Administrative Report PUBLIC HEARING

TO:

CITY COUNCIL

FROM:

Robert Clark, City Manager

DATE REPORT PREPARED:

October 1,2012

MEETING DATE:

October 9,2012

SUBJECT:

Public Hearing Regarding Formation Ojai Tourism Improvement Dish'ict (OTID) and Adoption of a Resolution Establishing the Dish·ict.

Recommendations 1. Conduct a public hearing in accordance with Government Code Section 54954.6 to determine if there is a majority protest regarding the establishment of the OTID and the levy of assessments as set forth in the Resolution of Intention. 2. If it is determined that there is no majority protest, adopt Resolution No. 12_ _establishing the Ojai Tourism Improvement District. Executive Summary City Council Goal #3 is to "Promote Ojai-TourismJArts/Culture/Leisure". To achieve this goal the City and Ojai Valley Chamber of Conunerce are working together to form the Ojai Tourism Improvement District (OIID). The California Code provides for the formation of this type of district. At the June 26 meeting the City Council approved a Marketing Services Agreement with the Ojai Valley Chamber of Commerce in which the City agrees to work with the Chamber to form a Tourism Improvement District and to provide $50,000 per year as its fair share contribution. Council also adopted a resolution seeking consent from the COWIty to include the unincorporated areas to the proceedings. The COWIty granted consent on August 7. On August 8 the City Council received petitions representing 73.9% of the assessment in the unincorporated area and 89.89% of the City aTea, requesting that the City initiate the proceedings to form the district. In response a District Management Plan was approved and a resolution was adopted setting a public meeting on September 25 and a public hearing on October 9. Notice of the public meeting and hearing was mailed to all businesses affected by the assessment. The Public Meeting was conducted on September 25.

The public hearing scheduled tonight is the oppOltunity for those who will be assessed to lodge a formal protest. If after the close of the public hearing the City Clerk determines that there was no majority protest representing more than 50% of the assessment to be levied, the City Council

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may adopt the Resolution establishing the district. If the Resolution is adopted the levy will be effective on November 1,2012. Fiscal Impact The City contributed $7,000 from the FY 2011-12 budget toward formation costs, and has agreed to provide a $50,000 arumal fair share contribution (subject to annual budget approvals). The budget for the assessment district includes $2,000 per year to cover City and County costs associated with collecting the assessments. Marketing is expected to increase transient occupancy tax, sales tax and event revenues to the City.

Approved for forwardrng City Manager's Office

Submitted by Robert Clark, City Manger

Attachments: A - Resolution _ _Approving Formation of the District B - Notice of Public Meeting and Public Hearing

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RESOLUTION NO. 12 -

_

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF OJAI DECLARING RESULTS OF MAJORITY PROTEST PROCEEDINGS AND ESTABLISHING IN THE CITY OF OJAI AND THAT PORTION OF THE COUNTY OF VENTURA SHOWN IN THE ATTACHED MAP THE OJAI TOURISM IMPROVEMENT DISTlUCT Whereas, the Property and Business Improvement District Law of 1994 (Streets and Highways Code §36600 et. seq.) authorizes cities and counties to establish property and business improvement districts upon petition by a weighted majority of the lodging business owners located within the boundaries of the district; and Whereas, lodging business owners who will pay more than fifty percent (50%) of the proposed assessment, as weighted according to the amount of the assessment to be paid by the petitioner, within the boundaries of the Ojai Tourism Improvement District ("OnD") have petitioned the City Council to establish the OnD; and Whereas, included with the petitions was a Management District Plan summary that describes the proposed assessment to be levied on lodging businesses within the OnD to pay for sales promotion and marketing activities, and other improvements and activities set f011h in the Management District Plan; and Whereas, the assessed lodging businesses within the OnD will be benefited by the activities and improvements set forth in the Management Dish'ict Plan; and Whereas, on August 14, 2012 at 7:00 p.m. at 401 Sonth Ventura Street, Ojai, CA 93024, the City Council adopted a Resolution ofIntention, Resolution No. 12-45; and Whereas, the public meeting and public hearing to consider the establishment of the OnD have been properly noticed in accordance with Streets and Highways Code §36623; and Whereas, the City Council has requested and received consent from the County of Ventura to include a portion of its jurisdiction in this OnD; and Whereas on September 25, 2012 at 7:00 p.m. at 401 South Ventura Street, OJ ai, CA 93024, the City Council held a public meeting regarding the establishment of the OTID, and the City Council heard and received objections and protests, if any, to the establishment of the onD and the levy of the proposed assessment; and Whereas, on October 9, 2012 at 7:00 p.m. at 401 South Ventura Street, Ojai, CA 93024, the City Council held a public hearing regarding the establislmlent of the OnD, and the City Council heard and received all objections and protests, if any, to the establishment of the OnD and the levy of the proposed assessment; and

