invoices in connection with the work to be performed under this Agreement. Vendor shall maintain complete and accurate records with respect to the costs incurred under this Agreement and any services, expenditures, and disbursements charged to the City for a minimum period of three (3) years, or for any longer period required by law, from the date of final payment to Vendor under this Agreement. All such records and invoices shall be clearly identifiable. Vendor shall allow a representative of the City to examine, audit, and make transcripts or copies of such records and any other documents created pursuant to this Agreement during regular business hours. Vendor shall allow inspection of all work, data, documents, proceedings, and activities related to this Agreement for a period of five (5) years from the date of final payment to Vendor under this Agreement. 10. CONFIDENTIALITY If Vendor receives from the City information which due to the nature of such information is reasonably understood to be confidential and/or proprietary, Vendor agrees that it shall not use or disclose such information except in the performance of this Agreement, and further agrees to exercise the same degree of care it uses to protect its own information of like importance, but in no event less than reasonable care. "Confidential Information" shall include all nonpublic information. Confidential information includes not only written information, but also information transferred orally, visually, electronically, or by other means. Confidential information disclosed to either party by any subsidiary and/or agent of the other party is covered by this Agreement. The foregoing obligations of non-use and nondisclosure shall not apply to any information that (a) has been disclosed in publicly available sources; (b) is, through no fault of the Vendor, disclosed in a Page 3 of 8 publicly available source; (c) is in rightful possession of the Vendor without an obligation of confidentiality; (d) is required to be disclosed by operation of law; or (e) is independently developed by the Vendor without reference to information disclosed by the City. 11. CONFLICT OF INTEREST CLAUSE a. Vendor covenants that it presently has no interests and shall not have interests, direct or indirect, which would conflict in any manner with performance of services specified under this Agreement. b. No immediate family members of either the Mayor, City Council Member, or any appointed City Official, including appointed board and commission members, as defined under the City's Municipal Code, whose position with the City shall award or influence the award of this Agreement, or any competing contract or amendment thereof, shall be employed in any capacity by the Vendor or have any other direct or indirect financial benefit or interest in this Agreement. c. The section also prohibits the awarding of any agreement, contract, grant, or any amendment to those awards, to any former full-time employee for one-year from date of employee separation except for any CalPERS retiree as authorized by City Council resolution. d. The Vendor must comply with all conflict of interest laws, ordinances, and regulations now in effect or hereafter to be enacted during the term of this Agreement. The Vendor warrants that it is not now aware of any facts which conflict with the prohibitions defined above. If the Vendor hereafter becomes aware of any facts that might reasonably be expected to create a conflict of interest, it must immediately make full written disclosure of such facts to the City. Full written disclosure must include, but is not limited to, identification of all persons implicated and a complete description of all relevant circumstances. Failure to comply with the provisions of this paragraph will be a material breach of this Agreement. e. Vendor covenants that none of its directors, officers, employees, or agents shall participate in selecting or administering any subcontract supported (in whole or in part) by City funds stemming from the Agreement where the awarding of the subcontract has any direct or indirect financial benefit or interest to any individual, as defined in subsections (b) and (c) above. 12. NON-DISCRINIINATION Vendor shall not discriminate because of race, color, creed, religion, sex, marital status, sexual orientation, gender identity, gender expression, gender, medical conditions, genetic information, or military and veteran status, age, national origin, ancestry, or disability, as defined and prohibited by applicable law, in the recruitment, selection, teaching, training, utilization, promotion, termination or other employment related activities or any services provided under this Agreement. Vendor affirms that it is an equal opportunity employer and shall comply with all Page 4 of 8 applicable federal, state and local laws and regulations. 