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HomeMy WebLinkAboutresolution.council.031-01 RESOLUTION NO. ~ (Series of 2000) A RESOLUTION OF THE CITY COUNCIL OF ASPEN, COLORADO, APPROVING AN AGREEMENT BETWEEN THE CITY OF ASPEN AND THE ASPEN CHAMBER RESORT ASSOCIATION AND AUTHORIZING THE MAYOR TO EXECUTE THE SAME. WHEREAS, there has been submitted to the City Council a proposed Agreement between the City of Aspen and the Aspen Chamber Resort Association relating to the expenditure of a portion of the receipts of the recently imposed 1.0% visitors benefits tax; and WHEREAS, the City Council desires to approve the proposed Agreement. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO: Section 1 That the Agreement between the City of Aspen and the Aspen Chamber Resort Association appended hereto as Exhibit A is hereby approved and the Mayor is authorized to execute the same on behalf of the City of Aspen. INTRODUCED, READ AND ADOPTED by the City Council of the City of Aspen on theo~7_ day of ~ , 2001. Qhel E. Richar~ 1 I, Kathryn S. Koch, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen, Colorado, at a meeting held on the day hereinabove stated. Kathryn S. K~n} City Clerk JPW~O2/21/2OO1-G: \john\word\resos\acra.doc AGREEMENT CITY OF ASPEN AND ACRA RE: TOURISM PROMOTION FUND THIS AGREEMENT is effective this~_~day of ~by and between the CITY OF ASPEN (the "City"); the ASPEN LODGING ASSOCIATION ("ALA"), and the ASPEN CHAMBER RESORT ASSOCIATION ("ACRA"), RECITALS 1. The City Council has submitted to the voters of the City of Aspen a referred question seeking authority to impose a 1.0% visitor benefits tax upon the rent paid or charged for accommodations in the City of Aspen. 2. The City Council has adopted Ordinance No. 45, Series of 2000, which imposes a 1.0% visitor benefits tax on condition that the voters of the City of Aspen approve the aforementioned ballot question at the November 7, 2000 municipal election. 3. Ordinance No. 45, Series of 2000, requires the City Council to appropriate 50% of all revenues generated by the tax for marketing and promotional efforts for the City's tourism industry. 4. The City desires to contract with an organization capable of performing the marketing and promotional efforts contemplated by said ordinance. 5. The Aspen Chamber Resort Association desires to contract with the City to receive funds appropriated by the City Council for tourism promotion activities and to thereafter perform such tourism promotion activities on behalf of the City of Aspen. 6. The Aspen Lodging Association desires to participate in the planning and delivery of the tourism promotion activities as contemplated by this agreement. AGREEMENT In consideration of the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the parties agree as follows: 1. Intent of the parties. The parties to this Agreement agree that the following sets forth their intent in entering into this agreement and the principals set forth below shall help guide all future interpretations of this Agreement and the parties continuing relationship with respect to the expenditure of tourism promotion funds of the City of Aspen. a. The parties acknowledge that the City shall use funds generated by the visitor benefits tax imposed by Ordinance No. 45, Series of 2000, to meet its financial obligations pursuant to this Agreement. Accordingly, the parties acknowledge that the purpose, limitations, and administrative requirements of such funds as set forth in said ordinance shall apply to this Agreement. b. The parties intend to enter into a continuing relationship for multi-year planning and implementation of tourism promotion activities as set forth herein. However, this agreement shall be for renewable terms of one year to coincide with the City's fiscal year and budgetary planning process. c. The parties acknowledge that the purpose of the 1% visitor benefits tax is to, inter alia, generate sufficient funds to adopt new and innovative methods for planning and delivering tourism promotion activities on behalf of the City of Aspen. Accordingly, the marketing plan and budget contemplated by this Agreement shall be primarily for new strategies and activities not currently funded by the City, ACRA or other third parties. 2. Scope of Services and Marketing Program. a. During the City's annual budget review and adoption procedures, ACRA shall recommend a marketing plan and budget for the City's forthcoming calendar year. Appended hereto as Extfibit A is the marketing plan and budget for fiscal year 2001. b. The marketing plan and budget shall include the following: 1. planning and implementing the advertisement, promotion, and development of tourism in the City of Aspen; 2. tourism advertising, written and graphic materials, and cooperative and matching promotional materials; 3. gathering and disseminating information on the tourist industries and attractions of the City of Aspen; 4. purchasing such equipment, materials, and supplies as shall be necessary, to be used solely for tourist promotion; 5. contracting for those services and materials as may be incidental, necessary, and appropriate to the accomplishment of the purposes of the fund, including but not limited to, administrative, secretarial, clerical, or professional services deemed necessary; 6. attracting conferences, conventions, and meetings of a commercial, cultural, educational, or social nature to the City of Aspen; 7. attracting sporting events and social and cultmal events sponsored by non-profit organizations; 8. defraying administrative and clerical costs of collecting and administering the tax, provided such expenses do not exceed the actual costs of such administrative and clerical costs. c. The marketing services shall be generally for new programs and services, and ACRA shall not defray costs of existing programs, special events and marketing efforts including