HomeMy WebLinkAbout07/12/1999 - Study Session0 CITY OF NEWPORT BEACH
City Council Minutes
Study Session
July 12, 1999 - 4:04 p.m.
ROLL CALL
INDEX
Present: Adams, Glover, Thomson, Ridgeway, Debay, Noyes, Mayor O'Neil
Absent: None
CURRENT BUSINESS
1. CLARIFICATION OF ITEMS ON THE CONSENT CALENDAR
In reference to Item #10 (Funding of Pro - Airport Support Organizations) and
due to the recent signing of the petition for the Safe & Healthy Communities
Initiative by Congressman Cox, Mayor O'Neil suggested that the City
Council hold a Study Session in regards to the status of the El Toro airport.
Mayor O'Neil suggested that a representative from the program office or the
County be invited to attend the Study Session.. He stated that everyone
needs to be brought up to date on the status of the various issues, including
the EIS's in Washington D.C., the EIR that the County is preparing, the bills
• in Sacramento and the initiative mentioned earlier. Mayor O'Neil requested
that the City Manager coordinate with the County offices, the City Attorney
and Deputy City Manager Ducey to present to the City Council the status of
the El Toro airport issues. He added that he and Council Members Glover
and Adams have been more involved and may be. more informed on the
issues, but he'd like to have a report presented to the full City Council.
Council Member Noyes suggested that the Study Session also include a
discussion on the new Ad Hoc City Council Airport Issues Committee's
responsibilities and protocol. He stated that the Committee might be acting
on the City Council's behalf without the full City Council's input or support.
He added that he thought the Committee was created to get the City
through the transition period of moving from one group of consultants to the
new Orange County Airport Alliance, Citizens for Jobs & the Economy and
Airport Working Group coalition. He suggested that the Committee may
need to be sunsetted or that other council members should possibly be
rotated through it.
Council Member Debay stated her support for the City Council's funding of
the pro- airport support organizations, but that she'd like more information
on the educational direct mail program being proposed by the Citizens for
Jobs & the Economy. She stated that she'd like to know how they're going to
target their mailing, and requested that the information be provided in a
staff report at a Study Session or directly from the consultant. Council
Member Debay stated that she also wanted to know how the monitoring of
the contracts was going to be performed.
Mayor Pro Tem. Thomson suggested that the consultants, who will provide
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the City Council with a presentation at the Study Session, prepare an
executive summary of their particular programs. He stated that this will
allow the City Council to make sure that efforts are not being duplicated and
determine the direction that the support organizations are going. He also
suggested that the decision on Item #10 not be made until after the City
Council receives the additional information being asked for.
Council Member Debay stated that she will provide an update at the evening
meeting regarding the activities that took place in West Newport over the 4th
of July weekend. She added that a meeting would be held with the Police
Tactical Force later in the week that will produce additional information.
At Council Member Ridgeway's request, City Clerk Harkless explained the
noticing that is done for the City Council Study Sessions. She explained that
the Study Sessions are noticed in the same way as the regular City Council
meetings by posting the agendas on the City Hall bulletin board and sending
a copy to Comcast and the Daily Pilot. She stated that Comcast posts the
agendas on Channel 3 and the Daily Pilot publishes those items that have
been marked as being of particular interest as a legal notice. She added that
the agendas are also available on the internet.
Mayor O'Neil stated that he would also announce the Study Session that will
discuss the airport issues at the evening meeting. City Manager Bludau
confirmed that the entire July 26, 1999, Study Session could be devoted to
the airport issues discussion.
Council Member Ridgeway requested that the August 9, 1999, Study Session
include a review of the moorings, the rental fees and the tidelands
administration. He added that the tidelands issue might also be included, as
a follow -up to the item that was on a recent City Council agenda.
Council Member Ridgeway requested that a future Study Session include a
discussion on the enforcement of use permits and parking requirements at
Lido Marina Village. He stated that the police have been called out to Lido
Plaza and he thinks a Study Session would help to address the situation. He
referred to a letter from Fritz Duda that discussed parking and harbor
permit matters. He presented the correspondence to Assistant City Manager
Wood.
City Attorney Burnham brought to the City Council's attention a
typographical error in the Traffic Phasing Ordinance staff report (item #4).
He stated that the error was on page 6 and that the "and" at the end of
15.40.030 B.2.d(ii)d should be an "or ".
2. NEWPORT BEACH CONFERENCE & VISITORS BUREAU 1999 -2000
ANNUAL REPORT PRESENTATION.
