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Home My WebLink AboutFS 2013-03-05 Item 2A - Discussion - Tourism Promotion AreaTO: City of Tukwila Jim Haggerton, Mayor INFORMATIONAL MEMORANDUM Mayor Haggerton Finance and Safety FROM: Derek Speck, Economic Development Administrator BY: Brandon Miles, Senior Planner DATE: February 27, 2013 SUBJECT: Tourism Promotion Area ISSUE Staff is seeking direction from the City Council as to whether the City of Tukwila should engage with stakeholders to form a Tourism Promotion Area. BACKGROUND /DISCUSSION The Cities of Tukwila and SeaTac have been requested by hoteliers to form a Tourism Promotion Area (TPA). The TPA would charge up to $2 per room night. According to the Revised Code of Washington (RCW) 35.101.010, the funds must be used for tourism promotion which means "activities and expenditures designed to increase tourism and convention business, including but not limited to advertising, publicizing, or otherwise distributing information for the purpose of attracting and welcoming tourists, and operating tourism and destination marketing organizations ". A TPA is a geographic region in which a legislative authority (such as a county or city) charges a per room night fee on the furnishing of lodging by either a hotel or motel. The fee may be up to $2 per room night and may be charged to lodging businesses with four or more lodging units. The fee is collected by the Washington State Department of Revenue and then transmitted to the legislative authority, or the legislative authority's designee. Staff estimates that if the Cities of SeaTac and Tukwila form a TPA that charges $2 per room night for hotels and motels with over 60 rooms, it could generate up to $2.5 million per year for tourism promotion. Attached is a chart summarizing the other TPAs in Washington State. There are currently no TPAs in King County. Lodging Tax As a separate but related issue, the cities of Tukwila and SeaTac each separately currently implement a 1% tax on lodging. As required by State law, each city also has a lodging tax committee that serves as an advisory committee to each city council and provides recommendations on the expenditures of the lodging tax funds. Through inter -local agreements, the cities of Tukwila, SeaTac, Kent, and Des Moines contribute approximately $1.2 million per year toward the Seattle Southside Visitors Services, which is a tourism program that promotes the region and is administered by the City of Tukwila. Formation of a TPA would not affect the collection of the 1`)/0 lodging tax. The lodging tax advisory committees are required by 1 INFORMATIONAL MEMO Page 2 State law and would remain in effect. Staff recommends that if a TPA is formed for the SeaTac and Tukwila region, that the responsibility for marketing the region to tourists be transferred to the new tourism organization. The cities could transfer the Seattle Southside brand, website, and other assets to the tourism organization. The cities could continue to use lodging tax for regional tourism promotion by contracting with that organization. TPA Formation Process The following outlines the basic process to form a TPA between the cities of Tukwila and SeaTac. Other cities could also be included. Of course, prior to starting these steps, staff would engage with SeaTac, Seattle Southside staff, our hoteliers, and other cities to come up with a consensus approach. 1. Cities designate the "legislative authority". The participating city councils would need to designate one of the cities as the legislative authority or form a combined legislative authority. This step would be enacted through an inter -local agreement. 2. Hoteliers submit petition to the legislative authority. 3. Legislative authority adopts a "resolution of intention to establish a tourism promotion area ". 4. Legislative authority holds a public hearing. 5. The legislative authority adopts an ordinance establishing the TPA and the lodging charge. 6. The legislative authority contracts with the Washington State Department of Revenue to collect the lodging charge on behalf of the TPA. 7. Washington State Department of Revenue starts collecting the TPA lodging charge. 8. The legislative authority contracts with a tourism organization to carry out the tourism promotion work. 9. The legislative authority should meet at least once a year to approve a basic budget, approve changes to the contract with the tourism organization, and review annual tourism promotion outcomes. Legislative Authority Under State law a "legislative authority" (e.g. city or county council) must adopt an ordinance in order to establish a TPA. The law also requires that in any county with a population of one million or more, the legislative authority shall be composed of two or more jurisdictions acting jointly as the legislative authority under an inter -local agreement (RCW 35.101.010). Thus, in order for the City of Tukwila to form a TPA it must partner with one or more jurisdictions, such as with the City of SeaTac, City of Renton or with King County. Staff from the City of SeaTac has expressed interest in forming a TPA with Tukwila and other cities. It should be noted that a city can transfer, through an Inter -local Agreement (ILA), its legislative 2 INFORMATIONAL MEMO Page 3 authority to another governmental entity. Therefore, the legislative authority for a Tukwila - SeaTac TPA could take the following forms: 1. SeaTac could transfer its legislative authority to Tukwila; 2. Tukwila could transfer its legislative authority to SeaTac; or 3. SeaTac and Tukwila could form a combined legislative authority that would have some councilmembers from both cities. In this case, one of the cities would coordinate the proceedings of the combined legislative authority. Most of the TPAs involve two or more jurisdictions so they have dealt