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SR-10-23-2012-8BCity of City Council Report Santa Moniea' City Council Meeting: October 23, 2012 . Agenda Item: 8'-d To: Mayor and City Council From: Andy Agle, Director of Housing and Economic Development Subject: Santa Monica Tourism Marketing District Recommended Action Staff recommends that the City Council: 1) Accept petitions submitted by hotels within the city to form a Tourism Marketing District; 2) Certify the submission of petitions from more than fifty percent of the lodging businesses to be assessed; and 3) Adopt the attached Resolution of Intention to create a Tourism Marketing District Executive Summary Santa Monica Convention and Visitors Bureau (CVB) is requesting the establishment of a Tourism Marketing District (TMD). The new assessment district would be a self - imposed and self - governed benefit assessment district designed to help fund marketing and sales promotion efforts for Santa Monica hotels. The City has received written request petitions from lodging businesses owners representing over 68 percent of the assessments to be levied within the proposed district, which exceeds the statutory requirement of 50 percent. Council approval of the attached Resolution of Intention is required in order to initiate the process of forming the Santa Monica TMD. Background Santa Monica Convention and Visitors Bureau (CVB), a 501(c) (4) non - profit corporation, has been marketing Santa Monica as a visitor destination since 1982. The CVB's mission is to increase visitor expenditures, tourism revenues and local employment opportunities through promotion of Santa Monica as a travel destination. Council approved a three -year contract with the CVB to continue its work promoting and cultivating tourism on July 13, 2010. Tourism is a mainstay sector of the Santa Monica economy and the Transient Occupancy Tax (TOT) has long been a significant General Fund revenue stream that 1 supports basic City services and functions. In FY 2010/11, the TOT generated approximately $36M. Over the last ten years, the TOT collected by the City has increased at an average annual rate of eight percent (Attachment C). The CVB is funded almost exclusively by the City. Annual allocations are included in the City's budget, and one -time funding has been granted occasionally for special projects. In FY 2012/13, the City allocated $2,562,744 to the CVB. In light of constrained City budgets and the CVB's belief that additional funding is needed to increase marketing efforts, the CVB has worked with its stakeholders to identify the establishment of a Tourism Marketing Assessment District as a sustainable funding source that would provide additional revenues for tourism promotion and marketing. Discussion TMDs are authorized by the California Property and Business Improvement District Act of 1994 (Streets and Highways Code §36600 et seq.) and have been used by many cities in California to help promote their communities as tourism destinations including nearby cities of Los Angeles, Long Beach, and West Hollywood. The proposal to establish a TMD in Santa Monica has been developed by the CVB and the Santa Monica hotels for the purpose of funding enhanced international marketing and sales promotion efforts. The chief components of the recommended establishment of a TMD as outlined in the Santa Monica Tourism Marketing District Management District Plan are summarized as follows: Location: The proposed TMD would include all lodging businesses located within the boundaries of the City of Santa Monica with an average daily room rate of $100 and above. The boundary includes 30 qualifying lodging businesses (Attachment D). If new qualifying hotels are developed in Santa Monica, those businesses would be subject to the assessment. 2 Services: Assessment funds would be used for marketing and sales promotions to increase tourism and to market Santa Monica lodging businesses as tourist, meeting, and event destinations. Budget: The total TMD annual budget for its five -year operation is estimated to average approximately $3,129,000 per year. SMTMD assessment funds are intended to supplement, not supplant, existing City funding for tourism marketing. Cost: The assessment would be assessed at a fixed rate, per occupied room, per night. Assessments would not be collected on stays of more than 30 consecutive days, or on stays made by contract or written agreement prior to January 1, 2013, regardless of the date of the stay. The daily amount charged per occupied room would be based on the businesses' average daily rate during the previous year. Lodging businesses with an average daily rate less than $100 would not be included in the district or assessed. The TMD proposed assessment rates are: Average Assessment Per Daily Rate Room Night $100 to $199.99 $2.00 $200 to $300 $3.00 Over $300 $4.00 The assessment rates may be subject to an annual increase of no more than $0.25 per year. The amount of the assessment, if passed on to each guest, would be disclosed in advance and separately stated from the amount of