HomeMy WebLinkAboutresolution.council.100-02 RESOLUTION NO. 1 ~'
(SERIES OF 2002)
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 SAID AGREEMENT
ON BEHALF OF THE CiTY OF ASPENi
WHEREAS, there has been submitted to the City Council an Agreement between the
City of Aspen, Colorado and The Aspen Chamber Resort Association, relating to the expenditure
ora portion of the receipts of the imposed 1.0% visitors benefit tax, a copy of Which is annexed
hereto and part thereof; and
WHEREAS, the City Council desires to approve the proposed Agreement
NOW, THEREFORE, BE IT RESOLVED BY THE CITY CO~CIL OF THE CI;I'Y
OF ASPEN, COLORADO.
Section One
That the City Council of the City of Aspen hereby approves that an Agreement between
the City o£Aspen, Colorado, and The Aspen Chamber Resort Association, regarding the
Tourism Promotion Fund also known as the 1.0% Visitors Benefit Tax, a copy of which is
annexed hereto and incorporated herein, and does hereby authorize the Mayor to execute said
Agreement on behalf of the City of Aspen.
Dated: ~ ~} ,2002.
Hden Kalin'Klana~ema,'4~yor
I, Kathryn Koch, duly appointed and acting City Clerk do certify that the foregmng is a true and
accurate copy of t!i~t resolution adopted by the City Council of the City of Aspen, Colorado, at a
meeting held ~ ~ ,2002.
Kathryn S. Kffcl~, City Clerk
AGREEMENT
CITY OF ASPEN AND ACRA
RE: TOURISM PROMOTION FUND
THIS AGREEMENT is effective this~ day of ((~'4-ff J~-4/- 2002 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 ~mposes a
1.0% visitor benefits tax and the voters of the City of Aspen approvedthe aforementioned ballot
question at the November 7. 2000 mumc~pal 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 ro 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 o£ 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 Exhibit A is the marketing plan and budget for fiscal year
2003.
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 Cultural 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.
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 t° 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 shail 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 therefore 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 1, 2003, through December
31, 2003. 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, suppliers, 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 ACRAJCity 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 Associahon 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 part/es 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.
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, 2003.
Dated:
CITY OF ASPEN, a ~,~,~i, J2~.~oration
Attest:
~ ~ By ~e~~em~, ~yor
Clerk
Dated: ? e>/,~o,/~,~,_ ,2002.
ASPEN CHAMBER RESORT ASSOCIATION
Attest: ~a Pevny, President
Secretary
JPW- I 0/23/2002-G;\j ohn\word~agrXacra-visitor-ben*tax,doc
k/ B A
2003 ASPEN MARKETING PLAN
October 21, 2002
GOALS · Increase lodging occupancy
· Elevate the Aspen brand
OBYECTIVES · Influence lodg~ng revenue using an integrated marketing approach based on a
continuous story based on promoting the Aspen brand
· Increase group sales
· Increase in web traffic and web referrals
· Increase in editorials and advertising equivalency
STRATEGY #1: Public Relations · Public Relations Management / Media Visits (6 months)
· Clipping Service & Media Management (co-op)
· Media & Group Press Kit
· Pitching Trip NY, LA, SF
STRATEGY #2: Advertising · Non-winter media placement for FIT
· Media placement for Group
· Creative Design
· Fulfillment Collateral
STRATEGY #3: E-Marketing · Co-op winter campaign
· Summer campaign
· Search Placement
· Website'design and implementation
STRATEGY g4: Group Sales · Attend trade shows: ASAE; 1TME,
· Follow-up collateral piece
STRATEGY #5: Special Events
· Grant Fund
· Focus on sponsorships
ASPEN CHAMBER R~SORT ASSOCIATION
2003 ACRA Budget Reallocation Items
INCOME: $19,000 increase in estimated co-op dollars from properties
EXPENSE:
Decreased · $10,000.00 Sterling Pice Group
· $25,000.00 Summer Intcrnet Campaign
· $17,400.00 Public Relations Management
· $6,000.00 Pitching Trips for PR and Travel Agents
· $9,500.00 for Affordable Meetings and Destination Colorado Trade Shows
· $10,000.00 Target Interactive Email Campaign
· $5,000.00 for Group Email Campaign
· $5,000.00 for Contract Labor
Increased
$20,000.00 Increase in Special Events Grant Fund
· $24,000.00 for Special Events and Marketing Assistant
· $20,000.00 Increase for Summer Vacation Planner
· $20,000.00 Increase for Summer Print Media Buys
· $11,000.00 Increase for ACRA Website
SPECIAL EVENTS GRANT FUND
The ACRA will allocate $40,000 in the 2003 Aspen Marketing Plan to be administered by the
Special Events Advisory Group (SEAG) in concert with ACRA staff in the form of a venture
capital fund. The purpose and scope of the fund will be to fund destination events as well as
events and activities that will benefit the core business community.
