Loading...
HomeMy WebLinkAbout1998-429ORDINANCE NO d — 7O� AN ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT BETWEEN THE CITY OF DENTON AND THE DENTON COUNTY HISTORICAL FOUNDATION, INC FOR THE USE OF EXISTING HOTEL TAX REVENUE, AND PROVIDING AN EFFECTIVE DATE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I That the Mayor is hereby authorized to execute an agreement between the City of Denton and the Denton County Historical Foundation, Inc for the use of existing hotel tax revenue, under the terms and conditions contained in the agreement, a copy of which is attached hereto and made a part hereof SECTION II That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED this the �L day of 1998 JA C LLER, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY BY APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY AGREEMENT BETWEEN THE CITY OF DENTON AND THE DENTON COUNTY HISTORICAL FOUNDATION, INC. (CY1999-2001) PROVIDING FOR THE USE OF HOTEL TAX REVENUE THIS AGREEMENT made between the City of Denton, Texas, a municipal corporation (the "CITY"), and the Denton County Historical Foundation, Inc, a corporation existing under the laws of the State of Texas (the "FOUNDATION") WHEREAS, Tex Tax Code §351002 authorizes the CITY to levy by ordinance a municipal hotel occupancy tax ("hotel tax"), based upon a percentage of the consideration paid by hotel occupants, and WHEREAS, by ordinance, the CITY has provided for the assessment and collection of a municipal hotel occupancy tax in the City of Denton for the past several years, and WHEREAS, Tex Tax Code §351 101(a) authorizes the CITY to use revenue from its municipal hotel occupancy tax to promote tourism and the convention and hotel industry through historic restoration and preservation projects or activities or advertising and conducting solicitations and promotional programs to encourage tourists and convention delegates to visit preserved historic sites or museums in the City of, and WHEREAS, the FOUNDATION is well equipped to perform those activities, and WHEREAS, Tex Tax Code §351 101(c) authorizes the CITY to delegate by contract with the FOUNDATION, as an independent entity, the management and supervision of programs and activities of the type described hereinabove funded with revenue from the municipal hotel occupancy tax, and WHEREAS, the FOUNDATION has been the recipient of hotel tax funds from the City for a number of years, but has accumulated a large unspent surplus of restricted funds which may not be spent legally for any other purpose NOW, THEREFORE, in consideration of the performance of the mutual covenants and promises contained herem, the CITY and the FOUNDATION agree and contract as follows I. CONSIDERATION AND DEFINITIONS 11 Consideration (a) For and in consideration of the activities to be performed by the FOUNDATION under this Agreement, the CITY agrees to extend the right to use hotel tax funds, as described in Paragraph 12, and which were previously allocated to the FOUNDATION and that are currently in the possession of the FOUNDATION (b) For satisfactory performance of the activities set forth in this Agreement and all attachments hereto, the CITY shall extend the use of the hotel tax revenue to the FOUNDATION for a period of two years, beginning December, 15, 1998 and ending December 15, 2000 This Agreement is subject to an annual approval of a budget by the City Council and subsequent receipt of quarterly reports as required by §351 of the Texas Tax Code (c) The funding of this project in no way commits the CITY to future funding of tins program beyond the current contract period Any future funding is solely the responsibility of the FOUNDATION (d) It is expressly understood that this contract in no way obligates the General Fund or any other monies or credits of the CITY Further, FOUNDATION understands that funding for the contract year 1999-2000 is expressly contingent upon City Council approval of the budget for that respective year 1.2 Definitions. As used in this Agreement, the following terms shall have the following specific meanings (i) The term "hotel tax revenue" shall mean the gross monies previously disbursed by the CITY that are now in the possession of the FOUNDATION These funds represent funds previously collected and received by the City as municipal hotel occupancy tax pursuant to Texas Tax Code §351 002 and City Ordinance The CITY and the FOUNDATION recognize that all of these funds may not be hotel tax funds, but because the nature of the funds have been compromised by 1) commingling with other funds and 2) transfer and handling of funds by a third and separate organization, the FOUNDATION agrees to spend the balance of these fiends according to TEx TAx CoDE §351 within a two- year period Likewise, the CITY agrees to extend the use of this balance to the FOUNDATION for the activities as stated in paragraph 2 1 and as approved by CITY Council in the attached annual budget The balance of these finds that will be considered the "hotel tax revenue" is the balance as recorded in the bank account as of December 15, 1998 as $27,323 37 on the beginning date of this contract, and any interest subsequently earned on this balance (u) The term "contract quarter" shall refer to any quarter of the calendar year in which this Agreement is in force Contract quarters will end on March 3l t, June 30th, September 30th, and December 315` of each contract year H USE OF HOTEL TAX REVENUE BY FOUNDATION 2.1 Use of Funds. For and in consideration of the CITY's extension of hotel tax fiord use to the FOUNDATION of the agreed amounts as specified above, the FOUNDATION agrees to use such hotel tax funds only for historic restoration and preservation projects or activities or advertising and conducting solicitations and promotional programs to encourage tourists and convention delegates to visit preserved historic sites or museums in the City of Denton, as authorized by TEx TAx CODE §351 101(a)(5) The hotel tax funds as described in paragraph 12 must be used by the end of this two year contract period Any funds not used by midnight December 15, 2000 shall be refunded to CITY within thirty (30) days unless the CITY and the FOUNDATION equitably negotiate an extension of this contract or approve a new contract prior to the termination date of this Agreement Page 2 22 Administrative Costs. The hotel tax funds currently in the possession of FOUNDATION may be spent for day-to-day operations, supplies, salaries, office rental, travel expenses, and other administrative costs that are incurred directly in the performance by the FOUNDATION of those activities specified in ¶2 1 above and are allowed by TEX TAX CODE §351 101(f) 23 Specific Restnctions on Use of Funds. (a) That portion of total administrative costs of the FOUNDATION for winch hotel tax funds may be used shall not exceed that portion of the FOUNDATION's administrative costs actually incurred in conducting the activities specified in ¶2 1 above (b) Hotel tax funds may not be spent for travel for a person to attend an event or conduct an activity the primary purpose of which is not directly related to the promotion of local tourism and the convention and hotel industry or the performance of the person's job in an efficient and professional manner III. RECORDKEEPING AND REPORTING REQUIREMENTS 31 Budget. (a) The FOUNDATION shall prepare and submit to the City Manager of the CITY an annual budget (see Exhibit "A") as approved by the City Council for each calendar year, for such operations of the FOUNDATION in which the hotel tax funds shall be used by the FOUNDATION This budget shall specifically identify proposed expenditures of hotel tax funds by the FOUNDATION In other words, the CITY should be able to audit specifically where the funds in the separate account relating to hotel tax funds will be expended The annual budget must be approved in writing by the Denton City Council to authorize the expenditure of funds as stated in Section I Failure to submit an annual budget may be considered a breach of contract, and if not remedied is considered grounds for termination of this Agreement as stated in paragraph 4 2 (b) The FOUNDATION acknowledges that the approval of such budget by the Denton City Council creates a fiduciary duty in the FOUNDATION with respect to the hotel tax funds currently in possession of the FOUNDATION and as described in Paragraph 12 of this Agreement The FOUNDATION shall expend hotel tax funds only in the manner and for the purposes specified in this Agreement, TEX TAX CODE §351 101(a)(5), and in the budget as approved by the CITY 3.2 Separate Accounts. The FOUNDATION shall maintain the hotel tax in a separate bank account with segregated accounting, such that any reasonable person can review the source of expenditures of tax funds A bank reconciliation report (see Exhibit "C") is required with each quarterly report 3.3 Financial Records. The FOUNDATION shall maintain complete and