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HomeMy WebLinkAboutCHAMBER OF COMMERCE HOTEL_MOTAL TAX FUND ORDINANCE NO. AN ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT BETWEEN R THE THE CITY OF DENTON AND THE PAYMENT AND USE OF HOTEL TAX REVENUE; AND PROVIDING AN EFFECTIVE D DATE. THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: 5.qi'ION I. That the mayor is hereby authorized to execute an agreement between the City Of Denton and the Denton Chamber of Caomerce for the payment and use of hotel tax revenueo under the which is made contained s part hereof9reement, acopy of terms and attached hereto conditions SECTION ii. That the City COun(:il hereby authorizes the expenditure of funds as set forth in the agreement. sF~ION IIi. That this ordinance shall become effective immediately upon its passage and approval. 1990. PASSED AND APPROVED this the day of 1 ~ 11 RAY STE BEN , MAYO t ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPR D A TO LEGAL FORM: 4 DEBRA ADAMI DRAYOVITCH, CITY ATTORNEY i C BY: DCC.ord t E 1 I • 2924L AGREEMENT BETWEEN THE. CITY OF DENTON AND THE DENTON CHAMBER OF COMMERCE PROVIDING FOR THE PAYMENT AND USE OF MOTEL TAX REVENUE THIS AGREEMENT made between the City of Denton, Texas, a muni- cipal corporation (the "City"), and the Denton Chamber of Commerce, a non-profit corporation incorporated under the laws of the State of Texas (the "Chamber"): WHEREAS TEX. TAX CODE §351.002 authorizes the City to levy by ordinance a municipal hotel occupancy tax ("hotel tax") not ex- ceeding seven percent (7%) of the consideration paid by a hotel occupant; and { WHEREAS, by Ordinance 86-67, the City has provided for the assessment and collection of a municippal hotel occupancy tax in the City of Denton of seven percent (7X); and WHEREAS, TEX. TAX CODE §351.101 (a) authorizes the City to use revenue from its municipal hotel occupancy tax to promote tourism y and the convention and hotel industry by advertising and conduct- ing solicitations and promotional programs to attract tourists and convention delegates or registrants to the municipality or its vicinity; and WHEREAS, the Chamber is well equipped to perform those activi- ties through its Denton Convention and Visitors Bureau; and WHEREAS, TEX. TAX CODE §351.101 (c) authorize; the City to delegate by contract with the Chamber as a private organization , the management and supervision of programs and activities of the type described hereinabove funded with revenue from the municipal hotel occupancy tax; NOW, THEREFORE, in consideration of the performance of the mutual covenants and promises contained herein, the City and the Chamber agree and contract as follows: I. HOTEL TAX REVENUE PAYMENT TO CHAMBER 1.1 Consideration. For and in consideration of the activities to be performed by the Chamber under this Agreement, the City t agrees to pay to the Chamber a portion of the hotel tax revenue collected by the City at the rates and in the manner specified herein (such payments by the City to the Chamber sometimes herein i referred to as the agreed payments or hotel tax funds"). j i rg - T 1 ~ff ,l 1.2 Amount of Payments to Chamber. i (a) As used in this agreement, the following terms shall have the following specific meanings: (i) The "hotel tax revenue" shall mean the monies col- lected and received by the City during any relevant period of time (i.e., fiscal year, fiscal quarter, or calendar month) as municipal hotel occupancy tax at the rate of seven percent (7x) of the price paid for a room in a hotel, pursuant to TEX. TAX CODE §351.002 and City Ordinance 86-87, together with and including any sums of money received by the City from taxpayers during any relevant fiscal quarter or calendar month I as attorney's fees, court costs, or other expenses of collection of hotel tax, but excluding interest and penalties received by the City from taxpayers. (ii) The term "base payment amount" shall mean an amount of money equal to three sevenths (3/7ths) of the total hotel tax revenue collected by the City during any relevant period of time (i.e. fiscal year, fiscal quarter, or calendar month), less (1) such amounts incurred during such relevant period of time for costa of collection of hotel taxes from taxpayers or auditing taxpayers for tax payment compliance, such ' collection and auditing costs to include fees paid to attorneys or other agents not in the regular employ of j j the City and which attorneys or Agents effect collection of the hotel tax from taxpayers or audit such taxpayers, and (2) court costs and expenses incurred in litigation against or auditing of such taxpayers. (iii) In the event that the municipal hotel occupancy tax rate is reduced from the current rate of 7% to 6%, the term "base payment amount" ahall be deemed to mean an amount of money equal to three sixths (3/6ths) of the total hotel tax