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HomeMy WebLinkAboutAgenda Bill 5F 06/07/2010~1~ Itewv #5. ~ R A L U1Lj a '~ IggB DATE: June 7,:2010 TO: Honorable Mayor and Members of the City Council FROM: John C. Brown, City Manager SUBJECT: Resolution Approving Professional Services Agreement between the City of Petaluma and the Petaluma Downtown Association for Operation of-the Visitor Center and Petaluma Visitors Program and Authorizing the City Manager to Execute said Agreement. REC®N1N1ENl)ATI®N It is recommended that the City Council adopt the attached Resolution, approving a Professional Services Agreement between the City of Petaluma and the Petaluma Downtown Association for operation of the Visitor Center and Petaluma Visitors Program, and authorizing the City Manager to negotiate and execute said agreement. BACI{G12®iJNI) The Petaluma Visitors Program (PVP, or "the Program") has been managed directly or indirectly for approximately 25 years by the Chamber of Commerce (Chamber). In .1993 the City Council approved Resolution 93-294 related to the Program, and addressed Chamber responsibilities for: developing a PVP oversight committee to provide advice to the Chamber; developing an annual work plan; establishing authority to hire and supervise the position of PVP Director; supervising part-time and volunteer staff through the Program director; and providing quarterly program and budget reports to the City Council. Transit Occupancy Tax (TOT) support provided by the City to the PVP, from 2000 to 2009, averaged $269,000 per year. The highest year's funding was $372,000 in 2003-2004. The lowest was $210,000 in 2004-05. The PVP budget has relied nearly exclusively on TOT funding, with modest amounts of revenue derived through advertising and program receipts. During the stated period, PVP funding represented an average of 28% of TOT revenues, and ranged from a low of 18% to a high of 45% of the totals collected by the-City. Due to the economic downturn that began impacting the City in 2008, significant changes were implemented in 2009-2010 to off-set declining revenues. Among the revenues most dramatically Agenda Review: Dept. Director <~ City Attorney Finance Director~~~ City Manag~ impacted was the TOT, which had corresponding effect on the programs funded from that source. Pursuant to Council policy, $1,000,000 was retained for City use. Based on initial estimates for 2009-10, TOT available for. distribution to non-City activities was reduced from the 2008-09 level of approximately $439,000 to less than $80,000. On that basis, funding for all recipients except the PVP was eliminated. PVP funding was curtailed to a level that could only marginally sustain previous efforts. By reducing program hours, staffing, and scope of work to match available funding, the Chamber was able to maintain Visitor Center operations for 2009- 2010, within a budget that is estimated at year end at approximately $100,000. Relying on part- time and volunteer positions, the Visitor Center has been open seven days per week during peak and semi-peak periods. With this reduced workforce, the visitor guide was produced; social networking tools were established; annual events were sustained; and articles, ads and.. other pieces of multi-media information were produced. Given limited resources, the effort expended this past year to maintain Program operations is laudable. TOT for 2010-11 is currently estimated at approximately $1,149,155. This is slightly more than was discussed with the Council during the May 27~" 2010 budget. workshop, and reflects both adjustment of estimated year-ending expenditures for 2009-10 and additional payments that are expected to be received during the next year on a back due account. Staff is currently working on an agreement for these payments. This additional funding can provide as much as $140,000 for the Visitors Program. This is not a large amount, but is sufficient to operate at current levels, provide for an expanded level of activity, and enable the program operator to position the program to further expand with economic recovery. DISCUSSI®N When notified of funding reductions, the Chamber ceased Visitors program operations as they had theretofore been conducted. The Chamber then agreed to keep the Visitor's Center open for the City on an interim basis, within available funding. In the meanwhile, City staff solicited interest in operating the Visitor Center and Program through a Request for Proposals (RFP) process. The RFP was issued on June 1, 2009. Desired services were described, based largely on the services that had previously been provided. Proposers were asked to: demonstrate. their knowledge and experience related to marketing, promotion, and tourism; present their ideas for processing requests for information and current activities and events; describing how they would work with local establishments in promoting local lodging facilities, restaurants, local events, attractions, and shopping opportunities; how they would establish and maintain cooperative working relationships with visitors, City staff, local and regional agencies, and area residents; present ideas for the website and data base management; and describe how they would maintain operations at the current Visitors Center in the historic Depot building. Providing Visitors Center services was underscored, to insure a point of contact for travelers and other inquiries, and in order to utilize the City's investment in facilities. The RFP also provided that the proposer of choice is required to execute a Professional Services Agreement with the City to formalize what has thus far been an informal relationship between the City and the PVP. Consideration was given to only those proposers who could meet