February 24, 2004

SUBJECT: Acceptance of the Pacific Gas and Electric Company Grant for Bio Industry Marketing Materials and Approve Budget Modification No. 25

REPORT IN BRIEF

This report recommends City Council approve Budget Modification No. 25 to accept grant funds received from Pacific Gas and Electric Company to support targeted marketing material development.

BACKGROUND

Economic Development started the development of a marketing campaign in 2002.  This plan included development of a message for businesses and residents about the importance of businesses in Sunnyvale.  The message developed was “Sunnyvale Supports Business Supports Sunnyvale”.  Materials developed during Phase 1 included the “Making Business Easy in the City of Sunnyvale” booklet, posters and various advertisements included in the Sunnyvale Sun and Mercury News.

To complete Phase 2 of the economic development marketing program, the City needs to develop targeted marketing materials focused on retaining and attracting specific emerging industry clusters such as bio-tech, nano-tech, wireless technology, and other telecommunications type of industries.

In July 2003, Pacific Gas and Electric Company issued a request for applications for grants supporting local economic development programs.  The grant will fund up to 25% for materials only.  Staff responded to the PG&E request and was awarded a grant of $5,000 to fund part of the project.

EXISTING POLICY

The following documents contain policy direction on this issue:

Legislative Action Policy - 5. SOCIO-ECONOMIC

5B/C/D. Economy and Employment

(2) Support coordinated economic development efforts to increase employment opportunities and increase quality of jobs including coordination with the existing employment and training resources funding under JTPA. [*/Modified in 1998-July and December]

(3) Support research and development funding that increases the capabilities of our existing industries, and increase the role of federal research and development in civilian research and technology. Support programs that promote continued/increased research and development that is innovative, entrepreneurial and has growth potential. [Combined from two policies that first appeared in 1994]

DISCUSSION

Targeted marketing materials are necessary in order to attract and retain specific industry groups.  The specific clusters include bio-tech; nano-tech; wireless and other telecommunications type of industries.  Marketing materials will be both hard copy brochures and web-based electronic information.  The materials will include information relevant to each group (economic, demographic, education, geographic), depicting Sunnyvale’s benefits to the different industry groups.  It will also communicate the importance of these industries to the economy in the City of Sunnyvale and Silicon Valley.

The materials will be used to attract new businesses to the city in order to maintain and increase the current workforce, as well as to retain current businesses in Sunnyvale.  The marketing program supports existing regional and local marketing efforts for job retention and job creation, which are key elements to our economic recovery.  The materials will be incorporated into the city’s business outreach and visitation program.  They will also be provided to brokers, developers, site selection consultants and others who influence location decisions.

FISCAL IMPACT

Staff estimates the total cost of the marketing campaign at approximately $19,500.  The PG&E grant would fund $5,000 for the cost of materials, and the remaining cost of $14,500 would be absorbed within the Economic Prosperity program budget for marketing expenses.

Staff recommends Council approve Budget Modification No. 25 to accept the $5,000 PG&E grant and appropriate it into the Economic Prosperity operating program budget.  Staff is also looking at ways to reduce the cost of producing the marketing materials.

PUBLIC CONTACT

Public contact was made through postings of the City Council agenda on the City’s official notice board, posting of the agenda and report on the City’s web page, publication of the Council agenda in the San Jose Mercury News, and the availability of the report in the Library and the City Clerk’s Office.

ALTERNATIVES

1. Approve Budget Modification No. 25 to accept the $5,000 PG&E grant and appropriate it into the Economic Prosperity program budget.

2. Do not take action at this time and forfeit the funds provided by Pacific Gas and Electric Company.

RECOMMENDATION

Staff recommends Alternative 1.

Prepared by:

Karen L. Davis
Economic Development Manager

Reviewed by:

Robert J. Paternoster
Director, Community Development

Reviewed by:

Mary J. Bradley
Director of Finance

Approved by:

Amy Chan
Acting City Manager

Attachments

A. Copy of Pacific Gas and Electric Company Grant Application (pdf format)