Agenda 12/11/2012 Item #11CQO
12/11/2012 Item 11.C.
EXECUTIVE SUMMARY
Recommendation to provide direction relative to reallocation of existing Tourist
Development Tax distributions to increase destination marketing efforts and the
annual accumulation of reserves for major beach renourishment.
OBJECTIVE: To obtain direction and authorization to initiate reallocations to the
existing tourist tax distributions and required Tourist Development Tax (TDT) Ordinance
amendments to increase funding for destination marketing and revise the Tourist
Development Tax Category "A" Funding Policy to increase accumulation of reserves for
major beach renourishment.
CONSIDERATIONS: Tourism is a major driver of Collier County's economy
supporting 32,000 hospitality and tourism industry jobs and providing a $1.4 billion
annual economic impact. According to Research Data Services, the Convention and
Visitor Bureau's (CVB) marketing consultant, each dollar invested in destination
advertising and promotion returned $40.79 in direct visitor spending. In addition many
County property and business owners were first introduced to Collier County through
visitation to our area as leisure or group meeting travelers.
A. special subcommittee of the Tourist Development Council (TDC) was appointed in
March of 2011 to review the current tourist tax structure and make recommendations on
how the destination can benefit from a more robust year -round marketing and promotion
effort. The committee met ten times beginning April 1, 2011 and developed a list of
findings and conclusions on the current situation of the tourism industry in Collier
County. From those findings and conclusions, a set of recommendations was developed
for review and recommendation to the County Commission. Attachment 1 is an overview
of the TDC subcommittee recommendations that were supported and recommended by
the Tourist Development Council on March 16, 2012.
The TDC requested staff to take the eleven (11) recommendations to the various tourism
industry stakeholder groups for consideration and input. The result of that process is
shown on Attachment 2. A table summarizing the TDC recommendations is provided as
attachment 3.
The County Manager reviewed the TDC recommendations and the outcome of the
stakeholder input meetings and requested staff to prepare recommendations to accomplish
the goals of more destination marketing funding and more realistic reserve requirements
for future beach renourishment and beach park facilities.
The County Manager suggests a blended approach to tourist tax allocation changes
combining the TDC recommendations and the staff recommendations. Some of these
reallocations will require an amendment of Tourist Tax Ordinance No. 92 -60, as
Packet Page -1745-
12/11/2012 Item 11.C.
amended, and some will require a change in the Category "A" Beacb and Inlet Funding
Policy adopted by the BCC in October of 2005.
FISCAL IMPACT: The recommendations under consideration involve changing the
allocation of existing Tourist Development Tax revenues and redistributing interest
earnings. The proposals both increase the allocation for promotional activities and beach
renourishment through decreases to Beach Park Facilities and County Museum funding.
Staff's proposal adds General Fund commitment to backstop potential Museum and
Beach Park Facility funding shortfalls. The following table compares the current TDT
allocation to staffs and the TDC's proposals.
Tourist Development Tax Raaiiocat on Analysis
The following table illustrates staff s 'reallocation approach including Merest and sweeps /�
of fund balances from designated funds as directed by ordinance:
Staff Reeorrxn wAnd Tourist DWW10PMWt Tax Reallocation
Beater Parks Pran UWn Fund TDC AWW Fund RauVWunent Mweurm
Desc #Mw Fund 183 184 1% 195 Fund 19$
A Fa ies -183 (2,7KWM - - -
Pranw ion -184 - 1,450AOD - - -
y Museums -293 - - - - -
Admin -294 - - - - -
tr Re muratunent 295 - - - 50DJM -
Dmsasw Recmefy -296
uy Museums -198 - - - - OWN
Admin Sweep I 250,00D (250,WO)
vr- -
sr s, � rTtrr ftwdki - ana Vim
In addition to the recommended changes detailed above which will result in annual
additional marketing and promotion dollars totaling $1,900,000, staff recommends that
the Board consider allocating one time dollars available within the disaster recovery
Packet Page -1746-
12/11/2012 Item 11.C.
advertising fund (196) in the amount of approximately $500,000 to supplement Category
n A beach renourishment/ ass maintenance projects and/or augment additional Category B
marketing and promotion. An ordinance amendment or policy change may be required
depending upon the use of these one time dollars. Lowering the ordinance mandated
minimum balance in the disaster advertising fund from $1,000,000 to $500,000 provides
the basis for this one time recommended distribution. Under this proposal, if the Disaster
Recovery Fund drops below $500,000 it will be replenished by the General Fund.
n
GROWTH MANAGEMENT IMPACT: There is no growth management impact
associated with this Executive Summary.
