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HomeMy WebLinkAbout10/04/2011, B5 - ANNUAL REPORT FOR THE TOURISM BUSINESS IMPROVEMENT DISTRICT councit "'�o j ac Enda REpont '�N vs C I T Y OF SAN LU I S 081 SPO FROM: Michael Codron;Assistant City Administrative Officer Prepared By: Brigitte Elke, Principal Administrative Analyst SUBJECT: ANNUAL REPORT FOR THE TOURISM BUSINESS IMPROVEMENT DISTRICT RECOMMENDATION 1. Receive and approve the Tourism Business Improvement District (TBID) Board's annual report. 2. Adopt a resolution of intention to levy and collect assessments within the TBID area in fiscal year 2011-12 at the same rateasin fiscal year 2010-11. DISCUSSION Background In June 2008 Council adopted Ordinance 1517 establishing a tourism business improvement district as requested by the local lodging industry. The district was formed under the State's Parking and Business Improvement Law of 1989, sections 36500 et seq. of the Streets and Highways Code and incorporated into the City's Municipal Code under Chapter 12.42. According to Municipal Code Section 12.42.060 and Sections 36530 and 36533 of the State's Parking and Business Improvement Law, the appointed TBID Advisory Board is to submit an annual report (Attachment 1) that outlines the past year's efforts and the proposed activities for use of the assessment funds in the upcoming year. In Section 35634, the law further requires that after the approval of the annual report, Council shall adopt a resolution of intention (Attachment 2) to levy an annual assessment for that fiscal year. The resolution also allows for a public hearing in order to receive any written or oral protests against the continuation of the district. Annual Report On September 14, 2011 the TBID Board met in its regular monthly meeting to, amongst other agenda items, review the annual report and define its recommendation for use of the assessment funding in 2011-12 (Attachment 3). The marketing campaign, to drive people from Southern and Northern California to come and stay in San Luis Obispo while discovering the attractions and activities of the entire County, remains the main focus of the TBID's efforts. Additionally, the board continues to entertain funding support for new events happening between November and April to attract visitors to San Luis Obispo in these shoulder months. With its support of the inaugural San Luis Obispo Marathon in April and the ongoing support of the SLO International Film Festival, it will now turn its attention to November, January, and February. Additionally, the B5-1 Council Agenda Report—Annual TBID Report Page 2 board wants to establish a presence at various tradeshows and has taken the first step by attending International Pow Wow in San Francisco in May 2011. Next Steps Assuming Council approves the annual report and adopts the resolution of intention, a public hearing will be scheduled for October 18, 2011. The public hearing will allow hoteliers to voice comment and provide an opportunity to raise a negative protest against the assessment. As set forth in Sections 36524 and 36525 of the California Streets and Highways Code, the Council has the ability to continue the proposed citywide TBID'at this public hearing, unless oral or written protests are received from City hoteliers that will pay 50% or more of the proposed assessments. In that event, the Council cannot consider continuation of the TBID in the City of San Luis Obispo for at least one year. FISCAL IMPACT According to the City's 2011-12 Financial Plan, the TBID assessment is estimated to raise $973,000 for tourism marketing and promotion based on anticipated Transient Occupancy Tax revenue. ATTACHMENTS 1. Annual Report 2. Resolution of Intention 3. TBID Board Draft Minutes from September 14, 2011 B5-2 cltyof RTfACN{ ®� San tuts amspo TOURISM BUSINESS IMPROVEMENT DISTRICT ANNUAL REPORT FROM: TOURISM BUSINESS IMPROVEMENT DISTRICT BOARD MEMBERS: Tim Billing, Chair John Conner, Vice-Chair Dean Hutton Clint Pearce Joel Koper Nipool Patel Susan Norris Prepared By: Brigitte Elke, Principal Administrative Analyst SUBJECT: TOURISM BUSINESS IMPROVEMENT DISTRICT BOARD ANNUAL REPORT DISCUSSION The City of San Luis Obispo Tourism Business Improvement District In June 2008 the City Council adopted Ordinance 1517 establishing the tourism business improvement district (TBID) in the City of San Luis Obispo as requested by the local lodging industry. The assessment of two percent of gross receipts for the district became effective on October 1, 2008 and the use of funds was defined in Section 