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HomeMy WebLinkAbout20 - Conference and Visitors Bureau (CVB) Annual ReportAGENDA ITEM NO. 20 CITY OF NEWPORT BEACH C- _ Office of the City ManagerBYTHE CIP(COUNCIL NEPOPT_BEACH July 28, 1997`„~-" } w JUL 2 8 (997 TO: MAYOR AND CITY COUNCILMEMBERS FROM: KEVIN J. MURPHY, CITY MANAGER/�4 SUBJECT: CONFERENCE AND VISITORS BUREAU (CVB) ANNUAL REPORT BACKGROUND The City of Newport Beach entered into an agreement with the Conference and Visitors Bureau in July 1996 for the period of July 1996 to August 2001. This agreement, which is attached as Attachment 1, outlines in Section 2 the duties of the Bureau and in Section 5 provides for the reports that the Bureau is responsible for providing to the City annually. A marketing plan and annual budget is due for presentation to the City by June 5th of each year. The CVB complied with this requirement; however, due to the length of City Council agendas and other conflicting schedules, this matter has been scheduled for July 28th for review by the City Council. The agreement provides for review and comment on the proposed marketing plan and budget by the City Council, however, formal approval isn't required. The CVB Board has previously approved both of these documents. The marketing plan and budget were reviewed by the City Council Finance Committee earlier this year and there were no comments on the two documents other than compliments to the CVB on their diligence and success in increasing visitor and tourism activity to the City as evidenced by the growth in our transient occupancy tax revenues. RECOMMENDATION The City Council review and comment on the Proposed Marketing Plan and Budget for the 1997-98 fiscal year for the Newport Beach Conference and Visitors Bureau. e--2-63 V This AGREEMENT, made and entered into this day of , 1996, by and between the CITY OF NEWPORT BEACH, a municipal &rporftion and charter city ("City"), and NEWPORT BEACH CONFERENCE & VISITOR'S BUREAU, a non-profit corporation organized and existing under and by virtue of the laws of the State of California ("Bureau") is made with reference to the following facts: A. The City, pursuant to the provisions of its City Charter and Section 37110 of the Government Code of the State of California, has the power to expend moneys accruing to the General Fund for the purpose of promoting tourism and related activities; B. The City has adopted Chapter 3.28 of Newport Beach Municipal Code which authorizes the collection of a visitors service fee to offset the cost of providing visitor services and promote tourism within the City. C. The City Council has determined that the Bureau has special knowledge and experience necessary to promote tourism in, and serve the needs of visitors to, Newport Beach; D. The City Council has determined that the Bureau's promotional activities are likely to substantially increase transient occupancy tax revenue and sales tax revenue; and i E. The City Council has determined that funding of Bureau activities will be a significant benefit to the residents of, and visitors to, the City. NOW., THEREFORE, the Parties agree as follows; This Agreement shall commence on the 1st day of September 1, 1996, and shall continue through August 31, 2001, unless terminated as provided in Section 10. Bureau shall develop, plan, carry out and supervise a program to promote tourism in, and serve the needs of, visitors to the City. This promotional program shall, at a minimum, include the following: (a) The maintenance of suitable quarters and the employment of competent personnel to properly carry out to promotional activities; (b) The preparation of brochures, publications, guides and information that inform prospective tourists and visitors of the recreational activities, cultural assets, and natural beauty of the City of Newport Beach; (c) The dissemination of the information described in subparagraph 2 (b) by way of the media, direct mail, handout or other means of distribution; (d) The development and implementation of specific marketing programs designed to increase business and visitor trade in the City of Newport Beach. (a) City shall pay the Bureau: (i) all funds received pursuant to the "Visitors Service Fee Ordinance," (Chapter 3.28 of the Newport Beach Municipal Code), less a sum equal to one (1 %) of those revenues to defray the City's administration costs. a sum equal to 50% of the transient occupancy tax collections in excess of $6,213,781 in 1996-97, not to exceed $400,000 annually. The $6,213,781 threshold and the $400,000 cap shall be adjusted each year based on the change in the Consumer Price Index - Los Angeles - Anaheim - Riverside - during the previous twelve months. City's obligation to make payments to Bureau under this subsection (ii) shall terminate on August 31, 1998, unless extended in writing by mutual agreement of the Parties. (b) City's obligation to pay bureau