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RES-2010-125RESOLUTION NO. 2010 -125 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM DECLARING ITS INTENTION TO ESTABLISH THE ANAHEIM TOURISM IMPROVEMENT DISTRICT; TO LEVY MULTI -YEAR ASSESSMENTS ON HOTEL BUSINESSES IN THE DISTRICT; TO PREPARE A MANAGEMENT PLAN, TO ESTABLISH ONE OR MORE ADVISORY BOARDS AND ORDERING AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING PURSUANT TO CITY ORDINANCE NO. 6174 RECITALS A. WHEREAS, the City Council (the " City Council ") of the City of Anaheim (the " City ") has adopted City Ordinance No. 6174 (the " Enabling Ordinance "), which establishes certain procedural and substantive requirements relating to the formation of tourism improvement districts and the assessment on businesses within such districts to aid in the promotion of tourism and physical and other improvements and activities within local tourism improvement districts; and B. WHEREAS, the Enabling Ordinance authorizes the City to levy and collect assessments on businesses within such districts for the purpose of providing improvements and promoting activities and business - related services that specifically benefit identified businesses located within such districts; and C. WHEREAS, the City Council desires to form a Tourism Improvement District, to be known as the "Anaheim Tourism Improvement District" (the " ATID "), pursuant to the Enabling Ordinance, to promote the proposed area as a premier tourism and convention district within the boundaries of the City and, specifically, to aid in the promotion of local tourism and convention- related programs and activities for hotels located in the proposed ATID area; and D. WHEREAS, the viability of the City's tourism and convention industry is vital to the overall economic development of the City, and any financing mechanism that provides for the health of that industry is extremely important to visitors to the City and the owners of businesses in that industry within the City; and E. WHEREAS, creating a sustainable funding mechanism for the ongoing planning, design, construction and operation of transit improvements, including Anaheim Rapid Connection ( "ARC "), the fixed guideway system that will connect the mass transit center known as ARTIC with the Platinum Triangle, the Anaheim Resort Area, and the Anaheim Convention Center, is critical for the prosperity of the City's visitor - related industry; and F. WHEREAS, the purpose of the establishment of the ATID is to: (1) provide for the current marketing and promotion efforts necessary to attract new conventions to the Anaheim Convention Center, (2) promote and . attract new visitors to the benefitted hotels in the City, (3) help fund the planning, design, construction and operation of transit improvements, including ARC, which will deliver visitors to and from the hotels from ARTIC, the regional rail station, (4) provide for improvements, security, and other benefits within the ATID area, and (5) facilitate the re- dedication of funds currently allocated from the City's general fund to the Anaheim Orange County Visitor and Convention Bureau, to facilitate the rapid expansion of the Anaheim Convention Center and Plaza; and 904303.06/OC 999903 - 40000 /7 -22 -10 /wrd /wrd G. WHEREAS, in order to assure adequate funding for the ATID's purposes, the ATID will remain in place for the term needed to retire the long -term financing mechanism, or bond, related to the expansion of the Anaheim Convention Center and /or the transit improvements related to the ATID. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Anaheim as follows: 1. The City Council declares its intention to form a Tourism Improvement District to be known as the "Anaheim Tourism Improvement District" or "ATID" within the City pursuant to the Enabling Ordinance. 2. The City Council hereby adopts this Resolution of Intention to establish the ATID and to levy an assessment on certain businesses within the ATID boundaries in accordance with the Enabling Ordinance. 3. The precise boundaries of the ATID are shown on attached Exhibit "A" while a list of the proposed Assessed Facilities (as hereinafter defined) is shown on attached Exhibit "B " . 