October 19, 1998

SUBJECT: Ratification of advertising expenditures to MQ&C Advertising and Marketing, Inc. for FY98; approval to renew contract #28-099704MB-01 to MQ&C Advertising and Marketing, Inc. for FY99.

PROPOSED ACTION
Item 1: The Board of Trustees ratify expenditures to MQ&C Advertising in the amount of $293,794 for FY98.

Item 2: The Board of Trustees approve the renewal of contract #28-099704MB-01 to MQ&C Advertising and Marketing, Inc. for FY99, in the amount not to exceed $400,000.

RELATED BOARD POLICY OR PLANNING PRIORITY
Board Policy C-10, Purchasing.

RATIONALE
Item 1: On November 1, 1997, following a Request for Proposal for professional and creative services, Austin Community College entered into a contract with MQ&C Advertising and Marketing (Contract 28-099704MB-01). MQ&C was determined to be the best choice for providing these services, based on price, creative concept, and other factors. MQ&C is a State of Texas certified HUB, #1-74-229-8627-700.

The services provided by MQ&C include the development of television and radio commercials, for which they bill 100 percent of the production costs. MQ&C also purchases radio and television airtime for the College, for which they receive a 15 percent commission on the gross price of the advertisements. For example, if a television station charges ACC $1,000 for a television commercial, MQ&C’s commission is $150. The television stations bill ACC through MQ&C, and MQ&C passes along the costs, while keeping its 15 percent commission. In FY 98, radio stations billed ACC directly. Their bills were at 85 percent gross cost, with MQ&C billing ACC separately for the 15 percent commission.

Of the gross billings received from MQ&C for FY98, approximately $20,000 was for production services, and another $53,700 was commission on radio and television airtime purchases. The balance was for direct charges from the broadcast stations. While MQ&C’s gross billings amounted to $293,794, no single vendor – MQ&C, individual television stations, or individual radio stations – received more than $100,000 net in FY98.

Item 2: Based on the excellent level of service provided by MQ&C, it is requested that the Board of Trustees approve a one-year extension of the existing contract #28-099704MB-01, in an amount not to exceed $400,000.

BUDGETARY CONSIDERATION
The funds required to cover the contract renewal are included in the approved FY99 budget.

RESOURCE PERSONNEL
Elvis Eaglin, Manager, Purchasing
Ed Osborn, Executive, Marketing and Public Information

Respectfully Submitted By:

Ana M. "Cha" Guzmán, Executive Vice President
Administration and Institutional Advancement

Richard Fonte, President