Council Member Noyes stated that the staff report did not include a copy of
the agreement between the City and the Newport Beach Conference &
• Visitors Bureau (CVB). City Manager Bludau confirmed that there was an
existing agreement, and Administrative Services Director Danner added
that the agreement was extended for five years a couple years prior.
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C -2638
Conference &
Visitors Bureau
Annual Report
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July 12, 1999
• Council Member Noyes stated that he understands that the CVB gets 1% of
the total Transient Occupancy Tax (TOT) of $7 million. With that
information, he asked if any of the City Council members knew why the CVB
budget was over $1 million.
Council Member Ridgeway stated that it is not 1% of the tax collected, but
1% of the add -on to the hotel rate.
Council Member Debay stated that she remembers a bonus being included in
the agreement if the TOT collection was greater than the base year.
Council Member Noyes stated that Council Member Debay's answer was
correct and he was trying to make the point to the City Council that because
the contract was not included with the staff report, it was unclear on what
the City Council was approving.
Council Member Noyes continued by stating that he also wanted clear
information on how the agreement changed over the past ten years from the
original agreement. He referred to verbiage in the original agreement that
required that administrative and salary costs were not to exceed 30% of the
total budget. He said that this requirement is no longer a part of the
agreement, and that current administrative and salary costs are
approximately 55 %.
• City Attorney Burnham stated that all amendments to the agreement have
been approved by the City Council.
Council Member Noyes commented that the report before the City Council is
a report from the CVB and that no City staff report was included. Referring
to the report, he added that he did not know if it was appropriate for the
CVB to use unexpended prior year funds in the new fiscal year. And,
Council Member Noyes stated that he didn't know if it was appropriate for
the City to give the CVB 1% plus the bonus, but that the City Council should
at least know what they're voting on.
City Manager Bludau added that 1% of the TOT collected on the short -term
private rentals in the City is also given to the CVB.
Council Member Noyes stated that the total collected from the private
rentals is $465,000. He stated that since the CVB receives money from the
private rental TOT collections, the City Council might want to look at what
the CVB does to service them.
Administrative Services Director Danner clarified for Council Member
Glover that the $22 million mentioned in the newspaper recently referred to
the estimated total revenue produced from tourists for the City, and includes
TOT and sales tax at restaurants. Administrative Services Director Danner
stated that the Revenue Division produces information on who's a resident
• and who's a tourist that visits Newport Beach.
Council Member Noyes mentioned that the revenue figures also include
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citation collections.
INDEX
Rosalind Williams, President/CEO of the CVB, stated that she would provide
the City Council with information on what the CVB's purpose is and
specifically what occurred during the last fiscal year. She read the CVB's
Mission Statement, and stated that the key objectives are to create a
destination image for Newport Beach, to market Newport Beach as a
destination for meetings and leisure travel, to represent the hospitality
industry within the community to visitors and to provide member referrals.
Ms. Williams stated that there are four areas that are focused on by the CVB
and listed the first one as conference sales. She defined "Fam Tours" as
familiarization tours that bring in qualified meeting planners, tour
operators, the media and those that can project significant influence on those
making a decision to travel to Newport Beach. She went on to list the areas
of focus, as listed in the report, as tourism sales, public relations and
membership programs.
Ms. Williams stated that, during the past fiscal year, the CVB produced 299
conference leads, which means that the CVB provided the local hotels with
299 meetings that had the potential for coming to Newport Beach. She
stated that the total value of the 299 leads was $43.5 million. She stated
that the conference leads came from trade shows, familiarization trips, sales
blitzes, telemarketing and advertising.
• Internationally, Ms. Williams stated that there was a slowdown in the
Japanese market, so the CVB opened up the United Kingdom and Germany
markets through receptive operators. Domestically, she said the CVB
launched the summer rewards program with American Express.
Ms. Williams reported that the CVB internet site has had inquiries from 1.5
million people since early Fall, 1998. She stated that the several guides that
are produced by the CVB are distributed regularly to Anaheim -area hotels.
She added that the CVB has also started taking a more regional approach to
marketing Newport Beach.
Ms. Williams stated that the CVB's public relations efforts tie everything
together. She stated that Newport Beach received more than $800,000 in
"free" press, which are articles and stories on Newport Beach that were not
paid for with advertising dollars.
Ms. Williams reported that the occupancy rate in Newport Beach over the
year was 70 %, at an average rate of $137.92.
Ms. Williams stated that the report provided to the City Council includes the
CVB's 1999 -2000 Sales and Marketing Plan and the supporting budget. She
stated that some new strategies have been implemented and the successful
ones have been expanded. She stated that with over 12,000 new rooms
planned for just Orange County, competition is fierce. She said that both
• Los Angeles and San Diego counties are also planning new hotels, and that
the industry, overall, views the year in progress with cautious optimism
tempered by mild concern.