A grant application process will be developed and implemented by SEAG. The grant application
process will require a complete special events plan including production and sponsorship
prospects. SEAG understands that the granting of funds cannot include commitment of ACRA
staff time without the full knowledge and approval of the ACRA CEO and the Board of
Directors.
The ACRA will not produce and manage any new events other than those for which they are
currently funded and have initiated in the 2003 Aspen Marketing Plan. The ACRA will welcome
production and management of new events based on available resources and management fees
based on the scope of work.
EVENT PARNTERSHIPS (SPONSORSHIP ACQUISITION)
The 2003 Aspen Marketing Plan recognizes the need for event partnerships (sponsorships) yet
realizes that until we have a "property" to sell securing sponsorships is difficult. The ACRA has
contracted with IEG, the leader in sponsorship consulting, to conduct a valuation service to assist
us with preparing sponsorship offers.
The ACRA is currently developing a job description for a marketing/special events assistant
position so that the ACRA can re-allocate staff resources to focus on securing sponsorships once
we have identified properties (events) for consideration. It is estimated that initially the value of
reallocated time is approximately $15,000 along with $24,000 for a contract assistant for a total
of $39,000 in staff costs. The commitment of staff time will graduate over time based on the
success of the overall special events program mcreasing the value of staff dedicated to
sponsorships. It is our goal to grow this into a full-time self funding position.
This function will work closely with the SEAG in identifying a sponsorship plan for
events/activities which have been funded by the special event grant process.
SUMMARY
This represents 20% of the 2003 Aspen Marketing Plan excluding event promotion, public
relations and resource overhead. Increases m special events will be based on success metrics
compared to the overall Aspen Marketing Plan. In the event total funds fall below 400K, the fund
allocation will remain at 20% targeted toward Special Events. The priority will be allocation to
staff resources, with the remaining monies to the grant fund.
Special Events Proposal
Revised 10/1612002
THE CASE FOR E-MARKETING
How Important is the Intemet to Tourism Marketing?
The lnternet is the most cost effective, efficient leading edge sales and marketing
tools that will position the Aspen brand in the forefront of our competition. Based
on reach potential and our limited resoumes this marketing strategy has the
greatest ROI potential. The success of our summer e-campaign generating three
times the national response average validates this as an important strategy of the
overall Aspen Marketing Plan.
· 196 million users in the US (70% of US population)
· 580 million users worldwide
· Over 94 million people visited travel websites in January 2002
· 62% of all travelers us the Internet to research and plan their travel;
whether they book online or use the phone
· 32% oft-ravelers book online today
· Travel category is the most highly visited category online.
