HomeMy WebLinkAboutItem 16 - 2019-20 Annual Report of the Tourism Business Improvement District (TBID)Item 16
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Council- d. Report
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Department Name: Administration and IT
Cost Center:
208-1006
For Agenda of:
October 6, 2020
Placement:
Business Item
Estimated Time:
30 minutes
FROM: Greg Hermann, Deputy City Manager
Prepared By: Molly Cano, Tourism Manager
SUBJECT: 2019-20 ANNUAL REPORT OF THE TOURISM BUSINESS IMPROVEMENT
DISTRICT
RECOMMENDATION
1. As recommended by the Tourism Business Improvement District (TBID) Board, receive and
approve the TBID Board's annual report for FY 2019-20 (Attachment A); and
2. Adopt a Resolution of intention to levy and collect assessments within the TBID area in
fiscal year 2020-21 at the same rate as in fiscal year 2019-20 (Attachment B).
DISCUSSION
Background
In June 2008, the Council adopted Ordinance No. 1517 establishing a tourism business
improvement district as requested by the local lodging industry. The TBID was formed under the
State's Parking and Business Improvement Law of 1989, sections 36500 et seq. of the Streets
and Highways Code and codified into the City's Municipal Code under Chapter 12.42.
Pursuant 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 A) that outlines the past year's efforts and how the funding was used
and to what effect.
Section 36534 further requires that after the approval of the annual report, the Council shall
adopt a resolution of intention to levy an annual assessment for that fiscal year. The resolution
also sets a public hearing in order to receive any written or oral protests against the continuation
of the TBID as required by the applicable statute.
Annual Report
On September 9, 2020, the TBID Board met in a regular monthly meeting to finalize the 2019-20
annual report for recommendation to the Council. Public noticing for the TBID Advisory Board
meeting was performed through the posting of the agenda on the City's website by 5:00 pm on
September 4, 2020. For convenience, the agenda was also distributed to TBID constituents and
stakeholders via email. The annual report reiterates the use of the TBID funds within the defined
marketing platform that guides the strategy used to deliver on the TBID's objective and goals.
Item 16
The annual report's contents include:
1. Impacts Resulting from COVID-19
2. TBID Background and Advisory Body
3. 2019-20 Year by the Numbers
4. Strategic Plan Implementation and Program Approach
5. 2019-20 Summary of Activities
6. 2019-20 Financial Statement
7. Looking Ahead to 2020-21
8. Charts and Graphs showing various results
Next Steps
Should the City Council approve the annual report and adopt the resolution of intention, a public
hearing will be noticed for October 20, 2020. The public hearing will allow hoteliers to submit
comments, voice concerns, and protest 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 pay 50% or more of the proposed
assessments. In that event, the Council cannot consider continuation of the TBID in the City for
at least one year.
Noticing Schedule
Legal notices regarding the Council's review and approval of the TBID annual report were sent
to TBID properties on Thursday, September 24, 2020. For convenience, the link to the agenda
was also distributed to TBID constituents and stakeholders via email.
Advisory Body Action
On September 9, 2020, the TBID Board approved the 2019-20 annual report for submission to
Council and recommended the continuation of the TBID for fiscal year 2020-21. (Attachment C)
Policy Context
As referenced in the City's Municipal Code, 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 that outlines the past year's efforts and how the funding was used and to
what effect.
Public Engagement
This item is on the agenda for the October 6, 2020 Council meeting and will follow all required
postings and notifications. The public may have an opportunity to comment on this item at or
before the meeting.
All Advisory Body Meetings for the TBID were noticed in accordance with Brown Act
standards.
Item 16
ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended action in this
report, because the action does not constitute a "Project" under CEQA Guidelines Sec. 15378.
FISCAL IMPACT
Budgeted: Yes Budget Year: 2019-20
Funding Identified: Yes
Fiscal Analysis:
Funding Sources
Current FY Cost
Annualized
On -going Cost
Total Project
Cost
General Fund
State
Federal
Fees
Other: TBID Fund
Total
The current unaudited year-end TBID Assessment Revenue for 2019-20 is $1,142,523 which is
$8,152 more than the revised budget amount which had been adjusted due to COVID-19.
