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1996-201A ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT BETWEEN THE CITY OF DENTONAND THE DENTON MISPANIC CMAMBER OF COMMERCE FOR THE PAYMENT AND USE OF MOTEL TAX REVENUE, AND PROVIDING AN EFFECTIVE DATE THE COIINCIL OF THE CITY OF DENTON HEREBY ORDAINS ~ That the Mayor is hereby authorized to execute an agreement between the C~ty of Denton and the Denton Hispanic Chamber of Commerce for the payment and use of hotel tax revenue, under the terms and conditions contained in the agreement, a copy of whzch ~s attached hereto and made a part hereof ~ That thzs ordinance shall become effective ~mmed~ately upon its passage and approval PkSSED AND APPROVED this the I~~ day of ~_ ,~,~ 1996 ATTEST JENNIFER WALTERS, CITY SECRETARY APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY AGREEMENT BETWEEN THE CITY OF DENTON AND THE DENTON HIBP~NXC CHamBER OF CO~ERCE (96-97) PROVXDING FOR THE PAYMENT AND USE OF HOTEL TAX REVENUE THIS AGREEMENT made between the City of Denton, Texas, a muni- cipal corporation (the "CITY"), and the Denton Hispanic Chamber of Commerce, a legal entity existing 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 exceeding 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 municipal hotel occupancy tax in the City of Denton of seven percent (7%), and WHEREAS, TEX. TAX CODE §351.101 (a) (3) authorizes the CITY to use revenue from ~ts municipal hotel occupancy tax to promote tourism and the convention and hotel industry by advertising and conducting solicitations and promotional programs to attract tourlsts and convention delegates or registrants to the munici- pality or ~ts vicinity; and WHEREAS, the CHAMBER is well equipped to perform those activities; and WHEREAS, TEX. TAX CODE §351.101 (c) authorizes the CITY to delegate by contract with the CHAMBER 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; 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 Consi~er&tion. For and ~n consideration of the activities to be performed by the CHAMBER under this Agreement, the CITY 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 referred to as "the agreed payments" or "hotel tax funds"). 1.2 Amount of Payments to Chamber. (a) As used in this agreement, the following terms shall have the following specific meanings. (1) 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 or fiscal quarter) as municipal hotel occupancy tax at the rate of seven percent (7%) of the price paid for a room in a hotel, pursuant to TEX. TAX CODE §3§1.002 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 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 (il) The term "base payment amount" shall mean One Thousand Dollars ($1,000). (b) The CITY shall pay to CHAMBER an amount of money equal to the base payment amount for the per~od of October 1, 1996, through September 30, 1997. 1.3 Dates of Payments to Chamber. (a) The term "quarterly payments" shall mean payments by the CITY to the CHAMBER of four (4) payments totalling the amount specified in 41.2. (b) CITY shall pay the CHAMBER quarterly payments of Two Hundred Fifty Dollars ($250). Each such quarterly payment shall be paid to the CHAMBER on or before the forty-f~fth (45th) day after the last day of such respective f~scal quarter for which such payment is due. If quarterly flnanc~al and performance reports are not received within thirty (30) days of the end of the applicable quarter, then CITY may withhold the quarterly payment(s) until the appropriate reports are received and approved. (c) The funding of this project in no way commits the CITY to future funding of this program beyond the current contract per~od. Any future funding is solely the responsibility of the CHAMBER. (d) It is expressly understood that this contract in no way obligates the General Fund or any other monies or credits of the CITY. PAGE 2 II. USE OF HOTEL TAX REVENUE BY CHAMBER 2.~ Use of Funds. For and in consideration of the payment by the CITY to the CF,%MBER of the agreed payments of hotel tax funds specified above, the CHAMBER agrees to use such hotel tax funds only for advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or regis- trants to the municipality or its vicinity, as authorized by TEX. TAX CODE § 351.101(a)(3). 2.2 ~a~nistrative Costs. The hotel tax funds received from the CITY by the CHAMBER may be spent for day-to-day operations, sup- plies, salaries, office rental, travel expenses, and other admini- strative costs that are incurred directly in the performance by the CHAMBER of those activities specified in 92.1 above and are allowed by TEX. TAX CODE S 351.10~(f). 