SUBJECT: Petro Electronic Sign Replacement
In July, 1985 the University entered into an agreement with First National Bank to erect an electronic sign East of Petro. First National Bank agreed to pay for the cost of the sign in return for a ten-year sponsorship concession which included display of the bank's name and 15% of the time on the electronic bulletin board for commercial messages. The sign was actually purchased and erected by Bank IV in April of 1986. The sign was at that time state of the art and the costs of the sign and its installation totaled over $60,000.
In April of 1997 the University entered into a three-year sponsorship agreement with NationsBank which again included signage and 15% of the available time on the message board. In return for these considerations, the University received an $8,000 donation and upon the expiration of the agreement in April, 2000 the sign became the University's property.
Although state of the art when erected in 1986, the electronic message board has experienced significant problems in recent years. The mechanical nature of the message board has necessitated several repairs over the past six years. Currently, the message board sign is inoperable. The mechanical portions of the message board are sufficiently deteriorated and replacement parts are no longer available requiring either replacement of the message board or the entire sign.
Custom Neon, which erected the original sign and has provided maintenance through the years, has estimated the cost of a new LED message board in the existing cabinet would cost approximately $45,000. The cost of replacing the entire sign to provide greater visibility for the University is $66,640 plus permit. Because the predecessor company of Custom Neon installed the original sign, the ability to incorporate some of the original installation is reflected in the replacement cost. The University has included the replacement cost of the sign in its FY'02 Capital Budget.
The University began discussions with Custom Neon regarding sign repair, message board replacement and entire sign replacement late in calendar 2000, and these conversations continued into calendar 2001. While these discussions were underway, Commerce Bank and Trust, which currently has the University's banking contract, indicated to Custom Neon they would be interested in providing financial support for a new electronic sign at Washburn in return for sponsorship considerations.
The University administration has negotiated with Commerce Bank and Trust a sponsorship program which would allow Commerce a 2' x 7' 11" cabinet for a sponsor's logo and 15% of the messages on the message board in return for an annual consideration to the University of $12,000 per year. Because of the overall marketing benefit a new sign with a state-of-the-art message center will bring to the University, this proposal is supported by the administration.
The approved FY'02 Capital Budget (Account #03-00302) included an amount for replacing the electronic sign. The cost of the sign will be $66,640 plus permit.
The University will be entering into a three-year sponsorship agreement with Commerce Bank and Trust in the amount of $12,000 per year. This income will go towards the operations and maintenance of the sign, for amortization of the costs of future sign replacement. The sign is estimated to have an eleven year life cycle and will probably require repainting at least twice during that period. Funds to cover the electrical costs, maintenance, repainting and ultimate replacement will come from the sponsorship revenue received. The University will have total control over all messages, including those of the sponsor, to be placed on the electronic message board. In return for these financial considerations, the University will agree that Commerce Bank and Trust will be the sole financial institution sponsor for the three year duration of this agreement.
President Farley recommends the Board of Regents approve issuance of a contract with Custom Neon and Vinyl Graphics for purposes of replacing the existing Petro sign with a new sign and message center. Funding from this project is available in FY 2002 Capital Improvement Account #03-00302.
(date) Jerry B. Farley, President