13. EXCLUSIVITY AND AMENDMENT This Agreement represents the complete and exclusive statement between the City and Vendor, and supersedes any and all other agreements, oral or written, between the parties. In the event of a conflict between the terms of this Agreement and any attachments hereto, the terms of this Agreement shall prevail. This Agreement may not be modified except by written instrument signed by the City and by an authorized representative of Vendor. The parties agree that any terms or conditions of any purchase order or other instrument that are inconsistent with, or in addition to, the terms and conditions hereof, shall not bind or obligate Vendor or the City. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which is not embodied herein. 14. ASSIGNMENT Inasmuch as this Agreement is intended to secure the specialized services of Vendor, Vendor may not assign, transfer, delegate, or subcontract any interest herein without the prior written consent of the City and any such assignment, transfer, delegation or subcontract without the City's prior written consent shall be considered null and void. Nothing in this Agreement shall be construed to limit the City's ability to have any of the services which are the subject to this Agreement performed by City personnel or by other Contractors retained by City. 15. TERMINATION This Agreement may be terminated by the City upon thirty (30) days written notice of termination. In such event, City shall be entitled to receive and Vendor shall pay all amounts due and payable to City, subject to the following conditions: a. Within thirty (30) days of receipt of the written notice of termination, Vendor shall provide City with final compensation in accordance with the terms of this Agreement. Such final compensation shall be accompanied by a final report which includes all relevant records and invoices required by this Agreement. b. City may require Vendor to deliver to the City all work product(s) completed as of such date, and in such case such work product shall be the property of the City unless prohibited by law, and Vendor consents to the City's use thereof for such purposes as the City deems appropriate. Within thirty (30) days receipt of written notice of termination, Vendor shall remove all ads and restore all City facilities and equipment to its original condition. Vendor shall bear responsibility for repair of any damage to City facilities and equipment caused by Vendor. 16. WAIVER Page 5 of 8 No waiver of breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this Agreement shall be effective unless it is in writing and signed by the party waiving the breach, failure, right or remedy. No waiver of any breach, failure or right, or remedy shall be deemed a waiver of any other breach, failure, right or remedy, whether or not similar, nor shall any waiver constitute a continuing waiver unless the writing so specifies. 17. JURISDICTION - VENUE This Agreement has been executed and delivered in the State of California and the validity, interpretation, performance, and enforcement of any of the clauses of this Agreement shall be determined and governed by the laws of the State of California. Both parties further agree that Orange County, California, shall be the venue for any action or proceeding that may be brought or arise out of, in connection with or by reason of this Agreement. 18. PROFESSIONAL LICENSES Vendor shall, throughout the term of this Agreement, maintain all necessary licenses, permits, approvals, waivers, and exemptions necessary for the provision of the services hereunder and required by the laws and regulations of the United States, the State of California, the City of Santa Ana and all other governmental agencies. Vendor shall notify the City immediately and in writing of its inability to obtain or maintain such permits, licenses, approvals, waivers, and exemptions. Said inability shall be cause for termination of this Agreement. 19. NOTICE Any notice, tender, demand, delivery, or other communication pursuant to this Agreement shall be in writing and shall be deemed to be properly given if delivered in person or mailed by first class or certified mail, postage prepaid, or sent by fax or other telegraphic communication in the manner provided in this Section, to the following persons: To City: City Clerk City of Santa Ana 20 Civic Center Plaza (M-30) P.O. Box 1988 Santa Ana, CA 92702-1988 Fax: 714- 647-6956 With courtesy copies to: Executive Director, Public Works Agency City of Santa Ana 20 Civic Center Plaza P.O. Box 1988 Santa Ana, California 92702 Page 6 of 8 To Vendor: John Apostolopoulos Director of Municipal Relations Creative Outdoor Advertising 15303 Ventura Blvd., Suite 1490 Sherman Oaks, California 91403 A party may change its address by giving notice in writing to the other party. Thereafter, any communication shall be addressed and transmitted to the new address. If sent by mail, communication shall be effective or deemed to have been given three (3) days after it has been deposited in the United States mail, duly registered or certified, with postage prepaid, and addressed as set forth above. If sent by fax, communication shall be effective or deemed to have been given twenty-four (24) hours after the time set forth on the transmission report issued by the transmitting facsimile machine, addressed as set forth above. For purposes of calculating these time frames, weekends, federal, state, County or City holidays shall be excluded. 