rent charged and any other applicable taxes, and each transient would receive a receipt for payment from the business. The assessment would be described as the "Tourism Marketing District Assessment" or "TMD Assessment" on the guest's documentation. Formation: TMD formation requires submittal of petitions from lodging businesses representing more than 50 percent of the total annual assessment, followed by a City Council hearing and an opportunity for a written protest. If Council approves the Resolution of Intention, lodging business owners would receive notice of the public hearing by mail. If there is a majority written protest, the TMD may not be formed. Duration: The proposed TMD would have a five -year term beginning January 1, 2013 and ending December 31, 2017. Once per year on the 3 anniversary date of the formation of the district, there would be a 30 -day period in which business owners paying more than 50 percent of the assessment may protest and terminate the district. Collection: The City would be responsible for collecting the assessment on a monthly basis (including any delinquencies, penalties, and interest) from each lodging business located in the boundaries of the TMD. The City would forward the assessments on a quarterly basis (less an administrative fee) to the CVB. Governance: The CVB board would serve as the Owners' Association for the TMD. The CVB would form a new standing advisory committee, to be known as the "TMD hotel committee." The TMD hotel committee would have between four and nine members, of which at least four would be representatives of assessed lodging businesses. The TMD hotel committee would be responsible for making recommendations to the CVB board regarding TMD funds and programs. The Management District Plan states that after the TMD is formed, the TMD hotel committee could research the feasibility of expanding the TMD to include businesses other than hotels. Any such modification would require an amendment to the proposed Management Plan, as well as new public hearing and resolution adoption proceedings before the City Council. Commission Action The SMTMD Management Plan was approved by the CVB Board of Directors at its August 8, 2012, meeting. Next Steps If Council adopts the attached Resolution of Intention, a Notice of Public Hearing, scheduled for November 13, would be posted and mailed to all Santa Monica lodging business owners who would be subject to the special assessment. A final public hearing would be scheduled for December 11, 2012, where a Resolution of Formation would be considered by Council. Affected business owners would have a 45 -day period prior to consideration of the Resolution of Formation to protest the formation of the district. To be considered, protests would need to be submitted in writing and presented to the City Clerk on or before the public hearing date. If the TMD is formed, collection of 4 assessments would begin on January 1, 2013. A services agreement between the City and CVB to manage the TMD on behalf of the businesses would be needed. Authorization for such agreement would be sought on December 11, 2012. The State's Property and Business Improvement District law requires every special assessment district to submit annual reports to the governing city showing proposed activities and budget for each fiscal year. Financial Impacts & Budget Actions There is no fiscal impact related to adoption of the Resolution of Intention. If the TMD is eventually established, it is expected to provide financial benefits to the City, primarily in the form of increased TOT and sales tax revenues. Prepared by: Elana Buegoff, Sr. Development Analyst Approved: Andy Agle, Director Housing and Economic Development Forwarded to Council: Rod Gould City Manager Attachments: A. Santa Monica Tourism Marketing District Management District Plan B. Resolution of Intention C. Historical Transient Occupancy Tax Revenues D. Qualifying Lodging Establishments in Santa Monica, 2012 5 Attachment A SANTA MONICA O TOURISM , R E DISTRICT Formed pursuant to the Property and Business ImprovementDistrictAct of1994 (Streets and Highways Code 536600 et seq.) Submitted to the Santa Monica Convention and Visitors Bureau September 6, 2012 by cIVITAs PARTNERSHIPS. PROGRESS. PROSPERITY P ,.. -. INTRODUCTION AND OVERVIEW Developed by Santa Monica hotels and the Santa Monica Convention and Visitors Bureau, the Santa Monica Tourism Marketing District (SIVITIVID) is a benefit assessment district proposed to help fund marketing and sales promotion efforts for certain Santa Monica lodging businesses. This approach has been used successfully in other destination areas throughout the country to improve room night sales for lodging businesses. Location: The proposed SIVITIVID includes all lodging businesses located within the boundaries of the City of Santa Monica with an average daily rate of $100 and above. Services: Marketing and sales promotions to increase tourism and to market assessed Santa Monica lodging businesses as tourist, meeting and event destinations. Budget: The total assessment collected in year one is anticipated to be approximately $3,129,031.49. The assessment funds are intended to supplement, not supplant, existing funding for marketing programs. Cost: The assessment is a fixed amount per occupied room per night. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days, nor on stays which are pursuant to contracts or written agreements which were executed prior to January 1, 2013, regardless of the date of the stay. The amount charged per occupied room per night is based on the businesses' average daily rate, based on the previous year's performance. Lodging businesses with an average daily rate less than $100 will not be included in the district or assessed. Assessment rates are: Average Daily Assessment Per Rate Room Per Night $100-$200 $2,00 $200 -$300 $3.00 Over $300 $4.00 Assessment rates may be subject to an annual increase of no more than $0.25 per year. The maximum assessment rate for each category each year is: Year $100-$200 $200-$300 Over $300 1 $ l2.00 $ 3.00 $ 4.00 2 $ 2.25 $ 3.25 $ 4.25 3 $ 2.50 $ 3.50 $ '4.50 4 $ 2.75 $ 3.75 $ 4.75 5 $ 3.00 $ 4.00 $ 5.00 Santa Monica Tourism Marketing District Management District Plan Page 2 II. WHY A TOURISM MARKETING DISTRICT FOR SANTA MONICA? There are several reasons why now is the right time to form a T10ID in Santa Monica; the most compelling reasons are below Z Stable Fundingfor Tourism Promotion The SMI'MD will provide a stable source of funding for consistent tourism promotion efforts in partnership with the City of Santa Monica. The SMTMD funds are intended to supplement, not supplant, existing funding for marketing programs. Should existing levels of funding for marketing programs be reduced, it is the intention of lodging businesses to petition to disestablish the SMIAID. 2. An Opportunity for Increasing City Tax Revenues As lodging business occupancy, rates, and revenue per available room (RcvPar) increase, so too will the City's TOT revenue. An increase in visitors from the target audience will also produce an increase in sales tax revenues from overall tourist spending. This represents a substantial return to the City. 3. Remain Competitive by GrowingMasket Share of Visitors The funding will ensure that more adequate financing exists for the investment required to help target and increase the number of overnight visitors consuming rooms at assessed hotels. It will allow further implementation of strategies and programs in currently producing markets and building emerging international markets. Santa Monica Tourism Marketing District Management District Plan Page 4 IV. BOUNDARY The S1NiTNM will include lodging businesses with an ADR of $$100 or more, existing and in the future, available for public occupancy within the boundaries of the City of Santa Afonica. Lodging businesses whose ADR increases to $$100 will be assessed upon determination of the increase; likewise, lodging businesses whose ADR decreases to below $100 will not be assessed upon determination of the decrease. ADR figures shall be updated annually. The boundary currently includes 31 lodging businesses. Please see the map below. A complete fisting of lodging businesses within the proposed SIVITIv1D can be found on Appendix 2 of this Plan. After the TNID is formed, the TNID hotel committee intends to research the feasibility of expanding the TNID to include businesses other than hotels. City of Santahlollica I AH IF H$ l 1 �il_HIt HI +����]`� /�J��� L am [-J1IH f11 1 a Santa Monica Tourism Marketing District Management District Plan Page 6 district - funded activities, be featured in advertising campaigns, and benefit from other district funded services. Non- assessed lodging businesses will not receive these and any other district- funded services. C. Time and Manner for Collecting Assessments The SMTMD assessment will be implemented beginning January 1, 2013 and will continue for five years through December 31, 2017. The City of Santa Monica will be responsible for collecting the assessment (including any delinquencies, penalties and interest) on a monthly basis, at the same time and in the same manner as transient occupancy taxes are collected, from each lodging business located in the boundaries of the SIvlTMD. The City shall take all reasonable efforts to collect the assessments from each lodging business. The City of Santa Monica shall forward the assessments on a quarterly or monthly basis to the Santa Monica Convention and Visitors Bureau (SNICVB) which will have the responsibility of managing TMID programs as provided in this Management District Plan. D. Penalties and Interest If any business shall fail or refuse to remit to the City the assessment due on or before the last day of the month in which the assessment becomes due, there shall be added to the assessment a penalty of ten percent (10 %) of the amount of the assessment. If the assessment remains delinquent and unpaid thereafter for a period of thirty days, there shall be an additional penalty of ten percent (10 %). E. Service Plan Budget Summary A summary of the annual service plan budget for the SMTM