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Council Member Ridgeway asked about the $70,000 paid to American
Express for the summer rewards program. Ms. Williams explained that
$50,000 was paid by the CVB and $20,000 by its members. She stated that
the promotion focused on Southern California and the responses are tracked
via special rates or amenities offered to the participants. Ms. Williams
confirmed for Council Member Ridgeway that by the end of September, the
CVB should be able to quantify the total dollars received through the
program. Council Member Ridgeway requested that the results be provided
to the City Council.
Council Member Debay asked Ms. Williams to provide information on what
is occurring in other cities as far as their TOT rate, use of a visitors bureaus
and marketing efforts. Ms. Williams stated that a report has been prepared
that illustrates what other visitors bureaus throughout the state receive
from TOT collections and that the amount varies. She stated that cities like
Palm Springs and San Diego have huge budgets for attracting meetings and
conferences, and it's difficult to compare Newport Beach to them. In the
leisure market, she stated that Newport Beach can be easily compared to
cities like La Jolla, Coronado, Santa Barbara and Santa Monica. She stated
that Newport Beach's TOT of 10% runs about average, and the percentage of
TOT that is received by visitor bureaus varies greatly. Ms. Williams stated
that she feels that Newport Beach is underbudgeted, given the quality of the
City.
• Ms. Williams referred to a previous statement about the percentage spent by
the CVB on personnel, and stated that more money could be spent on either
publications or staff, and she feels that the CVB has found a good mix of
both. She stated that the sales and marketing activities have increased, and
will continue to increase. She stated that the efforts of advertising would be
unsuccessful if the phones weren't answered when people call.
Referring to the summer rentals, Ms. Williams stated that from April to
August, the CVB receives more inquiries for rentals on the beach than for
anything else.
In response to Council Member Noyes' question, Ms. Williams stated that
the CVB refers customers to companies that handle the beach rentals and
are members of the CVB.
Council Member Noyes asked about the mission. statement of the CVB and
stated that it is different than the one in the most recent agreement. He
stated that the mission statement in the agreement states that the CVB is to
serve the needs of the visitors to the City, whereas the mission statement in
the CVB report focuses more on generating overnight stays. Council
Member Noyes feels that the City is not doing enough to promote to the
visitors once they're here, and he feels that the CVB should spend more
effort in this area. He also expressed his concern that the CVB's mission
statement is not consistent with what the City Council has approved.
• Ms. Williams stated that the CVB Board's philosophy has been to generate
overnight stays, which will supply people who will spend more money
because they are in the City longer. She added that the CVB does produce
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and distribute information to assist the visitor to the City.
100,000 visitor guides were printed and distributed last year.
Council Member Noyes asked about the money not spent from last year's
budget. Ms. Williams stated that Revenue Manager Everroad had indicated
earlier in the year that there would be a decrease in the money coming to the
CVB due to the hospitality business slowing down. Ms. Williams stated that
with that information, the CVB Board made the decision to reduce spending
at the end of the year and let that money carry over for the following year.
Council Member Noyes asked if it was appropriate to save money from one
year for the next. Administrative Services Director Danner stated that the
City is obligated by the agreement to make the payment to the CVB and he
feels that it then becomes their funds to spend as they see appropriate.
Council Member Noyes recapped some of his main concerns, as stated
earlier. He stated that the relationship between the City and the CVB was
established on a 4 -3 vote in 1987, with Council Members Hart, Strauss and
Sansone dissenting. He concluded by stating that informational kiosks and
phone lines to assist the visitor should be expanded, and that the CVB would
be the appropriate body to handle the improvements, possibly by working
with a City Council ad hoc committee. Ms. Williams stated that the CVB is
open to receiving specific suggestions. She added that the phone at the base
of the Newport Pier rings straight to the CVB office, and that the phones at
• lifeguard headquarters also have the capability of being transferred straight
to the CVB office.
Council Member Glover stated that Council Member Noyes has brought up a
good point, and she said that Newport Beach is going to have to make some
changes to compete, if tourism dollars are going to be relied upon in the
future. She said that Fashion Island is not going to spend the money to
promote itself and that Newport Beach doesn't have corporations to rely
upon, and agrees with Council Member Noyes that the City needs to get the
money from the visitors who are already here. She stated that Newport,
Rhode Island is doing it right and capturing money once it's in the City. She
concluded by stating that the City is going to have to really look at where
future revenues will be coming from.
