CITY OF SIMI VALLEY MEMORANDUM

Transcription

1 CITY OF SIMI VALLEY MEMORANDUM AGENDA ITEM NO. 5A June 9, 2014 TO: FROM: City Council Office of the City Manager SUBJECT: A PUBLIC HEARING TO RECEIVE PROTESTS FROM SIMI VALLEY LODGING BUSINESSES REGARDING THE FORMATION OF A TOURISM MARKETING DISTRICT, AND CONSIDERATION OF ADOPTION OF A RESOLUTION TO FORM THE SIMI VALLEY TOURISM MARKETING DISTRICT STAFF RECOMMENDATION It is recommended the City Council: 1. Conduct a public hearing and adopt a Resolution (Attachment A, page 9) declaring the results of a majority protest proceeding and establishing the Simi Valley Tourism Marketing District. 2. Designate a City representative to the Simi Valley Tourism Alliance. CITY MANAGER S RECOMMENDATION The City Council has expressed a goal to be more proactive in various economic development efforts. One approach is to assist the lodging industry in providing for a more unified marketing approach of Simi Valley and the benefits of visiting and staying in Simi Valley. The revenue source to increase marketing would be a TBID which has been petitioned for by members of the lodging industry. These funds would be used to market the area and be used to support the administration of the marketing of the area and specifically increasing lodging occupancy in Simi Valley. BACKGROUND AND OVERVIEW Over the past several years, outside forces have impacted the ability of cities and chambers of commerce to fund various activities related to increasing tourism. A growing trend to support local business and increase community tourism is the formation of tourism improvement or marketing districts (District). A District raises revenue through an additional charge on room nights at lodging locations within a defined area with all proceeds to be spent to increase business to those

2 2 assessing the additional charge. The City Council has taken several actions to date regarding the formation of a District. Tonight s public hearing is for the City Council to receive protests from Simi Valley Lodging Businesses and to take final action to create the Simi Valley Tourism Marketing District (SVTMD). FINDINGS AND ALTERNATIVES Background of Districts Throughout California, over eighty municipalities have formed Districts in order to provide a stable funding source for tourism marketing. In 1994, the California Legislature passed the Property and Business Improvement District Law of 1994 (1994 State Law). This law allows for the creation of special benefit assessment districts to raise funds within a specific geographical area with the purpose of providing information and promoting activities that benefit real property or business within the district. One method to raise funds is by the assessment of an additional charge, either a percentage of the room rate or a flat amount, on all room nights at hotels and motels located within the boundary of the district. All funds raised within the district are returned to a private, non-profit corporation charged with governing the district. Funds generated through the assessment must be used for activities and programs that benefit the assessed businesses, i.e. by increasing room night sales. The sales and marketing of the District will have a central theme of promoting the community as a desirable place for lodging. Some of the typical activities of a District include, but are not limited to: Internet marketing to increase awareness and optimize internet presence for lodging businesses; Advertisements on television, radio, magazines, and newspapers; Attendance at trade shows and professional industry conferences; Sales promotions; Familiarization tours; Use of collateral material such as brochures, flyers, and maps; Lead generation activities to attract tourism and group events; Education of hospitality staff at lodging businesses to create positive visitor experiences; and Education of management at lodging businesses on marketing strategies. The driving force to form a District is normally through a request from the businesses that will be subject to the assessment, in this case, the lodging businesses. However, as only cities and counties are allowed to form such Districts, requests for the formation of a District are made to the local legislative body. The legislative body then follows the process dictated by the 1994 State law to form a District. Locally, the cities of Oxnard, Camarillo, and Ventura jointly formed a District, named Ventura County West, in 2011 and have assessed a charge of 1.5% of the gross short

3 3 term (less than 31 days) room rental rate at all hotels, motels, RV parks, and inns located within the District boundary (which is defined as the City limits of the three cities). Additionally, the cities of Thousand Oaks and Agoura Hills jointly formed a District in 2013 which assesses a $1.00 assessment per gross room rental. Other nearby jurisdictions that have formed Districts include Santa Clarita (2% of gross room rate), Burbank (1% of gross room rate), Anaheim (2% of gross room rate), Lancaster (2% of gross room rate), Pasadena (2.89% of gross room rate), Torrance (1% of gross room rate), Santa Monica ($ $4.25 per occupied room per night), Irvine (2% of gross room rate), Newport Beach (2% of gross room rate), Long Beach (3% of gross room rate), West Hollywood (3% of gross room rate), and Los Angeles (1.5% of gross room rate). The Simi Valley Chamber of Commerce previously received input from several lodging businesses regarding the formation of a District in Simi Valley. Subsequently, City representatives and the Chamber of Commerce engaged in discussions regarding the formation of a District. Creating a District in Simi Valley would establish a revenue stream to fund activities that will increase room nights at the six lodging locations (Best Western Posada Royale; Grand Vista; Courtyard By Marriott; Holiday Inn Express; Motel 6; and Extended Stay America) in the community. While the main focus of a District tends to be the increase in tourism lodging (general vacation/visitation, youth/sports tournaments, family visits), the Chamber of Commerce and its lodging members are also cognizant of the amount of room nights created by business travelers. Another growth area noted by Simi Valley lodging businesses is the wedding and special occasion market. Additionally, the Ronald Reagan Presidential Library and Museum in addition to tourism, and the recently approved Hummingbird Nest project, provide for opportunities to bring conference, business retreat, and convention travel to the Simi Valley community. Successfully marketing Simi Valley as a venue for these and other activities will generate additional room nights at Simi Valley lodging businesses. A successful SVTMD would likely translate to increased revenue to the City through an increase in Transient Occupancy Tax. Additionally, increasing room nights has a secondary effect wherein restaurants, auto rental businesses, fuel stations, photographers and event planners, and general retail businesses can see an increase in business. These transactions at local businesses would also generate additional sales tax revenue to the City. A District can be an economic driver, as indicated in a 2012 study at San Francisco State University, which found that for every $1.00 spent by a tourism marketing district $5.50 in new revenue was generated to the municipality forming the District.

4 4 Proposed Simi Valley Tourism Marketing District As required by the 1994 State Law, all Districts must have a Management District Plan (MDP) which acts as the governing document for the District. The MDP details the reasons for the District, the boundary of the District, governance of the District, and a proposed budget. As the boundary of the proposed District would be the Simi Valley city limits, any lodging business that opens after the formation of the District would be subject to the District. The 1994 State Law provides that a District is operated through an owners association. As proposed in the MDP submitted by Simi Valley Lodging Businesses (Attachment B, page 14), the Chamber of Commerce will act as the owners association of the District. To carry out the activities and programs of the District, the Chamber of Commerce will form a new standing advisory committee to be known as the Simi Valley Tourism Alliance (SVTA). The SVTA will be responsible for developing and approving marketing, promotional activities, and the program budget for the District and the Chamber of Commerce will be responsible for the implementation of the SVTA s budget and activities. The SVTA is comprised of the following: 1. Five Simi Valley hotel representatives with a maximum of one representative from each hotel. 2. One representative from the City of Simi Valley designated by the City Council. 3. One Simi Valley Chamber of Commerce representative designated by the Simi Valley Chamber of Commerce Board of Directors. 4. Two at large representatives selected by the SVTA. Preference shall be given to hotel representatives. As noted above, the City will have representation on the SVTA. If the formation of the SVTMD is approved, the City Council may select a City Council Member to serve on the SVTA or appoint the City Manager or his designee as the appointee to the SVTA. The 1994 State Law considers the owners association a legislative body and is therefore subject to the Ralph M. Brown Act and the California Public Records Act. As such, all activities and meetings of the Chamber of Commerce Board of Directors, as it relates to the SVTMD activities, and activities and meetings of the SVTA, must be in compliance with the Brown Act. Additionally, the 1994 State Law requires the Chamber of Commerce to provide an annual report to the City Council at the end of each year of operation of the SVTMD. The following are the key provisions of the SVTMD as provided for in the MDP: Assessment of 2% of gross short term room rental revenue for all rooms at lodging businesses in Simi Valley. Funds will be used for marketing and sales promotions to increase room nights and to market Simi Valley lodging businesses. District will be in place for five years (July 1, 2014 June 20, 2019).