· Online travel booking is the biggest e-commerce industry today
· $29 billion will be spent by 2003 on trips booked via the web
· The Internet has surpassed all other media conduits as the most popular
source for travel news and information
Web Referrals to SAS (June - August 2002)
· June: 508 referrals: 3 sites in top 30 referring sites
· July: 766 referrals: 7 sites in top 30 referring sites
· August: 729 referrals: 6 sites in top 30 referring sites
SOurCCS:
The Travel Industry Association of America
US Destination Marketing
Wall Street Journal
ASPEN CHAMBER RESORT ASSOCIATION
ACRA - PrototYPe 4 Page 1 of 1
~ R~pen, CO
Temperature: 72°F/22~C 1
Humidity: 3~%
Barometer: 30.27in/lO26mb
~inds: VRR at §mph/Bkph
2003 ASPEN MARKETING BUDGET
INCOME
Lodging Tax Revenue 400,000
Co-op Funds 50,000
TOTAL INCOME $450,000
EXPENSE
Contract Labor
Director of Marketing 45000
Marketing & Event Coordinator 24000
Project Assistant 5000
subtotal 74000
Advertising
Print. Creative. Media Buys 106000
Internet Editorial Content 67500
subtotal 173500
Public Relations
PR Mgmt / Media Visits 25000
Editorial Pictching Trips 6000
Clipping Service / Media Mgmt 2000
Press/Group Kit 10000
subtotal 43000
Website/CRM Design & Implementation 5000
Photography & images 6000
Hosting & Maintenance 2200
subtotal 13200
Group Sales
Trade Shows 16500
Membership 1700
subtotal 18200
Speciat Events
Grant Fund 40000
subtotal 40000
Collateral/Direct Mail Group Follow-Up 9500
Summer Vacation Planner 50000
Multi-Purpose Follow-Up 5000
Pos[age & Distribution 10000
subtotal 74500
Administrative
Accounting & Legal 1500
Committees 1200
Phone, Fax, Copy 2400
Travel & Entertainment 6000
Miscellaneous 2500
subtotal 13600
TOTAL EXPENSE $45~,000
A CRA
revised 10/16/2002
A S P E N oH ,A sM, oR,
WWW.ASPENCHAMBER,ORG
2003 ASPEN MARKETING PLAN METRICS
SUMMARY
Marketing is about creating awareness ultimately leading to purchase. The most accurate
success metric especially during a period of economic slowdown where tourism is hardhit
and vulnerable is the awareness impact for actual dollars spent. Awareness builds the
desire to purchase as travel trends improve. The ACRA approaches management of the
2003 plan as the initial year ora 36 month marketing plan. It is only with year over year
analysis that we will have a true picture of the success of the overall plan.
TOURISM AND ECONOMIC OUTLOOK AND IMPACT
Due to the effects of9/11, uncertain economic outlooks, the loss of personal wealth as
well as the threat of war the mindset of consumers and business travelers has changed
and it won't be business as usual in the future. There's a heightened preference for
domestic travel and trips closer to home, with an emphasis on auto travel versus air. The
2003 Aspen Marketing Plan has the agility to address changing behavior patterns and
trends. Overall we will be measuring local trends versus state and national tourism
statistics to determine our competitive position.
CALL TO ACTION AND MEASUREMENT ASSUMPTIONS
Stay Aspen Snowmass (SAS) is the designated call to action for tactics and specific
promotions of the marketing plan. SAS represents approximately 7% of all lodging
dollars booked. ACRA will work closely with SAS to develop accurate tracking
mechanisms for SAS and useful multiplier effects for the remaining 93% of the bookings
in the community. Based on the recommendation of the Marketing Advisory Group and
the current travel environment the emphasis of the 2003 plan will be on broadening brand
awareness and cooperative programs with other local partners who have far more
substantial resources i.e. The Aspen Skiing Company, various Aspen lodging properties,
SAS, SVRA among others.
TA C TICAL ME TRI'CS
STRATEGY #1: Public Relations
* # of editorials using 2003 as baseline; compare year over year in 2004
· Type of editorials - horizontal and vertical publications
STRATEGY #2! Advertising (Print and online) · Reach (actual number ad deliveries bought i.e circulation)
· Impressions (who actually "saw" the ad)
· Responses (print - call to action; online - click through rates - .025% average)
· Actual bookings of promotional specials based on unique 800#
425 Rio Grande Place, Aspen Colorado 81611
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A S P E
WWW.ASPENCHAMB£R.ORG
STRATEGY #3: e-Marketing · Total Site Traffic per month
· User Sessions per month
· Referrals to booking engine (SAS) per month
· Look to Book ratios per month
· Actual online $ bookings from aspenchamber.org
· Apply % of referrals as % of overall web visits, then apply to total $ booked from
SAS website and associated 800# (margin of error less than 10%)
STRATEGY #4: Group Sales · Increase in group sales using 2003 as baseline; compare year over year in 2004
· Properties with meeting space - # of groups; $ booked by month
· # of closed leads generated from trade shows
STRATEGY #5: Special Events
· TBD by Special Events Advisory Group to include reach and response
425 Rio Grande Place, Aspen Colorado 81611
T 970 925 1940 F 970 920 1173
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