is limited by the following: ►A (i) The City's obligation to pay Bureau any funds pursuant to subparagraph 3 (a) (i) shall cease if the Visitor's Service Fee Ordinance is repealed or ruled invalid. Bureau gives up any right to seek any form of judicial relief or order based on repeal of the Visitor's Service Fee Ordinance or the failure of City to defend the Ordinance against a legal challenge. (ii) The City's obligation to pay Bureau any funds pursuant to Paragraph 3(a)(ii) shall cease if and when the City and its sole discretion decides to place any previously adopted revenue enhancing ordinance on the ballot for approval of the electorate and the measure is defeated, or a Court of competent jurisdiction enters an order invalidating any such revenue enhancing ordinance. Bureau acknowledges and agrees that this Agreement does not create any legal obligation on the part of the City to defend any of its revenue enhancing ordinances and that the City Council reserves the right, in its sole discretion, to repeal any such ordinance in the event of a legal challenge. (iii) If the City is required, by any validly issued Court Order, to refund any portion of the transient occupancy taxes collected by City, Bureau agrees that City may deduct from any payments made pursuant to Paragraph 3(a)(i) the portion of the amount ordered to be refunded that was paid to Bureau. 4. Manner of Payment (a) Funds due Bureau pursuant to the provisions of subparagraph 3 (a) (i) shall be paid on a monthly basis, and on or before the 20th day of the month subsequent to collection. (b) Funds due Bureau pursuant to the provisions of subparagraph 3 (a) (ii) shall be paid within sixty (60) days following the expiration of the relevant 12 month period. 5. Bureau Reports (a) Bureau shall provide City with a marketing plan and an annual budget on or before June 5th of each year during the term of this agreement. The Board of Directors of Bureau shall approve the budget before it is submitted to the City. The marketing plan shall specify the goals and 3 objectives of Bureau during the upcoming fiscal year, as well as the programs Bureau will implement to achieve those goals and objectives. (b) Bureau shall, on or before the first City Council meeting in October each year during the term of this agreement, submit to the City the following: (i) A report describing the services and programs offered by Bureau during the preceding fiscal year and an evaluation of the extent to which these services and programs have achieved the Bureau's goals and objectives; and (ii) an audit listing all revenues and expenses of the Bureau during the proceedings fiscal year. _.-�• • 1• Bureau shall expend funds provided by City in accordance with the budget submitted to, and approved by, the City Council. Bureau may transfer funds, or make expenditures, allocated for one element of the budget to another element so long as the basic goals and objectives of the tourist development program are not impaired. 7. Records Bureau shall prepare and maintain, during the term of this Agreement, and for twelve (12) months after its termination, complete and accurate books, records and accounts showing the expenditures of all funds disbursed to it by City pursuant to this Agreement. Bureau shall maintain all accounts, books and records in ordinance with generally accepted accounting principles. The City shall have the right, subject to reasonable written notice, and one time each calendar year the term of this Agreement, to conduct an audit of the accounts, books and records of the Bureau. Bureau shall fully cooperate with City in the conduct of the audit. If, upon audit of the records, it is determined that funds provided by the City have been utilized other than as provided in the budget and as specified in this Agreement, Bureau shall reimburse City for all such funds and the cost of the audit. 4 Bureau shall obtain and maintain any and all licenses and permits necessary to conduct its activities, render the services required by this Agreement and maintain its facilities. Bureau shall defend, indemnify, and hold harmless City, and its officers, employees agents and representatives from and against any and all claims, losses, damage, liability, lawsuits, judgments, costs, fees and expenses that may be claimed by any person or entity, or incurred by the City, and which arise out of, or are in any way related to, the activities of Bureau, its agents, employees, subcontractors, or representatives, pursuant to this Agreement, whether or not there is concurrent, passive or active negligence on the party of the City or its officers, agents or employees. However, Bureau's duties under this section shall not extend to any claims, losses, damage liability, lawsuits, judgments, costs, fees and expenses arising from the sole negligence, fraud or willful misconduct of the City, its employees, officers, agents or