5 5 City shall collect the assessment from the lodging businesses and transfer the funds to the Simi Valley Chamber of Commerce, who will serve as the owners association of the lodging businesses. The City shall receive 1% of the total collections as reimbursement for City services. The District shall be known as the Simi Valley Tourism Marketing District. Based on the reported room revenue by the Simi Valley lodging businesses, it is anticipated that the SVTMD will generate $230,000 annually. The MDP proposes a first year annual budget as follows: Sales, Marketing & Operations (76%) $174,800 Administration (20%) $46,000 Contingency/Renewal Account (3%) $6,900 City Collection Fee (1%) $2,300 TOTAL $230,000 The City will collect the assessment from the lodging businesses at the same time that the City collects the Transient Occupancy Tax from the businesses. As part of the District and noted above, the City receives 1% of the District collections to offset its administrative costs. The City would forward the assessment collected, less 1%, to the Chamber of Commerce for programs and activities of the SVTMD. City Council Actions to Form the SVTMD On September 30, 2013, the City Council considered a request from the Chamber of Commerce to initiate the process to form a District in Simi Valley. The Chamber also requested the City partner with the Chamber in funding 50% of the consultant costs. At the conclusion of the City Council s discussion, the Council approved a $9,000 contribution to partner with the Chamber of Commerce and authorized staff to initiate the process to form a District. On March 12, 2014, the Chamber of Commerce submitted to the City petitions (Attachment C, page 49) from five of the six of Simi Valley lodging businesses totaling 83% of the lodging businesses (Extended Stay America elected not to submit a petition requesting the formation of a District). These petitions request the City Council to initiate special assessment proceedings to form a District in accordance with the 1994 State Law. On March 31, 2014, the City Council accepted the signed petitions from Simi Valley Lodging Businesses and adopted a Resolution of Intention which declared the City s intent to establish the Simi Valley Tourism Marketing District. On May 5, 2014, the City Council conducted a public meeting to receive comments from the public regarding the formation of the Simi Valley Tourism Marketing District. At this meeting, no action was required of the City Council. At this public meeting, six persons

6 6 submitted Speaker Cards, but did not wish to speak, in favor of the formation of the SVTMD and four persons spoke in favor of its formation. The final step in the formation of the SVTMD is a public hearing to receive protests regarding its formation. At this public hearing, lodging businesses may protest the formation of the SVTMD and if more than 50% of the lodging businesses protest the District s formation, the formation cannot move forward. If less than 50% of the lodging businesses protest, then the City Council may move forward and adopt a resolution which forms the District. In accordance with State Law, because only lodging businesses are being assessed, only protests from lodging businesses are valid protests in the formation of a District. Provided less than 50% of Simi Valley Lodging Businesses protest, staff recommends the City Council adopt the attached resolution (Attachment A, page 9) approving the formation of the SVTMD. Should the City Council move forward with creation of the SVTMD, it would go into effect on July 1, Based on the City s collection of the Transient Occupancy Tax from the lodging businesses, funds would not flow to the SVTMD until the second quarter of Staff recommends the City Council conduct the public hearing and receive protests from Simi Valley Lodging Businesses. In the event that less than 50% of the Simi Valley Lodging Businesses protest the formation of the SVTMD, staff recommends the City Council adopt the attached resolution establishing the Simi Valley Tourism Marketing District. The following alternatives are available to the City Council: 1. Conduct a public hearing and adopt a Resolution (Attachment A, page 9) declaring the results of a majority protest proceeding and establishing the Simi Valley Tourism Marketing District; 2. Appoint a City Council Member or the City Manager or his designee as the City s representative on the Simi Valley Tourism Alliance; 3. Elect not to proceed with the District process at this time; 4. Provide staff with further direction. Staff recommends Alternative Nos. 1 and 2. SUMMARY A growing trend to support local business and increase community tourism is the formation of tourism improvement districts (District). A District raises revenue through an assessment on room nights at lodging locations within a defined area with all proceeds to be spent to increase business to those assessing the additional charge.

7 7 The City Council has taken several actions toward the formation of the Simi Valley Tourism Marketing District. The final step in the formation of the SVTMD is a public hearing to receive protests regarding its formation. If less than 50% of the lodging businesses protest, then the City Council may move forward and adopt a resolution which forms the District. In accordance with State Law, because only lodging businesses are being assessed, only protests from lodging businesses are valid protests in the formation of a District. Provided less than 50% of Simi Valley Lodging Businesses protest, staff recommends the City Council adopt the attached resolution approving the formation of the SVTMD. Brian P. Gabler, Director of Economic Development/Assistant City Manager INDEX Page Public Hearing Procedure... 8 Attachment A Resolution of Intention to Form a District... 9 Attachment B Draft Management District Plan Attachment C Petitions from Lodging Businesses... 49

8 8 PUBLIC HEARING PROCEDURE HEARING DATE: June 9, MAYOR: This is the time and place set for a public hearing for declaring the results of majority protest proceedings and establishing the Simi Valley Tourism Marketing District 2. STAFF: (Report) May we have an oral report on this matter by staff? 3. ANY COUNCIL MEMBER : (Questions of staff and staff response) 4. MAYOR: Is there anyone in the City Council Chamber wishing to be heard on this matter? 5. AUDIENCE: (Comments) 6. MAYOR: The hearing is closed. Are there any comments or questions from members of the City Council? 7. ANY COUNCIL MEMBER : (Comments) 8. MAYOR: The Chair will now entertain a motion. 9. MAYOR: May I have a reading of the resolution? 10. ANY COUNCIL MEMBER : City Council Actions (by motion of any Council Member)*: 11. ANY COUNCIL MEMBER : Second 12. MAYOR: (Call for vote) 13. MAYOR: Proceed to the next item. 1) Adopt, modify, or not adopt Resolution No declaring the results of majority protest proceedings and establishing the Simi Valley Tourism Marketing District (requires a second and a vote; requires reading of resolution). * Any action to refer the matter back to staff or to continue the matter requires a second and a vote.

9 9 ATTACHMENT A RESOLUTION NO A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SIMI VALLEY DECLARING RESULTS OF MAJORITY PROTEST PROCEEDINGS AND ESTABLISHING THE SIMI VALLEY TOURISM MARKETING DISTRICT WHEREAS, the Property and Business Improvement District Law of 1994 (Streets and Highways Code et. seq.) authorizes cities and counties to establish property and business improvement districts upon petition by a weighted majority of the lodging business owners located within the boundaries of the district; and WHEREAS, lodging business owners who will pay more than fifty percent (50%) of the proposed assessment, as weighted according to the amount of the assessment to be paid by the petitioner, within the boundaries of the Simi Valley Tourism Marketing District (SVTMD) have petitioned the City Council to Establish the SVTMD; and WHEREAS, included with the petitions was a Management District Plan summary that describes the proposed assessment to be levied on lodging businesses within the SVTMD to pay for sales promotion and marketing activities, and other improvements and activities set forth in the Management District Plan; and WHEREAS, the assessed lodging businesses within the SVTMD will receive a specific benefit from the activities and improvements set forth in the Management District Plan; and WHEREAS, on March 31, 2014 at 6:30 p.m. at 2929 Tapo Canyon Rd, Simi Valley, CA 93063, the City Council adopted a Resolution of Intention, Resolution No ; and WHEREAS, the public meeting and public hearing to consider the establishment of the SVTMD have been properly noticed in accordance with Streets and Highways Code 36623; and WHEREAS, on May 5, 2014 at 6:30 p.m. at 2929 Tapo Canyon Rd, Simi Valley, CA 93063, the City Council held a public meeting regarding the establishment of the SVTMD, and the City Council heard and received objections and protests, if any, to the establishment of the SVTMD and the levy of the proposed assessment; and WHEREAS, on June 9, 2014 at 6:30 p.m. at 2929 Tapo Canyon Rd, Simi Valley, CA 93063, the City Council held a public hearing regarding the establishment of the SVTMD, and the City Council heard and received all objections and protests, if any, to the establishment of the SVTMD and the levy of the proposed assessment; and