12.42.030 of the Municipal Code as follow: "This ordinance is made and enacted pursuant to the provisions of the Parking and Business Improvement Area Law of 1989 (Sections 36500 et. seq., of the California Streets and Highways Code). The purpose of forming the district as a business improvement area under the Parking and Business Improvement Area Law of 1989 is to provide revenue to defray the costs of services, activities and programs promoting tourism which will benefit the operators of hotels in the district through the promotion of scenic, recreational, cultural and other attractions in the district as a tourist destination. " The City subsequently established a special fund for the district through which the assessment funds are administered. Advisory Body The use of the assessment fund is based on the recommendation of the Tourism Business Improvement District advisory board that is staffed by City of San Luis Obispo hotel owners and/or general managers. The members serve for an initial four-year term with the opportunity for a second term. B5-3 Tourism Business Improvement District.___iiia]Report _D ATTACHMENT 1 2010-11 Advisory Board Name Property Term Tim Billing- Vice-Chair Embassy Suites 3/31/2013 John Conner- Vice-Chair Petit Soleil 3/31/2013 Dean Hutton Apple Farm 3/31/2013 Clint Pearce Madonna Inn 3/31/2015 Joel Koper Holiday Inn 3/31/2015 Susan Norris Sands Inn & Suites 3/31/2012 Nipool Patel Comfort Inn 3/31/2012 In addition to the governing City ordinance, the TBID Board established its advisory body bylaws and further defined its role and functions as: The functions and duties of the TBID BOARD shall include, but not be limited to, the following: A. Planning a comprehensive program to promote tourism to the City of San Luis Obispo and prepare an annual marketing program consistent with industry goals and objectives. B. Develop advertising and promotional programs and projects to benefit the lodging industry in San Luis Obispo. C. Present an annual assessment report to the City Council regarding the implemented promotional programs and projects. D. Perform any other lawful tasks as directed by the Council. The board meets monthly on the second Wednesday at 2:00 pm for its regular board meeting. In 2010- 11, the board met in 12 regular monthly meetings, a board retreat, and three special meetings for business related to events promotion and the 2011-12 budget. Additionally, it appointed a budget task force, a tradeshow task force, and appointed three of its members to serve on the events promotion subcommittee with three members of the Promotional Coordinating Committee. In order to keep the lodging constituency abreast of all TBID business, the board assigned liaisons and each board member is responsible for communication with his/her respective group of hotels. Additionally, the board chair and staff embark on hotel visits at least once a year to personally bring TBID updates and marketing material to each property. 2010-11 Work program Level Studios During fiscal year 2010-11, the TBID continued its marketing efforts with Level Studios and its triple award winning lodging website www.sanluisobispovacations.com. The 2010-11 marketing campaign transitioned from broad brand awareness to targeting experience specific interests and messages. Additionally, Level Studios continued to deepen the user experience on the website, using current traveler research and site analytics aggregated from the previous year. Some improvements included adding 18 interest categories such as vacation ideas for families, couples, and girlfriends, pet-friendly, deals & packages, honeymoons and weddings, and low cost getaways. A press room section was built that features the newly produced video, press releases, an B5-4 Tourism Business Improvement District A mal Report J ATTACHMENT 1 image gallery, and brand guidelines to provide greater access to visiting press and bloggers with assets and inspiration to write about the City. The executed media plan utilized the following strategies: - continued emphasis on targeting the TBID's message to the most searched for travel terms; - utilize digital advertising to build continued exposure with a seasonal emphasis; - utilize social and event content to build media message; The following media mix was applied in pursuit of the above mentioned strategy: - Print publications including consumer magazines and trade publications such as Skywest, Via Discover, Westways, LA Family Magazine, etc. - Online banner ads that appear on travel portals and in line with travel articles - Search