To: MAYOR AND CITY COUNCIL
From: ELIZABETH HAUSE, COMMUNITY SERVICES DIRECTOR
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DISCUSSION AND POSSIBLE DIRECTION ON THE POTENTIAL FOR UTILIZING BUS STOP FURNITURE AND BUSES TO GENERATE ADVERTISING REVENUE
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EXECUTIVE SUMMARY
As part of the City Council's Strategic Plan, staff was asked to explore potential advertising revenue opportunities utilizing bus stop furniture and structures. This report assesses the feasibility of implementing an advertising program to generate revenue utilizing Beach Cities Transit (BCT) assets, specifically bus stop furniture (shelters, kiosks, benches) and exterior wraps for buses. This assessment considers Federal Transit Administration (FTA) compliance, implementation models, and financial viability.
Key findings of the assessment indicate:
* FTA Compliance is Mandatory: As BCT assets are federally funded, FTA regulations (Circular 4220.1G) require competitive procurement for advertising contracts and restrict the use of net revenue solely to eligible transit program costs
* Implementation Options: The City could manage the program in-house, requiring significant City resources and expertise, or contract with a third-party vendor, which leverages external expertise but requires revenue sharing and robust City oversight
* Financial Viability: Program costs (furniture, installation, maintenance) vary significantly. Revenue potential depends on local market conditions, inventory size, and contract terms. Profitability is possible, but not guaranteed, and any program would require effective management to be successful
A transit advertising program is feasible but should be approached with caution. Its success depends on a detailed local market analysis, accurate cost projections, well-defined policies (including content guidelines and equitable placement priorities), and the selection of an implementation model that ensures strong City oversight. In accordance with FTA requirements, any net revenue gen...
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