American Express cooperative marketing funds, airport host program, visitor center support among others with funds from the marketing fund. Marketing funds may be used to enhance or promote existing tourism promotion programs and special events, d. The general nature and content of advertising paid for by the marketing fund shall follow these guidelines: the purpose of advertising and promotion shall be to enhance the year-round economy and public welfare of the City as a whole; advertising and promotional efforts shall avoid undue emphasis upon any particular commercial activity or enterprise that might be construed to create a competitive disadvantage to other similar commercial enterprises; and there shall be no advertising or promotion that is misleading or deceptive and therefure opposed to the public interest or prejudicial to the interests of the City. e. ACRA shall be solely responsible for planning and implementation of specific details of the marketing program and may include the lodging community in such planning. ACRA shall monitor the program and ensure conformance to its budget. At least 70 per cent of the funds are to be expended on program costs, rather than on support or staff. ACRA shall not use fund proceeds for its existing operational costs, for expenses not directly attributable to the purposes of this Agreement, or expenses not identified in its annual marketing plan and budget as approved by the City Council. f. The ACRA and the Aspen Lodging Association shall meet at least annually before September 1 of each calendar year to review a tourism promotion plan and budget for the City's following fiscal year prior to presentation to the City Council. 3. Term. The term of this Agreement shall be from January I, 2001, through December 31, 2001. The term of this Agreement may be extended by mutual agreement of the parties upon the submission by ACRA of the annual marketing plan and budget referenced herein and the approval of the same by the City Council. The City shall notify ACRA by October 1 of each year of its intention to renew the term of this agreement. 4. Reporting and Budgeting. ACRA shall submit a detailed marketing program and expense budget for inclusion in City's budget packets, along with a review of the previous year's program (except for the first year). The City Manager shall provide budget recommendations, including an estimate of prospective tax proceeds, general fund contributions, prior year carry- forward balance, and interest income. The marketing fund shall be eliminated from the City's Grant Panel Review process in that it is its own separate fund. The ACRA is allowed and encouraged to attend and advise the City Council at all such meetings where the marketing program and budget is discussed. The City shall not unreasonably restrict, reallocate, or change the marketing program and budget as submitted by the ACRA. ACRA shall provide annual reports to the City on the fund and expenditures from it. 5. Accounting. The City shall pay over to ACRA the marketing funds raised by the tax on a quarterly basis. ACRA shall be responsible for paying its vendors, suppliei's, subcontractors, staff, and the like. ACRA shall maintain the tax fund receipts in a separate and interest-bearing bank account from its general funds. The City may inspect ACRA's records upon reasonable notice. All marketing funds accrued during the life of this Agreement shall be paid over to ACRA, although ACRA shall account for and refund any funds not expended for the purposes set forth in this Agreement. 6. Equal Access. Any and all businesses within the City shall be permitted equal access and opportunity to participate in cooperative advertising efforts and package promotions specifically related to and supported by the use of the marketing funds referenced in this Agreement, whether or not the business is a member of the ACRA or the Aspen Lodging Association. That is, to the maximum extent possible, ACRA shall make a distinction between member service and other existing programs supported by membership dues, and new programs supported by the City by this Agreement, and as to the latter, not discriminate based on membership in the organizations. 7. Termination. Either party may terminate this agreement upon 90 days written notice prior to the end of the term of the agreement, setting forth the reasons for the termination. Either party may terminate the agreement upon 30 days written notice for cause, setting forth the grounds for such cause. 8. Other Restrictions and Provisions. a. The City shall not unreasonably withhold or redirect funds from the marketing funds raised by the visitor benefits tax that are to be handled by the ACRA. These are intended to be additional funds for marketing, and the intent is that the City will continue its existing funding (for the visitors center, etc.) as a floor, and not lessen those so that the marketing funds from the tax are not absorbed into existing ACRA/City programs. b. The marketing funds shall not be used for city capital projects such as the construction of visitor information centers or other tourist amenities. c. The City Council shall not, without prior consultation with the Aspen Lodging Association and ACRA, change the agent assigned to manage the tourism marketing funds. Nor shall the City change that agent without some sort of cause and explanation, and it shall consult with the Aspen Lodging Association as to any new fund manager. d. ACRA shall not use any of the marketing fund for providing direct reservation services. e. ACRA shall not use fund proceeds to influence the outcome of any election. 9. Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, representatives, successors and assigns and to any person into or with which any party hereto may merge, consolidate, or reorganize. 