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HomeMy WebLinkAboutMINUTES - 07121994 - FC.1 To: BOARD OF SUPERVISORS 5 Contra FROM: Finance Committee, Tom Torlakson �� �'` Costa Gayle Bishop County DATE: cis; �tJ rq coiir+'� July 12, 1994 SUBJECT: COUNTY CONTRACT WITH CONCORD CONVENTION & VISITORS BUREAU SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION: 1. Approve and authorize the Chair, Board of Supervisor, to execute a contract with Concord Convention and Visitors Bureau in the amount of$63,111 for marketing of the Sheraton Inn at the Airport as a convention spot and Contra Costa County as a tourist destination during fiscal year 1994-95. FISCAL IMPACT: Contract costs should be offset with increased transient occupancy taxes and sales tax to the General Fund and increased revenues to Buchanan Field Airport. BACKGROUND: The Finance Committee met on June 27 and heard from the Concord Convention and Visitors Bureau and Sheraton Inn personnel regarding the benefits of marketing services provided*by the Bureau. Based on their testimony and the following data compiled by staff, the Finance Committee is recommending continuing the County's contract with the Bureau. The County was in a nine month contract with the Concord Convention and Visitors Bureau which terminated this June. Under the contract, the Bureau includes the Sheraton Hotel at the Airport in its convention and tourist marketing for the Concord area. The County receives transient occupancy tax revenue (TOTs) when Sheraton Hotel rooms are filled and increased sales tax revenue from the tourism and related commercial activity. CONTINUED ON ATTACHMENT: YES SIGNATURE: RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE APPROVE OTHER A SIGNATURE(S): Tom Torlakson Gayle Bishop ACTION OF BOARD ON 9 YL APPROVED AS RECOMMENDED _¢ OTHER VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE 14 UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN. ATTESTED r2 Contact: Linda Bulkeley, 646-4870 PHIL BATCH LOR, ERK OF THE BOARD OF CC: County Administrator SUPERVISORS AND COUNTY ADMINISTRATOR Concord Convention & Visitor's Bureau Supervisor Mark DeSaulnier BY /' ,DEPUTY Page 2 The County has contributed funding to Concord Convention and Visitors Bureau since fiscal year 1980-81 with a brief year and three-quarter hiatus between January 1992 and September 1993. Cost of Services The Concord Convention and Visitors Bureau budgeted $360,000 in both fiscal year 1994-95 and the current year. The County is currently paying $40,200 for 9 months of Bureau services. The Bureau is asking $63,111 for a year of services. The cost borne by the County is calculated by a formula determined by actual TOT revenues received and the proposed level of public funds needed by the Bureau. Because the level of public funds needed by the Bureau is higher next year, the County will pay a little more next year for a full year than it would have in fiscal year 1993-94. The County and the City of Concord are being asked to fund 90% of costs in fiscal year 1994-95 vs. 83% in fiscal year 1993-94. The increased public funding appears to offset a decrease in funding from major hotel memberships. Contract Benefits The direct beneficiary of the Convention and Visitors Bureau is the Sheraton Hotel. The hotel's owners are spending over$5 million on improvements and are asking the County to assist them in their efforts by expanding the contract to 12 months. According to Sheraton's General Manager Richard Pryor, the Hotel is busier and is generating more income than last year. Occupancy levels for the first four months of 1994 were 36.2 vs. 31.6 for the same period in 1993. Also room revenues are $130,000 higher during the first calendar year quarter of 1994 than 1993. In the long run, the County's investment in the Concord Convention and Visitors Bureau probably results in increased County revenues and an expanded local economy. Unfortunately in some years, contract costs are greater than gains in TOTs revenue. In fact, thus far TOTs revenue from the Sheraton is less than last fiscal year when the County was not contracting with the Bureau. Fiscal Year 1992-93 Fiscal Year 1993-94 YTD (3rd Quarter) YTD (3rd Quarter) $164,702 $152,330 Shifts in the state of the economy or a hotel's upkeep, as well as new competition, will also affect the level of TOTs revenue collected in a year. The relation between the level of TOTs revenue and the efforts of the Concord Convention and Visitors Bureau can be somewhat obscured by these other factors. FY 1994-95 Budget Development Process The recommended proposed budget had already been developed when budget staff received the Bureau's request for a full year of funding. In the recommended proposed budget, the contract was budgeted at the $40,200 level. March 30, 1994 Total 1994-95 Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$360,000.00 Ws Private Sector Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.000.00 Total Public Funds $32,7.000.00 ORIGINAL FORMULA $879,719 = Actual 1992-93 TOT City 210.863 = Actual 1992-93 TOT County $1,090,582 = Total City and County $210.863 s County = 19.3% $1,090,582 = City & County $879.719 = City — 80.7% $11090,582 = City & County $327,000.00 X 19.3% = $63,111.00 $3271000.00 X 80.7% - 263.889.00 $327,000.00 Total Public Funding Office of County Adm1nd strator C ontra C o s t a C o u n ty Administration Building 651 Pine Street, 11th Floor Martinez, CA 94553 To: Members, Board of Supervisors From: Scott Tandy, Chief Assistant County Administrator Date: May 26, 1994 Subject: Concord Convention and Visitors Bureau Please find attached a letter and activity report through the third quarter of fiscal year 1993-1994 . Last year you reestablished membership with the Convention and Visitors Bureau at a pro-rated cost of $40,200 . Pursuant to the agreement, the full year cost will now approximate $63,000 to continue the Sheraton Hotel being represented in the 'Convention Bureau recruitment efforts. As you know the Sheraton and its owner Ted Kruschnitt is making a multimillion dollar investment in the hotel to make it more attractive inside and outside. He believes that it is imperative that the Sheraton be represented to insure its fair share of convention and conference business `in the future. Under the revised agreement, the County has one representative on the Board of Directors