D is provided on the following pages. The total five year improvement and service plan budget is projected at approximately $3,129,031.49 annually, or $15,645,157.43 through December 31, 2017. F. Annual Service Plan A service plan budget has been developed to deliver services throughout the District. An amoral service plan and budget will be developed and approved by the SMCVB Board. Please see the budget below. Santa Monica Tourism Marketing District Annual Budget, Years One through Five Category Percent of Dollar Budget Amount Sales and Maxkcting 85% $2,659,676.76 Administration 10% $312,903.15 Contingency/Renewal 5% $156,451.57 Total Annual Budget 100% $3,129,031.49 Sales and Marketing A sales and marketing program will promote Santa Monica lodging businesses as tourist and meeting destinations. The sales and marketing program will have a central theme of promoting Santa Monica as a desirable place to visit overnight, and may include the following activities Internet marketing efforts to increase awareness and optimize internet presence; Santa Monica Tout-ism Marketing District Management District Plan Page 8 VI. GOVERNANCE A. Owners' Association The City Council, through adoption of this Management District Plan, has the right, pursuant to Streets and Highways Code §36651, to identify the body that shall implement the proposed program, which shall be the Owners' Association of the TNID as defined in Streets and Highways Code §36614.5. The Santa Monica Convention and Visitors Bureau (Bureau) will serve as the Owners' Association for the TMD. The Bureau shall form a new standing advisory committee, to be known as the "TIAD hotel committee." The TIvID hotel committee shall have between 4 and 9 members, of which at least four will be representatives of assessed lodging businesses. The TME, hotel committee shall be responsible for making recommendations to the SMCVB board regarding TMD funds and programs. Annually, the Bureau shall hold a joint SNICVB board and TIvID hotel committee meeting which will be open to the public. The purpose of the annual meeting will be mutual approval of the budget and programs for TMD funds for the upcoming fiscal year. B. Brown Act and California Public Records Act Compliance The Owners' Association is subject to government regulations relating to transparency, namely the Ralph M. Brown Act and the California Public Records Act, designed to promote public accountability. The Owners' Association of a TMD is considered a legislative body under the Ralph M. Brown Act (Government Code 554950 ct seq.). Thus, meetings of the Bureau's board to the extent TMD business is conducted, and meetings of the TMD committee where a majority of the members of the board are present, must be held in compliance with the public notice and other requirements of the Brown Act. The Owner's Association is also subject to the record keeping and disclosure requirements of the California Public Records Act. C. Annual Report The Bureau's board shall provide an annual report at the end of each fiscal year of operation to the City Council pursuant to Streets and Highways Code X36650 (see Appendix 1). Santa Monica Tourism Marketing District Management District Plan Page 10 § 36603. Preemption of authority or charter city to adopt ordinances levying assessments Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different method of levying assessments for similar or additional purposes from those set forth in this part. A property and business improvement district created pursuant to this part is expressly exempt from the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)). § 36603.5. Part prevails over conflicting provisions Any provision in this part that conflicts with any other provision of law shall prevail over the other provision of law. § 36604. Severability This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. Assessments levied under this part are not special taxes. § 36605. [Section repealed 2001.] § 36606. "Assessment" "Assessment" means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and promoting activities which will benefit the properties or businesses located within a property and business improvement district. § 36607. "Business" "Business" means all types of businesses and includes financial institutions and professions. § 36608. "City" "City" means a city, county, city and county, or an agency or entity created pursuant to Article I (commencing with Section 6500) of Chapter 5 of Division 7 of Title I of the Government Code, the public member agencies of which includes only cities, counties, or a city and county. Santa Monica Tourism Marketing District Management District Plan Page 12 (c) Promotion of tourism within the district. (d) Marketing and economic development, including retail retention and recruitment. (e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services supplemental to those normally provided by the municipality. (f) Activities which benefit businesses and real property located in the district. § 36614. "Management district plan "; "Plan" "Management district plan" or "plan" means a proposal as defined in Section 36622. § 36614.5. "Owners' association" "Owners' association" means a private nonprofit entity that is under contract with a city to administer or implement activities and improvements specified in the management district plan. An owners' association may be an existing nonprofit entity or a newly formed nonprofit entity. An owners' association is a private entity and may not be considered a public entity for any propose, nor may its board members or staff be considered to be public officials for any purpose. Notwithstanding this section, an owners' association shall comply with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part I of Division 2 of Title 5 of the Government Code), at all times when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code), for all documents relating to activities of the district. § 36615. "Property owner "; "Owner" "Property owner" or "owner" means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of land by the city council. The city council has no obligation to obtain other information as to the ownership of land, and its determination of ownership shall be final and conclusive for the purposes of this part. Wherever this subdivision requires the signature of the property owner, the signature of the authorized agent of the property owner shall be sufficient. § 36616. "Tenant" "Tenant" means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner. Santa Monica Tourism Marketing District Management District Plan Page 14 the exterior boundaries of the proposed district. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements and activities and the location and extent of the proposed district. (2) A time and place for a public hearing on the establishment of the property and business improvement district and the levy of assessments, which shall be consistent with the requirements of Section 36623. § 36622. Contents of management district plan The management district plan shall contain all of the following: (a) A map of the district in sufficient detail to locate each parcel of property and, if businesses are to be assessed, each business within the district. (b) The name of the proposed district. (c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for establishment or extension in a manner sufficient to identify the affected lands and businesses included. The boundaries of a proposed property assessment district shall not overlap with the boundaries of another existing property assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created pursuant to this part to overlap with other assessment districts established pursuant to other provisions of law, including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500)). This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with another business assessment district created pursuant to this part. This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with a property assessment district created pursuant to this part. (d) The improvements and activities proposed for each year of operation of the district and the maximum cost thereof. (e) The total annual amount proposed to be expended for improvements, maintenance and operations, and debt service in each year of operation of the district. (f) The proposed source or sources of financing, including the proposed method and basis of levying the assessment in sufficient detail to allow each property or business owner to calculate the amount of the assessment to be levied against his or her property or business, The plan also shall state whether bonds will be issued to finance improvements. (g) The time and manner of collecting the assessments. (h) The specific number of years in which assessments will be levied. hi a new district, the maximum number of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years. Notwithstanding these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy assessments until the maximum maturity of the bonds. The management district plan may set forth specific increases in assessments for each year of operation of the district. (i) The proposed time for implementation and completion of the management district plan. 0) Any proposed rules and regulations to be applicable to the district. Santa Monica Tourism Marketing District Management District Plan Page 16 § 36625. Resolution of formation (a) If the city council, following the public hearing, decides to establish the proposed property and business improvement district, the city council shall adopt a resolution of formation that shall contain all of the following: (1) A brief description of the proposed activities and improvements, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property or businesses within the district, a statement about whether bonds will be issued, and a description of the exterior boundaries of the proposed district. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements and activities and the location and extent of the proposed district. (2) The number, date of adoption, and title of the resolution of intention. (3) The time and place where the public hearing was held concerning the establishment of the district. (4) A determination regarding any protests received. The city shall not establish the district or levy assessments if a majority protest was received. (5) A statement that the properties or businesses in the district established by the resolution shall be subject to any amendments to this part. (6) A statement that the improvements and activities to be provided in the district will be funded by the levy of the assessments. The revenue from the levy of assessments within a district shall not be used to provide improvements or activities outside the district or for any purpose other than the purposes specified in the resolution of intention, as modified by the city council at the hearing concerning establishment of the district. (7) A finding that the property or businesses within the area of the property and business improvement district will be benefited by the improvements and activities funded by the assessments proposed to be levied. (b) The adoption of the resolution of formation and recordation of the notice and map pursuant to Section 36627 shall constitute the levy of an assessment in each of the fiscal years referred to in the management district plan. § 36626. Resolution establishing district If the city council, following the public hearing, desires to establish the proposed property and business improvement district, and the city council has not made changes pursuant to Section 36624, or has made changes that do not substantially change the proposed assessment, the city council shall adopt a resolution establishing the district. The resolution shall contain all of the information specified in paragraphs (1) to (8), inclusive, of subdivision (b) of Section 36625, but need not contain information about the preliminary resolution if none has been adopted. Santa Monica Tourism Marketing District Management District Plan Page 18 § 36630. Expiration of district; Creation of new district If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section 36622, a new management district plan may be created and a new district established pursuant to this part. § 36631. Time and manner of collection of assessments; Delinquent payments The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by the city council in the resolution establishing the management district plan described in Section 36622. Assessments levied on real property may be collected at the same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part shall be charged interest and penalties. § 36632. Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion of residential and agricultural property (a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated benefit to the real property within the property and business improvement district. The city council may classify properties for purposes of determining the benefit to property of the improvements and activities provided pursuant to this part. (b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit to the businesses within the property and business improvement district. The city council may classify businesses for purposes of determining the benefit to the businesses of the improvements and activities provided pursuant to this part. (c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively presumed not to benefit from the improvements and service funded through these assessments, and shall not be subject to any assessment pursuant to this part. § 36633. Time for contesting validity of assessment The validity of an assessment levied under this part shall not be contested in any action or proceeding unless the action or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section 36626. Any appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry of judgment. § 36634. Service contracts authorized to establish levels of city services The city council may execute baseline service contracts that would establish levels of city services that would continue after a property and business improvement district has been formed. Santa Monica Tourism Marketing District Management District Plan Page 20 relating to the issuance of bonds, although proceedings under the Bond Act of 1915 may be modified by the city council as necessary to accommodate assessments levied upon business pursuant to this part. (b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of those improvements, specify the number of annual installments and the fiscal years during which they are to be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated to be raised from assessments over 30 years. (c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with the timely retirement of the debt. § 36641. [Section repealed 2001.] § 36642. [Section repealed 2001.] § 36643. [Section repealed 2001.] § 36650. Report by owners' association; Approval or modification by city council (a) The owners' association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements and activities described in the report. The owners' association's first report shall be due after the