independent contractor requirements; generally those with corporate status who can hire their own employees and with the ability to indemnify the City. Among those responding were community based non-profit entities, a private marketing firm and individuals looking to either partner with the City, or become employees of the City. Among the groups solicited in the RFP process that did not respond were the County's Tourism Bureau, the State Tourism Office, and the Petaluma Downtown Association. Two proposals met the evaluation criteria: the Chamber's, and that of an independent marketing firm. Of the two, the proposal submitted by the. private firm offered the greatest departure from the status quo, and was therefore looked upon more favorably by staff. The firm, however, was relatively new, had few references, and appeared to lack the experience staff felt is needed to operate the Program with a high likelihood of success. These proposals were discussed with the Council's TOT Sub- committee, which agreed with staff's recommendation to continue to seek other options. It was during this process that staff and the Subcommittee began to place greater importance in marketing and outreach activities than had initially been emphasized in the RFP. Subsequent to this activity, the Petaluma Downtown Association (PDA) was further solicited to submit a proposal, as a local organization that appears to have applicable experience operating a program that promotes the community, other than the Chamber, and which can meet independent contractor requirements. The PDA submitted a proposal, which was evaluated in comparison with the Chamber's. Evaluation included interviews conducted by the TOT Subcommittee with each group. The Subcommittee, by consensus, recommends that the City execute a contract with the PDA for Visitor services. The Subcommittee was impressed with the robust nature of the PDA proposal, including outreach and collaboration, and greater emphasis on web-based promotion and creating overnight stays. The PDA proposal was also found to be comprehensive in nature, and responsive to all elements sought in the RFP, including: ® Visitor Center operations, including seasonal operating scenarios. ® Visitor services, such as response to inquiries, distribution of visitor packets, coordination for distribution of community information and maintenance of informational kiosks. ® Web site upgrading, including the development of an itinerary builder, booking agent and links to community sites. ® Developing partnerships with local industry professionals, including coordination and collaboration with the lodging coalition. Developing partnerships with local and regional events and event coordinators, including recreational sports organizations. ® Continuing to host and coordinate holiday events. m Implementing comprehensive media outreach, utilizing a variety of strategies. 0 Developing and engaging target markets and differentiating between peak, shoulder and off seasons, and maintaining a focused objective on increasing overnight stays. ® Coordinating and developing a community event calendar. ® Developing and implementing a meeting request procedure to assist and encourage prospective meeting hosts. The Scope of Services proposed under the recommended agreement is included as an Exhibit to the Resolution attached to this report. As submitted, the PDA proposal estimates 2010-11 program costs of approximately $169,676. As estimated revenues for 2010-11 do not support that level of expenditure, staff requested the PDA to revise its scope of service and cost estimates to operate within available revenues. The PDA has developed such a budget, which requires $140,000 in TOT funding. Any less is viewed as compromising core services and effective marketing and outreach. Staff further analyzed TOT revenue assumptions for both 2009=10; and 2010-11, and believes that sufficient funding can be made available to provide the base level of service requested by the PDA. As a higher level of service is desirable and necessary if the program is to successfully expand from the present, staff proposes. to negotiate an agreement with the PDA that provides minimum guaranteed TOT support of $140,000 to the Program, and increases TOT support, based on any improvement in receipts, up to a maximum of $169;000 for the contract period. A copy of the City's standard contract is under PDA review anticipating negotiations with City staff over a handful of provisions. Staff seeks the Council's authorization to finalize negotiations with the PDA for Visitor Services, and to execute an agreement prior to transfer of program operations from the Chamber on July 1, 2010. FINANCIAL IMPACTS Total Cost of Proposal or Project Amount Budgeted: Name of Fund: Current Fund Balance: $140,000 to $169,000 $147,900 Transient Occupancy Tax Est. year end, 2009/10, $12,445 The PDA proposal requests a budget of nearly $170,000. It appears likely, based on revised TOT revenue and fund balance estimates that the City can provide as much as $140,000 of funding to the Program. For the sake of operating a viable program, this action is recommended. ATTACHMENTS 1. Resolution 2. Exhibit A -Scope of Services ® Items listed below are large in volume and are not attached to this report, but may be viewed in the City Clerk's office. PDA Proposal ATTACHMENT 1 RESOLUTION APPROVING PROFESSIONAL SERVICES AGREEMENT BETWEEN THE CITX OF PETALUMA AND THE PETALUMA D®WNTOWN ASSOCIATION FOR OPERATION OF THE VISITOR CENTER AND PETALUMA VISITORS PROGRAM AND AUTHORIZING THE CITY MANAGER TO EXECUTE SAID AGREEMENT WHEREAS, the City of Petaluma owns and has through the Petaluma Visitors Program operated the Petaluma Visitor Center; and, WHEREAS, the current economic downturn has