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Attachment A Page 1 of 4

Whereas, the City Clerk has determined that there was no majority protest. A majority protest is defined as written protests received from owners of businesses in the proposed district which would pay fifty percent (50%) or more of the assessments proposed to be levied. Protests are weighted based on the assessment proposed to be levied on each lodging business. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL THAT:

1. The recitals set forth herein are adopted by the City Council as findings and they are true and correct. 2. The Ojai Tow'ism Improvement District November 1,2012, for a five-year teml.

IS

hereby established, effective

3. The assessments levied for the OTID shall be applied towards marketing and sales promotions to increase overnight tourism and to market Ojai lodging businesses as tourist, meeting and event destinations in accordance with the Management District Plan. 4. The revenue from the levy of the assessments on lodging businesses within the OnD may not be used to provide for activities or inlprovements outside the OnD or for any purpose other than those specified herein, in the Management District Plan, and in the Resolution ofIntention. 5. Assessments levied on lodging businesses pursuant to this resolution shall be levied on the basis of benefit. Because the services provided are intended to increase room rentals, an assessment based on room rentals is the best measure of benefit. 6. The amoUllt of assessment, if passed on to each transient, shall be separately stated from the amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for payment from the business. 7.

The assessments for the entire District will total approxiinately $200,000 in year

one. 8. The activities and improvements set forth will be funded by the levy of an assessment on lodging businesses within the OnD as described in the Management District Plan that is on file with the City Cleric 9.

Bonds will not be issued to fund the OnD.

10. The boundaries of the OTID are shown on the attached map, incorporated herein as Exhibit A. The district is bound: on the north by the Nordhoff Ridge, on the south by the Sulphur Mountain ridgeline, on the east by the mountain ridge between Bear Canyon and Santa Paula Canyon, and on the west by the Lake Casitas / Ventura River watershed boundary.

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Attachment A Page 2 of 4

11. The assessments shall be used for the purposes set forth above and any funds remaining at the end of any year may be used in subsequent years in which the OTID assessment is levied as long as they are used consistent with the requirements set forth herein.

12. The assessments to fund the activities and improvements for the OTID will be collected at the same time and in the same manner as are transient occupancy taxes, and in accordance with Streets and Highways Code §36631. 13. The Ojai Chamber of Commerce shall be the Owners Association pmsuant to Streets and Highways Code §36614.5. 14. The Ojai Chamber of Commerce, pursuant to Streets and Highways Code §36650, shall cause to be prepared a repOli for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvement and activities described in the repOli. The first report shall be due after the first year of operation of the district. 15. The OTID established pursuant to this resolution will be subject to any amendments to the Property and Business Improvement District Law of 1994 (Califomia Streets and Highways Code §36600 et. seq.). 16. The City Clerk, or his or her designee, is directed to take all necessary actions to complete the establishment of the OTID and to levy the assessments. 17. Council.

This Resolution shall take effect immediately upon its adoption by the City

PASSED, APPROVED, AND ADOPTED this 9th day of October 2012.

