Loading...
HomeMy WebLinkAboutResolution 5383-04-2021A Resolution NO. 5383-04-2021 APPROVING AN AMENDED BUDGET AND SEVEN-YEAR SERVICE PLAN FOR FORT WORTH PUBLIC IMPROVEMENT DISTRICT NO. 18 (TOURISM PID) FOR FISCAL YEAR 2020-2021 WHEREAS, pursuant to Resolution No. 4837-08-2017 , the City Council established the Fort Worth Public Improvement District No. 18 ("Tourism PID") on August 29, 2017; WHEREAS, in accordance with Chapter 372 of the Texas Local Government Code, on August 25 , 2020, the City Council approved a budget for the 2020-2021 fiscal year and a seven-year service plan for the Tourism PID pursuant to M&C 20-0577; WHEREAS, pursuant to City Secretary Contract No. 50298 , the City has contracted with the Fort Wotih Tourism Public Improvement District and Fort Worth Convention and Visitors Bureau (collectively, "Contractors") to manage the day-to-day administration of the Tourism PID; WHEREAS, in accordance with the Texas Local Government Code, the City has assigned to Contractors the responsibility for preparing the annual budget and service plan for the Tourism PID; WHEREAS, City staff annually conducts mid-year reviews of the Tourism PID budget to ensure that actual Tourism PID expenditures correspond with budgeted expenses; and WHEREAS, in consultation with the Contractors regarding actual Tourism PID expenditures and necessary programs and services required to date, City staff recommends that the City Council approve an amended budget for the Tourism PID for the 2020-2021 fiscal year and seven-year service plan. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS THAT: 1. The Fiscal Year 2020-2021 Budget and Seven-Year Service Plan for the Tourism PID is hereby amended and approved in accordance with Exhibit "A", which is attached hereto. 2. This Resolution shall take effect immediately following its adoption. Adopted this 13th day of April 2021. ATTEST: By:~9-~ Mary J. Kayser, City Secretary EXHIBIT A City of Fort Worth Seven Year Service Plan (Mid-Year) Public Improveme nt District No. 18 -Tourism FY20/21 FY21/22 FY22/23 FY23/24 FY24/25 FY2 5/26 FY26/27 REVENUES I P ID Assessments $ 2,800,000 $ 3,515,000 $ 4,100,000 $ 4,430,000 $ 4,685,000 $ 4,915,000 $ 5,110,000 Total Fund& Ava ilable for Use S 2,800,000 $ 3,515,000 $ 4,100,000 $ 4,430,000 $ 4 ,685,000 S 4 ,915,000 $ 5,110,000 EXPENSES Inc ent ives & Sales Efforts $ 1,262,000 $ 1,643,500 1,921,375 $ 2,078 .125 $ 2,199,250 $ 2,308,500 $ 2,401 ,125 Marketing and Research (Promotion/ Ad vert is ing ) 972 ,000 1,21 1,000 1,415,750 1,531 ,250 1,620,500 1,701 ,000 1,769,250 Site Vis its & Familiarization Tour s 81 ,000 173,000 202 ,250 218,750 231,500 243 ,000 252 ,750 Cultura l Enhancements through Marketing and pro motion of the Arts 257,000 259,500 303 ,375 328,125 347,250 364,500 ~79 , 125 O pe ratio ns & Administratio n 173,000 173,000 202,250 ' 218,750 23 1,500 243,000 252,750 Ci ty Adm inistrative Fee 55,000 55,000 55,000 55,000 55,000 55 ,000 55 ,000 Total Budgeted Expenses $ 2,800 ,000 $ 3,515,000 I $ 4,100,000 $ 4,430,000 $ 4,685,000 $ 4,915,000 s 5,110,000 Contribution to Fund Ba lance Total Expe nse s $ 2,800 ,000 3,515,000 S 4,100,000 $ 4,430,000 s 4,685 ,000 4,915,000 s 5,110,000 Net Change in Fund Balance s s $ Fund Ba lance, Beginning of Year (Estimated Yrs 2-5)' 2,671 ,122 ' 2,67 1,122 2,671 ,122 I 2,671 ,122 2,671.122 2,671 ,122 2,671 ,122 J Estimated Fund Ba lance , End of Year 2,671 ,122 2,671,122 , 2,671,122 2,671 ,122 2,671,122 2,671 ,122 2,671,122 ReseM Requirement 533,439 ' 683,4.70 738,481 780,990 819,331 851 ,837 851,837 Over (Under) Reserve $ 2,137,683 s 1,987,652 S 1,932,641 s 1,890,132 $ 1,851,791 $ 1,819,285 s 1,819,285 City of Fort Worth, Texas Mayor and Council Communication DATE: 04/13/21 LOG NAME: 17PID18 M1DYEARFY21 SUBJECT M&C FILE NUMBER: M&C 21-0273 (ALL) Conduct Public Benefit Hearing Concerning the Following Matters Related to Fort Worth Public Improvement District No . 