revenue, as defined above, col- lected by the City during any relevant period of time (i.e. fiscal year, fiscal quarter, or calendar month), less (1) such amounts incurred during such relevant period of time for costs of collection of hotel taxes from taxpayers or auditing taxpayers for tax payment compliance, such collection and auditing costs to in- i clude fees paid to attorneys or other agents not in the regular employ of the City and which attorneys or agents effect collection pof the hotel tax from tax- payers expensesaudit aucosts incurred in xpitigation dagainstcourt dit- ing of such taxpayers. PAGE 2 } t t (b) The City shall pay to the Chamber an amount of money equal to one hundred percent (100%) of the base payment amount for the period April 1, 1990 until September 30, 1990. (c) The City shall pay to the Chamber an amount of money equal to ninety eight percent (98X) of the base payment amount j for the first (1st) full fiscal year of this contract, such fiscal year being October 1, 1990 to September 30, 1991. (d) The City shall pay to the Chamber an amount of money equal to ninety five percent (951) of the base payment amount for the second, third, and fourth (2nd, 3rd, and 4th) full fiscal years of this contract, such fiscal years being October 1, 1991 to September 30, 1992, October 1, 1992 to September 30, 1993, and October 1, 1993 to September 30, 1994. 1 1.3 Dates of Payments to Chamber. (a) The term "quarterly payments" shall mean payments by 1 the City to the Chamber of those amounts specified in 91.2 above as determined by the hotel tax revenue collected by the City dur- ing an7 one fiscal quarter during the term of this Agreement. The term 'monthly payments" shall mean payments by the City to the Chamber of those amounts specified in 91.2 above as determined by the hotel tax revenue collected by the City during any one calen- dar month during the term of this Agreement. (b) City shall pay the Chamber the agreed payments speci- fied in 41.2 above quarterly. Each such quarterly payment shall be paid to the Chamber on or before the forty-fifth (45th) day after the last day of such respective fiscal quarter for which f such payment is due. (c) Should the City, by amendment to the Code of Ordi- nances of the City of Denton, require that the hotel tax be paid on a monthly basis, the agreed payments by the City to the Chamber specified in 91,2 above shall be paid monthly. Each such monthly payment shall be paid to the Chamber on or before the forty-fifth (45th) day after the last day of such respective calendar month for which such payment is due. 11. USE OF HOTEL TAX REVENUE BY CHAMBER 2.1 Use of Funds. For and in consideration of the payment by the City to the Chamber of the agreed payments of hotel tax funds specified above, the Chamber agrees to use such hotel tax funds only for the purposes of advertising and conducting solicitations and promotional programs to attract tourists and convention dele- gates or registrants to the City of Denton or its vicinity, as authorized by TEX. TAX CODE 9351.101 (a)(3). J PAGE 3 1 `11 2.2 Administrative Costs. The hotel tax funds received from the city by the Chamber may be spent for day-to-day operations, supplies, salaries, office rental, travel expenses, and other administrative costs that are incurred directly in the perfor- 1 mance by the Chamber of those activities specified in 12.1 above. d 2,3 Specific Restrictions on Use of Funds. (a) That portion of total administrative costs of the Chamber for which hotel tax funds may be used shall not exceed that portion of the Chamber's administrative costs actually incurred in conducting the activities specified in 42.1 above. + i (b) Hotel tax funds may not be spent for travel for a 1 person to attend an event or conduct an activity the ome ion of purpose of which is not directly related to the pt onve thp. ofuthemperson'1s job in an efficienteandnprofession 1 manner~rmance III. RECORD KEEPING AND REPORTING REQUIREMENTS 3.1 Budget. ch calendar On or before July he Chamber ashall pr pareyand submit the term of this Agreement, the City Manager of the City an annual budget for the next ensuing fiscal year of this Agreement for the Denton Convention ion and Visitors Bureau and l any xofunds shall be usedfbycthenChamber. Chamber in which the Note reed payments or ho The City shall not P8Y fiscale Cha-Bber of athis agAgreement unless such tax funds during any roved in writ- Council~el year has been app , ing budget by the Dentonrespective (b) The Chamber acknowledges that the approval of such budget by the Denton City Council creates a fiduciary duty in the y Y t Chamber with respect to the hole] tax funds paid b the Ci the Chamber under this Agreement. The Chambeshal expend edtl for the purposes tax funds only in the man City, the budget as approved by the 3,2 Separate Accounts. The Chamber