representatives. (a) City Termination. City shall have the right to terminate this Agreement upon thirty (30) days' written notice to Bureau in the event the City Council determines, based upon substantial evidence, that: (i) Bureau has improperly expended funds provided by the City pursuant to this Agreement; or (ii) Bureau has failed to perform the services required of it pursuant to this Agreement. (b) City/Bureau Termination. Either party shall have the right to terminate this Agreement, without cause, by giving the other party three hundred sixty-five (365) days' written notice of its intention to terminate. (c) Automatic Termination. This Agreement shall terminate, without notice to either party, within ninety (90) days after the repeal of, or a final court order invalidating, the Visitor Service Fee Ordinance. 5 1!:•:1•:1 •1 •� The parties agree that Bureau, and its officers, employees and representatives, while engaged in performance of duties required by this Agreement, is an independent contractor, and not an officer, agent or employee of the City. LLQ=" !111.1! Bureau shall not assign this Agreement, or the right to receive any moneys pursuant to this Agreement, or the Visitors Service Fee Ordinance, without the prior written consent of the City. Bureau acknowledges that the unique nature of the services to be provided by the Bureau and nature of the funds disbursed to Bureau by City provide legally adequate justification for any City refusal to consent to an assignment of the rights and/or duties of this Agreement. 13. Notices All notices required to be given by this Agreement shall be in writing and personally served or given by mail. Notice by mail shall be deemed to have been given when deposited in the United States mail, certified and postage prepaid, and addressed to the party to be served as follows: TO CITY: City of Newport Beach Attn.: City Manager's Office 3300 Newport Boulevard P.O. Box 1736 Newport Beach, Ca 92659-1768 TO BUREAU: Newport Beach Conference & Visitor's Bureau Attn: President/ CEO 3300 West Coast Highway Newport Beach, Ca 92663 6 This document represents the entire Agreement between the City and Bureau and supersedes all prior negotiations, representations or agreements, either oral or in writing. This Agreement may be amended only by a written instrument signed by the City and the Bureau. In Witness whereof, the Parties are deemed to have executed this Agreement effective on the day and year first written above. Conferenos and Visitors Bureau: Title City of Newport Beach Ap ve a o form: By Title m City Attorney catlpatWisitorys.doc 1 7 EXECUTIVE SUMMARY 1997/1998 Marketing Plan Newport Beach Conference and Visitors Bureau BUREAU MISSION To gain and retain clients, thereby contributing to the economic fabric of the community, through the solicitation of conferences, tour groups, and related group business; and to engage in visitor promotions that generate overnight stays and increase visitorsspend. BUREAU'S OVERALL PROGRAM OBJECTIVES • To develop a comprehensive sales and marketing program that prospects, nurtures, encourages, and invites organizations and individuals to visit Newport Beach, thereby serving as an umbrella sales and marketing organization for the destination. • To work with the diverse segments of the hospitality and travel industry, coordinating their resources in support of bidding for meetings of various sizes. • To assist organizations and corporations with the coordination of their meetings while in the city, providing them with support services that draw on the resources of the bureau's members and the community. • To provide an array of services to tour planners, both domestic and international, in developing tour itineraries and coordinating other resources within the community that will attract group business to Newport Beach. • To provide leadership to the industry and to the community on behalf of hospitality and travel, urging coordinated and cooperative marketing programs. CONVENTION SALES ACTION PLAN (abbreviated) GOALS AND STRATEGIES • Increase conference sales and lead development • Focus sales efforts on targeted market areas • Generate 84 convention bookings and 246 sales leads • Conduct 12 site inspections, and 3 familiarization trips • Attend selected trade shows (state, regional, national), prospecting for new clients • Produce collateral publications to support sales efforts, including meeting planner friendly website • Conduct direct-mail campaigns with selected meeting planner markets for prospecting of new clients • Continually augment database for prospecting of new clients • Develop a cooperative advertising program to supplement other sales efforts among meeting planners and the trade • Support all sales and marketing efforts with an effective public relations campaign • Develop and maintain a comprehensive conference servicing program. TOURISM SALES ACTION PLAN (abbreviated) GOALS