1995-171E:\WPDOCS\OPdP\BLKCHAM.HOT
ORDINANCE NO. ~
AN ORDINANCE AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT BETWEEN
THE CITY OF DENTON AND THE DENTON BLACK CHAMBER OF COMMERCE 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 Denton Black Chamber
of Commerce 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.
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
APPROVED AS TO LEGAL FORM:
HERBERT L. PROUTY, CITY ATTORNEY
AGREEMENT BETWEEN THE CITY OF DENTON AND
THE DENTON BLACK CHAMBER OF COMMERCE (95-96)
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 Denton Black 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 its municipal hotel occupancy tax to promote
tourism and the convention and hotel industry by advertising and
conducting solicitations and promotional programs to attract
tourists and convention delegates or registrants to the munici-
pality or its 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
1.1 Consideration. For and in 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:
(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 Five
Thousand Dollars ($5,000).
(b) The CITY shall pay to CHAMBER an amount of money equal to
the base payment amount for the period of October 1, 1995, through
September 30, 1996.
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 ¶1.2.
(b) CITY shall pay the CHAMBER quarterly payments of One
Thousand Two Hundred Fifty Dollars ($1,250). 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 such payment is due. If quarterly financial 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 period.
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
2.1 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 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 Administrative 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
CNAMBER of those activities specified in ¶2.1 above and are allowed
by TEX. TAX CODE § 351.101{f).
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 con-
ducting 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 about September 1 and prior to the disbursement of
any funds for the 1995-96 fiscal year, the CHAMBER shall prepare
and submit to the City Manager of the CITY an annual budget for
such fiscal year for the CHAMBER and any other operation or
function of the CHAMBER in which the hotel tax funds shall be used
by the CHAMBER. This budget shall specifically identify proposed
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 in 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 paid by the CITY to the C~LAMBER
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 Separate Accounts. The CHAMBER shall maintain any hotel tax
funds paid to the CHAMBER by the CITY in a separate account.
3.3 Financial Records. 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 City Manager of the CITY
for additional information relating to the activities performed
under this Agreement.
3.5 Notice of Meetings. The CHAMBER shall give the City Manager of
the CITY reasonable advance written notice of the time and place of
general meetings of the Denton Black 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 Administrative 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 in ¶2.1 above or expenses or costs incurred by
the CHAMBER as described in ¶2.2 above. The CITY is obligated to
reimburse the CHAMBER 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
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 Contractual Obligations. 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 ¶4.1 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 ¶4.2 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 ¶4.2 above.
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, 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 invitees.
PAGE 5
V. TERM AND TERMINATION
5.1 Te~. The term of this Agreement shall commence on October 1,
1995 and terminate at midnight on September 30, 1996. 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;
(ii) The insolvency of the CHAMBER, the filing of a
petition in bankruptcy, either voluntarily or involuntarily,
or and assignment by the CHAMBER 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
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 Subcontract 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
PAGE 6
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 persons,
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. 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.
6.3 Assignment. 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 mail, certified
mail, return receipt requested, or by hand-delivery, addressed to
the respective parties as follows:
CITY CHAMBER
City Manager Chairman/Director
City of Denton Denton Black Chamber of Commerce
215 E. McKinney 625 Dallas Drive
Denton, TX 76201 Denton, TX 76205
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.
6.6 Application of Laws. Ail 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.
PAGE 7
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.
THE CITY OF DENTON, TEXAS
ATTEST: APPROVED AS TO LEGAL F~RM:
7
/~E~INI~ER WALTERS, HERBERT L. PRO~TY,
~,~ITY ~ECRETARY CITY ATTORNEY
DENTON BLACK CHAMBER OF COMMERCE
~Chairma~/Director~
ATTEST: APPROVED AS TO LEGAL FORM:
By: By:
Secretary
E: kWPDOCS \K\CHAMBER. K
PAGE 8