with this question -- even though these TPAs have been formed in counties that have a population of less than one million and are not required by State law to partner with an another jurisdiction. Options 1 and 2 have occurred with the TPAs in Snohomish, Pierce, Clark, and Spokane Counties. In those four TPAs, the partnering cities have transferred their legislative authority status to the largest governmental entities, the respective county councils. None of the TPAs have used option 3 to create a combined legislative authority. However, it should be noted that none of the TPAs are located in a county with over one million residents and so are not required by law to partner with other jurisdictions to form a legislative authority. There has been some discussion and consideration about transferring the legislative authority to a third party such as a Public Development Authority (PDA). While a third party can be used to actually implement the program and oversee the daily use of the funds, the legislative authority must remain with an elected body. The legislative authority must be able to adopt resolutions and ordinances. If a PDA had a board that was entirely composed of councilmembers then the cities could designate it as the legislative authority for the TPA. All of the TPAs have legislative authorities that are either city or county councils. State law specifies that the legislative authority "has sole discretion as to how the revenue derived from the charge is to be used to promote tourism (RCW 35.101.130)." However, it does not specify the level of involvement needed by the legislative authority in overseeing the TPA. The legislative authority may appoint existing advisory boards or create new advisory boards to make recommendations for the use of the funds. The legislative authority may also contract with tourism destination marketing organizations or similar organizations to promote tourism. Based upon the research into the other TPAs, most of the legislative authorities approve an annual budget for the TPA and the contract with a local tourism organization such as a convention and visitors bureau. Typically, the legislative authorities do not get involved in the day to day operations of the TPA. The one exception is Snohomish County. The Snohomish County Council approves all expenditures of the TPA funds, after request for funds have been reviewed by a commission of hoteliers. Petition and Geographical Area In order to form a TPA, State law requires that a petition be presented to the legislative authority. To be valid, the petition must include a number of items including: 3 INFORMATIONAL MEMO Page 4 1. A description of the boundaries of the proposed TPA. Given that Tukwila may partner with the City of SeaTac on the TPA, the description of the boundary would be the combined area of both cities; 2. The proposed uses and projects to which the proposed revenue from the charge shall be put and total estimated costs; 3. The estimated rate for the charge with a proposed breakdown by classification of lodging business. For example, the TPA could be set up to only apply to hotels with over a certain number of rooms. If the threshold is set to 60 or more rooms, Tukwila has fifteen hotels and motels in that classification which comprise a total of 2,035 rooms; SeaTac has 28 hotels and motels in that classification which comprise a total of 5,227 rooms. The combined total between the two cities is 7,262 rooms; and 4. The signatures of the persons who operate lodging businesses in the proposed area who would pay sixty percent or more of the proposed charges ( "ratepayers "). It is important to point out that the 60 percent requirement is for the entire TPA area, which would be the combined area of the cities of Tukwila and SeaTac. If the TPA is limited to hotel and motels with 60 or more rooms, there would be a total of 7,262 rooms within the TPA area, thus hoteliers comprising 4,357 of the rooms would be able to meet the 60 percent threshold. It is important to note that SeaTac hotels /motels would have approximately 71% of the rooms in the TPA, while Tukwila would make up 29 %; thus SeaTac hoteliers could submit a valid petition, even if ALL of Tukwila's hotel ratepayers objected to the formation of the TPA. Before a legislative authority can adopt an ordinance to implement a TPA, State law requires the legislative authority to hold a public hearing. If a protest is made by the lodging businesses in the area which would pay a majority of the proposed charges then the formation proceedings must terminate (RCW 35.101.070). Tourism Organization Once the legislative authority has formed the TPA it can determine the organizational structure to implement the tourism promotion work. There are basically four types of organizations that could work: 1. Business. The legislative authority could contract with a for - profit business (or even an individual as a sole proprietor), such as a marketing firm, to be carry out the tourism promotion work. This appears to be the framework with Union Gap's TPA. 2. City Department. The legislative authority could contract with the City of Tukwila or SeaTac to implement the tourism promotion. This arrangement would be similar to the relationship that Tukwila and SeaTac have with the Seattle Southside. SeaTac and Tukwila have an inter -local agreement in which the cities pool lodging tax funds for tourism promotion under the brand of Seattle Southside. The Seattle Southside staff members are City of Tukwila employees and the City of Tukwila administers the inter- local agreement. A benefit of this arrangement is that it may be faster to implement since we have an existing framework. It also provides stability and openness. There are some significant drawbacks because government agencies are more risk averse since they have to take into account