accurate financial records of each expenditure of the hotel tax funds made by the FOUNDATION These funds are required to be classified as restricted funds for audited financial purposes, and may not be used for supporting services, including, but not limited to, auditing fees and attorney's fees Upon reasonably advance written request of the Denton City Council, the City Manager or designate, or any other person, shall make such financial records available for inspection and review by the party Page 3 making the request FOUNDATION understands and accepts that all such financial records, and any other records relating to this Agreement shall be subject to the Public Information Act, TEX Gov'T CODE, ch 552, as hereafter amended 3.4 Quarterly Reports. Within thirty days after the end of every contract quarter, the FOUNDATION shall furnish to CITY (1) a performance report of the work performed under this Agreement, in the form determined by the City Manager or designate, describing the activities performed pursuant to this Agreement during that contract quarter, and (2) a list of the expenditures made with regard to hotel tax funds pursuant to TEX TAX CODE §351 101(c) Both the performance and expenditure reports will be in a form either determined or approved by the City Manager or designate The FOUNDATION shall respond promptly to any request from the City Manager of the CITY, or designate, for additional information relating to the activities performed under this Agreement 3.5 Notice of Meetings. The FOUNDATION shall give the City Manager of the CITY reasonable advance written notice of the time and place of all meetings of the Denton County Historical Foundation's Board of Directors, as well as any other meeting of any constituency of the FOUNDATION at which this Agreement or any matter the subject of this Agreement shall be considered This provision shall not be deemed to require the FOUNDATION to give notice of any executive session of the Executive Committee of the FOUNDATION IV. TERM AND TERMINATION 41 Term. The term of this Agreement shall commence on December 15, 1998 and terminate at midnight on December 15, 2000 This term shall be a period of two years 42 Termination Without Cause. (a) Tlus Agreement may be terminated by either party, with or without cause, by giving the other party sixty (60) days advance written notice (b) In the event this contract is terminated by either party pursuant to Section 4 2(a), the CITY agrees to extend the use of the hotel tax funds to the Foundation for any contractual obligations of the FOUNDATION undertaken by the FOUNDATION in satisfactory performance of those activities specified in ¶¶2 1 and 2 2 above and that were approved by the Council through the budget, as noted in ¶3 1 This extension is conditioned upon such contractual obligations having been incurred and entered into in the good faith performance of those services contemplated in ¶¶2 1 and 2 2 above, and further conditioned upon such contractual obligations having a term not exceeding the full term of this Agreement Notwithstanding any provision hereof to the contrary, the obligation of the CITY to extend the use of the hotel tax funds to the FOUNDATION or to assume the performance of any contractual obligations of the FOUNDATION for or under any contract entered into by the FOUNDATION as contemplated herein shall not exceed 66 2/3% of the current quarterly payment (c) Further, upon termination pursuant to ¶4 2(a), the FOUNDATION will provide the CITY 1) Within 10 business days from the termination notification, a short-term budget of probable expenditures for the remaining 60 day period between termination notification and Page 4 contract termination This budget will be presented to Council for approval within 10 business days after receipt by CITY If formal approval is not given within 10 business days and the budget does not contain any expenditures that would be prohibited by the Texas Tax Code, and is within the current contractual period approved budget, the budget will be considered approved, 2) Within 30 days, a full accounting of all expenditures not previously audited by the City, 3) Within 5 business days of a request from the CITY, a listing of expenditures that have occurred since the last required reporting period, 4) a final accounting of all expenditures and tax funds on the day of termination The FOUNDATION will be obligated to return any unused funds or funds determined to be used improperly Any use of