10 10 RES. NO WHEREAS, the City Clerk has determined that there was no majority protest. A majority protest is defined as written protests received from owners of businesses in the proposed district which would pay fifty percent (50%) or more of the assessments proposed to be levied. Protests are weighted based on the assessment proposed to be levied on each lodging business. WHEREAS, the City Council finds and determines that it desires to approve the Simi Valley Tourism Marketing District. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SIMI VALLEY DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The recitals set forth herein are adopted by the City Council as findings and they are true and correct. SECTION 2. The Simi Valley Valley Tourism Marketing District is hereby established for a five year term beginning on July 1, 2014 and ending June 30, SECTION 3. The assessments levied for the SVTMD shall be applied towards sales, promotions and marketing programs to market Simi Valley lodging businesses as tourist, meeting, and event destinations, and other improvements and activities as set forth in the Management District Plan. SECTION 4. The revenue from the levy of the assessments on lodging businesses within the SVTMD may not be used to provide for activities or improvements outside the SVTMD or for any purpose other than those specified herein, in the Management District Plan, and in the Resolution of Intention. SECTION 5. The activities to be provided to benefit businesses in the SVTMD will be funded by the levy of the assessment. The revenue from the assessment levy shall not be used: to provide activities that directly benefit businesses outside the SVTMD; to provide activities or improvements outside the SVTMD; or for any purpose other than the purposes specified in this Resolution, the Resolution of Intention, and the Management District Plan. SECTION 6. The activities funded by the assessment will provide a specific benefit to assessed businesses within the SVTMD that is not provided to those not paying the assessment. SECTION 7. The assessment is a charge imposed for a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of conferring the benefit or granting the privilege.

11 11 RES. NO SECTION 8. The assessment is a charge imposed for a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product. SECTION 9. Assessments imposed pursuant to the SVTMD are levied solely upon the assessed business, and the business owner is solely responsible for payment of the assessment when due. If the owner chooses to collect any portion of the assessment, up to and not to exceed the rate applicable to the business, from a customer, that portion shall be specifically called out and identified for the customer in any and all communications from the business owner as the SVTMD Assessment. SECTION 10. Assessments levied on lodging businesses pursuant to this resolution shall be levied on the basis of benefit. Because the services provided are intended to increase room rentals, an assessment based on room rentals is the best measure of benefit. SECTION 11. The amount of assessment, if passed on to each transient, shall be separately stated from the amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for payment from the business. SECTION 12. The assessments for the entire SVTMD will total approximately $230,000 in year one. SECTION 13. The activities and improvements set forth will be funded by the levy of an assessment on lodging businesses within the SVTMD as described in the Management District Plan that is on file with the City Clerk. SECTION 14. Bonds will not be issued to fund the SVTMD. SECTION 15. The boundary of the SVTMD shall be the City of Simi Valley as shown on the attached map, incorporated herein and attached hereto as Exhibit A. SECTION 16. The assessments shall be used for the purposes set forth above and any funds remaining at the end of any year may be used in subsequent years in which the SVTMD assessment is levied as long as they are used consistent with the requirements set forth herein. SECTION 17. The assessments to fund the activities and improvements for the SVTMD will be collected at the same time and in the same manner as are transient occupancy taxes, and in accordance with Streets and Highways Code SECTION 18. The Simi Valley Valley Chamber of Commerce shall be the Owners Association pursuant to Streets and Highways Code

12 12 RES. NO SECTION 19. The Simi Valley Valley Chamber of Commerce, pursuant to Streets and Highways Code 36650, shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvement and activities described in the report. The first report shall be due after the first year of operation of the SVTMD. SECTION 20. The SVTMD established pursuant to this resolution will be subject to any amendments to the Property and Business Improvement District Law of 1994 (California Streets and Highways Code et. seq.). SECTION 21. The City Clerk, or his or her designee, is directed to take all necessary actions to complete the establishment of the SVTMD and to levy the assessments. SECTION 22. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the Office of the City Clerk. Attest: PASSED and ADOPTED this 9 th day of June Ky Spangler, Assistant City Clerk Robert O. Huber, Mayor of the City of Simi Valley, California Approved as to Form: Approved as to Content: Sonia A. Hehir, Acting City Attorney Eric J. Levitt, City Manager Brian P. Gabler, Director of Economic Development/Assistant City Manager

13 13 RES. NO Exhibit A District Map

14 ATTACHMENT B SIMI VALLEY Prepared for the Simi Valley Chamber of Commerce By Lorena Parker (818) ProBIDConsulting@gmail.com [DRAFT MANAGEMENT DISTRICT PLAN] Prepared pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section et. seq

15 15 SIMI VALLEY TOURISM MARKETING DISTRICT MANAGEMENT DISTRICT PLAN TABLE OF CONTENTS TABLE OF CONTENTS... 1 I. OVERVIEW... 1 II. PURPOSE... 3 III. BACKGROUND... 4 IV. BOUNDARY... 6 V. SERVICE PLAN AND BUDGET... 7 Assessment... 7 Delinquencies... 7 Determination of Specific Benefit and Government Service... 8 Time and Manner for Collecting Assessments... 9 Service Plan Budget Summary... 9 Annual Service Plan... 9 Adjustments Expiration VI. GOVERNANCE A. Owners Association Brown Act and California Public Records Act Compliance Annual Report... 13

16 16 APPENDIX 1 PBID LAW APPENDIX 2 ASSESSED BUSINESSES Prepared by Lorena Parker 4024 Radford Avenue, Editorial Building Two, Room A Studio City, CA ProBIDConsulting@gmail.com (818)

17 17 I. OVERVIEW Developed by local lodging businesses, the Simi Valley Tourism Marketing District (SVTMD) is a benefit assessment district proposed to help fund marketing and sales promotion efforts which provide a specific benefit to assessed Simi Valley lodging businesses. This approach has been used successfully in other destination areas throughout the country to drive additional room night sales at assessed businesses via increased tourism. Location: The exterior boundaries of the proposed SVTMD are the boundaries of the City of Simi Valley ( the City ). The proposed SVTMD includes all lodging businesses located within the boundaries of the City. Services: Marketing and sales promotions that provide a specific benefit directly to assessed businesses by improving room night sales. Programs are designed to provide a specific benefit by directly marketing assessed Simi Valley lodging businesses as tourist, meeting and event destinations. Budget: The total SVTMD annual budget for each year of its five-year operation is anticipated to be approximately $230,000. Assessment: The annual assessment rate to be levied on each lodging business within the proposed SVTMD is two percent (2%) of gross short term (stays less than 31 days) room rental revenue. Lodging businesses include all lodging businesses within the boundaries of the SVTMD who are also subject to paying transient occupancy tax to the City of Simi Valley. The objective of the SVTMD marketing programs will not be to attract long-term visitors. Therefore, assessments will not be collected on stays of more than thirty (30) consecutive days, nor stays pursuant to contracts executed prior to July, Formation: The City of Simi Valley will act as the lead jurisdiction in forming the SVTMD. The Simi Valley City Council ( City Council ) may initiate proceedings to form the SVTMD upon the submission of a written petition signed by business owners (or their authorized representatives) who will pay more than 50% of the total annual assessment. If the City Council proposes to levy an assessment in proposed district, 1 1BI. Overview