citizen expectations and follow numerous laws and regulations. Cities also have wide variety of functions and policies that serve all departments which can make it challenging to provide the flexibility that may be 4 INFORMATIONAL MEMO Page 5 appropriate for tourism promotion. These aspects can result in higher administrative costs, limited flexibility, and longer time to get results. Snohomish County's operates its TPA program as a grant program. Anyone can propose programs or events to the TPA Commission for funding. The funding requests are reviewed by the Commission and then forwarded to the County Council for final action. The County TPA funds a Tourism Bureau that provides marketing and does not itself directly engage in any marketing or tourism functions. A benefit of this framework is that staff costs to the TPA are relatively low. The TPA is managed by one county staff member. A drawback is the time it takes to get final approval of funding requests given that the requests must be approved by the County Council. 3. 501(c)(6) Organization. All, except two, TPA legislative authorities in Washington State contract with a 501(c)(6) organizations, such as Convention and Visitor Bureaus, to implement the tourism work. Many of these 501(c)(6) organizations existed before the TPAs were formed. There appears to be no existing 501(c)(6) in the Tukwila/SeaTac area that could immediately implement the tourism promotion work. Thus, the organization would need to be created. One major benefit of a 501(c)(6) is that it can operate outside of many of the limitations and citizen expectations that are placed on local governments. Given that the entity would be using public funds it would need to comply with some requirements regarding the use of public funds. The board of directors of the 501(c)(6) would be independent from the legislative authority. The only relationship between the legislative authority and the 501(c)(6) would be a contract. The 501(c)(6) would also be free to solicit business from other governmental entities that need tourism and marking services. 4. Public Development Authority (PDA). In a memo dated March 29, 2012, representatives of eight hotels in Tukwila requested that the TPA be managed and implemented through a Public Development Authority as a way to provide autonomy and oversight, presumably by the TPA ratepayers hotels /motels. A PDA is a public agency created by a local government or combination of governments. Although currently no TPA legislative authorities have contracted with PDAs, a PDA can carry out tourism promotion work. For example, Pike Place Market is a PDA that undertakes significant tourism promotion. The creating legislative authority can choose to have oversight of the PDA; however, the PDA is a separate legal entity. The PDA can enter into its own contracts, sue and be sued, and generally operate independently from the parent organization. While the day to day operations of the PDA are separate from the local government that created it, ultimate oversight of the PDA would rest with the local government. A good example of this is the PDA for the Pike Place Market. While the Pike Place Market PDA operates outside of the management structure of the City of Seattle, the Seattle City Council appoints all of the members of the PDA Board'. Furthermore, the Seattle City Council can terminate all of the Board members and the budget of the Pike Place Market 1 Charter of the Pike Place PDA at p. 13. 5 INFORMATIONAL MEMO Page 6 PDA must be approved by the Seattle City Council2. While a PDA would have some autonomy from the cities of Tukwila and SeaTac, it would not have as much autonomy as a 501(c)(6), which would be fully independent from the legislative authority; with the only relationship being a contractual relationship. One potential benefit of the PDA is that it would provide an avenue for more oversight by the legislative authority and the cities that are part of the legislative authority. When a local government (city or county) creates a PDA, it typically has control of the Charter and bylaws of the PDA. For example, the Charter of the Pike Place Market PDA was approved by the Seattle City Council and any modifications require approval of the Seattle Mayor. Through the Charter, the government agency that creates the PDA can specify the membership of the PDA board and certain operational functions if it desires. Another potential benefit of a PDA is that, as a public agency its employees would be public employees and as such, it could choose to offer State Retirement and other benefits to the current Seattle Southside (City of Tukwila) employees. One potential drawback of using a PDA as the tourism organization is the fact that the PDA would have to comply with all of the same laws that a City has to comply with. Most notably, PDAs are subject to the Open Meetings Act, Public Records Act, archiving requirements, and gifting of public funds. A 501(c)(6) would face some of these same restrictions, but only when it used TPA funds. The restriction would not be in place for separate funds generated by the 501(c)(6). A PDA's full operations would be subject to the same requirements placed on the City. For example, all internal emails would be subject to disclosure under the Public Records Act, even if the emails have nothing to do with the TPA; this would not be the case for a 501(c)(6). Like the 501(c)(6), the PDA could solicit business from other governmental entities that need tourism and marking services; however, this would need to be permitted in the Charter that created the PDA. A benefit of a PDA is that donations to the PDA can be tax deductible. Termination of the TPA Should the need arise, the legislative authority may disestablish the tourism promotion area following a public hearing (RCW 35.101.140). When the cities create