remaining funds after notification of termination is conditioned upon such contractual obligations having been incurred and entered into in the good faith performance of those services contemplated in ¶¶2 1 and 2 2 above, and further conditioned upon such contractual obligations having a term not exceeding the full term of this Agreement 4.3 Automatic Termination. This Agreement shall automatically terminate upon the occurrence of any of the following events (a) The termination of the legal existence of the FOUNDATION, (b) The insolvency of the FOUNDATION, the filing of a petition in bankruptcy, either voluntarily or involuntarily, or an assignment by the FOUNDATION for the benefit of creditors, (c) The continuation of a breach of any of the terms or conditions of this Agreement by either the CITY or the FOUNDATION for more than thirty (30) days after written notice of such breach is given to the breaching party by the other party, or (d) The failure of the FOUNDATION to submit a financial quarterly report which complies with the reporting procedures required herein and generally accepted accounting principles prior to the beginning of the next contract term, or quarterly as required by Section 13 hereof 44 Right to Immediate Termination Upon Litigation Notwithstanding any other provision of this Agreement, to mitigate damages and to preserve evidence and issues for judicial determination, either party shall have the right to terminate this Agreement upon immediate notice to the other party in the event that any person has instituted litigation concerning the activities of the non -terminating party, and the terminating parry reasonably believes that such activities are required or prohibited under this Agreement 45 In the event that this Agreement is terminated pursuant to 1¶4 3 or 4 4, FOUNDATION agrees to refund any and all unused funds, or funds determined by the CITY to have been used improperly, within 30 days after termination of the this Agreement Page 5 V GENERAL PROVISIONS 5.1 Subcontract for Performance of Services. Nothing in this Agreement shall prohibit, nor be construed to prolmbit, the agreement by the FOUNDATION with another private entity, person, or organization for the performance of those services described in ¶2 1 above In the event that the FOUNDATION enters into any arrangement, contractual or otherwise, with such other entity, person or organization, the FOUNDATION shall cause such other entity, person, or organization to adhere to, conform to, and be subject to all provisions, terms, and conditions of this Agreement and to TEx TAx CODE ch 351, including reporting requirements, separate funds maintenance, and limitations and prohibitions pertaining to expenditure of the agreed payments and hotel tax funds 5.2 Independent Contractor. The FOUNDATION shall operate as an independent contractor as to all services to be performed under tins Agreement and not as an officer, agent, servant, or employee of the CITY The FOUNDATION shall have exclusive control of its operations and performance of services hereunder, and such persons, entities, or organizations performing the same and the FOUNDATION shall be solely responsible for the acts and omissions of its directors, officers, employees, agents, and subcontractors The FOUNDATION shall not be considered a partner or joint venturer with the CITY, nor shall the FOUNDATION be considered nor in any manner hold itself out as an agent or official representative of the CITY 53 Indemnification. The FOUNDATION agrees to indemnify, hold harmless, and defend the CITY, its officers, agents, and employees from and against any and all claims or suits for injuries, damage, loss, or liability of whatever kind or character, arising out of or in connection with the performance by the FOUNDATION or those services contemplated by this Agreement, including all such claims or causes of action based upon common, constitutional or statutory law, or based, in whole or in part, upon allegations of negligent or intentional acts of FOUNDATION, its officers, employees, agents, subcontractors, licensees and invitees 54 Assignment. The FOUNDATION shall not assign this Agreement without first obtaining the written consent of the CITY 5.5 Notice. Any notice required to be given under this Agreement or any statute, ordinance, or regulation, shall be effective when given in writing and deposited in the United States marl, certified mail, return receipt requested, or by hand -delivery, addressed