DATE: May 8, 2018
SUBJECT:
Title
RESOLUTION CONSENTING TO ASSIGNMENT AND ASSUMPTION OF MEDIA AGREEMENTS FOR AS NEEDED SAN DIEGO UNIFIED PORT DISTRICT MARKETING AND OUTREACH CAMPAIGNS FROM MIDWEST TELEVISION, INC. TO KFMB TV, LLC (dba KFMB-TV, NFMB-TV, KFMB-FM, KFMB-AM) DUE TO A CHANGE IN STATION OWNERSHIP
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EXECUTIVE SUMMARY:
On January 9, 2018, the San Diego Unified Port District (District) Board of Port Commissioners (Board) adopted resolutions authorizing agreements with Midwest Television Inc. for as-needed District Marketing and Outreach Campaigns for KFMB-TV (CBS) TV station and KFMB-FM radio station. The operations and assets of Midwest Television, Inc. were purchased by Tegna, Inc. shortly afterward on February 14, 2018. Tegna, Inc. established the legal entity KFMB-TV, LLC to transact all business formerly conducted by of Midwest Television Inc. In order to continue business with both KFMB-TV (CBS) TV station and KFMB-FM radio station, the District will need the agreements signed by the new legal entity KFMB-TV, LLC., which is not anticipated to have any effect on District projects or timelines.
RECOMMENDATION:
Recommendation
Adopt a Resolution Consenting to Assignment and Assumption of as-needed San Diego Unified Port District Marketing and Outreach Campaign agreements from Midwest Television Inc. to KFMB-TV, LLC.
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FISCAL IMPACT:
The proposed Board action would have no additional fiscal impact to the District.
Compass Strategic Goals:
This agenda item supports the following Compass Strategic Plan Goals:
• A Port that the public understands, trusts and values
• A vibrant waterfront destination where residents and visitors converge
• A Port with an innovative and motivated workforce
• A financially sustainable Port that drives regional job creation and regional economic vitality
DISCUSSION:
On January 9, 2018, the Board adopted a resolution authorizing agreements with Midwest Television Inc. for as-needed broadcast media services for KFMB-TV (CBS) TV and KFMB-FM radio. Contracts with Midwest Television Inc. were executed in order to carry out the resolutions, and to provide as-needed services to the Marketing & Communications Department.
Effective February 14, 2018, Virginia based Tegna, Inc Broadcasting Company purchased all operations and assets of Midwest Television, Inc. Tegna subsequently established a legal entity to transact all business formerly conducted by Midwest Television Inc.: KFMB-TV, LLC. This entity will conduct all business for the San Diego based portion of the broadcasting group including the television, radio and digital stations KFMB-TV, NFMB-TV, KFMB-FM, and KFMB-AM.
The stations are part of a broadcast television and radio pool with seven television and eight radio media advertising service providers in the local market for various District branding, marketing and outreach campaigns. Each service provider submits proposals for individual marketing campaigns to support various lines of business, and public outreach goals, and task authorizations are awarded based on the station’s ability to meet the campaign objectives, deliver the target audience and provide competitive rates based on the proposal submission. This process will continue under the revised contracts to ensure the District receives the most comprehensive and competitive broadcast media services for each campaign.
District Marketing & Communications staff has done due diligence and determined that project budgets and timelines will not be affected by this transfer of rights and obligations; therefore, staff recommends this assignment and assumption of the District’s agreements to KFMB-TV, LLC.
General Counsel’s Comments:
The Office of the General Counsel has reviewed the Assignment and Assumption of as-needed District Marketing and Outreach Campaign agreements from Midwest Television Inc. to KFMB-TV, LLC, and approves as to form and legality.
Environmental Review:
The proposed Board action, including without limitation, a resolution consenting to assignment and assumption of an agreement for as needed marketing and outreach campaigns does not constitute an “approval” or a “project” under the definitions set forth in California Environmental Quality Act (CEQA) Guidelines Sections 15352 and 15378 because no direct or indirect changes to the physical environment would occur. CEQA requires that the District adequately assess the environmental impacts of projects and reasonably foreseeable activities that may result from projects prior to the approval of the same. Any project developed as a result of Board’s action or direction that requires the District or the Board’s discretionary approval resulting in a physical change to the environment will be analyzed in accordance with CEQA prior to such approval. CEQA review may result in the District, in its sole and absolute discretion, requiring implementation of mitigation measures, adopting an alternative, including without limitation, a “no project alternative” or adopting a Statement of Overriding Consideration, if required. The current Board action in no way limits the exercise of this discretion. Therefore, no further CEQA review is required.
In addition, the proposed Board action allows for the District to implement its obligations under Sections 30, 81, and 82 of the Port Act, which authorize the use of funds for the promotion of the District’s interests and advantages. The Port Act was enacted by the California Legislature and is consistent with the Public Trust Doctrine. Consequently, the proposed Board action is consistent with the Public Trust Doctrine.
Finally, the proposed Board action does not allow for “development,” as defined in Section 30106 of the California Coastal Act, or “new development,” pursuant to Section 1.a. of the District’s Coastal Development Permit (CDP) Regulations because it will not result in, without limitation, a physical change, change in use or increase the intensity of uses. Therefore, issuance of a CDP or exclusion is not required. However, development within the District requires processing under the District’s CDP Regulations. Future development, as defined in Section 30106 of the Coastal Act, will remain subject to its own independent review pursuant to the District’s certified CDP Regulations, PMP, and Chapters 3 and 8 of the Coastal Act. The Board’s action in no way limits the exercise of the District’s discretion under the District’s CDP Regulations. Therefore, issuance of a CDP or exclusion is not required at this time.
Equal Opportunity Program:
Not applicable.
PREPARED BY:
Revekka Balancier
Manager, Marketing & Communications
Attachment(s):
Attachment A: Agreement No. 324-2017ND with Midwest Television, Inc. KFMB-FM Radio
Attachment B: Agreement No. 292-2017ND with Midwest Television, Inc. KFMB-TV (CBS)
Attachment C: Signed Assignment Agreement for Radio and Television