the inter -local agreement to designate the legislative authority or establish a combined legislative authority, the ILA could include a termination clause. Feedback from Stakeholders Following is an overview of the feedback that we have received regarding formation of the TPA. Seattle Southside Visitors Services: SSVS staff is very excited about a TPA and sees this as a good opportunity to generate up to $2.5 million in additional tourism promotion revenue each year and hope that the Cities of SeaTac and Tukwila would form a PDA to manage and implement the Seattle Southside tourism program drawing upon both the tourism promotion area revenue and lodging tax revenue. New and expanded tourism promotion activities are expected to include more advertising, sales and marketing (strategic planning, market research, 2 Id. 6 INFORMATIONAL MEMO Page 7 creative development, media placement, sales activities, hosting tourism industry events). New regional sales and marketing efforts could focus on small to mid -size meetings and events, multi - property meetings and events, Canadian market development, niche markets including urban, adventure, cultural, sports, incentive, and geo- tourism; group tour product development, FAM tours for targeted customers, public relations programs including press /travel writer tours and coverage, and sporting event marketing enhancement. Tukwila Lodging Tax Advisory Committee: Over the last year, the City of Tukwila's Lodging Tax Advisory Committee has received informational updates on the possibility of a TPA. City staff has not brought the item to a vote in order to complete additional research and receive City Council feedback on the various options. In general, the discussion at LTAC has been very supportive of forming a TPA. Tukwila Hoteliers: Managers representing eight Tukwila hotels submitted a letter dated March 29, 2012 to the Tukwila City Council requesting the City form a TPA (attached). City staff has not yet performed outreach to hoteliers not represented on the letter. Chamber of Commerce: The Southwest King County Chamber of Commerce provided letters dated March 29, 2012 and November 30, 2012 to the City of Tukwila expressing support for the creation of a TPA (attached). City of SeaTac: On 10/11/11 The SeaTac City Council Administration and Finance Committee received an informational briefing and written materials on the formation of a TPA and potential organizational structures (attached). After multiple conceptual discussions over several months the City's Hotel /Motel Tax Advisory Committee (HMAC) received a detailed briefing on the TPA and PDA concepts, including the distribution of written materials that served as the basis for the discussion. At the 6/12/12 City Council Study Session staff presented an Agenda Bill (attached) that authorized the City Manager to execute an agreement for legal services from Pacifica Law Group. The purpose of the agreement was to begin the preparation of the required documentation for the formation of the TPA. This agreement was approved by Council action on 6/26/12 and formally executed on 6/28/12. No actual drafting of documents has been approved pending the decision of the City of Tukwila whether to move forward with the formation of the TPA. After analysis of potential organizational structures and discussions with both the HMAC and the TPA Ratepayers Committee, staff recommended the PDA as the best option for the organizational structure to oversee the operation of the TPA. On 9/25/12 the Ratepayers Committee provided the SeaTac City Manager a letter that indicated strong support for both the TPA and the PDA and urged that the development of legal documentation move forward expeditiously. In each HMAC meeting that followed, the committee either made formal motions or asked that the City move forward with preparation of the legal documents pending Tukwila's decision, to retain the momentum that had been established. The City has yet to instruct the Pacifica Law Group to begin work on the legal documents due to the lack of clarity on the City of Tukwila's position on the TPA/PDA initiative. City of Des Moines: The Des Moines City Council heard this item at their meeting of May 17, 2012 and directed their staff to work with the Cities of SeaTac and Tukwila in the creation of the Seattle Southside Tourism Development Authority (minutes attached). Conclusion 7 INFORMATIONAL MEMO Page 8 City staff believes that a tourism promotion area is a very good opportunity for the City of Tukwila and Southwest King County. It is important to recognize that a number of the City's hoteliers are asking the City to impose the charge. Staff believes that hotelier support is a strong indication that the TPA would increase tourist activity and benefit the City and its businesses. Based upon the hotelier request, staff believes the additional benefits from the TPA would more than offset any competitive disadvantage due to the additional room night fee. If Council would like to consider forming a TPA, staff would engage the City of SeaTac, Seattle Southside staff, hoteliers, and other cities to see if we can reach a consensus approach. It is important to find a consensus because under State law the hotels need to submit a valid petition and at least two cities need to act jointly or else the TPA cannot be formed. Staff would return to Council when we have a consensus proposal outlining: the legislative authority roles and responsibilities; the draft language for the petition, resolution, and ordinance; and the tourism organization roles and responsibilities. At this time, staff seeks feedback on: 1. Is the Council interested in forming a TPA? 2. How much influence should the City of Tukwila have over the expenditures and operations of the tourism promotion area? 3. How involved would the Council like to be in the