CITY OF OJAI, CALIFORNIA

Betsy Clapp, Mayor ATTEST:

Rhonda Basore, City Clerk

APPROVED AS TO FORM:

Joseph W. Fletcher, City Attorney 3

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Attachment A Page 3 of 4

Exhibit A District Map

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Ojai Tourism Improvement District

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Ojai City Limits Ojai TID Boundary

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Attachment A Page 4 of 4

NOTICE OF PUBLIC MEETING AND PUBLIC HEARING CONCERNING ESTABLISHMENT OF THE OJAI TOURISM IMPROVEMENT DISTRICT AND LEVYING AN ASSESSMENT ON CERTAIN LODGING BUSINESSES WITHIN THE DISTRICT

NOTICE IS HEREBY GIVEN that on August 14, 2012, the City Council (the "Council") of the City of Ojai

(the "City") adopted a Resolution of Intention to establish the Ojai Tourism Improvement District (the "OTID") and to levy an assessment on certain lodging businesses within the OTID as set forth in the attached Resolution of Intention. NOTICE IS HEREBY FURTHER GIVEN that at 7:00 p.m. on September 2S, 2012, at the City of Ojai

Council Chambers, 401 South Ventura Street, Ojai, CA 93023, a public meeting shall be held pursuant to Government Code section S4954.6 to allow public testimony regarding the establishment of the OTID and the levy of assessments therein as set forth in the enclosed Resolution of Intention and pursuant to Government Code section 54954.6. NOTICE IS HEREBY FURTHER GIVEN that at 7:00 p.m. on October 9, 2012, at the City of Ojai Council Chambers, 401 South Ventura Street, Ojai, CA 93023, has been set as the time and place for a public hearing at which time the Council proposes to establish the OTID and to levy the proposed assessment as set forth in the Resolution of Intention.

Boundaries:

The OTID will include all lodging businesses, existing and in the future, available for public occupancy within the boundaries of the City of Ojai and that portion of the County of Ventura shown in the map below. The district is bound: on the north by the Nordhoff Ridge, on the south by the Sulphur Mountain ridgeline, on the east by the mountain ridge between Bear Canyon and Santa Paula Canyon, and on the west by the Lake Casitas / Ventura River watershed boundary.

Assessment:

Annual assessment rates are 1% of gross short term (stays less than 31 days) room rental revenue on lodging businesses. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days. Assessments pursuant to the OTID shall not include room rental revenue resulting from stays pursuant to contracts executed prior to November 1, 2012.

Budget:

The total OTID annual budget for each year of its five-year operation is anticipated to be approximately $200,000.

Purpose:

Marketing and sales promotions to increase tourism and to market Ojai lodging businesses as tourist, meeting and event destinations.

Collection:

The OTID assessment will be implemented beginning November 1, 2012 and will continue for five years until October 31, 2017. The City of Ojai and County of Ventura

Attachment B Page 1 of 2

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will be responsible for collecting the assessment on a quarterly or monthly basis in accordance with the local lOl practices, and including any delinquencies, penalties and interest, from each lodging business located in the boundaries of the OliO. Protest:

Any owner of a lodging business within the proposed OlIO that will be subject to the assessment may protest the establishment of the OliO. If written protests are received from the owners of lodging businesses in the proposed OliO who represent 50 percent (50%) or more ofthe estimated annual assessments to be levied, the OliO shall not be established and the assessment shall not be imposed. You may mail a written protest to: Office of the City Clerk City of Ojai 401 South Ventura Street Ojai, CA 93024 You may also appear at the public hearing and submit a written protest at that time.

Information: Should you desire additional information about this proposed OliO or assessment contact: Lorena Parker Civitas Advisors Inc. 7700 College Town Drive, Suite 111 Sacramento, CA 95826 (800)999-7781

Dated:

_

City Clerk

Attachment B Page 2 of 2

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