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    News

    City Mgr. Memo Asks Council To Extend Convention & Visitors Bureau Contract To 2014 & Increase '05 City Hall Payment To CVB By 200k; Doesn't Mention CVB Aquatics Festival Debts

    City Auditor Agendizes But Won't Release His Report On Aquatics Festival Until Monday, One Day Before Council Meeting


    (October 17, 2004) -- LBReport.com posts below the text of a memo from Long Beach City Manager Jerry Miller to Mayor O'Neill and Councilmembers, seeking to extend City's Hall's contract with the LB Convention and Visitors Bureau until 2014...and increase the 2005 amount given to CVB by roughly $200,000 to nearly $4 million.

    City Manager Miller's memo doesn't mention CVB debts related to a 2004 Aquatics Festival. It states in pertinent part:

    "The proposed increase in funding is to capitalize on the incredible marketing and promotional success resulting from the Long Beach Aquatic Festival and the other investments in Long Beach, such as the Pike at Rainbow Harbor and Carnival Cruise Lines, that help make this a desirable destination for conventions and tourists."

    At the same October 19 Council meeting as the City Manager has agendized his proposed extension of the CVB contract, City Auditor Gary Burroughs has agendized a "Report on the Operating Results of the 2004 Long Beach Aquatics Festival." This document was not included in Councilmembers' agenda package (prepared October 14) and as of our October 17 posting is not publicly available.

    Asked by LBReport.com on October 15 for a copy of the report, Auditor Burroughs' office indicated it would not be released until the afternoon of October 18 (the day before the Council meeting). Asked if the report had been given to Councilmembers or the Mayor, Auditor Burroughs' office said that it had not.

    City Manager Miller's memo (text below) asks Councilmembers to act on his request to extend the CVB contract on October 19.

    LB's CVB is privately-run. LBReport.com recently posted the members of its governing board. The City Manager is an ex officio (non-voting) member of the board.

    The CVB currently receives roughly 75% of its annual operating budget from LB City Hall via an allocation of LB's hotel room tax (transient occupancy tax). LB's hotel room tax totals roughly $12-14 million per year...but (under a distant Council action) only half of the hotel room tax reaches LB's General Fund (for police, fire, libraries and other services). The other half is given to other items, with the CVB getting the largest share; smaller sums go to a Rose Parade Float, Grand Prix support and the Redevelopment Agency (from downtown Redevelopment area hotels).

    The memo doesn't say from where the $200,000 increase proposed in FY 05 will be taken ("the City Manager's Office will attempt to absorb this additional expense within existing City appropriations." It's also not specific about how the CVB payment might change during the seven year contract extension.

    "[CVB] activities and budget will be included in the City's performance management efforts and in the program-based budget development. Key outcome measures for contract performance will be established as part of this process," City Manager Miller's memo says.

    A copy of the actual contract amendment text was not immediately available.

    The contract amendment also includes language requiring CVB Boardmembers to file Statements of Economic Interest (financial conflict of interest forms) with City Hall.

    [begin City Manager Miller memo text]

    October 19, 2004

    TO: HONORABLE MAYOR AND CITY COUNCIL

    SUBJECT: Second Amendment to Agreement No. 28164 With the Long Beach Area Convention and Visitors Bureau, Inc. (Citywide)

    DISCUSSION

    On October 1, 2002, the City Council approved a five-year agreement with the Long Beach Area Convention and Visitors Bureau, Inc. (LBACVB) to develop a program to promote the city as a convention and tourist destination (Council letter attached). The LBACVB administers a program to establish the city as a site for conventions and tourism, which advertises and publicizes the city, its natural advantages, resources, attractions, climate, and facilities. This five-year agreement, which runs through September 30, 2007, is amended annually to reflect the level of funding appropriated by the City Council. The agreement with the LBACVB is supported by the Special Advertising and Promotions Fund, which derives its revenue from the Transient Occupancy Tax.

    The City is seeking authorization to enter into the Second Amendment to Agreement No. 28164 with the LBACVB. The total amount of the proposed amendment for Fiscal Year 2005 (FY 05) is $3,930,366, which represents an increase in the amount of $201,366, or 5.4 percent, over the FY 04 agreement amount. This increase reflects the Consumer Price Index increase for the Southern California region over the past two years, and the first proposed increase for the LBACVB since the FY 01 agreement. As in prior years, the agreement includes $1 15,000 for the design and construction of the 2005 Rose Parade Float, and $35,000 to support Grand Prix activities. The proposed amendment will also extend the current five-year term by an additional seven years, through September 30,2014.