legislative authority or tourism organization? FINANCIAL IMPACT At this point, it appears there would be no financial impact to the city other than staff time during the formation process. If a TPA is formed it will generate additional funds for tourism promotion which should result in additional lodging and sales tax revenue to the City. RECOMMENDATION The Committee is being asked to consider this item and move it forward to the March 25, 2012 Committee of the Whole meeting and the April 1 Regular meeting. ATTACHMENTS • Chart of tourism promotion areas in Washington State • Chart of possible organizational relationships for a tourism promotion area • Chart comparing tourism organization forms • List of Tukwila hotels • List of SeaTac hotels • Minutes from City of SeaTac Administration and Finance Committee dated October 11, 2011 • Letter from Tukwila hoteliers dated March 29, 2012 • Letter from the Chamber of Commerce dated May 14, 2012 • Minutes from the Des Moines City Council meeting of May 17, 2012 • Minutes from the City of Tukwila's Finance and Safety Committee dated June 5, 2012 • City of SeaTac Agenda Bill #3433 from SeaTac study session on June 12, 2012 • City of SeaTac Ratepayers Committee letter dated September 25, 2012 • Letter from the Chamber of Commerce dated November 30, 2012 8 Tourism Promotion Areas in Washington State Location Jurisdictions = Legislative Authority - Thurisn Organization Snohomish County' All incorporated towns and cities, plus the County. Snohomish County Council. County Department; contract is in place for some services by the Snohomish County Tourism Bureau, a 501(c)(6). Spokane County2 s Spokane County, City of Spokane, and City of Spokane Valley, and City of Liberty Lake Spokane County Council Spokane Regional Visitors and Convention Bureau, a 501(c)(6) organization Pierce County Cities of Tacoma, Dupont, Fife, Gig Harbor, Lakewood, Sumner, Puyallup and the unincorporated areas of Pierce County. Pierce County Council Tacoma Regional Convention and Visitor Bureau, a 501(c)(6) Vancouver -Clark County TPA4 City of Vancouver and Clark County Clark County Council Southwest Washington Convention & Visitors Bureau, a 501(c)(6). City of Selah5 City of Selah City of Selah City Council. Part of the funding remain with the City; contract is also in place with the Yakima Valley Tourism and Convention Bureau, a 501(c)(6). City of Union Gapb City of Union Gap Union Gap City Council Contract in place with private person; and some funds are provided with the Yakima Valley Tourism and Convention Bureau. City of Yakima' City of Yakima Yakima City Council Yakima Valley Tourism and Convention Bureau. City of Wenatchee City of Wenatchee Wenatchee City Council Was the Tourism Bureau, a 501(c)(6); however, the contract has lapsed and the Chamber of Commerce is expected to assume the services9. 1 Phone call with Snohomish County TPA Coordinator on February 20, 2013. 2 ftp: / /ftp.spokanecounty.org /Adobe %20Files /11- 0172.pdf. 3 http: / /www.mrsc.org /ords /151o127.pdf 4 Email from Clark County Economic Development Department on February 25, 2013. 5 Phone call with Selah Parks and Recreation Department on February 26, 2013 6 Phone call with Yakima Valley Tourism and Convention Bureau on February 26, 2013. ' Phone call with Yakima Valley Tourism and Convention Bureau on February 26, 2013. 8 Phone call with City of Wenatchee on February 22, 2013. 9 Based on phone conversation with City of Wenatchee staff on February 22, 2013. 9 Tri- Cities Area TPA1° Cities of Richmond. Pasco and Kennewick. Each City Council has remained as the legislative authority for their respective city. Tri- Cities Visitor and Convention Bureau, a 501(c)(6). Walla Wall TPA11 City of Walla Walla Walla Walla City Council. Tourism Walla Walla, a 501(c)(6). Thurston County" (Proposed) Thurston County and cities of Lacey, Yelm, Olympia and Tumwater. Proposed to be Thurston County Board of Commissioners Proposed to be the Olympia, Lacey, Tumwater Visitor and Convention Bureau, a 501(c)(6). Kitsap County" (Proposed) Not yet formed, but could include all the cities and the County. Proposed to be the Kitsap County Council. It may be the Kitsap Peninsula Visitor and Convention Bureau, a 501(c)(6). 10 Phone call with Tri- Cities Visitor and Convention Bureau on February 26, 2013 t1 Phone call with Tourism Walla Walla on February 26, 2013 and City of Walla Walla on February 27, 2013. 12 Phone call with Olympia, Lacey, Tumwater Visitor and Convention Bureau on February 25, 2013. 13 Phone call with Kitsap Peninsula Visitor and Convention Bureau on February 21, 2013. 10 Tourism Promotion Area Possible Organizational Relationships Option 1 and 2 City of Tukwila City of SeaTac Other Cities Interlocal Agreement (ILA) One City Council Serves as the Legislative Authority • Enacts lodging charge • Meets at least once per year Contract A Y / Tourism Organization • PDA, 501 -C -6 or other form • Board: membership per bylaws, most or all hoteliers, meets frequently • Operates as a tourism destination marketing organization • Sets budget • Manages work • Controls day to day use of funds Reports outcomes Note: State law requires a TPA to be adopted by a legislative authority through an ordinance. The board of the legislative authority must be elected officials. Note: This is an example of one possible arrangement of organizations' roles and responsibilities and is intended to facilitate discussion. 