2.3 Specific Restrictions on Uss 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 con- ducting the activities specified in 92.1 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 tourism and the convention and hotel industry or the performance of the person's ]ob in an efficient and professional manner. III. RECORD KEEPING AND REPORTING REQUIREMENTS 3.1 Budget. (a) On or about September i and prior to the d~sbursement of any funds for the 1996-97 fiscal year, the CHAMBER shall prepare and submit to the city ~anager of the CITY an annual budget for such fiscal year for ths CHAMBER and any othsr operation or function of the CHAMBER in which the hotel tax funds shall be used by the CHAMBER This budget shall specifically identify propossd expenditure of hotel tax funds by the CHAMBER. 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 CITY shall not pay to the CHAMBER any hotel tax revenues as set forth ~n Section I. of this contract during any fiscal year of this Agreement unless a budget for such respective fiscal year has been approved in writing by the Denton City Council authorizing the expenditure of funds in such Section I. PAGE 3 (b) The CHAMBER acknowledges that the approval of such budget by the Denton City Council creates a fiduciary duty in the CHAMBER with respect to the hotel tax funds pald by the CITY to the CHAMBER under this Agreement. The CHAMBER shall expend hotel tax funds only in the manner and for the purposes specified in § 351.101(a) TEX. TAX CODE and in the budget as approved by the CITY 3.2 ssparats Aooounts. The CHAMBER shall maintain any hotel tax funds paid to the CHAMBER by the CITY in a separate account 3.3 Financial Rsoords. The CHAMBER shall maintain complete and accurate financial records of each expenditure of the hotel tax funds made by the CHAMBER and, upon reasonably advance written re- quest of the Denton City Council or the City's Executive Director of Finance or his designee, shall make such financial records available for inspection and review by the Denton City Council or the City's Executive Director of Finance or his designee. 3.4 Quarterly Reports. Within thirty days after the end of every quarter, the CHAMBER shall furnish to the CITY (1) a performance report of the work performed under this Agreement, in the form determined by the City Manager describing the activities performed under this Agreement during that quarter, and (2) a list of the expenditures made with regard to hotel tax funds pursuant to the TEX. TAX CODE ANN. § 351.101(c) (Vernon 1994). The CHAMBER shall promptly respond to any request from the C~ty Manager of the CITY for additional information relating to the activities performed under this Agreement. 3.5 Notios of Meetings. The CHAMBER shall give the C~ty Manager of the CITY reasonable advance written notice of the t~me and place of general meetings of the Denton Hispanic Chamber of Commerce Board of Directors, as well as any other meeting of any constituency of the CHAMBER at which this Agreement or any matter the subject of this Agreement shall be considered This provision 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 4.1 Reimbursement of Chamber for Adminxstrative Costs. In the event that this Agreement is terminated pursuant to Section 5 2(a), the CITY agrees to reimburse the CHAMBER for any and all expenses and costs undertaken by the CHAMBER in performance of those activities specified ~n 42.1 above or expenses or costs incurred by the CHAMBER as described in 42.2 above. The CITY is obligated to reimburse the CHAMBER for expenses and costs as described ~n 42.2 above only for the period commencing upon the date notice of termination is given and ending upon the date of term~natlon Further, this obligation shall be l~mlted to the lesser of the PAGE 4 actual expenses and costs incurred by the CHAMBER during the one hundred eighty day period preceding termination or the agreed payments otherwise due and payable to the CHAMBER for such period 4.2 Reimbursement of Chamber for Contreotu&l Oblig&tions. In the event that this Agreement is terminated pursuant to Section 5.2(a), the CITY agrees to reimburse the CHAMBER for any and all contractu- al obligations of the CHAMBER undertaken by the CHAMBER in perfor- mance of those services specified in ~2.1 above, conditioned upon such contractual obligations having been incurred and entered into in the good faith performance of those services contemplated in ~2.1 above, and further conditioned upon such contractual obliga- tions having a term not exceeding the full term of this Agreement. Notwithstanding any provision hereof to the contrary, the obliga- tion of the CITY to reimburse the CHAMBER or to assume the perfor- mance of any contractual obligations of the CHAMBER for or under any contract entered into by the CHAMBER as contemplated herein shall not exceed FIVE HUNDRED DOLLARS ($500.00). Such monetary limitation is cumulative of all contractual obligations and shall not be construed as a monetary limitation on a per contract basis. 