18 18 the City Council must hold a noticed meeting and a subsequent public hearing at which each business that would be subject to the assessment may submit a written protest. The business owners will receive notice of the meeting and public hearing by mail. If written protests are received from the owners or authorized representatives of businesses in the SVTMD that will pay 50% or more of the assessment to be levied, the City Council may not take any further proceedings to levy the proposed assessment against such businesses for a period of one year from the date of the finding of the majority protest. The City Council may form the district within the territorial jurisdiction of another city with the consent of the city council of such other city. Duration: The proposed SVTMD will have a five-year life. The SVTMD assessment will be implemented beginning July 1, 2014 through June 30, Once per year beginning on the anniversary of the formation of the district there is a 30-day period in which owners paying more than 50% of the assessment may petition the City Council to terminate the SVTMD. Collection: The City will collect the assessment from each lodging business at the same time and in the same manner as they collect transient occupancy taxes. Operation: The Simi Valley Chamber of Commerce ( the Chamber ) will serve as the owners association and be responsible for implementing programs. The Chamber will carefully manage programs to ensure that the specific benefit of room night sales is provided directly and only to assessed businesses. 2 1BI. Overview

19 19 II. PURPOSE There are several reasons why the Simi Valley lodging businesses desire to form a Tourism Marketing District (TMD): 1. The Need to Increase Occupancy The formation of the SVTMD is a proactive effort to provide services that specially and specifically benefit assessed lodging businesses. The funding will ensure that adequate financing exists for the investment required to increase occupancy. 2. Stable Funding for Tourism Promotion The SVTMD will provide a stable source of funding for consistent tourism promotion efforts. The SVTMD will provide funding for tourism promotion free of the political and economic circumstances that can reduce or eliminate government funding for tourism promotion. 3. The Need to Remain Competitive In recent years, the lodging industry has become more competitive. In order to ensure that Simi Valley will remain a competitive tourism market, the assessed lodging businesses must implement marketing programs designed to attract overnight visitors with the TMD funding. The investment will cover a new marketing and promotional budget needed to reach its market segment. 3 2BII. Purpose

20 20 III. BACKGROUND Cities throughout California have been creating Tourism Marketing Districts (TMDs) since The first TMD was formed in West Hollywood, California in Since then, over eighty California destinations have followed suit. In recent years, other states have begun adopting the California model Washington, Montana, and Texas have adopted TMD laws. Several other states are in the process of adopting their own legislation. And, some cities, like Portland, Oregon, have utilized their charter powers to create TMDs without a state law. Collectively, California s TMDs raise approximately $150 million for local destination marketing. The tourism market is an important industry. It has become increasingly necessary to implement marketing programs to stay competitive. With competitors raising their budgets, and increasing rivalry for visitor dollars, it is important that the Simi Valley lodging businesses continue their investment in stable, lodging-specific marketing programs. TMDs utilize the efficiencies of private sector operation in the market-based promotion of tourism districts. TMDs allow lodging business owners to organize their efforts to increase room night sales. Lodging business owners within the TMD pay an assessment and those funds are used to provide services that increase room night sales. In California, TMDs are formed pursuant to the Property and Improvement District Law of This law allows for the creation of a special benefit assessment district to raise funds within a specific geographic area. The key difference between TMDs and other special benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the district. 4 3BIII. Background

21 21 There are many benefits to Tourism Marketing Districts: Funds must be spent on services and improvements that provide a specific and special benefit only to those who pay; Funds cannot be diverted to general government programs; They are customized to fit the needs of each tourism district; They allow for a wide range of services, including those listed above; They are designed, created and governed by those who will pay the assessment; and They provide a stable funding source for tourism promotion. 5 3BIII. Background

22 22 IV. BOUNDARY The SVTMD will include all lodging businesses, existing and in the future, available for public occupancy within the boundaries of the city limits of Simi Valley. Lodging businesses include all lodging businesses within the boundaries of the SVTMD who are also subject to paying transient occupancy tax to the City of Simi Valley. The boundary currently includes six (6) lodging businesses. Please see the Simi Valley map below. A complete listing of lodging businesses within the proposed SVTMD can be found on Appendix 2 of this Plan. 6 4BIV. Boundary

23 23 V. SERVICE PLAN AND BUDGET ASSESSMENT The assessment rate is two percent (2%) of gross short term (stays less than 31 days) room rental revenue per night on lodging businesses, which is based on the estimated benefit to the businesses to be assessed. SVTMD program objectives will not be to attract long-term visitors. Therefore, assessments will not be collected on stays of more than thirty (30) consecutive days, nor stays pursuant to contracts executed prior to July 1, Bonds. State Law allows for the issuance of bonds to finance long-term projects. As part of this TMD, bonds will not be issued. The amount of assessment, if passed on to each transient, shall be separately stated from the amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for payment from the business. The assessment shall be identified as TMD assessment on guest documentation. DELINQUENCIES 1) Original delinquencies. Any business who shall fail to remit the assessment within the time required shall pay a penalty of ten (10%) percent of the assessment in addition to the amount of the assessment. 2) Continued delinquencies. Any business who shall fail to remit any delinquent remittance on or before thirty (30) days following the date on which the remittance first became delinquent shall pay a penalty in the amount of ten (10%) percent of the assessment in addition to the amount of the assessment and the ten (10%) percent penalty first imposed. 3) Fraud. For the fraudulent nonpayment of any remittance, a penalty in the amount of twenty-five (25%) percent of the amount of the assessment shall be imposed in addition to the penalties set forth in subsections (1) and (2) of this section. 4) Interest. In addition to the penalties imposed, any business who shall fail to remit any assessment imposed by the provisions of this Plan shall pay interest at the rate of onehalf (½) of one percent per month on the amount of the assessment, exclusive of penalties, from the date on which the remittance first became delinquent. 7 5BV. Service Plan and Budget

24 24 5) Penalties and interest merged with assessment. Every penalty imposed, and such interest as accrues, pursuant to the provisions of this section shall merge and become a part of the assessment required to be paid by the provisions of this Plan. DETERMINATION OF SPECIFIC BENEFIT AND GOVERNMENT SERVICE State law requires that assessment funds be expended on a specific benefit or service conferred directly to the payors that is not provided to those not charged, and that the assessment does not exceed the reasonable cost to the City of conferring the benefit or service. A specific benefit is not excluded from classification as a specific benefit merely because an indirect benefit to a nonpayor occurs incidentally and without cost to the payor as a consequence of providing the specific benefit to the payor. Further, the assessment may be utilized to provide a specific government service directly to the payors that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service. District services will be implemented carefully to ensure the charge imposed does not exceed the reasonable cost to the city of conferring the specific benefit described herein. Funds will be managed by the Chamber, and reports submitted on an annual basis to the City of Simi Valley. The amount of the assessment is no more than necessary to cover the reasonable costs of the proposed activities, and the manner in which the costs are allocated to each business bears a fair share relationship to the businesses benefits received from the proposed activities. The services discussed in this Management District Plan are designed to provide a direct benefit to assessed businesses by increasing overnight room sales. These promotional services are not tailored to serve the general public, but rather to serve the specific lodging businesses within the District by increasing room night revenue. The specific benefit the district will provide directly to assessed lodging businesses, and will not provide to non-assessed lodging businesses, is room night sales. In order to provide a specific benefit and government service only to payors, the marketing and promotions services provided with the district funds will be designed specifically to drive room night sales to assessed lodging businesses. Only assessed lodging businesses will be featured in marketing materials, receive sales leads generated from district-funded activities, be featured in advertising campaigns, and receive a direct specific benefit from other district-funded services. Non-assessed lodging businesses will not receive these, or any other district-funded services. 8 5BV. Service Plan and Budget

25 25 TIME AND MANNER FOR COLLECTING ASSESSMENTS The SVTMD assessment will be implemented beginning July 1, 2014 and will continue for five years through June 30, The City will be responsible for collecting the assessment on a quarterly basis (including any delinquencies, penalties and interest) from each lodging business located in its respective jurisdiction. The City shall take all reasonable efforts to collect the assessments from each lodging business. The City shall forward the assessments to the Chamber, which will have the responsibility of managing TMD programs as provided in this Management District Plan. SERVICE PLAN BUDGET SUMMARY A summary of the annual service plan budget for the SVTMD is provided on the following pages. The total five year improvement and service plan budget is projected at approximately $230,000 annually, or $1,150,000 through ANNUAL SERVICE PLAN Assessment funds will be spent to provide specific benefits conferred or privileges granted directly to the payors that are not provided to those not charged. The privileges and services provided with District funds are sales and marketing programs available only to assessed businesses. The Chamber shall form a new standing advisory committee, to be known as the Simi Valley Tourism Alliance (SVTA). The SVTA shall be responsible for approving the TMD marketing budget and programs. The Chamber shall be responsible for administering and implementing the TMD programs. A service plan budget has been developed and approved by the committee to deliver services to all assessed lodging businesses. Please see the budget exhibit on the following page. An annual service plan and budget will be developed and approved by the SVTA within the guidelines of this Plan. The annual service plan shall be filed with the City of Simi Valley as part of the Annual Report required by Streets and Highways Code section BV. Service Plan and Budget

26 26 Simi Valley Tourism Marketing District Budget Category Percent of Budget Dollar Amount Sales, Marketing and Operations 76% $174, Administration 20% $46, Contingency/Renewal 3% $6, City Collection Costs 1% $2, Total Annual Budget 100% $230, Sales, Marketing and Operations A sales and marketing program will promote the assessed lodging business in the Simi Valley as tourist, event, and meeting destinations. The sales and marketing program will have a central theme of promoting Simi Valley as a desirable place for lodging. All program elements will be provided directly to and focused entirely on assessed businesses, and may include the following activities: Internet marketing efforts to increase awareness and optimize internet presence for assessed businesses; Print ads in magazines and newspapers targeted at potential visitors and featuring assessed businesses; Television ads targeted at potential visitors and featuring assessed businesses; Radio ads targeted at potential visitors and featuring assessed businesses; 10 5BV. Service Plan and Budget

27 27 Attendance of trade shows to drive room night sales to assessed businesses; Sales blitzes for assessed businesses; Familiarization tours featuring assessed businesses; Preparation and production of collateral promotional materials such as brochures, flyers and maps featuring and utilized by assessed businesses; Attendance of professional industry conferences and affiliation events to promote and serve assessed businesses; Lead generation activities designed to attract tourists and group events to assessed lodging businesses; TMD District Administrator will plan and operate tourism promotion efforts for assessed lodging businesses; Education of hospitality staff at assessed lodging businesses on service and safety (related to alcohol and food) designed to create a visitor experience that will bring repeat visits; and Education of management at assessed lodging businesses and the owners association on marketing strategies best suited to meet those businesses needs. Administration and Operations The administrative and operations portion of the budget shall be utilized for administrative staffing costs, legal costs related to formation or operation of the district, accounting fees, office costs, and other general administrative costs. City Administration Fee The City of Simi Valley shall be paid a fee equal to no more than 1% of the amount of assessment collected in its respective jurisdiction to cover their costs of collection and administration. Contingency/Renewal A prudent portion of the budget will be set aside in a contingency fund, to be used for unforeseeable costs in carrying out the sales and marketing programs. If at the expiration of the SVTMD there are contingency funds remaining, and business owners wish to renew the SVTMD, the remaining contingency funds may be used for renewal costs. 11 5BV. Service Plan and Budget

28 28 ADJUSTMENTS The Simi Valley TMD expense plan shall remain consistent with the budget herein. Although actual revenues will fluctuate due to market conditions, the proportional allocations of the budget shall remain the same. The Chamber shall form a new standing advisory committee, to be known as the Simi Valley Tourism Alliance (SVTA). The Simi Valley Tourism Alliance shall have the authority to adjust budget allocations between the categories by no more than fifteen percent (15%) per year. EXPIRATION If there are funds remaining at the end of the SVTMD term and SVTMD businesses choose to renew, these remaining funds shall be transferred to the renewed District. If there are funds remaining at the end of the SVTMD and lodging businesses choose not to renew, any remaining funds will be spent consistent with this Plan or returned to assessed businesses in equal proportions to the assessment paid by each business. 12 5BV. Service Plan and Budget

29 29 VI. GOVERNANCE A. OWNERS ASSOCIATION The City Council, through adoption of this Management District Plan, has the right, pursuant to Streets and Highways Code 36651, to identify the body that shall implement the proposed program, which shall be the owners association of the SVTMD as defined in Streets and Highways Code The City Council has identified the Simi Valley Chamber of Commerce as the body that will serve as the Owner s Association for the SVTMD. The Chamber shall form a new standing advisory committee, to be known as the Simi Valley Tourism Alliance (SVTA). The SVTA shall be responsible for approving the TMD marketing budget and programs. The Chamber shall be responsible for administering and implementing the TMD programs. The majority of SVTA members must be hotel representatives. The Simi Valley Tourism Alliance shall be comprised of the following members: Five (5) Simi Valley hotels representatives, with a maximum of 1 representative from each hotel. One (1) City of Simi Valley representative, designated by the City Council One (1) Simi Valley Chamber of Commerce representative, designated by the Chamber Board of Directors Two (2) At-large representatives, appointed by the SVTA. Preference shall be given to hotel representatives. BROWN ACT AND CALIFORNIA PUBLIC RECORDS ACT COMPLIANCE The owner s association is subject to government regulations relating to transparency, namely the Ralph M. Brown Act and the California Public Records Act, designed to promote public accountability. The owners association of a TMD is considered a legislative body under the Ralph M. Brown Act (Government Code et seq.). Thus, meetings of the Chamber board and committees, to the extent they discuss and consider SVTMD business, must be held in compliance with the public notice and other requirements of the Brown Act. The Owner s Association is also subject to the record keeping requirements of the California Public Records Act. ANNUAL REPORT The Chamber board shall present an annual report at the end of each year of operation to the City Council pursuant to Streets and Highways Code (see Appendix 1). 13 6BVI. Governance

30 30 APPENDIX 1 PBID LAW Citation of part Property and Business Improvement District Law of 1994 *** This document is current through the 2012 Supplement *** (All 2011 legislation) This part shall be known and may be cited as the "Property and Business Improvement District Law of 1994." Legislative findings and declarations The Legislature finds and declares all of the following: (a) Businesses located and operating within the business districts of this state's communities are economically disadvantaged, are underutilized, and are unable to attract customers due to inadequate facilities, services, and activities in the business districts. (b) It is in the public interest to promote the economic revitalization and physical maintenance of the business districts of its city in order to create jobs, attract new businesses, and prevent the erosion of the business districts. (c) It is of particular local benefit to allow city to fund business related improvements, maintenance, and activities through the levy of assessments upon the businesses or real property that benefits from those improvements. (d) Assessments levied for the purpose of providing improvements and promoting activities that benefit real property or businesses are not taxes for the general benefit of a city, but are assessments for the improvements and activities which confer special benefits upon the real property or businesses for which the improvements and activities are provided. 14 7BAppendix 1 PBID LAW

31 Purpose of part The purpose of this part is to supplement previously enacted provisions of law that authorize city to levy assessments within a business improvement area. This part does not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes Preemption of authority or charter city to adopt ordinances levying assessments Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different method of levying assessments for similar or additional purposes from those set forth in this part. A property and business improvement district created pursuant to this part is expressly exempt from the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)) Part prevails over conflicting provisions Any provision in this part that conflicts with any other provision of law shall prevail over the other provision of law Severability This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. Assessments levied under this part are not special taxes [Section repealed 2001.] "Assessment" "Assessment" means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and promoting activities which will benefit the properties or businesses located within a property and business improvement district "Business" "Business" means all types of businesses and includes financial institutions and professions. 15 7BAppendix 1 PBID LAW

32 "City" "City" means a city, county, city and county, or an agency or entity created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the public member agencies of which includes only city, counties, or a city and county, or the State of California "City council" "City council" means the city council of a city or the board of supervisors of a county, or the agency, commission, or board created pursuant to a joint powers agreement and which is a city within the meaning of this part 'Improvement" "Improvement" means the acquisition, construction, installation, or maintenance of any tangible property with an estimated useful life of five years or more including, but not limited to, the following: (a) Parking facilities. (b) Benches, booths, kiosks, display cases, pedestrian shelters and signs. (c) Trash receptacles and public restrooms. (d) Lighting and heating facilities. (e) Decorations. (f) Parks. (g) Fountains. (h) Planting areas. (i) Closing, opening, widening, or narrowing of existing streets. (j) Facilities or equipment, or both, to enhance security of persons and property within the area. (k) Ramps, sidewalks, plazas, and pedestrian malls. (l) Rehabilitation or removal of existing structures. 16 7BAppendix 1 PBID LAW

33 "Property and business improvement district"; "District" "Property and business improvement district," or "district," means a property and business improvement district established pursuant to this part "Property" "Property" means real property situated within a district "Activities" "Activities" means, but is not limited to, all of the following: (a) Promotion of public events which benefit businesses or real property in the district. (b) Furnishing of music in any public place within the district. (c) Promotion of tourism within the district. (d) Marketing and economic development, including retail retention and recruitment. (e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services supplemental to those normally provided by the municipality. (f) Activities which benefit businesses and real property located in the district "Management district plan"; "Plan" "Management district plan" or "plan" means a proposal as defined in Section BAppendix 1 PBID LAW

34 "Owners' association" "Owners' association" means a private nonprofit entity that is under contract with a city to administer or implement activities and improvements specified in the management district plan. An owners' association may be an existing nonprofit entity or a newly formed nonprofit entity. An owners' association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. Notwithstanding this section, an owners' association shall comply with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), at all times when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code), for all documents relating to activities of the district "Property owner"; "Business owner"; "Owner" "Property owner" means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of land by the city council. "Business owner" means any person recognized by the city as the owner of the business. "Owner" means either a business owner or a property owner. The city council has no obligation to obtain other information as to the ownership of land or businesses, and its determination of ownership shall be final and conclusive for the purposes of this part. Wherever this part requires the signature of the property owner, the signature of the authorized agent of the property owner shall be sufficient. Wherever this part requires the signature of the business owner, the signature of the authorized agent of the business owner shall be sufficient "Tenant" "Tenant" means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner. 18 7BAppendix 1 PBID LAW

35 Alternate method of financing certain improvements and activities; Effect on other provisions This part provides an alternative method of financing certain improvements and activities. The provisions of this part shall not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. Every improvement area established pursuant to the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500) of this division) is valid and effective and is unaffected by this part Establishment of property and business improvement district A property and business improvement district may be established as provided in this chapter Requirement of consent of city council A county may not form a district within the territorial jurisdiction of a city without the consent of the city council of that city. A city may not form a district within the unincorporated territory of a county without the consent of the board of supervisors of that county. A city may not form a district within the territorial jurisdiction of another city without the consent of the city council of the other city Initiation of proceedings; Petition of property or business owners in proposed district (a) Upon the submission of a written petition, signed by the property or business owners in the proposed district who will pay more than 50 percent of the assessments proposed to be levied, the city council may initiate proceedings to form a district by the adoption of a resolution expressing its intention to form a district. The amount of assessment attributable to property or a business owned by the same property or business owner that is in excess of 40 percent of the amount of all assessments proposed to be levied, shall not be included in determining whether the petition is signed by property or business owners who will pay more than 50 percent of the total amount of assessments proposed to be levied. (b) The petition of property or business owners required under subdivision (a) shall include a summary of the management district plan. That summary shall include all of the following: (1) A map showing the boundaries of the district. 19 7BAppendix 1 PBID LAW

36 36 (2) Information specifying where the complete management district plan can be obtained. (3) Information specifying that the complete management district plan shall be furnished upon request. (c) The resolution of intention described in subdivision (a) shall contain all of the following: (1) A brief description of the proposed activities and improvements, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property or businesses within the district, a statement as to whether bonds will be issued, and a description of the exterior boundaries of the proposed district. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements and activities and the location and extent of the proposed district. (2) A time and place for a public hearing on the establishment of the property and business improvement district and the levy of assessments, which shall be consistent with the requirements of Section Contents of management district plan The management district plan shall contain all of the following: (a) If the assessment will be levied on property, a map of the district in sufficient detail to locate each parcel of property and, if businesses are to be assessed, each business within the district. If the assessment will be levied on businesses, a map that identifies the district boundaries in sufficient detail to allow a business owner to reasonably determine whether a business is located within the district boundaries. If the assessment will be levied on property and businesses, a map of the district in sufficient detail to locate each parcel of property and to allow a business owner to reasonably determine whether a business is located within the district boundaries. (b) The name of the proposed district. (c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for establishment or extension in a manner sufficient to identify the affected lands and businesses included. The boundaries of a proposed property assessment district shall not overlap with the boundaries of another existing property assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created pursuant 20 7BAppendix 1 PBID LAW

37 37 to this part to overlap with other assessment districts established pursuant to other provisions of law, including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500)). This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with another business assessment district created pursuant to this part. This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with a property assessment district created pursuant to this part. (d) The improvements and activities proposed for each year of operation of the district and the maximum cost thereof. (e) The total annual amount proposed to be expended for improvements, maintenance and operations, and debt service in each year of operation of the district. (f) The proposed source or sources of financing, including the proposed method and basis of levying the assessment in sufficient detail to allow each property or business owner to calculate the amount of the assessment to be levied against his or her property or business. The plan also shall state whether bonds will be issued to finance improvements. (g) The time and manner of collecting the assessments. (h) The specific number of years in which assessments will be levied. In a new district, the maximum number of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years. Notwithstanding these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy assessments until the maximum maturity of the bonds. The management district plan may set forth specific increases in assessments for each year of operation of the district. (i) The proposed time for implementation and completion of the management district plan. (j) Any proposed rules and regulations to be applicable to the district. (k) A list of the properties or businesses to be assessed, including the assessor's parcel numbers for properties to be assessed, and a statement of the method or methods by which the expenses of a district will be imposed upon benefited real property or businesses, in proportion to the benefit received by the property or business, to defray the cost thereof, including operation and maintenance. The plan may provide that all or any class or category of real property which is exempt by law from real property taxation may nevertheless be included within the boundaries of the district but shall not be subject to assessment on real property. 21 7BAppendix 1 PBID LAW