Prior to COVID-19, the projected revenue for the TBID assessment in 2019-20 was $1.6 million
however the revenue projection was adjusted by $500,000 to $1.1 million in the Spring to
account for the fiscal impacts resulting from COVID-19. The TBID Board reduced expenses in
excess of $230,000 to account for this change, however a deficit between the adjusted revenues
and expenses remained. Due to the fiscal prudence of the TBID Board, the TBID Fund had a
fund balance of $456,000 including the TBID Fund Reserve. The anticipated deficit of $211,000
remaining from 2019-20 expenditures will be covered by the available fund balance.
In 2020-21, the TBID projected revenue is $1,253,400 and is budgeted for program costs
including staffing. Additionally, the City will retain approximately $25,000 of the assessment
revenue- roughly 2% of 2020-21 TBID Assessment Revenue - to cover the City's administrative
costs associated with collecting, administering, and disbursing the assessment.
ALTERNATIVES
The Council may choose to not approve the report or levy the assessment. This action is not
recommended as the advisory body has fully reviewed the report and recommended the approval
to Council in order to move forward with the Public Hearing for the TBID.
Item 16
Attachments:
a - COUNCIL READING FILE - SLOTBID 2019-20 Annual Report
b - Draft Resolution of Intention
c - TBID Draft Minutes date September 9, 2020
Item 16
RESOLUTION NO. (2020 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, 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 A DATE FOR THE
PUBLIC HEARING ON THE DISTRICT AND THE ASSESSMENT FOR
2020-21
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 assessment went into effect on October 1, 2008; 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, an annual report was prepared pursuant to Section 36533 of the Streets and
Highway Code; and
WHEREAS, notices regarding the approval of the annual report were sent on September
24, 2020 to all assessed properties.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo
as follows:
a) That the Tourism Business Improvement District Annual Report for fiscal year 2019-
20 as filed by the advisory body is hereby approved.
b) 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).
Item 16
Resolution No. (2020 Series) Page 2
c) The assessment levied by the Tourism Business Improvement District shall be used to
promote lodging at the hotels within the district and administer a marketing program
that increases overnight hotel stays pursuant to the set goals.
d) The assessment will be levied and allocated by the City of San Luis Obispo.
e) 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.
f) The assessment shall be based on two percent (2%) of gross room rent.
g) New hotels shall not be exempt from immediate assessment.
h) 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 Tourism Business Improvement
District and proposed assessment, and is hereby set for 6:00 P.M., Tuesday, October
20, 2020, before the City Council of San Luis Obispo via teleconference.
i) At the public hearing, the testimony of all interested persons for or against the
continuation of the Tourism Business Improvement District, the boundaries of the
Tourism Business Improvement District, or the furnishing of specified types of
improvements or activities will be heard.
j) Any protest against the continuation of the Tourism Business Improvement District and
the levying of the assessment, or any aspect thereof, may be made in writing. 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. A protest may be withdrawn at any time before the
conclusion of the public hearing.
k) If, at the conclusion of the public hearing, there are of record, written protests by the
owners of businesses within the proposed Tourism Business Improvement District that
will pay fifty percent (50%) or more of the total assessments of the entire Tourism
Business Improvement District, no further proceedings to continue the Tourism
Business Improvement District shall occur. New proceedings to form the 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, then that type of improvement or activity shall
not be included in the Tourism Improvement District.
I[a
Resolution No. (2020 Series)
Item 16
Page 3
BE IT FURTHER 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 (a)(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 Council Member
, and on the following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was adopted this day of
ATTEST:
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
J. Christine Dietrick
City Attorney
seconded by Council Member
Mayor Heidi Harmon
2020.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City
of San Luis Obispo, California, on
Teresa Purrington
City Clerk
I[a
Item 16
TOURISM BUSINESS IMPROVEMENT DISTRICT BOARD
Minutes - DRAFT
Wednesday, September 9, 2020
Regular Teleconference Meeting of the Tourism Business Improvement District Board
CALL TO ORDER
The regular teleconference meeting of the San Luis Obispo Tourism Business Improvement District Board
was called to order on September 9, 2020 at 10:03 a.m. held via GoToWebinar by Chair John Conner.