4. As further described in Exhibit "C" attached hereto, an assessment equal to two percent (2 %) of the hotel room "rent ", as defined in Anaheim Municipal Code Section 2.12.005.080, (the " Assessment "), shall be assessed to all visitor accommodation facilities, hotels, and motels (but not including Vacation Ownership Resorts, as that term is defined in Anaheim Municipal Code Section 18.114.030.150, to the extent they are being used as Vacation Ownership Resorts) located within the ATID boundaries engaged in the renting of rooms for a period of less than thirty (30) days (the " Assessed Facilities "). Such Assessment may only be modified pursuant to the procedures set forth in Section 2.14.150 of the Enabling Ordinance. 5. The purpose of forming the ATID as a Tourism Improvement District is to provide revenues to cover the cost of activities, improvements, services and programs that will benefit the Assessed Facilities and the tourism and convention industry in the City. The activities, improvements, services and programs to be provided and paid for by the ATID revenues are described in Exhibit "D" attached hereto. 6. The failure by any Assessed Facility to timely pay any Assessment shall subject the Assessed Facility to the late payment penalties described in Exhibit "C " . 7. The City Council finds and determines that the public convenience and necessity require the establishment of the ATID, and that all Assessed Facilities within the ATID will be specially benefitted by the expenditure of the funds raised by the Assessments proposed to be levied. Any future Assessed Facilities shall be automatically included in the ATID as they will be specially benefitted by the expenditure of funds raised by the assessments levied. 8. It is intended that all or a portion of the ATID revenues dedicated to transit improvements, as set forth in the Management Plan (defined below), may be used to bond for such improvements pursuant to Section 2.14.140 of the Enabling Ordinance. 904303.06/OC 999903 - 40000/7- 22- 1 0 /wrd/wrd 2 9. It is intended that this ATID be established for a period of thirty (30) years pursuant to the authority set forth in Section 2.14.040.016 of the Enabling Ordinance, subject to Section 10 herein. 10. If, within the first three (3) years of the ATID, no bonds have been issued pursuant to Section 2.14.140 of the Enabling Ordinance, and if no debt or other long -term contract has been issued by or entered into by the City for improvements or expansion of the Convention Center (including the Plaza), then the disestablishment provisions set forth in Section 2.14.170 of the Enabling Ordinance shall become operative. Further details regarding the relationship between the ability to disestablish the ATID and activities authorized under Section 2.14.140 of the Enabling Ordinance or activities of the City relating to debt or other long -term contracting for improvements or expansion of the Convention Center shall be set forth in the Management Plan. 11. Pursuant to Section 2.14.050 of the Enabling Ordinance, a management plan (the "Management Plan") for the ATID will be prepared and shall be provided to all businesses expected to be subject to the Assessment, no later than ten (10) days prior to the Public Hearing. The Management Plan shall describe in more specific terms (a) the approved uses and/or improvements to which the 75% Marketing Component Funds and the 25% Transportation Component Funds, respectively (each as defined in Exhibit "C ") , may be put, and (b) the composition and selection process for members of the committees that will oversee expenditure of the 75% Marketing Component Funds and the 25% Transportation Component Funds, respectively, for the approved uses and/or improvements as further described in Exhibit "C " . 12. Pursuant to Section 2.14.070.040 of the Enabling Ordinance, valid written protests from Assessed Facilities that would be included in the proposed ATID and that are projected to pay fifty percent (50 %) or more of the Assessments proposed to be levied will prevent further action from being taken to form the ATID for a period of one (1) year from the date the City Council finds a majority protest exists. In order to determine the projected Assessments for purposes of establishing voting percentages, the City shall make projections based on the prior three -year average of rental revenues for the applicable businesses. Since such information is proprietary, the City, alone, will determine the total percentage protest and provide such percentage at the hearing on the Resolution of Formation. 13. The City Clerk is hereby directed to give proper notice of the Public Meeting and Public Hearing (as such terms are hereinafter defined), pursuant to California Government Code Section 54954.6, to all proposed Assessed Facilities no later than ten (10) days prior to the scheduled Public Meeting and forty -five (45) days prior to the scheduled Public Hearing. 14. The time and place of the public meeting to allow public testimony regarding the proposed Assessment (the " Public Meeting ") is set for August 31, 2010 at 5:00 p.m., or as soon thereafter as the matter may be heard at City Hall at 200 S. Anaheim Blvd, Anaheim, CA 92805. 15. The time and place of the public hearing to establish the ATID (the "Public Hearing "), with a Resolution of Formation, is set for September 14, 2010 at 5:30 p.m., or as soon thereafter as the matter may be heard at City Hall at 200 S. Anaheim Blvd, Anaheim, CA 92805. At the Public Hearing, the testimony of all interested persons for or against the establishment of the ATID, the extent of the ATID, or the furnishing of the types of improvements or activities set forth on Exhibit "D" will be heard. 904303.06/OC 999903 - 40000 /7- 22- 10 /wrd/wrd 3 16. The foregoing recitals and all exhibits attached hereto are hereby incorporated herein by reference. 17. THE FOREGOING RESOLUTION is approved and adopted by the City Council of the City of Anaheim this 27th day of July , 2010, by the following roll call vote: AYES: Mayor Pringle, Council Members Sidhu, Hernandez, Galloway, Kring NOES: NONE ABSENT: NONE ABSTAIN: NONE CITY OF ANAHEIM By: ( iA MAYOR OF THE ANAHEIM ATTEST: CITY CLERK OF THE CITY OFIANAHEIM 904303.06/OC 999903- 40000 /7 -22 -10 /wrd /wrd 4 EXHIBIT "A" BOUNDARIES AND MAP OF THE ANAHEIM TOURISM IMPROVEMENT DISTRICT Any and all current and future Assessed Facilities falling within the following boundaries will automatically be included in the ATID for the full term of the ATID. 904303.06/OC 999903 - 40000 /7 -22 -10 /wrd/wrd EXHIBIT "A" 3164 E� p7 i0 N Q� N H a U o O C T Qf E � E 4 L` LL 0 C) U r ro Y 0 0 o n.� ''���• b�� b bNb �•• Nbs as ssv c,'ll ORANGE:FR •� �y C _ C Z �; ca O_ w < a o w W 04 V Cr1 > z = C/) co r W O OD - OA19 3031100 31ViS —.006 a a° w > >< U) > < 5 LU cc w w J xx R e� IS SIM31 4 � f- --.516 E� Z5 N C3, 0 0C La C y C N T 2 E u d Z, a+ N o _. _ LL E E v •�.,�•yo` E E w m a� •`. a GH SSNl9R ° ° s �../ V IS 1SIHNns S 3 ''t � L 1 W 1 � 1 N 1 W •� 1 � Q Q _ 1 2 .. Q i OA19 393110) 31V1S S U 3 �0'�l/J a 3H1 f� N o a W O a 3 m W S E p5( ST > a W W W /Z S W 1S SIM31 S Y 15 SIM31 S! L uj a � S f F � Q 0 Cc W Q 3 1 � f f w 1S U31SVH S j IA S pool W 1 3 L � r �- OAIS aosaVH s W a � a s Nb � /3 NSIfl 3 S HO ONVIA3NSI0 S 1S 153M S Q 1 1 1 " " - " 1S 1nNlVM S W a � �+ 0 IS H1NIN S O > O W 3 z a •• K i • ! l U 1 � O 1 a u m ___t__ ! _ s( - m:)n3 s EXHIBIT "B" ASSESSED FACILITIES (AS OF SEPTEMBER 2010) ANAHEIM TOURISM IMPROVEMENT DISTRICT 904303.06/OC 999903 - 40000 /7- 22- 10 /wrd/wrd E HMIT "B" Anaheim Tourism Improvement District (TID) Assessed Facilities Abby's Anaheimer Inn 1201 W Katella Ave Alamo Inn and Suite 1140 W Katella Ave Alpine Motel 715 W Katella Ave America's Best Inns and Suites 414 W Ball Rd America's Best Inns and Suites 425 W Katella Ave Anabella Hotel 1030 W Katella Ave Anaheim Camelot Inn and Suites 1520 S Harbor Blvd Anaheim Carriage Inn 2125 S Harbor Blvd Anaheim Courtyard by Marriott 2045 S. Harbor Boulevard Anaheim Del Sol 1604 S Harbor Blvd Anaheim Desert Inn and Suites - Disneyland 1600 S Harbor Blvd Anaheim Desert Palms Hotel and Suites 631 W Katella Ave Anaheim Inn 1630 S Harbor Blvd Anaheim Luxury Suites 620 W Orangewood Ave Anaheim Marriott 700 W Convention Way Anaheim Plaza Hotel and Suites 1700 S Harbor Blvd Anaheim Rodeway Inn Maingate 1211 S West Place Arena Inn & Suites 130 W Katella Ave Best Western Courtesy Inn 1070 W Ball Rd Best Western Park Place Inn and Mini Suites 1544 S Harbor Blvd Best Western Raffles Inn & Suites 2040 S Harbor Blvd Best Western Stovall's Inn 1110 W Katella Ave Best Western- Pavillions 1176 W Katella Ave Budget Inn 1042 W Ball Rd Candy Cane Inn 1747 S Harbor Blvd Carousel Inn and Suites 1530 S Harbor Blvd Castle Inn 1734 S Harbor Blvd Clarion Hotel Anaheim Resort 616 W Convention Way Comfort Inn Maingate 2171 S Harbor Blvd Comfort Suites - Anaheim 300 E Katella Way Cortona Inn and Suites 2029 S Harbor Blvd Days Inn & Suites Anaheim at Disneyland 1111 S Harbor Blvd Days Inn Anaheim West 1030 W Ball Rd Doubletree Guest Suites Anaheim Resort/Con Ctr 2085 S Harbor Blvd Econo Lodge -The Park 1126 W Katella