38 38 (l) Any other item or matter required to be incorporated therein by the city council Procedure to levy assessment (a) If a city council proposes to levy a new or increased property assessment, the notice and protest and hearing procedure shall comply with Section of the Government Code. (b) If a city council proposes to levy a new or increased business assessment, the notice and protest and hearing procedure shall comply with Section of the Government Code, except that notice shall be mailed to the owners of the businesses proposed to be assessed. A protest may be made orally or in writing by any interested person. Every written protest shall be filed with the clerk at or before the time fixed for the public hearing. The city council may waive any irregularity in the form or content of any written protest. A written protest may be withdrawn in writing at any time before the conclusion of the public hearing. Each written protest shall contain a description of the business in which the person subscribing the protest is interested sufficient to identify the business and, if a person subscribing is not shown on the official records of the city as the owner of the business, the protest shall contain or be accompanied by written evidence that the person subscribing is the owner of the business or the authorized representative. A written protest that does not comply with this section shall not be counted in determining a majority protest. If written protests are received from the owners or authorized representatives of businesses in the proposed district that will pay 50 percent or more of the assessments proposed to be levied and protests are not withdrawn so as to reduce the protests to less than 50 percent, no further proceedings to levy the proposed assessment against such businesses, as contained in the resolution of intention, shall be taken for a period of one year from the date of the finding of a majority protest by the city council Changes to proposed assessments At the conclusion of the public hearing to establish the district, the city council may adopt, revise, change, reduce, or modify the proposed assessment or the type or types of improvements and activities to be funded with the revenues from the assessments. Proposed assessments may only be revised by reducing any or all of them. At the public hearing, the city council may only make changes in, to, or from the boundaries of the proposed property and business improvement district that will exclude territory that will not benefit from the proposed improvements or activities. Any modifications, revisions, reductions, or changes to the proposed assessment district shall be reflected in the notice and map recorded pursuant to Section BAppendix 1 PBID LAW

39 Resolution of formation (a) If the city council, following the public hearing, decides to establish the proposed property and business improvement district, the city council shall adopt a resolution of formation that shall contain all of the following: (1) A brief description of the proposed activities and improvements, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property, businesses, or both within the district, a statement about whether bonds will be issued, and a description of the exterior boundaries of the proposed district. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements and activities and the location and extent of the proposed district. (2) The number, date of adoption, and title of the resolution of intention. (3) The time and place where the public hearing was held concerning the establishment of the district. (4) A determination regarding any protests received. The city shall not establish the district or levy assessments if a majority protest was received. (5) A statement that the properties, businesses, or properties and businesses in the district established by the resolution shall be subject to any amendments to this part. (6) A statement that the improvements and activities to be provided in the district will be funded by the levy of the assessments. The revenue from the levy of assessments within a district shall not be used to provide improvements or activities outside the district or for any purpose other than the purposes specified in the resolution of intention, as modified by the city council at the hearing concerning establishment of the district. (7) A finding that the property or businesses within the area of the property and business improvement district will be benefited by the improvements and activities funded by the assessments proposed to be levied. (b) The adoption of the resolution of formation and, if required, recordation of the notice and map pursuant to Section shall constitute the levy of an assessment in each of the fiscal years referred to in the management district plan. 23 7BAppendix 1 PBID LAW

40 Resolution establishing district If the city council, following the public hearing, desires to establish the proposed property and business improvement district, and the city council has not made changes pursuant to Section 36624, or has made changes that do not substantially change the proposed assessment, the city council shall adopt a resolution establishing the district. The resolution shall contain all of the information specified in paragraphs (1) to (8), inclusive, of subdivision (b) of Section 36625, but need not contain information about the preliminary resolution if none has been adopted [Section repealed 1999.] [Section repealed 1999.] [Section repealed 1999.] Notice and assessment diagram Following adoption of the resolution establishing district assessments on properties pursuant to Section or Section 36626, the clerk of the city shall record a notice and an assessment diagram pursuant to Section No other provision of Division 4.5 (commencing with Section 3100) applies to an assessment district created pursuant to this part Establishment of separate benefit zones within district; Categories of businesses The city council may establish one or more separate benefit zones within the district based upon the degree of benefit derived from the improvements or activities to be provided within the benefit zone and may impose a different assessment within each benefit zone. If the assessment is to be levied on businesses, the city council may also define categories of businesses based upon the degree of benefit that each will derive from the improvements or activities to be provided within the district and may impose a different assessment or rate of assessment on each category of business, or on each category of business within each zone Assessments on businesses or property owners The city council may levy assessments on businesses or on property owners, or a combination of the two, pursuant to this part. The city council shall structure the assessments 24 7BAppendix 1 PBID LAW

41 41 in whatever manner it determines corresponds with the distribution of benefits from the proposed improvements and activities Provisions and procedures applicable to benefit zones and business categories All provisions of this part applicable to the establishment, modification, or disestablishment of a property and business improvement district apply to the establishment, modification, or disestablishment of benefit zones or categories of business. The city council shall, to establish, modify, or disestablish a benefit zone or category of business, follow the procedure to establish, modify, or disestablish a parking and business improvement area Expiration of district; Creation of new district If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section 36622, a new management district plan may be created and a new district established pursuant to this part Time and manner of collection of assessments; Delinquent payments The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by the city council in the resolution levying the assessment. Assessments levied on real property may be collected at the same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part shall be charged interest and penalties Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion of residential and agricultural property (a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated benefit to the real property within the property and business improvement district. The city council may classify properties for purposes of determining the benefit to property of the improvements and activities provided pursuant to this part. (b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit to the businesses within the property and business improvement district. The city council may classify businesses for purposes of determining the benefit to the businesses of the improvements and activities provided pursuant to this part. 25 7BAppendix 1 PBID LAW

42 42 (c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively presumed not to benefit from the improvements and service funded through these assessments, and shall not be subject to any assessment pursuant to this part Time for contesting validity of assessment The validity of an assessment levied under this part shall not be contested in any action or proceeding unless the action or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section Any appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry of judgment Service contracts authorized to establish levels of city services The city council may execute baseline service contracts that would establish levels of city services that would continue after a property and business improvement district has been formed Request to modify management district plan The owners' association may, at any time, request that the city council modify the management district plan. Any modification of the management district plan shall be made pursuant to this chapter Modification of plan by resolution after public hearing; Adoption of resolution of intention; Modification of improvements and activities by adoption of resolution after public hearing (a) Upon the written request of the owners' association, the city council may modify the management district plan after conducting one public hearing on the proposed modifications. The city council may modify the improvements and activities to be funded with the revenue derived from the levy of the assessments by adopting a resolution determining to make the modifications after holding a public hearing on the proposed modifications. If the modification includes the levy of a new or increased assessment, the city council shall comply with Section Notice of all other public meetings and public hearings pursuant to this section shall comply with both of the following: (1) The resolution of intention shall be published in a newspaper of general circulation in the city once at least seven days before the public meeting. 26 7BAppendix 1 PBID LAW

43 43 (2) A complete copy of the resolution of intention shall be mailed by first class mail, at least 10 days before the public meeting, to each business owner or property owner affected by the proposed modification. (b) The city council shall adopt a resolution of intention which states the proposed modification prior to the public hearing required by this section. The public hearing shall be held not more than 90 days after the adoption of the resolution of intention Reflection of modification in notices recorded and maps Any subsequent modification of the resolution shall be reflected in subsequent notices and maps recorded pursuant to Division 4.5 (commencing with Section 3100), in a manner consistent with the provisions of Section Bonds authorized; Procedure; Restriction on reduction or termination of assessments (a) The city council may, by resolution, determine and declare that bonds shall be issued to finance the estimated cost of some or all of the proposed improvements described in the resolution of formation adopted pursuant to Section 36625, if the resolution of formation adopted pursuant to that section provides for the issuance of bonds, under the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500)) or in conjunction with Marks Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). Either act, as the case may be, shall govern the proceedings relating to the issuance of bonds, although proceedings under the Bond Act of 1915 may be modified by the city council as necessary to accommodate assessments levied upon business pursuant to this part. (b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of those improvements, specify the number of annual installments and the fiscal years during which they are to be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated to be raised from assessments over 30 years. (c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with the timely retirement of the debt. 27 7BAppendix 1 PBID LAW

44 [Section repealed 2001.] [Section repealed 2001.] [Section repealed 2001.] Report by owners' association; Approval or modification by city council (a) The owners' association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements and activities described in the report. The owners' association's first report shall be due after the first year of operation of the district. The report may propose changes, including, but not limited to, the boundaries of the property and business improvement district or any benefit zones within the district, the basis and method of levying the assessments, and any changes in the classification of property, including any categories of business, if a classification is used. (b) The report shall be filed with the clerk and shall refer to the property and business improvement district by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information: (1) Any proposed changes in the boundaries of the property and business improvement district or in any benefit zones or classification of property or businesses within the district. (2) The improvements and activities to be provided for that fiscal year. (3) An estimate of the cost of providing the improvements and the activities for that fiscal year. (4) The method and basis of levying the assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the assessment to be levied against his or her property or business for that fiscal year. (5) The amount of any surplus or deficit revenues to be carried over from a previous fiscal year. (6) The amount of any contributions to be made from sources other than assessments levied pursuant to this part. 28 7BAppendix 1 PBID LAW

45 45 (c) The city council may approve the report as filed by the owners' association or may modify any particular contained in the report and approve it as modified. Any modification shall be made pursuant to Sections and The city council shall not approve a change in the basis and method of levying assessments that would impair an authorized or executed contract to be paid from the revenues derived from the levy of assessments, including any commitment to pay principal and interest on any bonds issued on behalf of the district Designation of owners' association to provide improvements and activities The management district plan may, but is not required to, state that an owners' association will provide the improvements or activities described in the management district plan. If the management district plan designates an owners' association, the city shall contract with the designated nonprofit corporation to provide services Renewal of district; Transfer or refund of remaining revenues; District term limit (a) Any district previously established whose term has expired, may be renewed by following the procedures for establishment as provided in this chapter. (b) Upon renewal, any remaining revenues derived from the levy of assessments, or any revenues derived from the sale of assets acquired with the revenues, shall be transferred to the renewed district. If the renewed district includes additional parcels or businesses not included in the prior district, the remaining revenues shall be spent to benefit only the parcels or businesses in the prior district. If the renewed district does not include parcels or businesses included in the prior district, the remaining revenues attributable to these parcels shall be refunded to the owners of these parcels or businesses. (c) Upon renewal, a district shall have a term not to exceed 10 years, or, if the district is authorized to issue bonds, until the maximum maturity of those bonds. There is no requirement that the boundaries, assessments, improvements, or activities of a renewed district be the same as the original or prior district Circumstances permitting disestablishment of district; Procedure (a) Any district established or extended pursuant to the provisions of this part, where there is no indebtedness, outstanding and unpaid, incurred to accomplish any of the purposes of the 29 7BAppendix 1 PBID LAW

46 46 district, may be disestablished by resolution by the city council in either of the following circumstances: (1) If the city council finds there has been misappropriation of funds, malfeasance, or a violation of law in connection with the management of the district, it shall notice a hearing on disestablishment. (2) During the operation of the district, there shall be a 30 day period each year in which assessees may request disestablishment of the district. The first such period shall begin one year after the date of establishment of the district and shall continue for 30 days. The next such 30 day period shall begin two years after the date of the establishment of the district. Each successive year of operation of the district shall have such a 30 day period. Upon the written petition of the owners or authorized representatives of real property or the owners or authorized representatives of businesses in the area who pay 50 percent or more of the assessments levied, the city council shall pass a resolution of intention to disestablish the district. The city council shall notice a hearing on disestablishment. (b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing required by this section. The resolution shall state the reason for the disestablishment, shall state the time and place of the public hearing, and shall contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district. The notice of the hearing on disestablishment required by this section shall be given by mail to the property owner of each parcel or to the owner of each business subject to assessment in the district, as appropriate. The city shall conduct the public hearing not less than 30 days after mailing the notice to the property or business owners. The public hearing shall be held not more than 60 days after the adoption of the resolution of intention Refund of remaining revenues upon disestablishment of district; Calculation of refund; Use of outstanding revenue collected after disestablishment of district (a) Upon the disestablishment of a district, any remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property or businesses then located and operating within the district in which assessments were levied by applying the same method and basis that was used to calculate the assessments levied in the fiscal year in which the district is disestablished. All 30 7BAppendix 1 PBID LAW

47 47 outstanding assessment revenue collected after disestablishment shall be spent on improvements and activities specified in the management district plan. (b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the amount of any refund. 31 8BAppendix 2 Assessed Businesses

48 48 APPENDIX 2 ASSESSED BUSINESSES Grand Vista Hotel 999 Enchanted Way Simi Valley, CA (805) Holiday Inn Express 2550 Erringer Road Simi Valley, CA (805) Best Western Plus Posada Royale Hotel & Suites 1775 Madera Road Simi Valley, CA (805) Courtyard by Marriott 191 Cochran St. Simi Valley, CA (805) Extended Stay America 2498 Stearns St. Simi Valley, CA (805) Motel North Erringer Road Simi Valley, CA BAppendix 2 Assessed Businesses

49 p.3 ATTACHMENT C 49 PETITION TO THE CITY OF SIMI VALLEY TO FORM THE SIMI VALLEY TOURISM MARKETING DISTRICT We petition you to initiate special assessment proceedings to form a Tourism Marketing District in accordance with the Property and Bus iness Improvement District Law of 1994, Streets and Highways Code Section et seq., for the purpose of undertaking and implementing the Tourism Marketing District as described in the attached summary of the Management District Plan attached hereto as Exhibit A. Lodging Establishment Busil1e$s Owner ~/f/~~~ Owner Representative/6wner Name (printed) Title Date A complete copy of the Management District Plan will be furn ished upon request. complete copy of the Management District Plan should be made to: lorena Parker 4()24 Radford Avenue Editoria l Building 2, Room A Studio City, CA ProBIDconsu lting@gmail.com Requests fo r a

50 50 PETITION TO THE CITY OF SIMI VALLEY TO FORM THE SIMI VALLEY TOURISM MARKETING DISTRICT We petiti on you to initiate specia l assessme nt proceedings to form a Touri sm Marketing District in accordance w ith the Property and Business Improvement District Law of 1994, Streets and Highways Code Section et seq., for the purpose of undertaking and implementing the Tourism Marketing District as described in the attached summary of the Management District- Plan attached hereto as Exhibit A. lodging Establishment Business Owner (/) Cwrtyc.f'd hy f1\mw SI'M,' Vallef (j) Idol I day Ill!) Et pq>.~s g,'m; valley {Irotb J/ofeJ S rmt{)'fid by Pac,f.ta Ow ner Representative/Owner Name (printed) Date A complete copy of the Management District Plan will be furnished upon request. complete copy of the Management District Plan should be made to: Requ ests for a Lorena Parker 4024 Radford Ave nu e Editorial Building 2, Room A Studio City, CA ProBIDconsulting@gmail.com

51 51 PETITION TO THE CITY OF SIMI VALLEY TO FORM THE SIMI VALLEY TOURISM MARKETING DISTRICT We petition you to initiate special assessment proceedings to form a Tourism Marketing District in accordance with the Property and Business Improvement District Law of 1994, Streets and Highways Code Section et seq., for the purpose of undertaking and implementing the Tourism Marketing District as described in the attached summary of the Management District Plan attached hereto as Exhibit A. l odging Establis hm ent Bu si ness Owner J- ~l&ls ~~~,"----=-,--.Sle-aCO --=-.::><l~~--"'-'-"-~ (0 y A complete copy of the Management District Plan will be furnished upon request. complete copy of the Management District Plan should be made to: Requests for a Lorena Parker 4024 Radford Avenue Editorial Building 2, Room A Studio City, CA ProBIDconsulting@gmail.com