Mayor Pro Tem Thomson stated that during a visit to the CVB earlier that
day, he observed two people making an inquiry about taking a boat ride on
the bay. He stated that the CVB employee did not do a good job at assisting
the visitors. He suggested that the CVB's goal, and the City's, should be to
better manage the City's beaches and bays.
Mayor Pro Tem Thomson pointed out an error in the report, prepared for the
City Council by the CVB, which listed The Coaster as a publication resource
in the 1999 -2000 membership program. He stated that The Coaster is no
longer in business. Mayor Pro Tem. Thomson expressed his disagreement
with the CVB hiring a public relations firm, when the work could be done by
• the CVB itself. He also disagreed with the report stating that Newport
Beach is not known outside of the state. He thinks Newport Beach is known
and has something to offer. Lastly, Mayor Pro Tem Thomson asked how so
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little could be budgeted for airfare when so much traveling is done.
Ms. Williams apologized for the error of listing The Coaster in the report.
She stated that although the CVB employee that Mayor Pro Tem Thomson
observed earlier in the day was a new employee, she agreed that the
response to the visitors was inappropriate. She clarified that the CVB
promotes Newport Beach as a destination, but that specific business
referrals are made to CVB members only. She stated that the relationship
with a couple airlines allows the airline to be a member of the CVB, but
instead of paying membership dues, they provide airline tickets.
Ms. Williams stated that the use of a public relations firm is essential in
getting coverage in some of the major publications, where experience is
necessary.
Mayor Pro Tem Thomson stated that the CVB has done a great job and that
the City Council is only looking to improve things.
Council Member Ridgeway stated that he is in support of the CVB and
thinks there is room for improvement. He stated that he had some issues to
discuss, but would do so at another time and hoped the previous comments
were meant as constructive criticism. He stated that he, and he hoped
everyone present, was only trying to make the CVB better.
Dale McDaniel, immediate Past - Chairman of the CVB Board of Directors,
• stated that through his employment in the hotel industry, he has worked
with nine different conference & visitor bureaus and he thinks Newport
Beach's is the best. He stated that although the hotels in the area do want to
attract conventions and conferences, they also rely upon the individual
traveler. Mr. McDaniel stated that 60% of his hotel's business at the Hyatt
Newporter comes from individual travelers, and he agreed that the
incremental business from the visitors that do not spend the night needs to
be addressed also. He stated that there needs to be a balance between the
distribution of information to the visitor in town and promoting the area to
potential visitors. Mr. McDaniel complimented the CVB staff for their work
and he sees some decline in potential business coming, which means that the
CVB will need the City's support.
Mayor O'Neil congratulated Mr. McDaniel on his new assignment with the
new Hyatt in Santa Lucia and thanked him for all he'd done for Newport
Beach while working at the Hyatt Newporter.
Council Member Noyes stated that with business down in the tourism
industry, it is the perfect time for Newport Beach to seek new markets. He
stated that Balboa Island produced a brochure that has been very effective
in bolstering the area.
Mr. McDaniel agreed that brochures are great tools for getting people to an
area, but that it is more difficult to promote individual businesses. He added
that Newport Beach is difficult to sell because people don't know about it.
. He thinks that the CVB's part in promoting golf tournaments, tennis
tournaments and increasing national exposure is extremely important.
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Mayor O'Neil concluded the conversation by stating that he is on the CVB
Board as ex- officio, so more closely associated with the CVB than some of the
other council members. He stated that the enthusiasm from the group at
their recent annual dinner was marvelous, and that the participation and
membership is tremendous. He felt that the City Council appreciated the
work of the CVB and that communication between the City and the CVB
should maybe be increased. He suggested that representatives from the
CVB meet with the City Manager to discuss the mission statement and
maybe increase some of the goals, as discussed earlier. Mayor O'Neil
thanked Ms. Williams for the presentation and wished Mr. McDaniel the
best of luck, and hoped that they received the review positively.
Council Member Noyes stated that he would like to see some of the
paperwork issues corrected, and that most of his comments were directed at
City staff.
3. STATUS REPORT ON DEVELOPMENT AGREEMENTS:
TO CONDUCT AN ANNUAL REVIEW OF CURRENT
DEVELOPMENT AGREEMENTS TO REVIEW THE APPLICANTS'
GOOD FAITH AND SUBSTANTIAL COMPLIANCE WITH EACH
AGREEMENT IN ADDITION TO THOSE TERMS AND CONDITIONS
REQUIRED OF THE CITY OF NEWPORT BEACH.