Ave Eden Roc Inn & Suites 1830 S West St Extended Stay America Anaheim Convention Center 1742 S Clementine St Fairfield Inn Anaheim Disneyland Resort 1460 S Harbor Blvd Greenwood Suites 1733 S Anaheim Blvd Hacienda Inn & Suites 2176 S Harbor Blvd Hilton Anaheim 777 W Convention Way Anaheim Tourism Improvement District (TID) Assessed Facilities Holiday Inn Anaheim Resort 1915 S Manchester Ave Holiday Inn Express - Maingate 435 W Katella Ave Holiday Inn Hotel and Suites 1240 S Walnut St Hotel Menage 1221 S Harbor Blvd Howard Johnson Plaza Hotel 1380 S Harbor Blvd Islander Inn and Suites 424 W Katella Ave Jolly Roger Inn 640 W Katell A- La Quinta Inn & Suites ve 1752 S Clementine St Little Boy Blue Motel 416 W Katella Ave Motel 6 100 W Disney Way Park Vue Inn 1570 S Harbor Blvd Peacock Suites Hotel 1745 S Anaheim Blvd Portofino Inn and Suites 1831 S Harbor Blvd Quality Inn & Suites Anaheim 1166 W Katella Ave Quality Inn and Suites Anaheim Resort 1441 S Manchester Ave Quality Inn Maingate 2200 S Harbor Blvd Ramada at the Anaheim Convention Center 2141 S Harbor Blvd Ramada Inn 515 W Katella Ave Ramada Inn Maingate 1650 S Harbor Blvd Ramada Limited Anaheim 921 S Harbor Blvd Red Lion Hotel Anaheim Maingate 1850 S. Harbor Blvd Residence Inn Anaheim Maingate 1700 S Clementine St Riviera Motel 410 W Katella Ave Rodeway Inn & Suites 2145 S Harbor Blvd Sheraton Anaheim Hotel 900 S Disneyland Dr Sheraton Park Hotel at the Anaheim Resort 1855 S Harbor Blvd Staybridge Suites 1855 S. Manchester Ave. Super 8 Motel Anaheim Near Disneyland 415 W Katella Ave Super 8- ANAHEIM Park 915 S Disneyland Dr Travelodge- Anaheim 1057 W Ball Rd Travelodge- International Inn 2060 S Harbor Blvd Tropicana Inn and Suites 1540 S Harbor Blvd Zaby's Motor Lodge 444 W Katella Ave Disneyland Hotel 1150 W Magic Way Disney's Grand California Hotel and Spa 1600 S Disneyland Dr Disney's Paradise Pier Hotel 1717 S Disneyland Dr Ayres Hotel 2550 E Katella Ave Towne Place Suites by Marriott 1730 S State College Blvd *Vacation Ownership Resorts within the TID boundaries are not subject to the TID assessment, to the extent they are being used as Vacation Ownership Resorts. 2 EXHIBIT "C" ASSESSMENT FORMULA, COLLECTION PROCESS AND PENALTIES FOR THE ATID Assessment Formula All Assessed Facilities shall pay an assessment in the amount equal to two percent (2 %) of the hotel room "rent" (as defined in Anaheim Municipal Code Section 2.12.005.080) charged by the operator of such Assessed Facility. Collection by City Each Assessed Facility shall, on or before the close of City business on the last City business day of each month, file a return with the City - designated collector on forms provided by such collector stating the total rents charged during the immediately preceding calendar month. The full amount of the assessments shall be remitted to the City collector along with the return. Penaltv for Non - Pavment. Any Assessed Facility that fails to remit any assessments imposed pursuant to the ATID within the time required shall: (i) pay interest equal to one and one half percent (1.5 %) per month on the outstanding amount due from the first day immediately following the due date until the date of payment; (ii) pay a penalty of ten percent (10 %) for each month, or portion thereof, said payment is overdue, from the first day immediately following the due date provided, that the amount of such penalty shall not exceed fifty percent (50 %) of the assessment; and (iii) pay any collection costs incurred by the City. Any and all interest and penalties collected shall be deposited into the same accounts that hold ATID assessment revenues and shall be used solely for the same authorized purposes of such revenues. Allocation From the ATID assessment revenues collected monthly, City shall recover its actual costs of administering the ATID, not to exceed one percent (1 %) of the levied Assessments, and of the remaining net ATID assessment revenues, seventy -five percent (75 %) shall be dedicated to marketing, promotion and related matters as outlined in Exhibit "D" (the 75% Marketing Component Funds ") and twenty -five percent (25 %) shall be dedicated to planning, design, construction and operation of transit improvements, including the "ARC," the inter -city dedicated mass transit system linking the regional rail station to the various Assessed Facilities and collector points throughout the City (the "25% Transportation Component Funds "). Until the ARC is