Engine Optimization(SEO) and Pay-per-click Search Engine Marketing - Social Media Advertising on Facebook and the introduction of You Tube - Public Relations, including interest, seasonal and event releases, press trip coordination and hotelier outreach By May 2011, the campaign, which remains highly targeted to California travelers,had seen: ➢ 130 million impressions ➢ 560,000 email messages ➢ 28,500 visits to the San Luis Obispo TripAdvisor page Which resulted in: ➢ 3.5 times more visitors to the website (for only 9.5%more media spend) ➢ 32%more San Luis Obispo related searches ➢ 6,600 new email subscribers ➢ 21,800 unique monthly site visits ➢ 20,050 clicks to hotel sites ➢ 10,700 mobile visitors In addition to these efforts, the TBID commissioned several campaigns to increase the reach for its brand and tourism message. Those efforts were: - Funding allocation to the San Luis Obispo Visitors and Conference Bureau (VCB) in order to participate in the effort to build awareness for San Luis Obispo County. The TBID board also recommended payment of individual VCB membership fees in order to provide a direct benefit to the properties paying the assessment fee. - Central Coast Tourism Council membership including a San Luis Obispo ad in the organization's tourism guide. - Continuation of the STR report for occupancy comparison between various counties and an additional report comparing San Luis Obispo occupancy to Pismo Beach and Paso Robles. - Funding for a hotel board and 24/7 outdoor kiosk at the Visitors Center and a hotel concierge training program"MySLO"through the Chamber of Commerce. Events Promotion One of the goals of the Tourism Business Improvement District for 2010-11 was to seek events that bring people to San Luis Obispo. Events that cater to the shoulder seasons were of special interest. In order to address funding requests, the TBID board appointed three of its members to serve on the joint- events promotion subcommittee together with three members of the Promotional Coordinating B5-5 Tourism Business Improvement District taual Report ... AT(ACHMENT 1 Committee. Through this collaboration, the TBID took the lead in investing in the following major events: Sunset "Savor The Central Coast" This event highlighted San Luis Obispo through the Mission Plaza Dinner and allowed for a tourism booth at the main event in Santa Margarita. The TBID took this opportunity to produce a tradeshow booth that could be used for future opportunities. Straight Down Golf Tournament This collaboration was used to develop golf content on the website and a new golf brochure highlighting the courses around San Luis Obispo. SLO International Film Festival The TBID board gave support to the Film Festival as one of the premier San Luis Obispo spring event. The TBID's agency redesigned the website, produced the Festival brochure, and executed a media buy driving traffic to the Festival. SLO Marathon The inaugural San Luis Obispo Marathon is scheduled for April 2012. As one of the fastest growing sports, marathon running attracts thousands of people to destinations. To have a major sporting event in San Luis Obispo was one of the TBID's events promotion goals. Cal Poly Athletics Through this partnership, the San Luis Obispo hotels are now the exclusive lodging showcased in all Cal Poly Athletic venues. The marketing efforts through this partnership open the Cal Poly Athletics newsletters and email, lists which includes the Alumni, to the San Luis Obispo tourism message. San Luis Obispo GranFondo The inaugural 2010 GranFondo attracted 675 bicycle riders to San Luis Obispo, 70% of which came from out of town. The second GranFondo is scheduled for October 15, 2011. 2011-12 Workprogram For the 2011-12 fiscal year, the TBID will continue its efforts through Level Studios whose contract expires in June 2012. In addition to the approved media campaign, the agency will continue the feature and content updates on the website and develop an itinerary builder for use online and on mobile applications. The TBID board recommended continuing its contracts with the San Luis Obispo Visitors and Conference Bureau for integration of San Luis Obispo in the countywide marketing efforts. The programs commissioned through the Chamber of Commerce will also continue through fiscal year 2011-12. The concierge program will be refined and offer classes at various hotels for hotel front desk specific training. The promotion of large events continues to be a priority for the TBID and the board already recommended support of the nationally recognized