    The proposed Second Amendment will include language requiring the LBACVB Board members to file the California Fair Political Practices Commissionís Form 700 Statement of Economic Interest with the City. Additionally, LBACVB activities and budget will be included in the Cityís performance management efforts and in the program-based budget development. Key outcome measures for contract performance will be established as part of this process.

    At the October 19, 2004 City Council meeting, the LBACVB will provide an in-depth presentation outlining some highlights from FY 04, including the Long Beach Aquatic Festival, which brought international attention to Long Beach, and what to look forward to in FY 05. In FY 04, the LBACVB posted an estimated 5.5 percent increase in room night bookings, adding to the over 24 percent increase achieved the previous fiscal year. Building on this success, the City expects another strong year from the Long Beach convention and tourism industry.

    The proposed increase in funding is to capitalize on the incredible marketing and promotional success resulting from the Long Beach Aquatic Festival and the other investments in Long Beach, such as the Pike at Rainbow Harbor and Carnival Cruise Lines, that help make this a desirable destination for conventions and tourists. The City, through the agreement with the LBACVB, needs to continue to invest in this important segment of our economy.

    This matter was reviewed by Senior Deputy City Attorney Donna Gwin and Budget Management Officer David Wodynski on October 13,2004.

    TIMING CONSIDERATIONS

    The proposed amendment makes the funding appropriated for Fiscal Year 2005 available to the LBACVB. Accordingly, action is recommended at the October 19, 2004 City Council meeting.

    FISCAL IMPACT

    The total amount of the agreement for FY 05 is $3,930,366. A total of $3,729,000 is budgeted in the Special Advertising and Promotions Fund (SR 133) in the City Managerís Office (CM). Although the proposed augmentation of $201,366 is not budgeted, the City Managerís Office will attempt to absorb this additional expense within existing City appropriations.

    IT IS RECOMMENDED THAT THE CITY COUNCIL:

    Authorize the City Manager to execute the Second Amendment to Agreement No. 28164 with the Long Beach Area Convention and Visitors Bureau, Inc., in the amount of $3,930,366 for a period of one year and extend the term of the current agreement for an additional seven years.

    Respectfully submitted, .
    GERALD R. MILLER
    CITY MANAGER

    [2002 memo attached follows]

    October 1, 2002

    To: HONORABLE MAYOR AND CIlY COUNCIL

    SUBJECT: Agreement With the Long Beach Area Convention and Visitors Bureau, Inc. (Citywide)

    DISCUSSION

    On September 30, 1997, the City Council determined that a need existed to develop a program to promote the city as a convention and tourist destination. To meet that need, City Council approved an agreement with the Long Beach Area Convention and Visitors Bureau, Inc. (LBACVB). The LBACVB administers a program to establish the city as a site for conventions and tourism, which advertises and publicizes the city, its natural advantages, resources, . attractions, climate, and facilities. The initial five-year agreement was amended annually to allow the City Council to appropriate funds from the Special Advertising and Promotions Fund, which derives its revenue from the Transient Occupancy Tax.

    The City is seeking another five-year agreement with the LBACVB. The total amount of the agreement for Fiscal Year 2003 is $3,729,000, which represents the same level of funding as in Fiscal Year 2002. As in prior years, the agreement includes $1 15,000 for the design and construction of the 2003 Rose Parade Float, and $35,000 for Grand Prix events. Any funding changes to the agreement in subsequent years will be brought to the City Council for approval. The LBACVB will provide a presentation at the City Council meeting on their programs and services.

    This matter was reviewed by Assistant City Attorney Heather A. Mahood on September 26,2002 and Budget Manager Annette Hough on September 25,2002.

    TIMING CONSIDERATIONS

    The proposed agreement makes the funding appropriated for Fiscal Year 2003 available to the LBACVB. Accordingly, action is recommended at the October 1, 2002 City Council meeting.

    FISCAL IMPACT

    The total amount of the agreement for FY 03 is $3,729,000 and is budgeted entirely in the Special Advertising and Promotions Fund (SR) in the City Manager's office (CM). There is no net impact on the General Fund.

    IT IS RECOMMENDED THAT THE CITY COUNCIL: Authorize the City Manager to execute an Agreement with the Long Beach Area Convention and Visitors Bureau, Inc., in the annual amount of $3,729,000 for a period of five years.

    Respectfully submitted,
    HENRY TABOADA
    CITY MANAGER


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