ROLL CALL
Present: Chair John Conner and members LeBren Young -Harris, Clint Pearce, Pragna Patel -Mueller,
and John Burns
Absent: Natalie Ward
Staff: Tourism Manager Molly Cano and Tourism Coordinator Chantal Burns
PUBLIC COMMENT ON ITEMS NOT ON THE AGENDA
None.
--End of Public Comment --
CONSENT ITEMS
ACTION: MOTION BY COMMITTEE MEMBER PEARCE SECONDED BY COMMITTEE MEMBER
HARRIS, CARRIED 5-0-1, TO APPROVE THE CONSENT AGENDA ITEMS 1 THRU 7.
C.1 Minutes of Meeting on Wednesday, August 12, 2020
C.2 Smith Travel Report
C.3 Transient Occupancy Tax (TOT) Report
CA Chamber Public Relations Monthly Report
C.5 Chamber Visitor Center Monthly Report
C.6 Noble Studios & DCI Marketing Monthly Report
C.7 Notice of Unscheduled Vacancy
Public Comment
None.
--End of Public Comment --
DRAFT Minutes — Tourism Business Improvement District Board Meeting of 09/09/2020 Pg. 1
Item 16
PRESENTATIONS
1. New Board Member Introductions
New member John Byrns, the General Manager for the Kinney introduced himself to the Board while other
board members introduced themselves. New members Natalie Ward and upcoming new member David
Smith will join the October meeting.
BUSINESS ITEMS
1.2019-20 TBID Annual Report
Tourism Manager Cano reviewed the draft FY 2019-20 annual report while highlighting the impacts of
COVID-19 on the TBID and major accomplishments for the fiscal year. Cano then presented the annual
report video. Board members did not have any edits or feedback. The action taken by the TBID Board
recommended the adoption of the 2019-20 annual report and thus endorsed the continuation of the district
for fiscal year 2020-21as communicated through the approved recommended scheduling of the annual
public hearing on October 20, 2020.
Public Comments:
None
---End of Public Comments ---
ACTION: MOTION BY COMMITTEE MEMBER PEARCE, SECONDED BY COMMITTEE
MEMBER BYRNS, CARRIED 5-0-1, to approve the 2019-20 SLO TBID Annual Report for
recommendation to City Council.
2. Appointment of the TBID Board Vice Chairperson
Board members reviewed the SLO TBID Bylaws regarding the Vice Chairperson positioned and both
members Patel -Mueller and Pearce expressed interest in the position.
Public Comments:
None
---End of Public Comments ---
ACTION: MOTION BY COMMITTEE MEMBER HARRIS, SECONDED BY COMMITTEE
MEMBER BYRNS, CARRIED 4-1-1 (Patel -Mueller abstained), to nominate member Pearce as the current
Vice Chairperson.
3.2020-21 Board Liaison & Committee Assignments
Chair Conner recommended to the remaining members the below committee assignments for the 2020-21
FY and will fill in on either committee as needed. Board members had no edits or discussion to the
recommended committee assignments or liaison assignments and will move forward with the presented.
TBID Marketing Committee: LeBren Harris, Clint Pearce and Natalie Ward
TBID Management Committee: Pragna Patel -Mueller, John Byrns and new incoming board member
Committee members discussed meeting in person only for the Marketing Committee meetings at physically
distanced meeting spaces.
Public Comments:
None.
---End of Public Comments ---
DRAFT Minutes — Tourism Business Improvement District Board Meeting of 09/09/2020 Pg. 2
Item 16
No action was taken on this item.
TBID LIAISON REPORTS AND COMMUNICATION
1. HOTELIER UPDATE — Liaison Reports
a. Member Harris — New property Town Place Suites is planned to open in February 2021
b. Member Byms — The Kinney has reopened their restaurant and restarted weekly trivia outdoors
c. Tourism Manager Cano — The Apple Farm is under new management; Blu Hotel Investors and Matt
Wilkins, a previous board member, is the new general manager for La Cuesta Inn and has express
interest in a March 2021 board set.