20. MISCELLANEOUS PROVISIONS a. Each undersigned represents and warrants that its signature herein below has the power, authority and right to bind their respective parties to each of the terms of this Agreement, and shall indemnify City fully, including reasonable costs and attorney's fees, for any injuries or damages to City in the event that such authority or power is not, in fact, held by the signatory or is withdrawn. b. All Exhibits referenced herein and attached hereto shall be incorporated as if fully set forth in the body of this Agreement. [signatures on following page] Page 7 of 8 IN WITNESS WHEREOF, the parties hereto have executed this Agreement the date and year first above written. ATTEST Jennifer L. Hall City Clerk APPROVED AS TO FORM SONIA R. CARVALHO City Attorney By: �� //A� Kyle ellesen Assistant City Attorney RECOMMENDED FOR APPROVAL: f Digitally signed by Rodolfo Rosas RodolI o Rosas em:cnrrosas wants-s, U fl email=rrosas@santa-ana.org, c=US Date: 2026.01.2711:09:40-08'00' Rodolfo Rosas, P.E. Acting Executive Director Public Works Agency CITY OF SANTA ANA Alvaro Nunez City Manager VENDOR Matthew Kearney By: Title: Page 8 of 8 EXHIBIT A CITY OF SANTA ANA RFP NO.: 25-096 MANAGEMENT OF ADVERTISING AT BUS SHELTERS AND BUS STOPS IN THE CITY OF SANTA ANA SCOPE OF WORK INTRODUCTION AND BACKGROUND The City of Santa Ana ("City" or "Santa Ana") is interested in contracting with a qualified and experienced Company to manage its advertising program at designated bus stops and bus shelters throughout the city. Services include the full scope of advertising operations, including sales, installation, and compliance, with the goal of maximizing advertising revenue while preserving the visual quality and functionality of the City's transit -related street furniture. DESCRIPTION OF WORK I. Sales and Marketing The selected vendor will be responsible for: a. Developing and executing a comprehensive marketing and sales strategy aimed at maximizing advertising revenue across bus stops and bus shelters throughout the City of Santa Ana. i. This strategy should be data -driven, scalable, and adaptable to changing market conditions. ii. The vendor will proactively identify and pursue potential advertisers, targeting a diverse mix of local businesses, regional organizations, and national brands to ensure a broad and sustainable revenue base. To support sales efforts, the vendor will be expected to: b. Produce professional marketing collateral, including media kits, rate cards, demographic data, and other promotional materials that clearly communicate the value of advertising in Santa Ana's transit network. i. These materials should highlight audience reach, traffic counts, geographic advantages, and any value-added features such as digital displays or high -visibility locations. c. The vendor will also be responsible for negotiating advertising contracts, finalizing agreements, and managing client relationships with a focus on transparency, customer service, and long-term retention. II. Production and Installation The selected vendor will be responsible for: Page 1 of 4 CITY OF SANTA ANA RFP NO.: 25-096 MANAGEMENT OF ADVERTISING AT BUS SHELTERS AND BUS STOPS IN THE CITY OF SANTA ANA a. The production and installation of all advertising materials, including but not limited to: i. Vinyl posters, ii. Static displays, and iii. Digital signage where applicable. iv. All advertisements must be installed securely and in a manner that ensures high visual quality, consistency, and public safety. b. The vendor must regularly inspect installations to maintain aesthetic standards and functionality across all sites. c. In addition, the vendor is required to promptly remove any expired, damaged, or non- compliant advertisements to prevent visual clutter and ensure compliance with City regulations. III. Inventory and Space Management The selected vendor will be responsible for: a. Maintaining an up-to-date inventory of all available advertising locations associated with bus stops and bus shelters across the City. i. This includes tracking occupancy, availability, and condition of each advertising unit to ensure optimal use of space. b. The vendor will coordinate closely with the City of Santa Ana Public Works Agency to confirm space availability, accommodate changes to infrastructure, and align advertising placements with City planning initiatives. c. Additionally, the vendor must manage and schedule advertisement rotations in accordance with contractual obligations, ensuring timely updates and minimizing gaps in ad coverage. Page 2 of 4 CITY OF SANTA ANA RFP NO.: 25-096 MANAGEMENT OF ADVERTISING AT BUS SHELTERS AND BUS STOPS IN THE CITY OF SANTA ANA IV. Compliance and Approvals The selected vendor will be responsible for: a. Ensuring that all advertisements comply with applicable local, state, and federal laws, including regulations related to content, placement, and public safety. b. The vendor must also respond promptly and appropriately to any public