operational, the 25% Transportation Component Funds may be used for other programs or activities which facilitate transportation to and from the Assessed Facilities. The specific uses of the 25% Transportation Component Funds and the priority of such uses shall be governed by a Transportation Committee or Board which shall include a representative from the City, a representative from the Assessed Facility contributing the largest annual assessment to the ATID, and a third member, all as more particularly described in the Management Plan. The 904303.06/OC 999903 - 40000/7- 22- 10lwrd/wrd EXHIBIT "C" specific uses of the 75% Marketing Component Funds shall be as set forth in the Management Plan. The City will enter into a contract with an entity (the "Contracting Entity ") that will be responsible for handling the day to day management of the 75% Marketing Component Funds. In addition, a board, made up of representatives from the Assessed Facilities, will be established to provide oversight. Details regarding the management of all these funds, decision - making regarding priorities, and any changes in the percentage of the allocation and other related matters will be provided in more detail in the Management Plan. The board and /or Contracting Entity responsible for managing the 75% Marketing Component Funds and the board, committee, or entity responsible for managing the 25% Transportation Component Funds shall each file an annual report with the City in accordance with Section 2.14.150 of the Enabling Ordinance. If and to the extent the City elects to issue bonds pursuant to Section 2.14.140 of the Enabling Ordinance for the purpose of financing authorized transit improvements, the sole source of payment of debt service and any other costs of such bonds shall be the 25% Transportation Component Funds and no portion of the 75% Marketing Component Funds shall be pledged to or otherwise be available to pay such costs. 904303.06/OC 999903 - 40000 /7- 22- 10 /wrd/wrd EXHIBIT "C" EXHIBIT "D" SERVICES AND PROGRAMS TO BE FUNDED BY THE BUSINESSES IN THE ANAHEIM TOURISM IMPROVEMENT DISTRICT Purpose of the Anaheim Tourism Improvement District The Anaheim Tourism Improvement District will serve as a funding mechanism for some or all of the following special improvements or activities to market and promote the City's tourism and convention industry. ➢ Advertising and marketing programs; ➢ Special events produced by resort properties - demand generators; ➢ Underwriting of related special events that benefit the Assessed Facilities; ➢ Public art related to the promotion of Anaheim Convention Center or Anaheim Assessed facilities; ➢ Private additional security within the Resort area for Assessed Facilities; ➢ Transportation expenses such as Anaheim Transportation Network for Assessed Facilities; ➢ Alternative transportation methods for Assessed Facilities; ➢ Funding of satellite offices and facilities for the promotion of Anaheim as a desirable destination location; ➢ Staff and organizational operating costs related to the administration of the ATID; ➢ Repayment of formation costs including the use of attorneys, consultants and related professional services; ➢ Any incidental collection fees levied by the City based upon agreement of the Assessed Facilities; and ➢ Initially twenty -five percent (25 %) of the ATID assessments collected annually will be dedicated to planning, design, construction and operation of transit improvements, including the "ARC," the inter -city dedicated mass transit system linking the regional rail station to the various Assessed Facilities and collector points throughout the City. Until the ARC is operational, the twenty -five percent (25 %) revenue may be used for other programs or activities which facilitate transportation to and from the Assessed Facilities. The proceeds of the ATID assessments shall be spent to administer marketing and visitor programs to promote the benefited Assessed Facilities in the City as a tourism and convention destination and to fund projects, programs and activities, including appropriate staff administrative charges, that benefit Assessed Facilities within the boundaries of the ATID. Funds remaining at the end of any ATID fiscal year may be used in subsequent years in which the ATID assessments are levied as long as they are used consistent with the requirements of the adopted resolution of formation. 904303.06/OC 999903 - 40000 /7- 22- 10 /wrd /wrd EXHrBrr "D"