The Chicago Transit Board today approved a contract authorizing IMG International to research the viability of corporate sponsorships and naming rights to various Chicago Transit Authority properties and assets.
IMG will conduct a three-part process which will determine how the CTA can best position itself to entertain offers from private companies. The first step is to identify which CTA assets are marketable. The next step is for IMG to evaluate the market value of the properties. IMG then will develop Requests for Proposals to solicit sponsorships.
Already, CTA has identified Bus Tracker and Train Tracker technology, Penny Rides and the Holiday Train traditions as potential assets that can attract sponsors. IMG will also identify corporate sponsorship opportunities for physical and intangible assets such as the website, information materials, recycle bins, winter heating lamps, benches and bus routes and rail stations—excluding those not owned by CTA. It is estimated that it will take IMG six months to one year to identify, evaluate, and solicit sponsorship proposals for CTA's assets.
“CTA welcomes this partnership with IMG,” said CTA President Forrest Claypool. “In a time when budgets are tight, we have to be creative and explore new avenues for CTA to help generate revenue. For CTA this is uncharted territory, but other businesses and transit agencies have successfully used corporate sponsorships to generate revenue. We believe CTA’s assets have some recognition value making them attractive to sponsors.”
According to the agreement, CTA will not pay IMG to conduct their market research. If sponsorships are secured and approved by the Chicago Transit Board, IMG will be compensated strictly by commission and on a graduated percentage scale depending on the value of the sponsorship transaction.
“This is a limited risk, high reward opportunity for the CTA,” said Chicago Transit Board Chairman Terry Peterson. “The CTA bears no front end cost to explore the feasibility of corporate sponsors while positioning itself to generate much-needed revenue in the future.”
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