4.3 Payment of Reimbursement to Chamber. (a) With respect to expenses and costs incurred by the CHAMBER for which the CITY is obligated to reimburse the CHAMBER pursuant to 44.1 above, the CITY shall pay such reimbursement 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 the CHAMBER for which the CITY is obligated to reimburse the CHAMBER as provided in 44.2 above, the CITY shall reimburse the CHAMBER for such monetary obligations required in such contractual obligation in such amounts and at those times such contractual costs and expenses are due and payable according to the terms of such contract limitation set forth in 44.2 above 4.4 Inde~liifioation. The CHAMBER agrees to indemnify, hold harmless, and defend the CITY, 1ts 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 CHAMBER 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 CHAMBER, its officers, employees, agents, subcontractors, licensees and invltees V. TERM AND TERMINATION PAGE 5 5.1 Term. The term of this Agreement shall commence on October 1, 1996 and terminate at midnight on September 30, 1997. This term shall be a period of one year. 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: (i) The termination of the legal existence of the CHAMBER; (11) The insolvency of the CHAMBER, the flllng of a petition in bankruptcy, either voluntarily or involuntarily, or and assignment by the CHAMBER for the benefit of creditors; (i11) The continuation of a breach of any of the terms or conditions of this Agreement by either the CITY or the CHAMBER for more than thirty (30) days after written notice of such breach is given to the breaching party by the other party; or (iv) The failure of the CHAMBER to submit a financial report which complies with the reporting procedures required herein and generally accepted accounting principles prior to the beginning of the next contract term. VI. GENERAL PROVISIONS 6.1 Suboontraat for Performance of Services. Nothing in this Agreement shall prohibit, nor be construed to prohibit, the agree- ment by the CHAMBER with another private entity, person, or organi- zation for the performance of those services described in ~2.1 above. In the event that the CHAMBER enters into any arrangement, contractual or otherwise, with such other entity, person or organi- zation, the CHAMBER shall cause such other entity, person, or orga- nization to adhere to, conform to, and be subject to all provi- sions, terms, and conditions of this Agreement and to TEX. TAX CODE Chap. 351, including reporting requirements, separate funds maIn- tenance, and limitations and prohibitions pertaining to expenditure of the agreed payments and hotel tax funds 6.2 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 PAGE 6 operations and performance of services hereunder, and such persons, entitles, 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. The CHAMBER shall not be considered a partner or joint venturer with the CITY, nor shall the CHAMBER be consIdered nor in any matter hold itself out as an agent or official representative of the CITY 6.3 Assig~ent. The CHAMBER shall not assign this Agreement without first obtaining the written consent of the CITY 6.4 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 mall, certified mail, return receipt requested, or by hand-delivery, addressed to the respective parties as follows. CITY CHAMBER City Manager Chairman/Director C~ty of Denton Denton Hispanic Chamber of Commerce 215 E. McKlnney 1607 East McKlnney Denton, TX 76201 Denton, TX 76201 6.5 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 CHAMBER and their respective successors and assigns. 6.$ Application of Laws. All terms, cond~tlons, 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. 6.7 Exclusive Agreement. This Agreement contains the entire understanding and constitutes the entire agreement between the parties hereto concerning the subject matter contained herein There are no representations, agreements, arrangements, or under- standings, oral or written, express or implied, between or among the parties hereto, relating to the sub]ect matter of this agree- ment, which are not fully expressed herein. The terms and con- dltlons 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 6.8 Duplicate Or~ginals. This Agreement is executed in duplicate originals. PAGE 7 6.9 He&dings. The headings and subheadings of the various sec- tlons 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. THE CITY OF DENTON, TEXAS By: ~ ATTEST: APPROVED AS TO LEGAL FORM: i NNI~R W~LTERS, HERBERT L PROUTY, TY BECRETARY CITY ATTORNEY DENTON HISPANIC CHAMBER OF COMMERCE C~'ai~man/Dire6t6r ATTEST: APPROVED AS TO LEGAL FORM: By: By: Secretary PAGE 8