11 Tourism Promotion Area Possible Organizational Relationships Option 3 City of Tukwila City of SeaTac J Other Cities Interlocal Agreement (ILA) V [ Combined Legislative Authority • Members from city councils • Enacts lodging charge • Meets at least once per year Contract A V Tourism Organization • PDA, 501 -C -6 or other form • Board: membership per bylaws, most or all hoteliers, meets frequently • Operates as a tourism destination marketing organization • Sets budget • Manages work • Controls day to day use of funds • Reports outcomes Note: State law requires a TPA to be adopted by a legislative authority through an ordinance. The board of the legislative authority must be elected officials. Note: This is an example of one possible arrangement of organizations' roles and responsibilities and is intended to facilitate discussion. 12 General Overview Comparison of Possible Types of Organizational Structures for a Tourism Organization Title 35 RCW Traditional means of a city forming a separate department or program to perform a certain function. Could be an LLC or other entity organized under State and Federal Law. Title 24 RCW Corporations described in section 501(c)(6) are commonly referred to as "membership associations ". It must be an association of persons having some common business interests, and its purpose must be to promote this common business interest. Its activities must be directed to the improvement of the business conditions rather than the performance of particular services for individual members. RCW 35.21.730 Public Development Authorities (PDAs) can be established by cities or counties to perform public functions. PDAs are instrumentalities of their creating jurisdiction. They are often create to manage the development and operation of a single project, which the city or county determines is best managed outside of its traditional bureaucracy and lines of authority. The particular project may be entrepreneurial in nature and intersect with the private sector in ways that would strain public resources and personnel. PDAs can issue tax exempt bonds, but have no power of eminent domain or taxing authority. Currently in use by TPAs? Yes, Snohomish County. Commission of Hoteliers advises on all use of funds. County Council must approve all expenditures. Yes, City of Union Gap Yes, various, including Pierce and Spokane Counties. None. May serve as the legislative a uthority? Staff members cannot, but a City Council can. N No. Yes, but only if elected officials serve as the PDA's Board members. Governance With the existing framework of either the City of Tukwila Private organization, organized under State and RCW 24.03.095 RCW 35.21.745 or City of Seatac. Federal Laws The affairs of a corporation shall be managed by a board of directors. Directors need not be residents of this state or members of the corporation unless articles of incorporation or the bylaws so require. The articles of incorporation or the bylaws may prescribe other qualifications for directors. A PDA is a separate legal entity, governed by its Board of Directors. A City chartering a PDA has discretion to direct the composition of the board. Members may be appointed by participating cities and confirmed by a City Council. Participating cities can also place restrictions on the operations of the PDA. Relationship with TPA Could be contractual or integrated. Contractual. Contractual. Contractual. General Oversight of TPA Funds Oversight remains with the Legislative Authority. Oversight remains with the Legislative Authority. Oversight remains with the Legislative Authority. Oversight remains with the Legislative Authority. Daily Oversight of TPA Funds City Administration. Depends on the contractual arrangement. Subject to Prohibition on Lending of Credit and Gifting of Public Funds Yes. Not traditionally, but the nature of the TPA funds, as public funds, will cause the entity to be subject to such restrictions, but only on the use of the TPA funds. Depends on the contractual relationship, but could have discretion in how funds are used, provided the Legislative Authority has approved a general use of the funds. For example, the legislative authority might authorize a website, the 501(c)(6) could then determine the best manner of providing those services without having to get the approval of the legislative authority. Not traditionally, but the nature of the TPA funds, as public funds, will cause the entity to be subject to such restrictions, but only on the use of the TPA funds. Depends on the contractual relationship, but could have discretion in how funds are used, provided the Legislative Authority has approved a general use of the funds. For example, the legislative authority might authorize a website, the PDA could then determine the best manner of providing those services without having to get the approval of the legislative authority. Yes. Audit and Reporting All laws applicable to the Any organization charged Any organization charged The PDA would report on a Requirements participating cities would apply with administering the TPA must comply with all applicable provisions of law, all applicable City resolutions and ordinances, and all regulations imposed by the State Auditor or other State agencies. Additionally, since the for - profit would be using public dollars, the books and records of the company may be subject to review. TPA revenue would also be reported in the financial statements for each participating City. with administering the TPA must comply with all applicable provisions of law, all applicable City resolutions and ordinances, and all regulations imposed by the State Auditor or other State agencies. In general, exempt nonprofit organizations are required to file annual returns with the IRS and to the Washington Secretary of State. Furthermore, as a recipient of public funds, the books and records of the nonprofit organization may be subject to review by the State Auditor. TPA revenue would also be reported in the financial statements for each participating City. fiscal year -end consistent with participating cities (more frequently if desired). PDAs issue their own financial statements, which are audited by the State Auditor. The charter of the PDA will outline the level of