10. Acknowledgments. The parties declare that they have read and understand the terms of this Agreement, that they have had an opportunity to be represented by counsel with regard to the execution of this Agreement, and that they execute this Agreement voluntarily and without being pressured or influenced by any statement or representation made by any person acting on behalf of any one else. 11. Indemnification. ACRA agrees to indemnify and hold harmless the City, its officers, employees, insurers, from and against all liability, claims and demands on account of injury, loss, or damage, arising out of or in any manner connected with this Agreement, if such injury, loss, or damage is caused in whole or in part, or is claimed to be caused in whole or in part by, the act, omission, error, mistake, negligence, or other fault of ACRA, employee, representative, or agent. ACRA agrees to investigate, handle, respond to, and to provide a defense for and defend against any such liability, claims or demands at the sole expense of ACRA, or at the option of the City, ACRA agrees to pay the City or reimburse the City for the defense costs incurred by the City in connection with, any such liability, claims or demands. If it is determined by the final judgment of a court of competent jurisdiction that such injury, loss, or damage was caused in whole or in part by the act, omission, or other fault of the City, its officers, or its employees, the City shall reimburse ACRA for the portion of the judgment attributable to such act, omission, or other fault of the City, its officers, or employees. If any lawsuit challenges the City's authority to impose the visitor benefits tax, the City shall be primarily responsible for the defense of the suit. 12. No Warranties. Except as expressly set forth in this Agreement, the parties have not made and make no other representations, warranties, statements, promises or agreements to each other. 13. Entire Agreement. The parties agree that this Agreement represents the entire agreement and supersedes all prior agreements between and among them with regard to the subject matter set forth herein, and may not be amended nor may any condition contained herein be waived except by written instrument signed by all parties 14. Notices. Notices hereunder shall be sent to the City Manager and the City Attorney at 130 S. Galena Street, Aspen CO 81611; to ACRA at Aspen Chamber Resort Association, 425 Rio Grande Place, Aspen CO 81611; and to J. Nicholas McGrath, 600 E. Hopkins Ave, Suite 203, Aspen CO 81611. 15. Counterpart Signatures. This document may be executed in counterpart original copies, with the original signatures on separate pages to be collated together on one original form of the agreement. 16. Effective Date. This agreement shall be effective on January 1, 2001, and then only if the visitor benefit tax is approved by the voters in the City of Aspen at the general election in November 2000. Dated: achel Richar~ Clerk f , 2000. ASPEN CHA/IfilBER RESORT ASSOCIATION By Christine Nol[n,"l~resident JPW- 02/08/01 -G:\j ohn\word\agrkaera-visitor-ben-tax.do c EXHIBIT A ASPEN CHAMBER RESORT ASSOCIATION MARKETING ADVISORY COMMITTEE REPORT ON PROGRESS TO DATE AND OUTLINE FOR PLAN OF WORK March 2001 Meetings and structure: The Marketing Advisory Committee (membership list attached) has met four times since the beginning of the year under the auspices of ACRA. The group has heard presentations from Colorado Ski Countryl the state tourism office's public relations firm, the Aspen 'Skiing Company, the Aspen Music Festival and School, and the Aspen Sales Directors Association. At its last meeting, members considered the outline that follows as a plan to proceed. Content and conclusions of presentations: The following points were made about the tourism environment by our various speakers; although this list is not comprehensive, it does include the major observations. At the state level: ~ Colorado tourism has dropped 30percent since 1994. The ski industry is fiat; CO skier visits are down. Competition in tourism promotion spending ts very high (Hawaii, $55 million; Colorado, $6 million.) ~ Tourism officials are trying to re-energize the Colorado brand. P Public relations, advertising and promotions are being used. ~ Demographic targets are baby boomers, older gen-xers, families. ~ Psychographic targets are active travelers seeking an experience- based vacation. ~ Key markets are Dallas, LA, Chicago, Albuquerque/Santa Fe. P For the "mountain traveler, ' Colorado is most desirable location, in both summer and winter. Generally: ~ National travel is up. ~ Vacationers want multi-dimensional experience--lots to choose from, easy to access, and smartly packaged. ~ Family time is important; kids participate in vacation decisions. ~ Beauty of the environment is still a major motivator. ~ Average stay is shrinking; lead booking time is shrinking. ~ Web-based vacation research and bookings are on the rise. Aspen: ~ We have a high return-guest rate, and relatively Iow trial. ~ Ourguest is aging, both in summer and winter. ~ Aspen is considered a mature destination. ~ Competition in the ski industry is intense, including significant development in other communities. ~ Our image is one of exclusivity, expense, inaccessibility. One survey shows satisfaction of the Aspen visitor is high, but value compared to expense and diversity of attractions are average. ~ Word of mouth and personal experience are the strongest motivators in Aspen vacation decisions, both summer and winter. ~ The group,business traveler is important to drive shoulder seasons, trial, and spending levels. ~ The community's collateral, web presence, message and sales efforts appear uncoordinated. ~ The bed base has decreased, but so has occupancy. Luxuryproperties tend to fill first. Emerging themes: Consistent themes emerged from the disparate presentations; this was in itself a large statement, as the individuals presenting had different constituencies and agendas. The committee thought it prudent to capitalize on these recognized consistencies and assign smaller groups to work on them more specifically. Developing trial: We have known for some time that the Aspen Skiing Company has claimed a significant number of return guests among its skiing population. We now know, as of the summer of 2000, return guests also make up the majority of non-ski-season visits to Aspen as well. (In winter, 75 percent of guests have been to Aspen before; in summer, 71 percent.) While we certainly need to devote resources to this important segment--i.e., increasingly personalized customer service, the creation of enhanced recreational and cultural experiences, etc.--the committee agreed on the wisdom of assigning a significant portion of this new marketing fund to reach new audiences. Questions for subcommittee assigned to developing trial: ~ What new audiences are wegoing to try to reach? What characterizes them ? --Middle-aged affluent? -- Young and hip ? --Families? --Recreation and/or culture seekers? --Meetings/conference business? --International? ~ What information do we need as a baseline? What is known or available now, and what do we need to find out about our current visitor demographics / psychographics ? ~ How will we determine success? That is, what is ourgoal and how will we measure incremental improvement? ~ What tools should we begin to think about, i.e., public relations; advertising; trade shows; web sites; direct mail; special events; etc. ~ When is it most effective to go directly to consumers? To selected media? To meeting planners? To influencers/changemakers? ~ What kinds of resources will be required, that is, what will this effort require in terms of time, money, and professional support? Crafting a unified message: This theme surfaced in a number of different ways, including the need to sell the entire destination/vacation experience, and the wisdom of promoting all seasons and activities. Questions for subcommittee assigned to developing a unified message: ~ What are the key elements of this message? What are we trying to say about Aspen? --Affordable? --Glamorous? --Accessible? --Diverse in terms of activities/opportunities for entertainment? --Fun? --Sophisticated? ~ Is there more than one message, depending on the audience, time of year, and promotional vehicle? Is this realistic~do-able? ~ What is the shape/form of this message--theme statement, logo, narrative ? ~ How will we determine success? That is, what is ourgoal and how will we measure incremental ~mprovement? ~ What tools should we begin to think about, i.e., public relations; advertising; trade shows; web sites; direct mail; special events; etc. ~ When is it most effective to go directly to consumers? To selected media? To meeting planners? To influencers/changemakers? ~ What kinds of resources will be required, that is, what will this effort require in terms of time, money, and professional support? Pursuing collaborative relationships: A consistent message will only be effective if it is presented in a consistent manner. The point has been made that the community lacks a clear, focused call to action and information source. On a related note, the committee has also seen how much more powerful its work will be if it builds on existing efforts at both the community and state level. Questions for subcommittee assigned to developing collaborative relationships: ~ Whatpartners must come together in the community to mount the most powerful campaign to increase tourism? ~ What resources are available on the state or national level? ~ What are the strengths and weaknesses of these groups' current initiatives? ~ How will we determine success in achieving greater cooperation and effectiveness? ~ What resources/tools are needed to facilitate this enhanced cooperation ? Analyzing competitive forces: The point was made ar the last committee meeting that the potential Aspen visitor, whoever we determine that to be, is part of a finite, limited audience. What we are actually discussing are ways build market share by taking it away from others. The committee also felt we had a great deal to learn from other successful operations. Thus, a fourth subcommittee was added to look at these factors. P Who is our competition and what characterizes them? ~ What do we know about them? What do we not know? ~ What research do we need to conduct to know more? ~ Why do people make the decision to visit other (similar) destinations ? ~ How do we effectively reach thosepeople with a compelling message about Aspen? ~ Do we want to measure, ultimately, how much market share we have gained and from whom? What tools do we need to employ to do that? Plan of work: Subcommittees were formed to address the questions outlined here and others the committees will pose themselves. At subsequent meetings, after 45 minutes of independent work, the entire committee will re- convene and scribes will present reports. As we progress, staff will attempt to gather necessary information, conduct research, etc. to supply whatever data the subgroups don't have readily available. At such time as the committees have completed this working phase, we would summarize and present the next phase of "emerging themes." At this point, subcommittees might re-form along the lines of more specific promotional tools and strategies (i.e., a media relations group; a web site group; a direct mail group.) Those groups would in turn start to recommend tactics, and begin to outline for the marketing plan exactly where resources would be spent and how the work would best be accomplished. Ultimately~ of course~ staff will formulate the specific plan and bring it back To the Marketing Advisory Committee for its response. The revised goal is to have a plan, and accompanying budget, ready for City Council by June 1.