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HomeMy WebLinkAboutresolution.council.180-17 RESOLUTION NO. 180 SERIES OF 2017 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN,COLORADO,APPROVING A FIFTH AMENDED AND RESTATED AREEMENT BETWEEN THE CITY OF ASPEN, COLORADO AND THE ASPEN CHAMBER RESORT ASSOCIATION SETTING FORTH THE TERMS AND CONDITIONS REGARDING MARKETING AND TOURISM PROMOTION SERVICES AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAID DOCUMENT ON BEHALF OF THE CITY OF ASPEN, COLORADO. WHEREAS,there has been submitted to the City Council a Fifth Amended and Restated Agreement between the City of Aspen, Colorado and the Aspen Chamber Resort Association, LLLP, a copy of which document is annexed hereto and made a part thereof. NOW,THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO: That the City Council of the City of Aspen hereby approves a Fifth Amended and Restated Agreement between the City of Aspen, Colorado and the Aspen Chamber Resort Association regarding marketing and tourism promotion services for the City of Aspen, a copy of which document is annexed hereto, and does hereby authorize the City Manager of the City of Aspen to execute said document on behalf of the City of Aspen. p RESOLVED,APPROVED, AND ADOPTED this I2 th day of December 2017, by the City Council for the City of Aspen, Colorado. ; I � Steven Skad on, Mayor I, Linda Manning, 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 December 4, 2017. W 01 f. Linda Manning, City Clerk CITY OF ASPEN AND ACRA TOURISM PROMOTION FUND AGREEMENT THIS AGREEMENT is effective this 1st day of January 2018, by and between the CITY OF ASPEN (the"City")and the ASPEN CHAMBER RESORT ASSOCIATION ("ACRA"), RECITALS 1. The City and ACRA entered into that certain Agreement dated February 27, 2001, which agreement has been renewed over the years, and the parties hereto desire to again renew said agreement. 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,which the voters did approve. 3. Ordinance No.45, Series of 2000, requires the City Council to appropriate 50%of all revenues generated by the original tax for marketing and promotional efforts for the City's tourism industry. 4. The City Council has adopted Ordinance No. 31, Series of 2010,which imposes an additional 1%visitor benefit and promotion tax on condition that the voters of the City of As approve the aforementioned ballot question at the November 2, 2010 municipal election,which the. voters did approve. S. Ordinance No. 31,Series 2010, requires the City Council to appropriate 100%of all revenues generated by the additional 1%tax for marketing and promotional efforts for the City's tourism industry. 6. Asa result, 25%of all revenues generated by the total 2%visitor benefit and promotion tax shall be used to enable the City to meet its financial obligations to the Roaring Fork Regional Transportation Authority or other similar transportation services provider, and 75%of all revenues generated shall be used for marketing and promotional efforts for the City's tourism industry. 7. The foregoing taxes are codified at Aspen Municipal Code Chapter 23.50,and are referred to herein as the Visitor Benefit Tax or"funds" or"marketing funds." The City desires to contract with an organization capable of performing the marketing and promotional efforts contemplated by said ordinance and funded by the Visitor Benefit Tax. 8. 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. 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 principles 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 benefit and promotions tax imposed by Ordinance No.45,Series of 2000, and Ordinance No. 31, Series 2010,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 ordinances shall apply to this Agreement. b. The parties intend to enter into a continuing relationship for the multi-year planning and implementation of tourism promotion activities as set forth herein. 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 City Council's consideration for the forthcoming calendar year. City Council may approve the budget for the marketing plan as it may deem necessary. b. The marketing plan and budget shall include the following: 1. planning and implementing the advertisement, promotion, and development of tourism and special events 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; S. 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. For the year 2018,the contribution shall be $35,000.00, and the contribution shall not increase by more than 3%in any year. Notwithstanding the foregoing,the City shall reduce ACRA's required contribution to such costs in any year to the extent necessary so that when such costs are added to other non-program costs in the budget, the total non- program costs do not exceed the limits of Paragraph 2(b)(8). C. The marketing services shall be primarily for strategies and activities developed since February 27, 2001, and ACRA shall not defray costs of programs existing on that date (such as existing special events and marketing efforts,visitor center support, among others)with funds from the Visitor Benefit Tax. Marketing funds maybe 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 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, or for expenses not directly attributable to the purposes of this Agreement, or for expenses not identified in its annual marketing plan and budget (initial or revised) as approved by the City Council. f. The ACRA and Aspen Lodging Association shall meet at least annually in the last quarter 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, 2018 through December 31, 2022. This agreement may be terminated by either party as set forth as Section 8, below. 