reduced the funds available to provide visitor services and programming, and, WHEREAS, it is in the economic interests of the City to find creative ways to provide reasonable and responsible levels of service, including development of partnership efforts for programs and projects, and, WHEREAS, as part of the 2009-2010 budget reduction process, the City of Petaluma dramatically reduced the TOT funding affecting reliant entities and programs, including the Petaluma Visitors Program; and, WHEREAS, the City solicited and reviewed proposals to provide visitor services; and WHEREAS, the Petaluma Downtown Association appears to have the ability to operate a viable Visitors Program; and WHEREAS, the Petaluma Downtown Association's proposal was viewed as providing the most beneficial approach to operating the Visitors Program and marketing the City of Petaluma; and WHEREAS, the Petaluma Downtown Association is willing to enter into a standard professional services agreement that includes all aspects of Visitor Center Operations and Programs; and, WHEREAS, a scope of services for management of the Visitor Center and Visitor Program is attached to this resolution and incorporated by reference herein as Exhibit A. NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Petaluma hereby: Approves a Professional Services Agreement between the City of Petaluma and the Petaluma Downtown Association, for operation of the Visitor Center and Petaluma Visitors Program consistent with the scope of services attached as Exhibit A in an amount not to exceed $169,000; and 2. Authorizes the City Manager to negotiate and execute said Agreement. EXHIBIT A SCOPE OF SERVICES Contractor shall perform the following services. All services provided shall be consistent with the following items, numbered 1 - 8 and shall be consistent with all applicable regulatory requirements. 1. Visitors Center a. Provide sufficient staffing, paid and volunteer, to operate the Visitor's center according to In-season and Off-season schedules. i. In-season shall be from the Monday preceding Memorial Day through the Monday following Labor Day. Operations during this time period shall be 7 days per week, with a minimum 8 hours open Friday -Monday, and 6 hours open Tuesday -Thursday. ii. Off-season hours shall be a minimum of 6 hours, Thursday -Monday. 2. Visitor Services a. Respond to inquiries and contacts, including those through the web-site, telephone, email and walk-in. Assemble and provide comprehensive visitor packets. b. Coordinate, develop, manage and distribute visitor information, including brochures, catalogs, flyers and other printed, digital or otherwise electronic information. c. Assure appropriate management and maintenance of visitor information kiosk located at retail outlet mall. 3. Web-Site a. Upgrade, consolidate, maintain and manage the web-site. Coordinate and seek approval of designated City staff relative to changes contemplated and made. b. Incorporate itinerary builder and link web-site to museum, galleries, theater and music options. c. Examine feasibility of including a booking agent, and consider implementation. 4. Partnerships a. Seek and develop partnerships with local industry professionals and businesses and develop and implement communication and collaboration strategies. Included within this task shall be coordination and collaboration with the lodging coalition and county, regional and national tourism professionals'and organizations. b. Seek and develop partnerships with local events and organizations who promote local events that increase overnight stays. Such groups include, but are not limited to; Infineon; Recreational sport providers such as Youth Soccer, Little Baseball and Lacrosse Organization; Service Clubs; Mystic Theatre; American Graffiti; and, other similar organizations and event hosts. 1 c. Support, consult, advise and collaborate with local organizations and residents who are engaged in development of tourism activities. d. Seek joint marketing opportunities. 5. Holiday Events a. Coordinate and/or support important community Holiday events, including but not limited to; Santa's Arrival; Lighted Boat Parade; Tree Lighting; Lighting and Decoration Contests; and, other similar or future events. 6. Media & Outreach a. Coordinate, promote, conduct outreach and develop relationships with the press and media, including travel writers and others promoting tourism. b. Conduct outreach to travel organizers, in order to promote for example, restaurants, the River or Coast and golfing. c. Develop and distribute materials such as, media kits, press releases, story ideas and an image library. d. Take full advantage of social networking opportunities, such as Facebook, MySpace, Twitter, Linkden and YouTube. 7. Target Markets a. Develop target markets, with emphasis and priority placed on promotions that will increase overnight stays, such as recreational sports events, the film industry, local professionals seeking to host meetings and conventions, wedding planners and target tourist markets. b. Develop distinct in and off season target markets. Intentionally increase overnight stays in off season period. c. Develop, circulate and make available an event calendar, including development of an event notification system. d. Develop a series of travel packages and deals and market and promote such. e. Prepare and formalize a meeting request procedure, whereby prospective hosts can submit the requirements of the event for Visitor staff to circulate to appropriate venues. 8. Reporting a. Provide City with quarterly operating and program schedule. Such schedules to be provided prior to July 1, 2010, October 1, 2010, January 1, 2011 and April 1; 2011. b. Provide mid-year and annual reports to the City Council.