LEGAL CONSIDERATIONS: Any amendment to the Tourist Development Tax
Ordinance No. 92 -60, as amended, will require a super - majority vote. This item has been
reviewed by the County Attorney's Office, is legally sufficient for Board action and
requires a majority vote for approval. — CMG
RECOMMENDATION: To provide direction on the reallocation of current Tourist
Development Tax funding to increase destination marketing efforts and the annual
accumulation of reserves for major beach renourishment, and further, to solicit
recommendations from stakeholder groups prior to the Board's consideration of
ordinance and/or policy changes.
Prepared by: Jack Wert, Tourism Director, Ed Finn, Senior Budget Analyst, OMB
Attachments:
1. TDC recommendations overview
2. Stakeholder meeting outcomes
3. Subcommittee recommendations table
Packet Page -1747-
12/11/2012 Item 11.C.
COLLIER COUNTY
Board of County Commissioners
Item Number: 11.C.
Item Summary: Recommendation to provide direction relative to reallocation of current
Tourist Development Tax funding to increase destination marketing efforts and the annual
accumulation of reserves for major beach renourishment. (Ed Finn, Sr. Budget Analyst, Office
of Management and Budget)
Meeting Date: 12/11/2012
Prepared By
Name: BrockMaryJo
Title: Executive Secretary to County Manager, CMO
11/30/2012 1:14:32 PM
Submitted by
Title: Executive Secretary to County Manager, CMO
Name: BrockMaryJo
11/30/2012 1:14:33 PM
Approved By
Name: OchsLeo
Title: County Manager
Date: 12/5/2012 5:02:05 PM
Packet Page -1748-
12/11/2012 Item 11. C.
Attachment 1
n Overview of the Tourist Development Council (TDC) Recommendations Process
• The TDC Sub Committee of 5 members was appointed by Commissioner Hiller in March 2011
• The group met 10 times over 12 months and made recommendations to the full TDC in
February 2012. TDC recommended 11 tactics for consideration by tourism industry
stakeholder groups
• The overarching goal of the recommendations is to extend the reach of our destination
marketing efforts to attract more visitor spending to our communities
• Final community supported recommendations will go back to TDC and then to BCC for
possible implementation
THE RECOMMENDATIONS:
1. Implement changes to the tourist tax allocations to increase the marketing and promotion
allocation from 25% of the total Tourist tax revenue (currently $ 2 million) to 45% generating a
budget of $4.0 million per year for destination marketing efforts
2. Reduce Beach Park Facilities annual allocation of Category A funds from 16.67% to 6 %, or from
$2 million per year to $600,000 per year
3. Reduce Collier County Owned & Operated Museums Operating funding from tourist tax
funding after five years (FY 17) from 11% to 0 %. Future funding (after 5 years) for museum
operations would revert to General Fund, supplemented by the following new revenue
sources:
a. Charge admission to non - residents
b. Apply for state, regional and national museum grants
c. Annual major fund raising efforts
d. Tourism Department would direct more TDC funds to heritage marketing
4. Increase allocation to Category A Beach renourishment funding from 33.33% to 34% annually
(Increase of $100 k)
S. Increase the allocation to tourism department administration from 11.60% to 12.60% ( +$13 k)
6. Request County Commission (BCC) to recognize excess TDT revenue above current year
projections for immediate use in current fiscal year for destination marketing
7. Extend the allocation of interest earned on each TDT fund to Fund 184 for destination
marketing for an additional three years through FY 15
S. Aggressively pursue State and Federal cost share funding for our beach renourishment
projects through legislative lobbying and education
Packet Page -1749-
12/11/2012 Item 11.C.
Attachment 1
9. Increase the current budget ($100,000) for air service marketing funds by $50,000 per year to r
attract more direct service and enhance and expand existing air service especially from U.S.