2. MARKETING COMMITTEE UPDATE — Tourism Manager Cano highlighted the social strategy that was
presented by Noble Studios and DCI and was approved by committee members.
3. MANAGEMENT COMMITTEE UPDATE — Chair Conner highlighted the meeting discussions on budget
and CHLA.
4. PCC UPDATE — Chair Conner highlighted the new GIA program that was discussed and reported in the August
12, 2020 minutes.
5. VISIT SLO CAL UPDATE — Liaison Reports by member Pearce and Tourism Manager Cano:
a. Advocacy work for tourism with the County and State mandates.
b. Working with different groups for forecasting data
c. Marketing Committee reviewed marketing, sales and PR activities including Go West Summit leads
web traffic numbers and launching paid search with Visit Ca.
6. TOURISM PROGRAM UPDATE — Staff Report from Tourism Manager Cano and Tourism Coordinator
Burns
a. David Smith from Hotel SLO is scheduled to be appointed by City Council in September and will join
the TBID Board starting in October
b. #SLOready Campaign —
i. Campaign development through video and still photography went well
ii. #SLOready Challenge was a success with 58 qualified entries
ADJOURNMENT
The meeting was adjourned at 11:10 a.m. The next Tourism Business Improvement District Board meeting
is scheduled for Wednesday, October 14, 2020 at 10:00 a.m. held remotely and via teleconference.
APPROVED BY THE TOURISM BUSINESS IMPROVEMENT DISTRICT BOARD: XX/XX/XXXX
DRAFT Minutes — Tourism Business Improvement District Board Meeting of 09/09/2020 Pg. 3
City of San Luis Obispo
Tourism Business improvement District
FY 2019-20 Annual Report
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Recommendation
1. Receive and approve the Tourism Business Improvement
District (TBID) Board's 2019-20 annual report.
2. Adopt a Resolution entitled 'A Resolution of the City
Council of the City of San Luis Obispo, California, 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 a date for the
public hearing on the district and the assessment for 2020-
21" at the same rate as in fiscal year 2019-20.
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Background on the TBID
■ Established in 2008
■ 7-member Advisory Board
■ 2% assessment on lodging properties
"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."
3/31/21
3/31/21
3/31/23
3/31/21
3/31/2
SLO TBID Board
01 - 0 ADVISORY BOARD
Dean Hutton
Bruce Skidmore (Vice Chair)
LeBren Harris
Pragna Patel -Mueller
i pool Patel
Clint Pearce
John Conner (Chair)
Kristin Battaglia
Apple Farm Inn Resigned
Embassy Suites by Hilton San Luis Obispo
Hampton Inn & Suites by Hilton
Hotel Buena Vista
Lamplighter Inn &Suites Completed
Madonna Inn Appointed
Petit Soleil Appointed
The Kinney SLO Resigned
SLO TBID Staff & Contractor Team
Molly Cano, Tourism Manager
Matchfirelo
Chantal Burns, Tourism Coordinator
MEDAMF
AGROUP
2019-24 SLO TBID Strategic Plan
A welconhi ng mmmurrity
We share ifie abundance of
e
with aviDrarc economy that
5L0, Mmngthelod�hg
rship
enriches the livrss of visitors and
econorny and servirg as the
F��
ahiliiy
7UR?�ve
residents alike
voice of our stakeholders
oration
■ ■ , • ■
• Increase visitor awarerress in target markets
Elevate the SLO Brand and Experience I ncrease pcsfive visitDr perception
Deliver Smart Growth
Build Meaningful Partnerships
sure Organizational E=ellence
• Chm RevPAR by 4% year-crver--year, adjusted far inflation
• Year -overhear g x wth in TOT, adjusted for inflation
• Year-overlear g woth in ratio of weekday to weekend occupancy
- Increase year -over -year average Earned Partnership Value snore
• Grow economic impact of tourism in SLO, adjusted far inflation
• Growth in member neaysletler open rates
• Growth in stekehdder satisfaction score on survey
The SLOTBID stewards the brand of San Luis Obispo and represents its lodging
partners, driving evern4d stays by:
• Tefng the San Luis Obispo story via targeted marketing oonl&A and ad yfties
• Serving as aorrvener and subject riutter experi fart�rrism oorwersativns inpaoting
the destination
- Advancing strategic partnerships that extend the reach and inMLErroe of 1he
SLO TBID
AL
• Ideriify the oore SLO idenlity and develop a plan to market it
• Estald h aTBID social respahsiS14 program
• IdenliFy opportunities to kA&-nee connxmity placerroking and destination
rnenagement efforts
• Dewlap a group sales stratepy
• Develop a mid -week promotion program
• Dewlap a kcal businesstravd pry, am to dtiue %nsitarkn
• tTfluenm the SLO oonferenoe center development plan and effort
• Develop an approach to mmitoring local senimeri relailEd In tourism
• Identify and develop BOLD pa&mrships that generate uvernighf slays
• Creates partnership management plan using measurable goals that are in line with
otwTBID Mission
• Develop an organtatinn ll resience plan
• Establish and document a process to execrte, evaluate and crack strategic plan
Identify opporiunities to streanine governance and leverage constituency of TBID
TBID Objectives for 2019-20
■ Implementation of 2019-20 Marketing Plan
■ Addition of 3 new lodging properties into the TBID
■ Successful RFP process for Marketing Services contract
■ Execution of select 2019-24 TBID Strategic Plan
initiatives
44%
ONE-
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COVID-19 Impacts on Tourism in SLO
■ California Stay -At -Home order (March 2020)
■ Essential travel only
■ Cancelation of special events and promotions
■ Postpone TBID's Rainy Day campaign
■ Cal Poly Commencement
■ Seasonal spring events & travel demand
■ SLO lodging business temporary closures
■ Cautious reopening & recovery (May 2020)
■ Priority focus on health & safety for employees,
residents and visitors
2019- 20 Year by the Numbers
TOT
Occupancy
ADR
RevPAR
$6..292,853
57.74%
$144.86
$ 87.64
OCC MONTH TO MONTH 2019-20
im
nn �9
;l 1
I.y A, h:ic r5K 1- Feb Mar Apr M,rp
ADR MONTH TO MONTH 2019-20
xnnro
r5G
2091iln
Transient Occupancy Tax
TOT CHART FOR 2019-20
10000000
8000000
6000000
4000000
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
TOT MONTH TO MONTH 019-20
1000000
800000
G00000
0000
200000
July Aug Sept Oct Nov Dec Jan
019- 0
Feb Mar Apr May Jun
2019-20 Summarized Financials
INCOME
TOT Revenue Assumption
$8,033,000
$6,177,377
TBID Assessment Pevenue Assumption
1,5�6,t���
$1,134,371
(20°r6 of TOT Revenues
018-19 Carryover
S66.000
$66,000
TBID Fund Reserve
$loo,000
$1I)0,00o
EXPENDITURE
Prior to COVID-19,the TBID Fund had a fund balance of approximately $456,000 including the TBID Fund Reserve.
The deficit of approximately $211,000 from 2019-20 expenditures will be covered by the available fund balance.
2019-20 SLO TBID Accomplishments
• Be Here Campaign performance
• Two Seasonal Promotions
• Launched the new VisitSLO.com
• Enhanced tradeshow presence +maximized strategic
partnerships
• Influencer campaign
• Impactful Public Relations achievements
• Prompt COVID-19 response
2019-20
TBID Highlights
tar
Looking Ahead to 2020 — 21
• Continued COVID-19 impacts on tourism
• Transition of new Tourism Marketing Agency contractor team
• Conscious approach to Diversity, Equity and Inclusion
• Leadership through the fully seated TBID Board
• Cautious revenue projections and carefully controlled expenses
Recommendation
1. Receive and approve the Tourism Business Improvement
District (TBID) Board's 2019-20 annual report.
2. Adopt a Resolution entitled 'A Resolution of the City
Council of the City of San Luis Obispo, California, 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 a date for the
public hearing on the district and the assessment for 2020-
21" at the same rate as in fiscal year 2019-20.
(Public Hearing to be scheduled for October 20, 2020)