first year of operation of the district. The report may propose changes, including, but not limited to, the boundaries of the property and business improvement district or any benefit zones within the district, the basis and method of levying the assessments, and any changes in the classification of property, including any categories of business, if a classification is used. (b) The report shall be filed with the cleric and shall refer to the property and business improvement district by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information: (1) Any proposed changes in the boundaries of the property and business improvement district or in any benefit zones or classification of property or businesses within the district. (2) The improvements and activities to be provided for that fiscal year. (3) An estimate of the cost of providing the improvements and the activities for that fiscal year. (4) The method and basis of levying the assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the assessment to be levied against his or her property or business for that fiscal year. (5) The amount of any surplus or deficit revenues to be carried over from a previous fiscal year. Santa Monica Tourism Marketing District Management District Plan Page 22 after the date of establishment of the district and shall continue for 30 days. The next such 30- day period shall begin two years after the date of the establishment of the district. Each successive year of operation of the district shall have such a 30 -day period. Upon the written petition of the owners of real property or of businesses in the area who pay 50 percent or more of the assessments levied, the city council shall pass a resolution of intention to disestablish the district. The city council shall notice a hearing on disestablishment. (b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing required by this section. The resolution shall state the reason for the disestablishment, shall state the time and place of the public hearing, and shall contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district. The notice of the hearing on disestablishment required by this section shall be given by mail to the property owner of each parcel or to the owner of each business subject to assessment in the district, as appropriate. The city shall conduct the public hearing not less than 30 days after mailing the notice to the property or business owners. The public hearing shall be held not more than 60 days after the adoption of the resolution of intention. § 36671. Refund of remaining revenues upon disestablishment of district; Calculation of refund; Use of outstanding revenue collected after disestablishment of district (a) Upon the disestablishment of a district, any remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property or businesses then located and operating within the district in which assessments were levied by applying the same method and basis that was used to calculate the assessments levied in the fiscal year in which the district is disestablished. All outstanding assessment revenue collected after disestablishment shall be spent on improvements and activities specified in the management district plan. (b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the amount of any refund. Santa Monica Tourism Marketing District Management District Plan Page 24 Attachment C Santa Monica Historical Transient Occupancy Tax Revenues Fiscal Year Revenues 2001 -2002 $16,348,300 2002 -2003 $17,058,700 2003 -2004 $19,850,000 2004 -2005* $23,419,100 2005 -2006 $29,209,200 2006 -2007 $31,892,400 2007 -2008 $34,969,100 2008 -2009 $31,265,200 2009 -2010 $29,803,600 2010 -2011 CAAG ** $32,747,300 8.00 *TOT rate was increased in mid 2004/05 from 12% to 14% ** Compound Average Annual Growth Attachment D Qualifying Lodging Establishments in Santa Monica, 2012 BUSINESS NAME STREET ADDRESS The Ambrose 1255 20th St Bayside 2001 Ocean Ave Best Western PLUS Gateway Hotel 1920 Santa Monica Blvd Cal Mar Hotel Suites 220 California Ave Comfort Inn Santa Monica 2815 Santa Monica Blvd Days Inn Santa Monica 3007 Santa Monica Blvd Doubletree Suites by Hilton 1707 Fourth St The Embassy Hotel Apartments 1001 Third St Fairmont Miramar Hotel & Bungalows 101 Wilshire Blvd Holiday Inn Santa Monica at the Pier 120 Colorado Ave Holiday Motel 1102 Pico Blvd Hotel California 1670 Ocean Ave Hotel Carmel 201 Broadway Hotel Casa Del Mar 1910 Ocean Way Hotel Shangri -La 1301 Ocean Ave Huntley Santa Monica Beach 1111 Second St JW Marriott Santa Monica Le Merigot 1740 Ocean Ave Loews Santa Monica Beach Hotel 1700 Ocean Ave Ocean Lodge 1667 Ocean Ave Ocean View Hotel 1447 Ocean Ave Oceana Beach Club Hotel 849 Ocean Ave Santa Monica Pico Travelodge 3102 Pico Blvd Rest Haven 815 Grant Street Santa Monica Motel 2102 Lincoln Blvd. Sea Shore Motel 2637 Main St Seaview Hotel 1760 Ocean Ave Sheraton Delfina Santa Monica 530 W. Pico Blvd Shore Hotel 1515 Ocean Ave Shutters on the Beach One Pico Blvd The Georgian Hotel 1415 Ocean Ave Viceroy Santa Monica 1819 Ocean Ave Reference Resolution No. 10708 (CCS).