4. Reporting and Budgeting. ACRA shall submit a detailed marketing program and expense budget for inclusion in the City's budgeting packets, along with a review of the previous year's program. 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. During the course of the year,ACRA may submit a revised budget to the City Council for their consideration in order to accomplish such additional strategic marketing objectives as they may identify. City Council may approve the revised budget as it may deem necessary,with the understanding that City Council need not approve such a revised budget unless revenues from the Visitor Benefit Tax are available. ACRA shall provide reports to the City on the fund and expenditures from it, including quarterly income statements and any independent reviews or audits that ACRA receives. 5. Accounting. The City shall pay all actual lodging tax revenues generated by the Visitor Benefit Tax during the term of this Agreement to ACRA as they are generated from the City of Aspen each month, except for such funds as have been designated in the approved Budget to be deposited in the reserve account described in Paragraph 6 below. ACRA shall be responsible for paying its vendors, suppliers, subcontractors, staff, and the like. ACRA shall maintain the tax fund receipts in an interest- bearing bank account separate from its other funds. The City may inspect ACRA's records upon reasonable notice. ACRA shall account for any funds not expended for the purposes set forth in this Agreement. 6. Reserves. ACRA's budget shall include a reserve account of up to$300,000. The funds in the reserve account shall be held for use to supplement actual tax revenues in the event of an economic downturn. Specifically, if the actual tax revenues for the 12 months prior have paced at a decrease of at least 5 percent from the prior 12 months, ACRA may request that a specific amount of reserve funds be appropriated as a supplement to the actual tax revenues. The reserve shall be held as a restricted fund balance by the City of Aspen in the City Tourism Promotion Fund, separate and distinct from any other funds or accounts used or maintained by the City for any other purposes. The funds in the reserve account will be appropriated to be used for the marketing program proposed by ACRA upon written request to and approval by City Council. The reserve funds shall not be used to fund any specific event or sponsorship request that is not part of the annual marketing plan. The reserve funds may be used for no purpose other than a purpose that is(a) permitted pursuant to Ordinance No.31, Series 2010 and (b) supplements the tax revenues appropriated pursuant to paragraph 5 of this Agreement following a 12 month period during which tax revenues have decreased. The parties agree that ACRA will use good faith efforts to build the fund to$300,000 by December 2019. The funds in the reserve account are separate and distinct from any funds paid to and set aside by ACRA to provide contingency or cash flow during the budget year. 7. 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 and this Agreement, and as to the latter, not discriminate based on membership in the organizations. 8. Termination. Either party may terminate this agreement effective on December 31 of any year; provided, however, that written notice is delivered to the other party not later than June 30 of the year that termination is to become effective. 9. Other Restrictions and Provisions a. 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 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 ACRA as to any new fund manager. d. ACRA shall not use any of the marketing funds for providing direct reservation services. e. ACRA shall not use fund proceeds to influence the outcome of any election. 10. 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. 11. Acknowledgements. The parties declared 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 anyone else. 12. 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 part, or is claimed to be caused in whole or 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 agree 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 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. 13. 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. 14. 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. 15. 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 Oates, Knezevich &Gardenswartz, P.C., 533 East Hopkins Avenue,Aspen CO 81611. 16. 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. CITY OF ASP a unix al c oration By: Stephen H. Barwick . Ci y Clerk ASPEN CHAMBER RESORT ASSOCIATION Attest: By: Debbie Braun, President S cretary