shall maintain any hotel tax funds paid to the Chamber by the City in it separate account other umoney ordmain aint suchmhotel tax established with such accounts such hotel tax funds in any other account. pp er shall and a curate afinancials records ofaeach expendituremaintain the mnotel of a PAGE 4 I 1 a t tax funds made by the Chamber and, upon reasonably advance written City's ci or the of request Finance the Denton designee,snshall make such financial Drecords for of Financetor histdesignee Council or i City insection and review b the Y 3.4 Quarterly Reports. The Chamber shall furnishrt the this the Chamb a report of the services Qe dayseafter the end of each fiscal Agreement within thirty (30J uarter of this Agreement. Such report shall summarize the activ- sties of the Chamber in performance of the services specified and 1t2.1 and q2.2 above and the receipt of the ag expenditure of the hotel tax funds received by the Chamber from the City. 3.5 Notice of Meetings. The Chamber shall give the City nce the Manager the geCity neral reasonable meetings ofv the DentonnChamber of Commerce and place e of g other meeting of any consti- Bosubbjec ecard of Directors Chamber t as anY the as well tu of the reme tw shallthbe considered. Thy ism p terrovisthe t of this s Ag Ag shall not be deemed to require the Chamber to give notice of any executive session of the Executive Committee of the Chamber. IV. REIMBURSEMENT AND INDEMNIFICATION ~ the 4.1 Reimburseaent of Chamber for Admii~istrative Costs In .n the Chamber any and callexpenses event that agrees this g reement reimburse the iChambe ~ated City performance of those and coats undertaken by the (;i in activities specified in 42.1 above e or or expen e Cor c ityosts incurred s is obligated by the Chamber as described in 92.2 above. Th e of only the for the Chamber periodexpenses cmmencing and upon vets the as date desnoticcribed in to reimburse termination is given and ending upon the date of termination. lesser of the Further, this obligation shall be limited Cto the during the one preceding termination or the agreed actual expenses dad costs e iod incurred to the Chamber for such period. hundred eighty day period payments otherwise due and payable In 4.2 Reimbursement of Chamber for Contractual Obligations. the event that this Agreement is terminated pursuant to Section 5.2(a), the City agrees to reimburse the Chamber for any and all the Chamber condi- contractual obligations of the Chamber undertaken by amber in performance of those services specified in 1t2.1 above, tioned upon such contractual obligations having been incurred and entered into in the goad faith performance of those services con- PAGE 5 1 templated in 112.1 above, and further conditioned upon such con- tractual obligations having a term not exceeding the fulltter of this Agreement. Notwithstanding any pr Crary, the obligation of the City to reimburse the Chamber or to assume the performance of any contractual obligations of the Chamber for or under any contract entered into by the Chamber as contemplated herein Such monetary hall nolimitation iEN cumu U SAN a DOL all ($10 000.00) . ions taryrlimitationl on to per contract basis, be construed as a move- 4.3 Payment of Reimbursement to Chamber. (a) With respect to expenses and costs incurred by the amber Chamber for which the City then obligated shallt pay isuchs reimbursement pursuant to 94.1 above, Y ' i amount due, if any, to the Chamber on or before the forty-fifth (45th) day after the date of termination of this Agreement, (b) With respect to contractual obligations undertaken by , reimb the the Chamber pfor rovided which in 94.2 above,sthelCity sd to hall reimburse the Chamber as pr Chamber for such monetary obligations required in such contrac- tual obligation in enses are due and such amounts and at those times such contrac- ? oftualsucosts and x limcontractitation set forthainb94.2caboveng to the terms 4.4 Indemnification. The Chamber 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 arishamber nofothose ' or in connection with the performance by the ch claims upon Agreement, constitutionallorustatutory , services contemplated ion this or causes of f allegations of negligent law, or based, in whole or in part, upon ; subcontractors, Chamber, its employee,J, agents, or intentional acts of f V, TERM AND TERMINATION Agreement shall April 1, 1990b and for four and one te minatirg Term. The term years, one-half (4-1/2) at midnight on September 30, 1 This and msubsequent cfour i(4) of an initial period of six (6) 6) mom fiscal years, each fiscal year constituting the period from October 1 of a calenJar year to the next ensuing September 30. PACE 6 5.2 Termination. (a) This Agreement may be terminated by either party by giving the other party one hundred eighty (180) days' advance written notice. (b) This Agreement shall