reporting to participating cities. Its operations and capital expenditures can be supported by lodging tax funds? Yes. No. Yes. Unclear. RCW 67.28.1816 (1) states: Lodging tax revenues under this chapter may be used, directly by local jurisdictions or indirectly through a convention and visitors bureau or destination marketing organization, for the marketing and operations 0) of special events and festivals and to support the operations and capital expenditures of tourism- related facilities owned by nonprofit organizations described under section 501(c)(3) and section 501(c)(6) of the internal revenue code of 1986, as amended (emphasis added) . This RCW is set to expire on June 1, 2013. Application of other laws All laws applicable to participating cities would apply. State and federal corporate laws apply. Depending on the circumstances, laws regulating local governments and use of public funds may apply when TPA funds are used. However, laws such as open meetings and the public records act would not apply to matters that are unrelated to the TPA. State and federal corporate laws apply. Depending on the circumstances, laws regulating local governments and use of public funds may apply when TPA funds are used. However, laws such as open meetings and the public records act would not apply to matters that are unrelated to the TPA. Generally, a PDA is subject to all "general laws regulating local governments, multimember governing bodies, and local government officials (RCW 35.21.759). Such legal requirements include, but are not limited to compliance with accounting and auditing requirements, the Open Meetings Act, Public Records laws, ethical considerations for municipal officers, employees and others. Financial Risk to participating cities. Yes. Separate Entity. Separate Entity. Separate Entity. PDAs are separate legal entities, all liabilities incurred by the PDA must satisfied exclusively from the assets of the PDA, except as otherwise agreed by contract. PDA creditors do not have any right of action against or recourse to the creating municipality, or its assets, on account of the PDAs debts, obligations, liabilities, acts or omissions. Note: That this section is only true if the PDAs employees are truly separate from the City. Risks could be posed if the PDAs employees were actually City employees. Donations /contributions deductible from income taxation. Yes. No. No. Yes. Viability of Option Possible Option. Snohomish County is the only TPA that has county staff do coordinate the tourism work (mainly as a grants administrator). The County does provide funds to the local 501(c)(6) to provide certain tourism and marking activities. Possible Option Union Gap, which is a small TPA, is the only TPA using this model. One benefit of this function is that the for- profit would be selected through a competitive selection process. There are two downsides: 1) the for profit would want to generate a profit from the TPA; thus funds, which could be used for the City's hoteliers would be reduced and, 2) The option would require some oversight by one of the participating cities in order to manage the contract. Possible Option. A well run 501(c)(6) could likely operate with lower administrative costs than any of the other options. Additionally, a 501(c)(6) would only have a contractual relationship with the TPA. The TPA Legislative Authority and the cities would have no involvement in the organization's daily operations or activities that are unrelated to the TPA. One major drawback is the fact that there is not a 501(c)(6) currently formed which could assume the role of the tourism organization. Possible Option Structure permits the participating cities oversight of the PDA organization. Liability and financial risk to the participating cities is limited; and provides for effective oversight, while maintaining a certain amount of autonomy. One benefit of the PDA is that the cities have experience forming PDAs. The use of the PDA to act as the TPA organization is unproven, given that no other TPA has an arrangement with a PDA. While many of the TPAs in the state use a 501(c)(6), it appears that the organizations were in existence prior to the TPA formation. Hotels and Motels in Tukwila Hotel Name Example Classifications by Number of Rooms All 40+ 60+ 90+ Best Western Rivers Edge 146 146 146 146 Comfort Suites 138 138 138 138 Courtyard by Marriott Southcenter 149 149 149 149 Courtyard by Marriott- SeaTac 211 211 211 211 Days Inn Seattle South 119 119 119 119 Doubletree Guest Suites 219 219 219 219 Econo Lodge 47 47 Embassy Suites 238 238 238 238 Extended Stay America Tukwila 96 96 96 96 Great Bear Motor Inn (a) 35 Hampton Inn Tukwila 154 154 154 154 Homestead Studio Suites 94 94 94 94 Homewood Suites by Hilton 106 106 106 106 Knights Inn 54 54 Ramada Limited 68 68 68 Residence Inn by Marriott 144 144 144 144 Riverside Residence (a) Spruce Motel 40 40 Americas Best Value 81 81 81 Jet Inn Motel 34 Travelers Choice 36 Travelodge 72 72 72 Total 2,281 2,176 2,035 1,814 Minimum needed for initiation petition (60 %) 1,306 1,221 1,088 Minimum needed for successful protest vote (50 + %) 1,089 1,018 907 Hotels who signed the 3/29/12 memo 1,200 1,200 1,200 Notes (a) Room count information was unavailable at the time of this report. (b) Hotel data provided by Seattle Southside Visitor Services 5/29/12 (c) Per RCW 35.101.020 an initiation petition must be signed by persons who operate lodging businesses who would pay sixty percent or more of the proposed charges. (d) Per RCW 35.101.070 the proposed action to create a tourism promotion area must terminate if protested by the lodging businesses which would pay a majority of the proposed charges. (e) Hotels that signed the 3/29/12 memo to the Tukwila City Council 19 Hotels and Motels in SeaTac Example Classifications by Number of Rooms Hotel