vintage show "Remnants of the Past" at the Madonna Expo Center on October 8-9, 2011. Additionally, the board is looking to continue its partnership with the International Film Festival and is actively seeking an event for early September. The weekend after Labor Day is traditionally very slow and an attractive event could help increase B5-6 ATTACHMENT 1 Tourism Business Improvement District P.ival Report occupancy for this weekend. The partnership with Cal Poly Athletics is a three-year commitment through June 2014. In addition to the tourism marketing efforts and events promotion, the board is looking into increasing San Luis Obispo's presence at industry tradeshows. The board is currently looking at the following four tradeshows: - International PowWow 2012 in Los Angeles - Los Angeles and Bay Area Travel & Adventure Shows - 2012 World AG Expo - RCMA (Religious Conference Manager Association) for group business Proposed Assessment for 2011-12 The TBID Board does not recommend any changes in the levy of the assessment. The assessment is recommended to continue at 2% of.gross receipts to be submitted monthly to the City of San Luis Obispo together with the Transient Occupancy Tax. B5-7 Tourism Business Improvement District iurival Report O ATTACHMENT 1 Financial Statement 2010-11 Income Time Frame - Amount TBID Assessment July 2010-June 2011 $ 967,215.00 Investment Earnings $ 8,135.00 Starting Balance $ 616,000.00 Total Income Fiscal Year 2010-11 $ 195919350.00 Expenditure 2010-11 Level Studios Contract July 2010—June 2011 $ 750,000.00 Level Studios Carry-Over From 2009-10 $ 106,000.00 PR Contract July 2010—June 2011 $ 45,000.00 SLO VCB incl. hotel membership July 2010—June 2011 $. 95,000.00 SLO VCB Coo $ 27400.00 Chamber of Commerce July 2010—June 2011 $ 53,600.00 STR Report $ 4,000.00 Central Coast Tourism Council $ 7,800.00 SLO Intern. Film Festival $ 35,000.00 Straight Down Golf Tournament $ 22,500.00 GranFondo Bicycle Event $ 20,000.00 Sunset Savor the Central Coast $ 64,000.00 SLO Marathon $ 35,000.00 Cal Poly Athletics $ 25,000.00 PBS Travelsco e $ 3,750.00 Future of Work Conference $ 10,000:00 International Pow Wow Tradeshow_ in San Francisco $ 20,000.00 Various event support, TBID PBS Travelscope, SLO $ 23,000.00 Retreat, and marketing material. Symphony, Hop Fest, Salmonid Conference, Cal Poly en House City Administration $ _ 32,000.00 Expenditure $1,3799050.00 Agency Carry Over Unused 2010-11 budget $ 28,000.00 Total Expenditure $1,3519050.00 B5-8 Tourism Business Improvement District'Aimual Report - ATTACHMENT 1 Preliminary Financial Statement 2011-12 2011-12 Anticipated Income Anticipated Carryover 2011-12 $ 240,300.00 Budget Estimate Financial Plan 2011-13 $ 973,000.00 Total Estimated Budget 2011-12 $192139300.00 Expenditure 2011-12 Committed Agency Contract incl. PR July 2011 —June 2012 $ 800,000.00 SLO Chamber of Commerce July 2011 —June 2012 $ 39,500.00 SLO VCB incl. hotel membership July 2011 —June 2012 $ 119,000.00 Central Coast Tourism Council $ 8,000.00 Smith Travel Research $ 4,000.00 Remnants of the Past Vintage $ 25,000.00 Show SLO Intern. Film Festival $ 20,000.00 Cal Poly Athletics $ 52,500.00 Administrative Cost Estimate/4% of assessment $ 38,000.00 Total Expenditure Committed in 2011-12 $19106,000.00 B5-9 �I AITACHMER2 RESOLUTION NO. (2011 Series) RESOLUTION OF THE CITY OF SAN LUIS OBISPO DECLARING ITS INTENTION TO CONTINUE THE SAN LUIS OBISPO TOURISM BUSINESS IMPROVEMENT DISTRICT, TO CONTINUE THE BASIS FOR AND TO LEVY THE ASSESSMENT FOR THE DISTRICT,AND TO SET DATES FOR THE PUBLIC HEARINGS ON THE DISTRICT AND THE ASSESSMENT FOR 2011-12 WHEREAS the Parking and.Business Improvement Law of 1989, sections 36500 et seq. of the Streets and Highways Code, authorizes cities to establish business improvement districts for several purposes, one of which is promotion of tourism; and WHEREAS the lodging businesses within the proposed City of San Luis Obispo Tourism Business Improvement District had requested the City of San Luis Obispo establish such a self-assessment improvement district in 2008; and WHEREAS the San Luis Obispo Tourism Business Improvement District was established in July 2008 and incorporated into the Municipal Code under Chapter 12.42; and WHEREAS the City Council appointed an advisory board to provide oversight, guidance, and recommendations regarding the use of the assessment funds; and WHEREAS the City Municipal Code and the Parking and Business Improvement Law require the advisory board to prepare and submit an annual report stating proposed changes, improvements and