1995-065E:\WPDOCS\ORD\GD~C,HOT
ORDINANCE NO. ~
AN ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT BETWEEN
THE CITY OF DENTON AND THE GREATER DENTON ARTS COUNCIL FOR THE
PAYMENT AND USE OF 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 Greater Denton Arts
Council for the payment and use of 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 immed-
iately upon its passage and approval.
PASSED AND APPROVED this the ~/~day of ~, 1995.
BOB CASTLE
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
APPROVED AS TO LEGAL FORM:
MICHAEL A. BUCEK, ACTING CITY ATTORNEY
AGREEMENT BETWEEN THE CITY OF DENTON AND
THE GREATER DENTON ARTS COUNCIL
PROVIDING 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 Greater Denton Arts
Council, a non-profit corporation incorporated under the laws of
the State of Texas (the "GDAC"):
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) (4) authorizes the CITY to
use revenue from its municipal hotel occupancy tax to promote
tourism and the convention and hotel industry for the encourage-
ment, promotion, improvement, and application of the arts,
including instrumental and vocal music, dance, drama, folk art,
creative writing, architecture, design and allied fields, painting,
sculpture, photography, graphic and craft arts, motion pictures,
radio, television, tape and sound recording, and other arts related
to the presentation, performance, execution, and exhibition of
these major art forms; and
WHEREAS, the GDAC is well equipped to perform those activi-
ties; and
WHEREAS, TEX. TAX CODE §351.101 (c) authorizes the CITY to
delegate by contract with the GDAC 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
GDAC agree and contract as follows;
I. HOTEL TAX REVENUE PAYMENT TO GDAC
1.1 Consideration. For and in consideration of the activities to
be performed by the GDAC under this Agreement, the CITY agrees to
pay to the GDAC 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 GDAC sometimes herein referred to as "the agreed
payments" or "hotel tax funds").
1.2 Amount of Payments to GDAC.
(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 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 §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 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 the total hotel tax revenue collected by the
CITY during any relevant period of time (i.e. fiscal year or
fiscal quarter), 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 compli-
ance, such collection and auditing costs to include fees paid
to attorneys or agents not in the regular employ of 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.
(b) The CITY shall pay to GDAC an amount of money equal to
fourteen and twenty-nine one hundredths of a percent (14.29%) of
the base payment amount for the period of October 1, 1994, through
September 30, 1995 0r Seventy-two Thousand Dollars ($72,000.00),
whichever is less.
1.3 Dates of Payments to GDAC.
(a) The term "quarterly payments" shall mean payments by the
CITY to the GDAC of those amounts specified in ¶1.2 above as
determined by the hotel tax revenue collected by the CITY during
any one fiscal quarter during the term of this Agreement.
(b) CITY shall pay the GDAC the agreed payments specified in
¶1.2 above by quarterly payments paying fourteen and twenty-nine
one hundredths of a percent (14.29%) of the base payment amount
(quarterly) for the first three quarters of 94-95 and the percent-
age of the base payment amount for the last quarter shall be
adjusted so that the total of the quarterly base payment amounts
shall not exceed Seventy-two Thousand Dollars ($72,000.00). Each
such qus. rterly payment shall be paid to the GDAC on or before the
forty-fifth (45th) day after the last day of such respective fiscal
quarter for which such payment is due. If quarterly financial and
PAGE 2
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 period.
Any future funding is solely the responsibility of the GDAC.
(d) It is expressly understood that this contract in no way
obligates the General Fund or any other monies or credits of the
CITY.
II. USE OF HOTEL TAX REVENUE BY GDAC
2.1 Use of Funds. For and in consideration of the payment by the
CITY to the GDAC of the agreed payments of hotel tax funds
specified above, the GDAC agrees to use such hotel tax funds only
for the following purposes:
(a) advertising and conducting solicitations and promotional
programs to attract tourists and convention delegates or regis-
trants to the municipality or its vicinity;
(b) the encouragement, promotion, improvement, and applica-
tion of the arts, including instrumental and vocal music, dance,
drama, folk art, creative writing, architecture, design and allied
fields, painting, sculpture, photography, graphic and craft arts,
motion pictures, radio, television, tape and sound recording, and
other arts related to the presentation, performance, execution, and
exhibition of these major art forms; and
(c) historical restoration and preservation projects or
activities or advertising and conducting solicitations and promo-
tional programs to encourage tourists and convention delegates to
visit preserved historic sites or museums;
(i) at or in the immediate vicinity of convention center
facilities or visitor information centers; or
(ii) located elsewhere in the municipality or its
vicinity that would be frequented by tourists and convention
delegates.
as authorized by TEX. TAX CODE § 351.101(a) (2)-(5) .
2.2 Administrative Costs. The hotel tax funds received from the
CITY by the GDAC 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 GDAC of
those activities specified in ¶2.1 above and are allowed by TEX
TAX CODE ~ 351.101(f) . ·
PAGE 3
2.3 Specific Restrictions on Use of Funds.
(a) That portion of total administrative costs of the GDAC
for which hotel tax funds may be used shall not exceed that portion
of the GDAC'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 tourism and the
convention and hotel industry or the performance of the person's
job in an efficient and professional manner.
III. RECORD KEEPING AND REPORTING REQUIREMENTS
3.1 Budget.
(a) On or before July 31st of each calendar year during the
term of this Agreement, the GDAC shall prepare and submit to the
City Manager of the CITY an annual budget for the next ensuing fis-
cal year of this Agreement for the GDAC and any other operation or
function of the GDAC in which the hotel tax funds shall be used by
the GDAC. This budget shall specifically identify proposed
expenditure of hotel tax funds by the GDAC. 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 GDAC any agreed payments or hotel tax
funds during any fiscal year of this Agreement unless such budget
for such respective fiscal year has been approved in writing by the
Denton City Council.
(b) The GDAC acknowledges that the approval of such budget by
the Denton City Council creates a fiduciary duty in the GDAC with
respect to the hotel tax funds paid by the CITY to the GDAC under
this Agreement. The GDAC 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 Separate Accounts. The GDAC shall maintain any hotel tax
funds paid to the GDAC by the CITY in a separate account.
3.3 Financial Records.. The GDAC shall maintain complete and
accurate financial records of each expenditure of the hotel tax
funds made by the GDAC and, upon reasonably advance written request
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 GDAC 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
PAGE 4
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 GDAC shall
promptly respond to any request from the City Manager of the CITY
for additional information relating to the activities performed
under this Agreement.
3.5 Notice of Meetings. The GDAC shall give the City Manager of
the CITY reasonable advance written notice of the time and place of
general meetings of Greater Denton Arts Council Board of Directors
as well as any other meeting of any constituency of the GDAC at
which this Agreement or any matter the subject of this Agreement
shall be considered. This provision shall not be deemed to require
the GDAC to give notice of any executive session of the Executive
Committee of the GDAC.
IV. REIMBURSEMENT AND INDEMNIFICATION
4.1 Reimbursement of GDAC for Administrative Costs. In the event
that this Agreement is terminated pursuant to Section 5.2{a), the
CITY agrees to reimburse the GDAC for any and all expenses and
costs undertaken by the GDAC in performance of those activities
specified in ¶2.1 above or expenses or costs incurred by the GDAC
as described in ¶2.2 above. The CITY is obligated to reimburse the
GDAC for expenses and costs as described in ¶2.2 above only for the
period commencing upon the date notice of termination is given and
ending upon the date of termination. Further, this obligation
shall be limited to the lesser of the actual expenses and costs
incurred by the GDAC during the one hundred eighty day period
preceding termination or the agreed payments otherwise due and
payable to the GDAC for such period.
4.2 Reimbursement of GDAC for Contractual Obligations. In the
event that this Agreement is terminated pursuant to Section 5.2(a),
the CITY agrees to reimburse the GDAC for any and all contractual
obligations of the GDAC undertaken by the GDAC in performance 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 obligations
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 GDAC or to assume the performance
of any contractual obligations of the GDAC for or under any
contract entered into by the GDAC as contemplated herein shall not
exceed THREE THOUSAND FIVE HUNDRED DOLLARS ($3,500.00). Such
monetary limitation is cumulative of all contractual obligations
and shall not be construed as a monetary limitation on a per
contract basis.
PAGE 5
4.3 Payment of Reimbursement to GDAC.
(a) With respect to expenses and costs incurred by the GDAC
for which the CITY is obligated to reimburse the GDAC pursuant to
¶4.1 above, the CITY shall pay such reimbursement amount due, if
any, to the GDAC 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
GDAC for which the CITY is obligated to reimburse the GDAC as
provided in ¶4.2 above, the CITY shall reimburse the GDAC 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 ¶4.2 above.
4.4 Indemnification. The GDAC 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 GDAC 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 GDAC, its officers, employees, agents,
subcontractors, licensees and invitees.
4.5 Insurance. The GDAC shall provide insurance as follows:
$500,000 Commercial General Liability
Statutory Workers' Compensation and Employers' Liability
($250,000/$500,000/$250,000)
$500,000 Business Automobile Liability
The CITY must be named as an additional insured (except Workers'
Compensation) and proof of coverage shall be submitted prior to any
payment by the CITY.
V. TERM AlqD TERMINATION
5.1 Term. The term of this Agreement shall be for one-half year,
commencing April 1, 1995 and terminating at midnight on September
30, 1995. This term shall be a period of six (6) months.
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:
PAGE 6
(i) The termination of the corporate existence of the
GDAC;
(ii) The insolvency of the GDAC, the filing of a
petition in bankruptcy, either voluntarily or involuntarily,
or and assignment by the GDAC for the benefit of creditors;
(iii) The continuation of a breach of any of the terms
or conditions of this Agreement by either the CITY or the GDAC
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 GDAC to submit a financial
report which complies with the recording procedures required
herein and generally accepted accounting principles prior to
the beginning of the next contract term.
VI. GENERAL PROVISIONS
6.1 Subcontract for Performance of Services. Nothing in this
Agreement shall prohibit, nor be construed to prohibit, the agree-
ment by the GDAC with another private entity, person, or organi-
zation for the performance of those services described in ¶2.1
above. In the event that the GDAC enters into any arrangement,
contractual or otherwise, with such other entity, person or organi-
zation, the GDAC 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 GDAC 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 GDAC shall have exclusive control of its
operations and performance of services hereunder, and such persons,
entities, or organizations performing the same and the GDAC shall
be solely responsible for the acts and omissions of its directors,
officers, employees, agents, and subcontractors. The GDAC shall
not be considered a partner or joint venturer with the CITY, nor
shall the GDAC be considered nor in any manner hold itself out as
an agent or official representative of the CITY.
6.3 Assignment. The GDAC 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 mail, certified
mail, return receipt requested, or by hand-delivery, addressed to
the respective parties as follows:
PAGE 7
CITY GDAC
City Manager Executive Director
City of Denton Greater Denton Arts Council
215 E. McKinney 207 S. Bell
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 GDAC and their respective successors and assigns.
6.6 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.
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 subject matter of this agree-
ment, which are not fully expressed herein. The terms and con-
ditions 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 Originals. This Agreement is executed in duplicate
originals.
6.9 Headings. The headings and subheadings of the various sec-
tions 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.
EXECUTED this~/~day of ~ , 1995.
THE CITY OF DENTON, TEXAS
,,, /
BOB CASTLEBERRY, MAYO/ ~
ATTEST: APPROVED AS TO LEGAL FO~4:/
ACTING CITY ATTORNEY
PAGE 8
AGREEMENT BETWEEN THE CITY OF DENTON AND
THE GREATER DENTON ARTS COUNCIL
PROVIDING 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 Greater Denton Arts
Council, a non-profit corporation incorporated under the laws of
the State of Texas (the "GDAC") :
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)(4) authorizes the CITY to
use revenue from its municipal hotel occupancy tax to promote
tourism and the convention and hotel industry for the encourage-
ment, promotion, improvement, and application of the arts,
including instrumental and vocal music, dance, drama, folk art,
creative writing, architecture, design and allied fields, painting,
sculpture, photography, graphic and craft arts, motion pictures,
radio, television, tape and sound recording, and other arts related
to the presentation, performance, execution, and exhibition of
these major art forms; and
WHEREAS, the GDAC is well equipped to perform those activi-
ties; and
WHEREAS, TEX. TAX CODE §351.101 (c) authorizes the CITY to
delegate by contract with the GDAC 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
GDAC agree and contract as follows;
I. HOTEL TAX REVENUE PAYMENT TO GDAC
1.1 Consideration. For and in consideration of the activities to
be performed by the GDAC under this Agreement, the CITY agrees to
pay to the GDAC 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 GDAC sometimes herein referred to as "the agreed
payments" or "hotel tax funds").
1.2 Amount of Payments to GDAC.
(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 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 §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 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 the total hotel tax revenue collected by the
CITY during any relevant period of time (i.e. fiscal year or
fiscal quarter), 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 compli-
ance, such collection and auditing costs to include fees paid
to attorneys or agents not in the regular employ of 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.
(b) The CITY shall pay to GDAC an amount of money equal to
fourteen and twenty-nine one hundredths of a percent (14.29%) of
the base payment amount for the period of October 1, 1994, through
September 30, 1995 or Seventy-two Thousand Dollars ($72,000.00),
whichever is less.
1.3 Dates of Payments to GDAC.
(a) The term "quarterly payments" shall mean payments by the
CITY to the GDAC of those amounts specified in ¶1.2 above as
determined by the hotel tax revenue collected by the CITY during
any one fiscal quarter during the term of this Agreement.
(b) CITY shall pay the GDAC the agreed payments specified in
¶1.2 above by quarterly payments paying fourteen and twenty-nine
one hundredths of a percent (14.29%) of the base payment amount
(quarterly) for the first three quarters of 94-95 and the percent-
age of the base payment amount for the last quarter shall be
adjusted so that the total of the quarterly base payment amounts
shall not exceed Seventy-two Thousand Dollars ($72,000.00). Each
such quarterly payment shall be paid to the GDAC on or before the
forty-fifth (45th) day after the last day of such respective fiscal
quarter for which such payment is due. If quarterly financial and
PAGE 2
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 period.
Any future funding is solely the responsibility of the GDAC.
(d) It is expressly understood that this contract in no way
obligates the General Fund or any other monies or credits of the
CITY.
II. USE OF HOTEL TAX REVENUE BY GDAC
2.1 Use of Funds. For and in consideration of the payment by the
CITY to the GDAC of the agreed payments of hotel tax funds
specified above, the GDAC agrees to use such hotel tax funds only
for the following purposes:
(a) advertising and conducting solicitations and promotional
programs to attract tourists and convention delegates or regis-
trants to the municipality or its vicinity;
(b) the encouragement, promotion, improvement, and applica-
tion of the arts, including instrumental and vocal music, dance,
drama, folk art, creative writing, architecture, design and allied
fields, painting, sculpture, photography, graphic and craft arts,
motion pictures, radio, television, tape and sound recording, and
other arts related to the presentation, performance, execution, and
exhibition of these major art forms; and
(c) historical restoration and preservation projects or
activities or advertising and conducting solicitations and promo-
tional programs to encourage tourists and convention delegates to
visit preserved historic sites or museums;
(i) at or in the immediate vicinity of convention center
facilities or visitor information centers; or
(ii) located elsewhere in the municipality or its
vicinity that would be frequented by tourists and convention
delegates.
as authorized by TEX. TAX CODE § 351.101(a) (2)-(5).
2.2 Administrative Costs. The hotel tax funds received from the
CITY by the GDAC 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 GDAC of
those activities specified in ¶2.1 above and are allowed by TEX.
TAX CODE § 351.10t(f) .
PAGE 3
2.3 Specific Restrictions on Use of Funds.
(a) That portion of total administrative costs of the GDAC
for which hotel tax funds may be used shall not exceed that portion
of the GDAC'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 tourism and the
convention and hotel industry or the performance of the person's
job in an efficient and professional manner.
III. RECORD KEEPING AND REPORTING REQUIREMENTS
3.1 Budget.
(a) On or before July 31st of each calendar year during the
term of this Agreement, the GDAC shall prepare and submit to the
City Manager of the CITY an annual budget for the next ensuing fis-
cal year of this Agreement for the GDAC and any other operation or
function of the GDAC in which the hotel tax funds shall be used by
the GDAC. This budget shall specifically identify proposed
expenditure of hotel tax funds by the GDAC. 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 GDAC any agreed payments or hotel tax
funds during any fiscal year of this Agreement unless such budget
for such respective fiscal year has been approved in writing by the
Denton City Council.
(b) The GDAC acknowledges that the approval of such budget by
the Denton City Council creates a fiduciary duty in the GDAC with
respect to the hotel tax funds paid by the CITY to the GDAC under
this Agreement. The GDAC 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 Separate Accounts. The GDAC shall maintain any hotel tax
funds paid to the GDAC by the CITY in a separate account.
3.3 Financial Records. The GDAC shall maintain complete and
accurate financial records of each expenditure of the hotel tax
funds made by the GDAC and, upon reasonably advance written request
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 GDAC 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
PAGE 4
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 GDAC shall
promptly respond to any request from the City Manager of the CITY
for additional information relating to the activities performed
under this Agreement.
3.5 Notice of Meetings. The GDAC shall give the City Manager of
the CITY reasonable advance written notice of the time and place of
general meetings of Greater Denton Arts Council Board of Directors
as well as any other meeting of any constituency of the GDAC at
which this Agreement or any matter the subject of this Agreement
shall be considered. This provision shall not be deemed to require
the GDAC to give notice of any executive session of the Executive
Committee of the GDAC.
IV. REIMBURSEMENT AND INDEMNIFICATION
4.1 Reimbursement of GDAC for Administrative Costs. In the event
that this Agreement is terminated pursuant to Section 5.2(a), the
CITY agrees to reimburse the GDAC for any and all expenses and
costs undertaken by the GDAC in performance of those activities
specified in ¶2.1 above or expenses or costs incurred by the GDAC
as described in ¶2.2 above. The CITY is obligated to reimburse the
GDAC for expenses and costs as described in ¶2.2 above only for the
period commencing upon the date notice of termination is given and
ending upon the date of termination. Further, this obligation
shall be limited to the lesser of the actual expenses and costs
incurred by the GDAC during the one hundred eighty day period
preceding termination or the agreed payments otherwise due and
payable to the GDAC for such period.
4.2 Reimbursement of GDAC for Contractual Obligations. In the
event that this Agreement is terminated pursuant to Section 5.2(a),
the CITY agrees to reimburse the GDAC for any and all contractual
obligations of the GDAC undertaken by the GDAC in performance 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 obligations
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 GDAC or to assume the performance
of any contractual obligations of the GDAC for or under any
contract entered into by the GDAC as contemplated herein shall not
exceed THREE THOUSAND FIVE HUNDRED DOLLARS ($3,500.00). Such
monetary limitation is cumulative of all contractual obligations
and shall not be construed as a monetary limitation on a per
contract basis.
PAGE 5
4.3 Payment of Reimbursement to GDAC.
(a) With respect to expenses and costs incurred by the GDAC
for which the CITY is obligated to reimburse the GDAC pursuant to
¶4.1 above, the CITY shall pay such reimbursement amount due, if
any, to the GDAC 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
GDAC for which the CITY is obligated to reimburse the GDAC as
provided in ¶4.2 above, the CITY shall reimburse the GDAC 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 ¶4.2 above.
4.4 Indemnification. The GDAC 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 GDAC 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 GDAC, its officers, employees, agents,
subcontractors, licensees and invitees.
4.5 Insurance. The GDAC shall provide insurance as follows:
$500,000 Commercial General Liability
Statutory Workers' Compensation and Employers' Liability
($250,000/$S00,000/$250,000)
$500,000 Business Automobile Liability
The CITY must be named as an additional insured (except Workers'
Compensation) and proof of coverage shall be submitted prior to any
payment by the CITY.
V. TERM AND TERMINATION
5.1 Te~. The term of this Agreement shall be for one-half year,
commencing April 1, 1995 and terminating at midnight on September
30, 1995. This term shall be a period of six (6) months.
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:
PAGE 6
(i) The termination of the corporate existence of the
GDAC;
(ii) The insolvency of the GDAC, the filing of a
petition in bankruptcy, either voluntarily or involuntarily,
or and assignment by the GDAC for the benefit of creditors;
(iii) The continuation of a breach of any of the terms
or conditions of this Agreement by either the CITY or the GDAC
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 GDAC to submit a financial
report which complies with the recording procedures required
herein and generally accepted accounting principles prior to
the beginning of the next contract term.
VI. GENERAL PROVISIONS
6.1 Subcontract for Performance of Services. Nothing in this
Agreement shall prohibit, nor be construed to prohibit, the agree-
ment by the GDAC with another private entity, person, or organi-
zation for the performance of those services described in ¶2.1
above. In the event that the GDAC enters into any arrangement,
contractual or otherwise, with such other entity, person or organi-
zation, the GDAC 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 GDAC 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 GDAC shall have exclusive control of its
operations and performance of services hereunder, and such persons,
entities, or organizations performing the same and the GDAC shall
be solely responsible for the acts and omissions of its directors,
officers, employees, agents, and subcontractors. The GDAC shall
not be considered a partner or joint venturer with the CITY, nor
shall the GDAC be considered nor in any manner hold itself out as
an agent or official representative of the CITY.
6.3 Assignment. The GDAC 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 mail, certified
mail, return receipt requested, or by hand-delivery, addressed to
the respective parties as follows:
PAGE 7
CITY GDAC
City Manager Executive Director
City of Denton Greater Denton Arts Council
215 E. McKinney 207 S. Bell
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 GDAC and their respective successors and assigns.
6.6 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.
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 subject matter of this agree-
ment, which are not fully expressed herein. The terms and con-
ditions 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 Originals. This Agreement is executed in duplicate
originals.
6.9 Headings. The headings and subheadings of the various sec-
tions 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.
EXECUTED thick/~day of ~ , 1995.
THE CITY OF DENTON, TEXAS
/
BOB CASTLEBERRY, MAY~ ~
/
ATTEST: APPROVED AS ~O LEGAL FO~M:
,.~ciNNIF~ WALTERS, MICHAEL A. BUCEK,
TY ~CRETARY ACTING CITY ATTORNEY
PAGE 8