complaints or formal notices issued by the City regarding specific advertisements, including taking corrective action when necessary. V. Reporting and Revenue Sharing The selected vendor will be required to: a. Provide monthly reports detailing advertising sales, panel occupancy rates, and total revenue generated. b. In addition, the vendor must submit quarterly financial statements that clearly outline gross advertising sales and the corresponding revenue share owed to the City. c. All payments to the City must be remitted in accordance with the terms specified in the contract, ensuring accuracy, timeliness, and transparency in all financial transactions. d. The City may perform an annual financial audit of vendor at City's cost. VI. Digital Asset Management and Operational Tracking To ensure efficiency, transparency, and accountability in the administration of the bus stop and bus shelter advertising program, the selected vendor shall: a. Implement a comprehensive digital system to manage all aspects of operations. i. This system must include the use of barcodes and scanners to uniquely identify and track each advertising location and asset across the City of Santa Ana. ii. Each shelter or advertising unit should be labeled with a scannable barcode or QR code that links to a centralized management portal. iii. The digital platform must support real-time tracking and documentation of advertising installations, maintenance activities, and ad rotation schedules. iv. It should allow authorized personnel to log updates from the field, upload photos, verify completed tasks, and flag issues for repair or compliance review. v. The centralized portal should also serve as a reporting hub, housing: 1. Sales data, Page 3 of 4 CITY OF SANTA ANA RFP NO.: 25-096 MANAGEMENT OF ADVERTISING AT BUS SHELTERS AND BUS STOPS IN THE CITY OF SANTA ANA 2. Occupancy metrics, 3. Maintenance logs, and 4. Financial records, enabling both the vendor and City staff to monitor performance, ensure compliance, and streamline communication. b. This digital infrastructure is critical to maintaining a modern, responsive, and well - documented advertising program that meets the operational and strategic goals of the City. VII. Performance Metrics a. The performance of the selected vendor will be evaluated based on a set of key metrics designed to ensure accountability and quality service. i. These metrics include the achievement of agreed -upon revenue targets and the consistent maintenance of a high percentage of ad space occupancy across all shelters and bus stops. ii. Timely execution is also critical; therefore, the vendor must complete ad installations and resolve reported issues within 48 hours. iii. Additionally, strong performance will be reflected in the absence of unresolved public complaints or regulatory violations, demonstrating the vendor's commitment to compliance, responsiveness, and professional standards. Page 4 of 4 EXHIBIT B RFP #: 25-096 Technical Proposal REVENUE PROPOSAL COA's Advertising Program City of Santa Ana Creative Outdoor Advertising proposes to share advertising revenue with the City of Santa Ana based on the greater of: • A Minimum Annual Guarantee (MAG) of $160,000, paid to the City in equal monthly installments; or • Fifty-five percent (55%) of gross advertising sales revenue, generated from the advertising program. This structure ensures the City receives a strong, predictable revenue stream while also benefiting from the upside potential of increased advertising sales. COA's proven marketing strategies and consistently high occupancy rates position us to maximize revenue across all available inventory. ASSUMPTIONS This revenue proposal is based on the current inventory of 160 advertising units with 320 advertising faces — the number that we are presently authorized to advertise on in the City of Santa Ana. If the available advertising inventory changes during the term of the agreement, COA would be pleased to engage in a discussion with City staff to ensure the revenue structure continues to align with the scope of the program. • It is assumed that the City of Santa Ana will be responsible for all utility costs associated with the operation of illuminated transit shelters, including but not limited to electricity for lighting and any other powered components. I Phone: 1.800.661.6088 30 www.CreativeOutdoor.com EXHIBIT C Vendor shall procure and maintain for the duration of the agreement, the following insurance coverages: MINIMUM SCOPE AND LIMIT OF INSURANCE Vendor shall maintain limits of insurance coverage in the following minimum amounts and shall be at least as broad as: Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an "occurrence" basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $2,000,000 per occurrence and $4,000,000 aggregate. Automobile Liability (AL): Insurance Services Office Form CA 00 01 covering Code 1 (any auto), with combined single limits of $1,000,000. In the event Vendor does not maintain commercial automobile liability insurance, City will accept evidence of personal automobile insurance with existing limits, which