activities for the fiscal year; and WHEREAS this report was filed and approved by the City Council on October 4, 2011. NOW,THEREFORE, BE IT.RESOLVED by the City Council of the City of San Luis Obispo as follows: a) The San Luis Obispo City Council proposes to continue the established Tourism Business Improvement District in the City of San Luis Obispo in accordance with City Municipal Code Chapter 12.42 and the California Streets and Highways Code, sections 36500 et seq. (Parking and Business Improvement Law of 1989). b) The assessment levied by the Tourism Business Improvement District shall be used to promote lodging at the.hotels within the district and administer marketing programs that increase overnight lodging. c) The assessment will be levied and allocated by the City of San Luis Obispo. B5-10 J AITACHMEW2 d) The assessment is proposed to be levied on all "hotels", as that term is defined in San Luis Obispo Municipal Code section 3.04.020, to wit: any structure, or any portion of any structure, which is occupied or intended or designed for occupancy by transients for dwelling, lodging or sleeping purposes, and includes any hotel, inn, tourist home or house, motel, studio hotel,bachelor hotel, lodging house, rooming house, apartment house, dormitory, public or private club, mobile home or house trailer at a fixed location, or other similar structure or portion thereof. e) The assessment shall be based on two percent (2%) of gross room rent. 0 New hotels shall not be exempt from assessment. g) The public hearing,held pursuant to the City Municipal Code Chapter 12.42 and the Parking and Business Improvement Law of 1989, section 36535 of the Streets and Highways Code, is to allow for comments on the District and proposed assessment, and is hereby set for 7 P.M., Tuesday, October 18, 2011, before the City Council of San Luis Obispo at the City Council Chambers at 990 Palm Street, San Luis Obispo, California.. h) At the public hearing, the testimony of all interested persons for or against the continuation of the District, the boundaries of the District, or the furnishing of specified types of improvements or activities will be heard. i) Any protest against the continuation of the City of San Luis Obispo Tourism Business Improvement District and the levying of the assessment, or any aspect thereof, may be made in writing. A protest may be withdrawn at any time before the conclusion of the public hearing. Any written protest shall contain a description of the business in which the person signing the protest is not shown on the official records of the City of San Luis Obispo as the owner of the business, then the protest shall contain or be accompanied by written evidence that the person is the owner of the authorized representative of the business. Any protest as to the regularity or evidence of the proceedings shall be in writing and clearly state the irregularity or defect to the City of San Luis Obispo at 990 Palm Street, San Luis Obispo, CA 93401. j) If, at the conclusion of the public hearing, there are of record, written protests by the owners of businesses within the proposed San Luis Obispo Tourism Business Improvement District that will pay fifty percent (50%) or more of the total assessments of the entire San Luis Obispo Tourism Business Improvement District, no further proceedings to continue the San Luis Obispo Tourism Business Improvement District shall occur. New proceedings to form the San Luis Obispo Tourism Business Improvement District shall not be undertaken again for a period of at least one(1) year from the date of the finding. If the majority of written protests are only as to an improvement or activity proposed, B5-11 ATTACH 2 then that type of improvement or activity shall not be included in the San Luis Obispo Tourism Improvement District. BE IT THEREFORE RESOLVED, the City Clerk is instructed to provide notice as required by the City Municipal Code Chapter 12.42 and the Parking and Business Improvement Law of 1989, section 36534, subpart (7) of the Streets and Highways Code, to wit: the City Clerk shall give notice of the public hearing by causing the resolution of intention to be published once in a newspaper of general circulation in the City no less than seven days before the public hearing. Upon motion of seconded by , and on the following roll call voter AYES: NOES: ABSENT: The foregoing resolution was adopted this day of , 2011. Mayor Jan Marx ATTEST: Elaina Cano, City Clerk APPRUOVE0 AS TO FORM: �(Z�� 4, Christine Dietrick, City Attorney B5-12 Tourism Business Improvement District