who also serves on the Executive Committee. The Executive Committee reviews budget and operations of the Bureau on a continuous basis . Barring any unforeseen circumstances, we believe it is appropriate to continue the contract with the Bureau and to make our first installment payment under the contract after the new fiscal year begins. If you have any questions regarding this matter, please contact me. ST: lmj Attachments cc: Phil Batchelor AGREEMENT THIS AGREEMENT, made and entered into on this 12 day of July 199 by and between the COUNTY OF CONTRA COSTA, a political subdivision of the state of California (hereinafter "COUNTY"), and the CONTRA COSTA CONVENTION AND VISITORS BUREAU, a private, non-profit corporation, dba the CONCORD CONVENTION AND VISITORS BUREAU (hereinafter 'BUREAU"). WHEREAS, pursuant to the provisions of Section 26100 (b) of the Government Code of the State of California, COUNTY may expend certain monies accruing to the General Fund for the purpose of making known the resources of the county. WHEREAS, the BUREAU has special knowledge and experience, together with available facilities and personnel, for the maintenance of an office to serve as a public information and convention bureau for the advertising and promotion of the resources of the COUNTY and the people thereof by methods which, in the judgment of the BUREAU and the COUNTY, will be of benefit to the people of the COUNTY; and WHEREAS, said BUREAU is willing to undertake the services hereinafter set forth on behalf of the COUNTY in the manner and for the purposes hereinafter provided. NOW, THEREFORE, in consideration of the faithful performance of the terms and conditions herein, the parties hereto agree as follows: 1. Performance of Services. The BUREAU hereby contracts .with..the COUNTY to perform the services herein set forth. 2. Description of Services. The BUREAU will carry on tourist and convention development activities of a public character herein mentioned on behalf of the Sheraton Concord Hotel & Conference Center for the COUNTY and shall use its facilities and experience to secure as beneficial a return as possible from the expenditures made by it. The specific goals and objectives of said activities shall be as set forth in Exhibit A (Marketing Plan), which is attached hereto and incorporated herein by this reference. 3. Payment. Except as otherwise provided herein, COUNTY shall pay BUREAU for and in consideration of services to be performed by BUREAU during the 1994-1995 fiscal year, Sixty Three Thousand One Hundred and Eleven ($63,111); payable one-half forthwith on execution of this agreement and one-half on February 1, 1995. 4. Reporting_ The BUREAU shall furnish COUNTY with a monthly report which includes the financial condition of the BUREAU, and an annual audit on October 1, 1995 covering the Fiscal Year 1994-1995. The COUNTY shall have the right to review BUREAU'S records at any reasonable time at the office of the BUREAU. BUREAU shall furnish COUNTY with reports on the BUREAU'S activities on May 15, 1995, which report shall cover the three preceding fiscal year quarters, and on August 15, 1995, which shall cover all of the fiscal year 1994-1995. Each report shall specifically address the goals and objectives set forth in Exhibit A of this Agreement. 5. Term. The Agreement herein shall be in effect from July 1, 1994 through June 30, 1995. This Agreement may be extended on prior written approval of both parties to said extension, and approval of both parties to the amount of payment for services. Should the agreement be extended past July 1, 1995 and should the BUREAU be servicing the city of Walnut Creek for tourist and convention development activities at that date, the parties agree that the scope of this agreement shall be expanded to include the Embassy Suites Hotel located near the Pleasant Hill BART Station with an appropriate adjustment in payment for services. 6. Independent Contractor. In the performance of the activities required by this Agreement, the parties recognize that the BUREAU is acting as an independent contractor. All officers, agents and employees of the BUREAU shall not be deemed to be agents or employees of the COUNTY. The COUNTY shall not be liable to BUREAU or any person or persons acting for BUREAU for any death, injury, or property destruction or damage received or claimed resulting from activities undertaken pursuant to this Agreement, except for liabilities and claims which arise solely from acts or omissions of the COUNTY, its officers, agents, and employees for which the COUNTY shall be liable. 7. Notice. All notices required herein shall be sent first class mail to the parties as follows: To COUNTY County of Contra Costa Attn: County Administrator 651 Pine Street, 11th floor Martinez, CA 94553 To BUREAU Contra Costa Convention and Visitors Bureau dba Concord Convention and Visitors Bureau 2151 Salvio Street, Suite N Concord, CA 94520 Notices shall be deemed effectively served upon deposit in the United States mail with first class postage prepaid. 8. Indemnification. The BUREAU shall defend, hold harmless and indemnify the COUNTY and their officers, agents and employees, from all liabilities and claims for death, sickness, or injury to persons or damage to property, including without limitation all consequential damages, from any cause whatsoever connected with the operations of the BUREAU hereunder, resulting from the acts or omissions, negligent or otherwise, of the BUREAU, or its agents or employees. admin\agrshert.wp5 9. Non-Assignable. This Agreement shall not be assigned by BUREAU without the prior written consent of the COUNTY. 10. Entire Agreement. This Agreement represents the entire agreement between the parties and supersedes any prior written contract, or amendments thereto, and any oral agreements. 11. Amendment. This Agreement may be amended, modified, or changed by the parties provided that said amendment, modification or change is in writing and approved by both parties. IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written. CONTRA COSTA CONVENTION AND VISITORS BUREAU dba CONCORD CONVENTION AND VISITORS BUREAU, a California corporation BY: Presid96tj Board of Wectors BY: � xecutive Director COUNTY OF CO COSTA, a geneT1 law co my BY: Chairperson County Board of Supervisors ATTEST: BY: Clerk of the Board admin\agrshert.wp5