A) NO. 4 (THE IRVINE COMPANY, LIBRARY EXCHANGE
AGREEMENT);
B) NO. 5 (HOAG MEMORIAL HOSPITAL PRESBYTERIAN);
C) NO. 6 (THE IRVINE COMPANY, CIRCULATION IMPROVEMENT
AND OPEN SPACE AGREEMENT [ CIOS.A]);
D) NO. 7 PACIFIC VIEW MEMORIAL PARK);
E) NO. 8 (FORD MOTOR LAND DEVELOPMENT CORPORATION);
F) NO. 9 (FLETCHER JONES MOTOR CARS);
G) NO. 10 (NEWPORT HARBOR LUTHERAN CHURCH); AND
H) NO. 11 (THE IRVINE COMPANY AND IRVINE COMMUNITY
DEVELOPMENT COMPANY CONCERNING BONITA CANYON).
City Manager Bludau stated that an annual review of all development
agreements is required by the City's Municipal Code.
Mayor O'Neil confirmed with Assistant City Manager Wood that compliance
with all terms and conditions of the development agreements has been met.
He added that the development agreements have different terms and
conditions, and he understands that staff has met with the parties involved.
Council Member Glover referred to the CIOSA Open Space Dedications chart
in the staff report for Development Agreement No. 6 and asked about the
dedication of the trail and bluff area on the Upper Castaways property.
Associate Planner Garcia responded that maintenance is taking place on the
upper bluff trail and that when it is completed, the site will be dedicated.
Council Member Glover confirmed with Associate Planner Garcia that
compliance meant that although there may be outstanding issues, that the
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INDEX
Development
Agreements
No 4: C- 2823 -A
No 5: C -2912
No 6: C -2920
No 7: C -3058
No 8: C -3059
No 9: C -3067
No 10: C -3152
No 11: C -3174
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City Council Minutes
July 12, 1999
• terms of the agreement are being met.
Council Member Glover stated that the plantings on the bluff side of the
fence are not compliant with what the City required. She stated that plants
are being planted that are maybe pretty but are not appropriate to limit
erosion of the Cliff. She requested that the City talk with Taylor - Woodrow.
Council Member Glover added that the fence that has been installed by
Taylor- Woodrow is made of cheap wood and should not be accepted by the
City. Also, the plants on the trail were removed and the residents have
planted new ones. Council Member Glover again wanted that issue looked
into.
Council Member Noyes commented about the topping of the trees on Lower
Castaways, and was curious who did it. No answer was received.
In reference to Development Agreement No. 9, City Manager Bludau stated
his disappointment that the repayments from Fletcher Jones had not been
received, and that staff is looking at ways to make sure development
agreements are agreed upon by all departments.
Mayor O'Neil suggested that Development Agreement Nos. 6 & 9 should be
continued for further review of the issues that have been raised.
Assistant City Manager Wood confirmed for Council Member Ridgeway that
• the repayment owed by Fletcher Jones is for the improvement to Bayview
Way, and that the City did not send the invoice last year. She added that
she does not feel that Fletcher Jones has been out of compliance, but that the
City failed to make the billing.
Assistant City Manager Wood commented on the dedication of the trail on
the Upper Castaways property. She stated that the offer to dedicate was
made but that the City will not accept the dedication until the property is in
the right condition for the City to accept it for long -term maintenance.
Associate Planner Garcia confirmed this and added that many of the
improvements are related to the finalizing of the tract map. She said that
the Public Works Department is aware of the issues.
Council Member Glover stated her concern that people think it is the City
that has made, or approved, the changes to the site, which is not the case.
She said that she is receiving many complaints.
Carol Hoffman, The Irvine Company, confirmed that The Irvine Company
did make the offer of dedication for the Upper Castaways site, in compliance
with the development agreement. She stated that the acceptance has not
come as quickly as expected, but that the Public Works Department wants to
resolve all issues before accepting it.
Council Member Glover stated that Taylor - Woodrow must replace the fence.
• Ms. Hoffman referred to the CIOSA Open Space Dedications chart in the
staff report, and stated that the Freeway Reservation parcel was included in
the park site that was acquired through Mello -Roos and the joint powers
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authority. She stated that the site was purchased on March 18, 1999 and is
now owned by the City. She also stated that the deferred maintenance on
the Newport Village parcel has been completed.
Motion by Mayor O'Neil to determine compliance on all Development
Agreements, except for No. 6 - pending further review of the issues raised.
Without objection, the motion carried by acclamation.
PUBLIC COMMENTS - None.
ADJOURNMENT — 5:25 p.m.
The agenda for the Study Session was posted on July 7, 1999, at 2:40 p.m. on
the City Hall Bulletin Board located outside of the City of Newport Beach
Administration Building.
Recording Se tary
City Clerk
Mayor
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