HomeMy WebLinkAboutIR 6958 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6958
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�offORT�p To the Mayor and Members of the City Council July 24, 1984
;TfXPy� Subject: FINANCING PLAN FOR CULTURAL INSTITUTIONS
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A financing plan has been developed for the distribution of the hotel/
motel occupancy tax revenue for 1984-85. This financing plan is based
upon the following set of assumptions:
(1) collection of the hotel/motel occupancy tax will be $2,663,030
for 1984-85;
(2) the Arts Council and Convention and Visitors Bureau will absorb
their projected budgetary shortfalls in 1983-84;
(3) the Fort Worth Art Museum and Museum of Science and History
will receive funds at the adopted budget level for 1983-84
and will absorb the projected shortfall of funds in 1984-85;
(4) the Arts Council's 1984-85 allocation will be $85,000, the
amount the Arts Council actually received in 1981-82; and,
(5) the Water Garden's 1984-85 allocation will be $129,309.
Attached is a copy of the proposed financing. plan; this plan is divided
into three sections: (1) distribution of revenue, (2) a payment plan
for the museums, and (3) a bonus payment plan.
This financing plan assumes that the Arts Council and Water Garden will
receive their requested allocations of $85,000 and $129,309 respectively.
These amounts were subtracted from the total revenue estimate of $2,663,030;
the balance of $2,448,721 was distributed among the Fort Worth Art Museum,
the Museum of Science and History, and the Convention and Visitors Bureau
on a percentage basis (the 1983-84 budget amounts for these three institutions
were totaled and an approximate percentage was calculated on the amount that
each institution comprised of this total) .
This financing plan includes a payment plan for the museums that is based
upon their 1984-85 proposed allocations. Since the museums will be paid
at their adopted budget level in 1983-84, the museums will be required
in 1984-85 to reimburse the City for the overpayments in the 1983-84 fiscal
year. The projected shortfall amounts will be subtracted from the proposed
budget amounts. This revised budget will be divided into twelve equal
payments and paid monthly to the museums.
A bonus plan also is reflected in the event that revenue exceeds the
projected amount of $2,663,030. The payment of these bonuses would be
made in August after the majority of the hotel/motel occupancy tax revenue
has been collected for the 1984-85 fiscal year. For revenue received in
excess of the budget estimates, the Convention and Visitors Bureau and the
two museums would share the bonus amount based upon their budgeted percentages.
The Water Garden and Arts Council would not share in this bonus plan; instead
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the City's General Fund would receive 8.2 percent of the additional revenue.
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6958 - p. 2
�of10RJ�p To the Mayor and Members of the City Council July 24, 1984
/i
Subject: FINANCING PLAN FOR CULTURAL INSTITUTIONS
This bonus plan would be effective up to a total collection amount of
$3,000,000. Should this amount be exceeded, then the Convention and Visitors
Bureau would receive 42.8% (3% of the 7% tax) and the City's General Fund
would receive the remaining 57.2% (4% of the 7% tax) of the additional
revenue.
This financing plan appears to be equitable to all parties involved.
Since the revenue estimate of $2,663,030 is conservative, only $263,935
or 11% over the 1983-84 re-estimate (which was collected for one quarter
at four percent and three quarters at seven percent; whereas, the 1984-85
revenue will be collected at a rate of seven percent for the full year),
all cultural institutions would be assured of receiving a minimum amount.
The Fort Worth Art Museum and the Museum 'of Science and History would
have an established payment plan, so the museums would be certain of
their monthly payment. This bonus payment plan would also serve as an
incentive to encourage the Convention and Visitors Bureau, the Fort Worth
Art Museum, and the Museum of Science and History to attract additional
tourism. The City would also have the potential for benefitting from the
bonus plan, since the General Fund would receive 57.2% of the additional
revenue in excess of $3,000,000. The City would also benefit from this
proposed financing plan because the reimbursements from the two museums
will be made automatically.
Additional information will be provided upon request.
L
Robert L. erc e
City Manager
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Attachment
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS