Metro considering naming rights for light rail

The Valley’s light-rail line runs past Wells Fargo Arena in Tempe, and downtown Phoenix’s Chase Field and US Airways Center — venues where extra revenue was found by selling off the names.

Now Metro, too, is interested in allowing companies to name stations or the entire system in return for money.

During Wednesday’s meeting of Metro’s Rail Management Committee, a proposal to investigate the selling of naming rights was met with enthusiasm.

Perhaps the panelists were desperate to hear of good financial news, considering minutes before they heard how a budget crunch would lead to an expansion slowdown and service reductions.

“It’s important that we look at every opportunity we can for revenue,” said Patricia Kraus, Chandler’s coordinator for intergovernmental affairs. “This could be very valuable, and this could help extend the system further and faster.”

The matter will go before Metro’s board of directors later this month.

If the day comes when naming rights are sold, it will mark a complete reversal of the board’s no-advertising policy, adopted in the early part of the decade. But in April, the board voted to allow the sale of space at stations as well as on and in trains.

According to a presentation by Metro executives, the selling of naming rights usually is associated with sporting venues. But transit systems around the country have done the same, or are looking to do so:

• The Greater Cleveland Regional Transit Authority sold off the name of a bus rapid transit system to two hospitals along the route. The Cleveland Clinic and University Hospitals will pay $6.25 million over 25 years to name the nine-mile Euclid Corridor route the HealthLine.

The deal could jump to $18 million if the transit agency sells sponsorships for 10 stations along the route over the life of the agreement.

• The city of Norfolk, Va., and Hampton Roads Transit could reap nearly $29 million over 20 to 30 years by selling naming rights to light-rail stations, park-and-ride lots, or even the entire rail system, a recent study showed.

• Miami-Dade Transit learned last year a popular station on its Metromover loop could garner $48,000 annually.

Although members of the commission were unanimous in welcoming a new revenue stream, there were pleas for caution.

Mike James, deputy transportation director in Mesa, pointed out how the sale of naming rights for University of Phoenix Stadium put the venue’s host municipality, Glendale, in a position where it gains no name recognition.

“A city could get snubbed,” James said.

Phoenix City Manager Frank Fairbanks, the committee’s chairman, also warned of having a business buy ad space on a train or station, only to have a competitor purchase the rights to name the station or even the whole system.

“But,” Fairbanks concluded, “it would be almost foolish not to do this.”

If the board approves the idea of selling naming rights, Metro then will conduct a formal inquiry on how best to do so. Executives said developing that information could range in cost from $50,000 to $100,000.