West Coast
10. Expand the CVB Community Relations efforts to encourage more local and regional media
coverage of the impact and importance of tourism to our community
11. Tourism Dept (CVB) should be included as an equal participant in economic development
planning for County
The projected results the first year of additional destination marketing funding:
a. 27,700 more Visitors
b. $15.6 million increase indirect visitor expenditures
c. $23.3 million increase in economic impact
d. $250,300 in additional TDT revenue
e. 500 new tourism industry jobs each year
f. Increased tax savings to Collier home owners
Packet Page -1750-
N_
�
N
_O
N
CD
3
�
m
§
&
f
2
»
z
B
.
z
z z
z
z
z
z
z
zw,
w
w
w
z
z
z«
\
\ \
\
\
\
\
}
\
}
\
§ k
z
z
\}
z
z
/ |ƒ
z
z
z
z
z
z
7#
(D \
\
z z
)
)
§
z
z
z
z
z
z
z
z
}
z
>
»
K
)
}
�
C%4
z
0�
)
■
■§
z
z
z
z
z
z
z
z
z
E§
2
k
z
z
U
#
2
)
z
k
z
.
Q
)
z
z
z
k
\}
z
z
z
/)
»
>
f
z
§
E
)
§
\
k
{
2
§
ƒ
o
r
E
2
E
o
£
&
-
)
®
/
%
-
§
.� _
_
`
■
N_
�
N
_O
N
CD
3
�
m
N
N
O
1
I
W G7
z Z
m
C
z
ZJ
d
t
L
N
L
L
W
O
z
C
C
L
Q a
ob
U
U
C
U
U
D.
bo
40
U
p z
C
C
C
L
V
C
C
L
U
z
C
C
C
C
p z
c
c
c
'o-
c
c
v
u
•-
Y+ o
v
u
u
c
•°
z
W
�v
O
O
O
a
O
O
a°
A
w¢
o
z
0
z
0
Z
O
� N
W
� N
O Z
= W
W u
Y Z
O
F
a
v
a
w
H
a
0
u
N
v
r
0
z
w
r
v
r
m
r
r
Y
r
r
v
r
>
z
o
,0_,
m o
5 m
Y �•1
A �
00
m
�• O
,=
L
� �
� C
�
�
C •W
00
C
0
O C t'
Y
i6
LM
C
Y
N
°
W
N
C
'O
\�
A O
Y O
N
O
N
>
N
y
>
d
Y
7 yaC
in m
v p
O
C
O
O
an E c
a E
E
c v u
o m
g
Ln
o
0
c w c
eMp
a
°
o
1 w ,1pn
"
0
C .-
m w +-
a
° m o
v
-o
-o
°o
E a m
c
;-°.
f0
:L
Ol
0 x 0
-o
0
o
Z �.
o
z 5
m w 1O
m E
-p
l7 v
¢
an v v
¢
Q
¢
a
m
O
£
Gi
N
C
>
>
K
O
w s
E
a
o
w
03
u
w
o
z
x 0
E
CO v
V' C
N
�'
,�
N
O
o
z
m
'O
,«
N
O
E
y
H
O i
•O
¢W
O j
N
y 0 Y
w
~
0
? N
7C
e0+
ao
M
C
O
r
Z o °o
c
'o
�°
YO
°
u
a y
E
o
°o
S O
c
L C
0
c
c
w
o
w
ti
tD
K
LL
o E
0
„
u
o
a L
y
w e
v c
o •Z
m
16
3
ui
N
N
0° E
m N
`
W Y
LL a
N
.°.
O
a
C 4
O` O
F
Cc,
O m
N
C
n
w
✓ E
OZS L
Y
0
> N
d o
9
d
N
a0
m
\
2
>
u a,
vi°i o
v m
m
o m
`m
c
'^
E"
O>
p
O m
7 N O
Lt
R O
.O
D
n
'O X
0
O O
O N
¢
n
u m
5
c n
¢
r°
i- °
a°
a d
m
v
F
D
F
w
O
01
c
m
C
E
L
N
C
H
Y
O O
O
Y
w
E
O
m
W
a+ 0
O
O
a
Q
L
m
r
w
N
d
m
M
V
O:
LL
p
L
W
U
E
C
E
O
C
C
L.L
a
Ou
W
N y
cr
p,
0£
V
d
m
Y
r
E
N
s
E
K
d
LL
O
16
W X
C
G
N
�
o~
a
m
~
O
O
Z
U
Q U
V
U
m
H
N
F-
v1
N
m
N
a 10-
�
7 V
O
i
z
w
m
w
a
=
w
~
p
C
u
C7
W
rl
N
f�1
C'
N
tp
1-4
m
N
N
O
1
I