18 -Tourism (Tourism PIO): (1) Expansion of the Tourism PIO to Include Three Additional Hotels , (2) the Updated and Revised Fiscal Year 2020-2021 Budget and Seven-Year Service Plan , and (3) the 2020-2021 Assessment for the Addit ional Hotel Properties ; Adopt Attached Resolution Correcting the Sufficiency Percentages Associated w ith the Prior Tourism PIO Expansion Petition and Authorizing and Expanding the Tourism PIO to Include Three Add itional Hotel Properties ; Approve Attached Rev ised 2020-2021 Assessment Roll ; Adopt Attached Ordinance Levying Special Assessments on the Additional Hotel Properties for Fiscal Year 2020-2021; Adopt Attached Resolution Updating and Revising the Tourism PID's Fiscal Year 2020-2021 Budget and Seven-Year Service Plan ; and Adopt Attached Appropriation Ordinance (PUBLIC HEARING -a . Report of City Staff: Crystal Hinojosa ; b . Public Comment; c . Council Action : Close Public Hearing and Act on M&C) RECOMMENDATION: It is recommended that the City Council: 1. Conduct Public Benefit Hearing Concerning the following matters related to Fort Worth Public Improvement District No. 18-Tourism (Tourism PIO): (1) Expansion of the Tourism PIO to include three additional hotel properties , (2) the updated and revised Fiscal Year 2020- 2021 Budget and Seven-Year Service Plan , and (3) the 2020-2021 Assessment for the additional hotels ; 2 . Adopt the attached Resolution : (i) correcting the sufficiency percentages associated with the prior Tourism PIO Expansion Petition; (ii) making certain findings concerning the nature and advisability of special improvements and services to be provided for the benefit of the additional hotels to be included in the Tourism PIO , the estimated costs of such improvements and services , the method of assessment, the boundaries of the Tourism PIO, and the apportionment of costs between the Tourism PIO and the City , as a whole ; and (iii) authorizing and expanding the Tourism PIO to include three additional hotel properties ; 3 . Direct the City Secretary to publish notice of the expansion of the Tourism PIO as required by Chapter 372 of the Texas Local Government Code ; 4. Approve the attached revised 2020-2021 Assessment Roll; 5 . Adopt the attached ordinance levying special assessments on the additional hotel properties for Fiscal Year 2020-2021 , with such assessments to be effective on the date that the Resolution to Expand the Tourism PIO is published one time in a newspaper of general circulation in the City ; 6 . Adopt the attached resolution updating and revising the Tourism PID's Fiscal Year 2020-2021 Budget and Seven -Year Service plan; and 7 . Adopt the attached appropriation ordinance decreasing appropriations in the amount of $1 ,378.453.00 for Fiscal Year 2020-2021 in the Fort Worth Public Improvement District 18 -Tourism Fund . DISCUSSION: The purpose of this Mayor and Council Communication (M&C) is to conduct a second public hearing concerning the expansion of the Fort Worth Public Improvement District 18 -Tourism (Tou ri sm PIO) to include three additional hotel properties , the updated and revised fiscal year 2020-2021 budget and seven -year serv ice plan , and the 2020-2021 assessment for the additional hotel properties , along with certain actions related thereto . The City Council conducted the first public hearing on April 6 , 2021 , finding that the Petition to Expand the Tourism PIO met the requirements set forth in Chapter 372 of the Texas Local Government Code ("Code"), approving the filling of the revised 2020-2021 assessment roll , and setting this public hearing for April 13, 2021 . On August 29 , 2017 , the City Council adopted Resolution No. 4837-08-2017 , establishing the Tourism PIO ("Establishing Resolution"). On August 18, 2020 , the City Council adopted a Resolution No. 5264-08-2020 to expand the boundaries of the Tourism PIO to include five (5) additional hotels (Mayor and Council Communication (M&C) 20-0551 ) ("Expansion Resolution"). EXPANSION OF THE TOURISM PID Boundaries: The current boundaries of the Tourism PIO consist of noncontiguous areas authorized under Section 372 .0035 of the Code consisting solely of hotel properties with 100 or more rooms ordinarily used for sleeping within the City of Fort Worth . A list of the hotels that are included within the boundaries of the Tourism PIO is included in the Original and Expansion Resolutions and attached hereto . Section 372.0121 of the Code allows the City Council to include additional properties in the Tourism PIO if (i) the property is a hotel and (ii) the property could have been included in the Tourism PIO without violating Section 372 .005 (b-1) of the Code when the Tourism PIO was created regardless of whether the record owners of the property signed the original petition . W ith rega rd to the second