can be lower than $1,000,000. Workers' Compensation (WC): as required by the State of California, with statutory limits, and Employer's Liability Insurance with limit of no less than $1,000,000 per accident, per employee, per policy for bodily injury or disease. This requirement can be waived if Vendor has no employees. If Vendor maintains broader coverage and/or higher limits than the minimums shown above, City requires and shall be entitled to the broader coverage and/or the higher limits maintained by Vendor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to City. Other Insurance Provisions The insurance policies are to contain, or be endorsed to contain, the following provisions: 1. CGL and AL policies: City of Santa Ana, its City Council, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds with respect to liability arising out of work or operations performed by or on behalf of the Vendor including materials, parts, equipment, and personnel furnished in connection with such work or operations. 2. CGL, AL, and WC policies: Insurance company(ies) agrees to waive all rights of subrogation against City, its City Council, its officers, officials, employees, agents, and volunteers for losses paid under the terms of any policy which arise from work performed by Vendor for City. 3. All required insurance policies: For any claims related to this contract, Vendor's insurance coverage shall be primary and any insurance maintained by City, its City Council, its officers, officials, employees, agents, or volunteers shall not contribute with it. 4. All required insurance policies: A severability of interest provision must apply for all the additional insureds, ensuring that Vendor's insurance shall apply separately to each insured against whom a claim is made or suit is brought, except with respect to the insurer's limits of liability. 5. Each insurance policy required herein shall provide that coverage shall not be canceled, suspended, voided, reduced in coverage or in limits, non -renewed by the carrier, or materially changed except after thirty (30) days prior written notice has been given to City. Ten (10) days prior written notice shall be provided to City for policy cancellation or non -renewal due to non-payment. 6. Certificate Holder on each Evidence of Insurance certificate shall be: City of Santa Ana, Attention: Marlene Alcaraz, 20 Civic Center Plaza, M-93, Santa Ana, CA 92701. The name and location of event should be included in the Description of Operations section of each certificate. Self -Insured Retentions Self -insured retentions must be declared to and approved by the City. City may require Vendor to purchase coverage with a lower retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. Acceptability of Insurers Insurance is to be placed with insurers authorized to conduct business in the state of California with a current A.M. Best rating of no less than A:VII, unless otherwise acceptable to City. Verification of Coverage Vendor shall furnish City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy listing all policy endorsements to Entity before work begins. However, failure to obtain the required documents prior to the work beginning shall not waive Vendor's obligation to provide them. City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time. Claims Made Policies If any of the required policies provide coverage on a claims -made basis: 1. The retroactive date must be shown and must be before the date of the contract or the beginning of work. 2. Insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of work. 3. If coverage is canceled or non -renewed, and not replaced with another claims -made policy form with a retroactive date prior to the contract effective date, Vendor must purchase "extended reporting" coverage for a minimum of three (3) years after completion of work. Subcontractors Vendor shall require and verify that all sub -contractors maintain insurance meeting all the requirements stated herein, and Vendor shall ensure that City is an additional insured on insurance required from sub -contractors. Special Risks or Circumstances City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances. Signature: lt&thew lleanney Matthew Kear ey IJa 2T. 202612'. 19:56 EST; Email: matthewkearney@creativeoutdoor.com Agreement - Creative Outdoor (25-107) (CAO 1.22.26)(2148884.1) Final Audit Report 2026-01-27 Created: 2026-01-27 By: marlene alcaraz (malcaraz@santa-ana.org) Status: Signed Transaction ID: CBJCHBCAABAART5C4vHccPewJ3avCywH1FjXvcwgojiB "Agreement - Creative Outdoor (25-107) (CAO 1.22.26)(214888 4.1)" History `'.; Document created by marlene alcaraz (malcaraz@santa-ana.org) 2026-01-27 - 5:16:00 PM GMT Document emailed to Matthew Kearney (matthewkearney@creativeoutdoor.com) for signature 2026-01-27 - 5:16:06 PM GMT Email viewed by Matthew Kearney (matthewkearney@creativeoutdoor.com) 2026-01-27 - 5:18:28 PM GMT Document e-signed by Matthew Kearney (matthewkearney@creativeoutdoor.com) Signature Date: 2026-01-27 - 5:19:56 PM GMT - Time Source: server Agreement completed. v. 2026-01-27 - 5:19:56 PM GMT a Adobe Acrobat Sign