automatically terminate upon the occurrence of any of the following events: 4 (i) The termination of the corporate existence of the Chamber; (ii) The insolvency of the Chamber, the filing of a petition in bankruptcy, either vol- untarily or involuntarily, or an assign- ment by the Chamber for the benefit of l creditors; or (iii) The continuation of a breach of any of the terms or conditions of this Agreement by either the City or the Chamber for more tan thirty (10) days after written notice c.,t such breach is given to the breaching party by the other party. I E VI. GENERAL PROVISIONS 6.1 Subcontract for Performance of Services. Nothing in this Agreement shall prohibit, nor be construed to prohibit, the agreement by :he Chamber with s:rrther private entity, person, or organization for the perforn.+inre of those asr./ices described in 42.1 above. In the event that the Chamber enters into any ar- rangement, contractual or otherwise, with such other entity, person or organization, the Chamber 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 TEX. TAX CODE Chap. 351, includinf, reporting requirements, sepa- rate funds maintenance, and limitations and prohibitions pertain- ing to expenditure of the agreed payments and hotel tax funds. 6.2 Acknowledgment of Denton Convention and Visitors Bureau. The City acknowledges that the setvires contemplated in this Agreement may be performed by the Denton Convention and Visitors Bureau, a wholly-owned and managed entity within the Chamber. Any and all rights, benefits, obligations, and duties under this Agreement, includirg reporting requirements, separate funds main- tenance, limitations and prohibitions pertaining to the ex- penditure of the agreed payments and hotel tax funds, shall inure to the benefit and obligation of she Denton Convention and PAGE 7 i Visitors Bureau. The Bureau shall not be construed to be a sub- contractor or assignee under q6.1 or 56.4 of this Agreement. 6.3 Independent Contractor. The Chamber shall operate as an independent contractor as to all services to be performed under this Agreement and not as an officer, agent, servant, or employee of the City. The Chamber shall have exclusive control of its operations and performance of services hereunder, and such per- sons, entities, or organizations performing the same and the Chamber shall be solely responsible for the acts and omissions of its directors, officers, employees, agents, and subcontractors. f The Chamber shall not be considered a partner or joint venturer with the City, nor shall the Chamber be considered nor in any manner hold itself out as an agent or official representative of the City. 6.4 Assignment. The Chamber shall not assign this Agreement Ir without first obtaining the written consent of the City. F 1 6.5 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 mail, certified mail, return receipt requested, or by hand-delivery, addressed to the respective parties as follows: City.: Chamber If by Mail: , City Manager President City of Denton Denton Chamber of Commerce i 215 E. McKinney Drawer P Denton, TX 76201 Denton, TX 76202 If by hand-delivery: President LJ Denton Chamber of Commerce 414 W. Parkway 4 Denton, TX 76201 6.6 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 obli- gation of the City and the Chamber and their respective successors and assigns. 6.7 Application of Laws. All terms. .auditions, and provi- sions of this Agreement are subject to all applicable federal laws, state laws, the Charter of the City of Denton, all ordi- nances passed pursuant thereto, and all judicial determinations relative thereto. PAGE 8 i r i .8 Exclusive Agreement. This Agreement reements bethe tween entire 6understanding and constitutes the ectirmatter contained or under- parties hereto concerning then reeme ts, arrangements, ex ress or implied, between or among There are no representations, B ree- standings, oral or wrelating to the subject matter of this ag con ~ the parties hereto, variance which are not fully expresso rei ith aThe tes nding any variance went, Agreement shall p l notw other tions of this in this Agreement f o, the terms coon and thesettransactionse document relating to this in This Agreement is executed 6,9 Duplicate Originals. duplicate originals* and subheadings of the various The headings eement are inserted merely for 6.10 Headings. sections and paragraphs of this Agr specific terms of the tatio siooonn of the espec °r imply any limi- the purpose of conveni a%ten n , definition , o ~ aph so designated. section and parag ' 1990• day of EXECUTED this THE CITY OF DENTON, TEXAS BY: Ray a ens, ayor APPROVED S TO LEGAL FORM: ATTEST: d I ~ 1 By: a tc y, am y 4e B• tyaAttorney ,n e a tens, Ci y Se etary s DENTON CHAMBER OF COMMERCE i • ~ By: Charles arpenter, President f x APPROVEDfAS TO LEGAL ORM: i E ATTEST: B By. av es, or ey y: a etary PAGE 9 l~