element, the Code requires the petition to be signed by the (1) reco rd owners of taxable real property liable for assessment that constitute more than 60 .00% of the appraised value and (2) more than 60 % of (i) all record owners liable for assessment or (i i) area of all taxable property liable for assessment with in the Tourism PID. If the addition of the new properties results in these numbers dropping at o r below the 60 .00% threshold , then the properties may not be added . The add itional properties to be included in the Tourism PID meet both of the above-stated elements, therefore they, may be cons idered by the City Council for inclus ion into the Tourism PID . First, the following three properties to be included in the Tourism PID are all hotels : 1 . Home2 Suites-Cultu ral District, 3000 & 3012 W Lancaster Ave , Fort Worth , TX 76107 2 . Hotel Drover, 200 Mule Alley Drive , Fort Worth , TX 76164 3 . Residence Inn Waterside-Fort Worth Southwest, 5825 Arborlawn Drive , Fort Worth , TX 76109 With regard to the second element, the City Council found that the previous two petitions (original and expanded) complied with Section 372 .005 (b-1) of the Code because they had met the necessary percentage thresholds. In the process of calculating the updates and revised percentages for 2020 expansion , staff discovered that Hyatt Pla ce TCU , 2500 W . Berry Street, had signed the 2020 Expansion Petition to be included in the Tourism PID but was inadvertently counted as not having signed . When factoring in the signed petition for the Hyatt Place TCU , the petition sufficiency percentages for the 2020 Expansion Petition increased and should have been as follows : (1 ) 7 4.9% of the appraised value of taxable real property liable for assessment, (2) 61 .1 % of record owners of taxable real property liable for assessment , and (3) 65.7% of the area of all ta xable real property liable for assessment. This will be corrected in the attached resolution . The property owners , or their duly authorized representatives , for all three new hotel properties have signed a petition requesting inclusion within the Tourism PID . This results in an increase to 75.7% of the appraised value of taxable real property liable for assessment, 63.2% for the area of all taxable real property liable for assessment, and 66 .9% of record owners liable for assessment. Because the percentages are still above the 60 .00% threshold , the properties meet the second element. NOTE : Crossland Economy Stud ios -Fossil Creek located at 3804 Tanacross Drive , a hotel property that was a part of the original petition recently converted to permanent supportive housing in September of 2020 and is no longer considered a hotel by use and will no longer be paying into the Tourism PID. Removal of this hotel does not affect the percentages that were in place at the time of the original petition . Nature of the Improvements: The goals of the Tourism PID focus on increasing the economic impact and enhancing competitiveness in conventions , meetings , leisure and sports tourism and increasing tourism-related economic activity at all times , includ ing during economic downturns and as inventory grows . The Tourism PID projects include incentives and sales efforts, convention and sports marketing and promotion , site visits and familiarization tours , community arts grants , convention services , event fund ing application , operations , research , and administration , all of which benefit the hotels w ithin the Tourism PID . Method of Assessment and Apportionment of Costs: The assessment rate will be an amount equal to 2 .00 % of the consideration received from the occupancy of any sleeping room furnished by a hotel located with in the Tourism PID , with such assessment to be collected in the same manner and in accordance with the same procedures as those established for the collection of the City's Hotel Occupancy Tax, as set forth in Chapter 32, Article II of the City Code , as amended . The entire costs of each improvement and service will be paid from the above-stated assessments and no City funds w ill be used to pay any portion of such costs unless such funding is approved by the City Council on a case-by-case basis. Estimated Costs of the Improvements and Services : The total estimated costs for the pro posed services and improvements for the life of the Tourism