Board Minutes Wednesday, September 14, 2011 2:00 pm Council Chamber— City Hall CALL TO ORDER: Chair Tim Billing Draft PRESENT: Pearce, Patel, Hutton, Norris STAFF PRESENT: Brigitte Elke, Principal Administrative Analyst PUBLIC COMMENT There was no public comment CONSENT AGENDA ACTION: Moved by Hutton/Patel to approve the consent agenda as presented. Motion carried 4:0 PRESENTATIONS 1. SLO MARATHON Samantha Pruitt and Heather Hellman provided an update on the efforts for the inaugural San Luis Obispo Marathon. They thanked On The Horizon PR for its help with the recent press release. They mentioned that they will be at several half and full-marathons to market the SLO event. Team in Training's CA chapter has committed and is actively promoting the event. It is possible that the national chapter will come to the event and hopefully by year two the marathon will see national participants. The board members were asked to distribute the rack cards in the hotel lobbies. 2. SAVOR THE CENTRAL COAST The commissioners approved listening to Business Item 6 at the same time as the Savor presentation as both items were presented by the San Luis Obispo Visitors & Conference Bureau (VCB). Molly Cano, Marketing Director for the VCB, reported on Savor ticket sales in comparison to 2010 (40% out-of-county/ 60% in-county at this point/ 2010 30% all together out-of-county). The numbers do not include the hotel package sales as those numbers will be reported at the end of the week. B5-13 � TBID Minutes AITACHMN 3 The chair asked why the City of SLO TBID was not mentioned in the recent press release and why the TBID was not informed regarding the chef and winery line up. Mrs. Cano explained that the contractor was hired through the SLO Vintners to line up the chefs with local wineries. However, the VCB will definitely address the concern for next year. BUSINESS ITEMS 1. CENTRAL COAST VISITORS GUIDE AD Matthew Gibbons with Striker Media introduced the 2012 Central Coast Visitors Guide. He mentioned that the number of copies will be increased to 55,000 without increase in ad prices. Striker Media sends the Visitors Guides directly to requesting parties and 60% go overseas. The full page will be $7,250 including the map mention and website presence. ACTION: Moved by Patel/Hutton to postpone decision to October meeting to review possible ad creative and media exposure. Motion carried 4:0 2. QUARTERLY CONTRACTOR REPORTS Ryan Allshouse and Rebecca Jensen presented the agency's efforts throughout July and August. They included the finalization of the five short videos, Rosetta Search and Media Integration, email marketing, event marketing, PR integration, website updates, and the Cal Poly Athletic program initiative which included printed signs on all major Cal Poly fields, gyms, and stadiums, 3 video min-clips on digital scoreboard, print ad in event booklets, radio spot during the games, and the brandnew ShareSLO.com website. 3. EVENTS PROMOTION Commissioner Hutton who also serves as the joint events subcommittee, elaborated on the report included in the agenda package which highlighted the request from the Film Festival. The funding is at $25,000, $20,000 from the TBID and $5,000 to be allocated through the PCC. ACTION: Moved by Pearce/Hutton to support the 2012 San Luis Obispo International Film Festival with $20,000 to be managed by Level Studios. Motion carried 4:0 ACTION: Moved by Hutton/Patel to support the requested change in date for the "Future of Work" conference to January. Motion carried 3:0 Board Chair Billing abstained. 4. ANNUAL REPORT The board reviewed the presented annual report for efforts in 2010-11, the financial statement, and proposed work program for 2011-12. ACTION: Moved by Pearce/Patel to forward the annual report to Council as presented Motion carried 5:0 S. HOTEL QUESTIONNAIRE — SURVEY MONKEY B5-14 — TBID Minutes -- MACHMEW3 Board Chair Billing presented a list of questions and asked the board to review, provide comments, and send additional questions for review at the October meeting. 6. CALIFORNIA VISITORS GUIDE —COOP THROUGH VCB Molly Cano presented the opportunity for a coop ad in the California Visitors Guide. The VCB was looking for 9 participants at $2,000 each. She handed out a document mentioning the distribution of the guide. To date, the VCB has two confirmed participants. ACTION: Moved by Patel/Pearce to participate in the coop ad at $2,000. Motion carried 4:0 BOARD COMMUNICATION Board Chair Billing reported on the hotel visits and the material brought to each property. Adjourned 4:06 pm B5-15