to the respective parties as follows City Manager Chair, Board of Trustees City of Denton Denton County Historical Foundation, Inc 215 E McKinney P 0 Box 2184 Denton, TX 76201 Denton, TX 76202 56 Inurement. This Agreement and each provision hereof, and each and every right, duty, obligation, and liability set forth herein shall be binding upon and inure to the benefit and obligation of the CITY and the FOUNDATION and their respective successors and assigns Page 6 57 Application of Laws. All terms, conditions, and provisions of this Agreement are subject to all applicable federal laws, state laws, the Charter of the City of Denton, all ordinances passed pursuant thereto, and all Judicial determinations relative thereto 58 Exclusive Agreement. This Agreement contains the entire understanding and constitutes the entire agreement between the parties hereto concerning the subject matter contained herem There are no representations, agreements, arrangements, or understandings, oral or written, express or implied, between or among the parties hereto, relating to the subject matter of this agreement, which are not fully expressed herein The terms and conditions of this Agreement shall prevail, notwithstanding any variance in this Agreement from the terms and conditions of any other document relating to this transaction or these transactions 59 Duplicate Originals. This Agreement is executed in duplicate originals 5.10 Headings. The headings and subheadings of the various sections and paragraphs of this Agreement are inserted merely for the purpose of convenience and do not express or imply any limitation, definition, or extension of the specific terms of the section and paragraph so designated 511 Severability. If any section, subsection, paragraph, sentence, clause, phrase or word in this Agreement, or application thereof to any person or circumstance is held invalid by any court of competent Jurisdiction, such holding shall not affect the validity of the remaining portions of this Agreement, and the parties hereby declare they would have enacted such remaining portions despite any such invalidity EXECUTED this _ day of �Y// �, 1998 ATTEST rWI i �. i� ECRETARY THE CITY OF DENTON, TEXAS By JAC ,ER, MAYOR APPROVED AS TO LEGAL PROUTY, CITY ATTORNEY DENTON FOUNDATION, HISTORICAL Page 7 ATTEST By Secretary F bham"eptLLGLWw U mmw\Cw acb Wwndadon dm APPROVED AS TO LEGAL FORM a Page 8 DENTON COL\TY HISTORICAL FOUNDATION, INC. P O Box 2184 � + Denton Texas76202 ' / O'c\'ON Co. N' COURTHOUSE BU 996 DENTON COUNTY HISTORICAL FOUNDATION, INC. PROPOSED BUDGET 1998-1999 LALOR FUNDS - CITY OF DENTON, TEXAS 1996-1997 Lalor Fund. $5,048 Disbursemens 00E Slides /Phots 2 OOE Archives 3 OOE Publication 2,500 REprint Broc/Maps 4 OOE Proj Equip supplies OOE Memb training subscriptions 6 OOE Heritage 1,000 pro3 marker 6 OlE Marker 500 5 02E Cemetery 5.03E Presery 548 7 OBE Bus Office 7 OlE 3 OOE 9 ODE OOE TOTAL $5,048 1997-1998 1998-1999 *Lalor Fund $ 7,600 * Reserve $ 5,586 * Disbursements 1 OOE Slides 250 2 ODE Archives 350 3.00E Publication 1100 3.01E REprint 3.02E Broc/maps 4.00E Proj Equip 200 supplies 5.00E Training 100 Mem dues 6.00E Herritage 400 6 OlE His Marker 800 6.02E Cent Proj 6 03E Presery 800 7.00E Office 514 operations 7 OlE Audit/IRS 800 8 OOE Hist Educ 172 9 ODE Capitol 100 improvement 10 OOE Hist Prev TOTAL *Lalor fund was denied by the City of Denton for 1997-1998 $ 5,586 ' Reserve fund of $ 1_,:72 will be divided, between 1998-1999 and 1999 2000 DENTON COUNTY HISTORICAL FOUND-MON, INC. P O Box 2184 Denton Texas76202 August 4, 1998 UEN-0% COUNT' C06n7wOU9E BU L' • 999 DENTON COUNTY HISTORICAL FOUNDATION, INC HOTEL -MOTEL TAX RECOMMENDATION C.D. ACCOUNT The Denton County Historical Foundation has designated entire amount of the C D to be used to re -furbish the 1935 Pirsch Fire Truck and some type of building designed for visitors to be able to view the truck at all times The site that has been choosen is adjacent to the Firefighters Memorial on Mulberry Our desire is to have the truck functional to participate in parades and used for other functions in the City of Denton MARVOURENE MATTHEWS, CHAIRPERSON OLIVE STEPHENS, SECRETARY DENTON COUNTY HISTORICAL FOUNDATION, INC. P O Box 2194 Denton Texas76202 'd DENTON COUNTY COUPTNOUSE SUiL- 18H TO WHOM IT ,MAY CONCERN DENTON COUNTY HISTORICAL FOUNDATION, INC C.D ACCOUNT #87173 FIRST STATE BANK, DENTON, TEXAS BALANCE AS OF JANUARY 1, 1998 $ 16,286 42 OLIVE STEPHENS, SECRETARY