PID (approximately seven years ) will be $29 ,555 ,000 .00 , which includes an estimated cost of $2 ,800 ,000 .00 for the Fiscal Year 2020-2021 Mid-Year Budget Adjustment. The updated and revised budget and seven-year service plan is set forth in more detail below and attached . The final version will be subject to approval by the City Council. The estimated costs of the proposed improvements and services to be provided in subsequent years will be subject to future annual budget and serv ice and assessment plans adopted by the City Council in accordance with the Code . The actual costs of improvements and services will be determined in accordance with the approved budget and service plan to be adopted by City Council and will be paid from Tourism PID assessments. Advisability: Staff recommends that the City Council find that these improvements and services are advisable because they will promote the interests of the City and confer a special benefit on the assessed properties within the expanded boundary of the Tourism PID . Staff recommendation: Staff recommends that City Council adopt the attached resolution correcting the sufficiency percentages associated with the prior Tourism PID petitions and authorizing and expand ing the Tourism PID to include the above-state three additional hotel properties . Tourism PID Mid-Year Adjustments The Tourism PID is funded through a 2 % assessment on the consideration received from occupancy of any sleeping room furnished by a hotel in the Tourism PID . Due to the steep drop in hotel occupancy rates as a result of the COVID-19 situation , Tourism PID assessment revenue is now projected to be 33% less than originally budgeted . Consequently , staff has proactively worked with the Fort Worth Tourism Public Improvement District Corporation (FWTPIDC) and the Fort Worth Convention and Visitors Bureau (CVB ), wh ich are the contracted Tourism PID managers , to conduct a mid-year review of the Tourism PID 's FY 2020-202 1 budget. C ity staff, FWTPIDC , and CVB have identified the need to decrease the Tourism PIO assessment revenue by 33 % or $1 ,378,453 .00 to account for the decl ine in funding as a result of COVID-19 . The budget also takes into account the three new hotels. The budgeted expenses show a reduction in each category line item fo r the current fiscal year service plan (see table below). Revenue adjustments : Line Items Previously Recommended Amended to be Approved FY21 Adjusted Budget Item PIO $4 ,178,453.00 Assessments Totals $4,178 ,453.00 Expenditures adjustments : Line items to be Adjusted Incentive & Sales Efforts Marketing and Previously Approved FY21 Budget Item $1 ,855 ,554 .00 Mid-Year FY21 Budget Adjustment Item ($1 ,378,453.00) $2 ,800 ,000.00 ($1 ,378,453 .00 $2 ,800 ,000.00 Recommended Amended Mid-Year FY21 Budget Adjustment Item ($593 ,554.00) $1 ,262 ,0 Research $1,443 ,208.00 ($471 ,208 .00) $972 ,000 .00 ( Promotion/Advertising) Site Visits & Familiarization Tours Cultural Enhancements hrough Marketing and promotion of the Arts $309 ,259 .00 $309 ,259 .00 ($228 ,259 .00) $81 ,000 .00 Staff supports FWTPIDC 's and CVB 's recommended mid-year budget adjustments . Upon approval of the above recommendations , the total budgeted expenses for FY 2020-2021 will be $2 ,800 ,000 .00 . This mid -year budget adjustment will increase the unaud ited , unassigned fund balance by a total of $1 ,378,453 .00 . The revised Budget and seven-year service plan will take effect upon approval by City Counci l. The proposed changes to the Tourism PID 's FY 2020-2021 budget complies with the City's reserve requirements. The Tourism PIO properties are located in ALL COUNCIL DISTRICTS . A Form 1295 is not required because: This M&C does not request approval of a contract with a business entity . FISCAL INFORMATION/ CERTIFICATION: The Director of Finance certifies that upon approval of the above recommendations and adoption of the attached appropriation ordinance, funds w ill be available in the current operating budget, as appropriated , in the FWPID #18 -Tourism Fund. Prior to any expendi ture being incurred , the Economic Development Department has the responsibility to validate the ava ilability of funds . Submitted for City Manager's Office by: Jay Chapa 5804 Originating Business Unit Head: Robert Slums 2663 Additional Information Contact: Crystal Hinojosa 7808 Exped ited