AND STRATEGIES International Markets • Solicit international visitors to Newport Beach bu ensuring inclusion in 7 new tour programs • Develop relationships with key tour operators from selected upscale markets, making 120 sales calls • Explore the development of a public transportation program to encourage International visits to the Newport Beach area • Produce 6 group tour bookings and 17 sales leads • Develop group tour itineraries • Attend selected trade shows for developing group sales prospects • Conduct direct-mail solicitations, including the use of developed collateral materials • Endeavor to put Newport Beach destination in front of key decision makers on an ongoing basis, hosting 18 site inspections • Link Newport Beach Conference and Visitors Bureau homepage to all conceivable partners to broaden base of exposure on the worldwide web. Leisure Visitor Market • Market Newport Beach as a viable visitor destination • Develop an advertising/public relations campaign to "spread the word" • Respond to visitor inquiries for information on things to see and do in a timely fashion • Publish a "Visitors Guide" • Conduct research into consumer buying behaviors for/toward Newport Beach • Continue to update the Website MEMBERSHIP ACTION PLAN (abbreviated) GOALS AND STRATEGIES • Increase membership by 66 to reach a total of 208 members, with an annual income of $55,000 • Target a retention rate of 83% • Present programs for membership development, i.e. customer focus groups and educational seminars • Establish membership committee to guide the program • Publish quarterly newsletter • Host the Annual Dinner and Holiday Open House • Distribute monthly report on Bureau activities • Produce semi-annual membership services directory PUBLIC RELATIONS • Continue a public relations program on behalf of Newport Beach • Update media kit to include stories, fact sheets, slides and photographs • Distribute media kits to gelect travel/business/food and wine writers. • Identify media contacts and compile media mailing lists • Identify editorial calendars and work with select media • Publish a quarterly newsletter that is sent to media, meeting planners, tour operators and consumers • Develop a monthly press release program • Conduct faro tours for media writers Revised July 11, 1997 NEWPORT E(- \CH CONFERENCE AND VI FORS BUFtEAU 1997/1998 BUDGET Line Item/Chart of Accounts Budget 96/97 Year End 96197 Budget 97/98 REVENUE Hotel TOT/400 907,500 981,386 1,155,290 Membership/402 45,000 54,920 50,000 Merchandise/406 1,0001 622 1,000 Publication Sales/426 01 1101 0 TOTAL (REVENUE) $953,500 $1,037,038 $1,206,290 TOTAL (EXPENSES) $953,000 $954,616 r $1,206,290 Page 1 7/10/97 NEWPORT B ',CH CONFERENCE AND VI ORS BUREAU 1997/1998 BUDGET Line Item/Chart of Accounts Budget 96/97 Year End 96/97 Budget 97/98 PERSONNEL EXPENSES Salaries/225 350,750 * * 332,933 * 396,800 Personnel/Temp. Services/505 0 8,245 2,000 Personnel/Payroll Taxes/230 27,565 29,307 33,810 Personnel Benefits/508 34,501 * * 26,394 38,496 Workers Comp./510 2,0731 1,605 2,100 TOTAL PERSONNEL 7F $414,889 $398,484 $473,206 OPERATIONS Rent/522 50,326 52,177 54,632 Legal/Account./526 14.195 11,995 13,110 Bank Charges/527 580 .5841 670 Comp. Consult./528 15,900 11,2631 9,580 Repair/Maint./530 1,500 4711 1,500 Maint. Contracts/532 2,460 5,194 5.640 Office Supplies/534 8,000 9,535 9,994 Insurance/536 3,3301 2.872 3,330 Mtg./Events/Local/538 5,5151 4,152 6,155 Eauipment/540 1,550 5,128 5,780 Equipment Lease/542 12,119 9.664 10,879 Miscellaneous/548 500 0 500 Outside Services/554 1,812 2.446 2,472 Taxes/Licenses/556 7651 7281 835 Depreciation T5001 9,5021 8,600 TOTAL OPERATIONS $126,052 $125,711 $133,677 Additional staff person. " Result of staff turnover. Page 2 7/10/97 NEWPORT L \CH CONFERENCE AND VIS-'" O0R* BUREAU 1997/1998 BUDGET Line Item/Chart of Accounts Budget 96/97 Year End 96/97 Budget 97/98 MARKETING Travel/Entert./602 7,032 5,848 8,088 Trade Shows/604 66,748 70,092 64,216 Publications/606 10,100 1,034 * 35.220 Visitors Guide/607 23,000 -10,316 18,000 Printing/608 7,752 12,314 9,768 Advertise-Mtgs./610 70,000 123,952 110,000 Advertise-Consumer/611 30,000 14,440 74,288 Advertise-Tourism/612 40,000 38,933 41,321 Fam/Site Tours/614 7,000 7,954 18,000 Sales Blitz/615 15,000 10,168 13,000 Newsletter/616 8,380 6.910 9,000 Compt. Database/618 2,000 1,995 10,500 Telemarketing/620 15,000 16,536 18,000 Post/Dir. Mail/622 39,382 45,060 51,504 Media/Photo/PR/624 36,500 25,082 35,000 Community Relat/626 * * 2.000 38,939 50,000 Prof. Memb/Subs/628 7,515 6,710 7,555 Research/630 3,000 1,327 3,000 Education/Training/631 12,275 5,840 10.837 Gen. Marketing/632 1,000 250 1,000 Spec. Promotions/634 8,375 7,353 11,110 TOTAL MARKETING $412,059 $430,421 $599,407 TOTAL EXPENSES $953,000 $954,616 $1,206,290 *" 96-97 Dollars budgeted in advertising. Moved to community relations for 97/98. " Production of new brochure. Page 3 7/10/97