Name All 40+ 60+ 90+ Best Western Airport Executel 140 140 140 140 Cedarbrook Lodge 104 104 104 104 Clarion Hotel Seattle Airport 214 214 214 214 Westcoast Gateway Hotel 143 143 143 143 Comfort Inn & Suites SeaTac Airport 176 176 176 176 Days Inn Seattle SeaTac Airport 104 104 104 104 Doubletree Seattle Airport 850 850 850 850 Econo Lodge SeaTac Airport South Seattle 94 94 94 94 Fairfield Inn Seattle SeaTac Airport 146 146 146 146 Hampton Inn Seattle Airport 130 130 130 130 Hampton Inn and Suites (BMI Hospitality) 218 218 218 218 Hilton Seattle Airport & Conf Center 396 396 369 396 Holiday Inn Express & Suites Seattle SeaTac 171 171 171 171 Holiday Inn SeaTac International Airport 259 259 259 259 La Quinta Inn & Suites Seattle SeaTac 143 143 143 143 Marriott Seattle Airport 459 459 459 459 Motel 6 Seattle Airport 109 109 109 109 Motel 6 Seattle SeaTac Airport South 144 144 144 144 Motel 6 Seattle South 124 124 124 124 Quality Inn SeaTac Airport Seattle 104 104 104 104 Radisson Seattle Airport 204 204 204 204 Ramada Inn SeaTac 155 155 155 155 Red Lion Hotel Seattle Airport 144 144 144 144 Red Roof Inn Seattle Airport 152 152 152 152 Sleep Inn SeaTac Airport 105 105 105 105 Super 8 Seattle SeaTac Intrntl Arprt 119 119 119 119 Sutton Suites & Extended Stay 71 71 71 Jet Motel 51 51 - - Sandstone Inn 94 94 94 94 Skyway Inn 58 58 SeaTac lnn 39 - SeaTac Crest Motor Inn 46 46 - Rodeway lnn 59 59 New West Motel (a) - - Americas Best Value Airport Inn 50 50 - 5,575 5,536 5,245 5,201 Minimum needed for initiation petition (60 %) Minimum needed for successful protest vote (50 + %) Hotels who have indicated support Hotel data provided by Seattle Southside Visitor Services 7/25/12 20 3,322 2,768 3,432 3,147 2,623 3,432 3,121 2,601 3,432 Administration and Finance Committee Minutes Members: Gene Fisher, Chair Tony Anderson Rick Forschler Tuesday, October 11, 2011 3:00 PM Council Chambers Present: Absent: Commence: 3:05 p.m. Break: 3:47 p.m. Commence: 4:05 p.m. Adjourn: 4:19 p.m. X X X Note: Items 6 & 7 to be reviewed jointly with the Public Safety & Justice Committee Other Councilmembers Present: Ralph Shape, Pam Fernald Staff Coordinator: Joyce Papke, interim Finance Director 1. Council's HRANEBA Program — Deputy Mayor Fisher /Anh Hoang Informational Update X Recommended for: X Approval Approval with modifications Denial X Referred to 10/25/11 RCM. Human Resources Director, Anh Hoang distributed a draft memorandum outlining three options for Council consideration with regard to their HRANEBA contributions from the City. The three options are: 1) The City would continue contributing to HRANEBA as it is now. The Council would not need to take any action if this option were chosen; 2) Stop contribution to HRANEBA and deposit specified dollar amount into a deferred compensation plan set up for each Councilmember effective January 1, 2014. From January, 2012 through December, 2013 the City would continue contributing into each Councilmember's HRANEBA account. 3) Stop contribution to HRANEBA effective January 1, 2012 and deposit a specified dollar amount into a deferred compensation plan set up for the four positions elected for the 2012 -2015 term. The HRANEBA contributions would cease for the remaining three Councilmembers. The City's contribution into a deferred compensation plan would commence for the remaining three Councilmembers at the beginning of the next term, January 1, 2014. City Attorney Mary Bartolo stated Council would need to take action by the 10/25/11 Council meeting if there was a change. It was recommended an Ordinance be written and presented at the next RCM for Option #2. If it does not pass, it would default to Option #1 (no change). 21 M1&F Minutes October 11, 2011 Page 2 of 3 2. Draft 2012 Legislative Agenda — Jeff Robinson X Informational Update Recommended for: Approval Approval with modifications Denial Referred to . Economic Development Manager Jeff Robinson distributed a draft of the 2012 Legislative Agenda for the Committee's review. The primary issues of particular importance to the City of SeaTac are : 1) Transportation Funding; 2) Infrastructure; 3) Light Rail Station Area; and 4) Stormwater Capacity Grants. The purpose for presenting the draft was to give the Council time and opportunity to respond to the issues. It was suggested that there be a one hour workshop in November or December to discuss the issues prior to bringing it to full Council. Mr. Robinson requested that additional comments or questions be addressed to him electronically. 3 SeattleSouthside Tourism Promotion Area — Jeff Robinson, Jeff Hart, G.M. Seattle Marriott, Lynn Wallace, President, SW King County Chamber of Commerce X Informational Update Recommended for: Approval Approval with modifications Denial Referred to . Economic Development Manager, Jeff Robinson reported on the potential for the creation of a TPA in the Seattle Southside market area. A least two cities have to participate and initial discussions have included Tukwila and Kent. The revenue generated by a per room night surcharge would be deposited into a TPA account for the express purpose of tourism marketing activities. The estimated revenue would be between approximately $1 million and $2 million a year. Mr. Robinson reported that there will be meetings with the other cities to lay the ground work. A "Frequently Asked Questions" and information sheet is available for the Council's information. 4. City Councilmembers and City Manager Future Travel Authorizations and Completed Travel Approval of City Credit Card Payments and Personal Reimbursements — Joyce Papke Informational Update X Recommended for: X Approval Approval with modifications Denial X Referred to 10/25/11 RCM . Travel authorizations were reviewed by A & F Committee and recommended for approval at the next regular Council meeting. 5. Next Meeting November 8, 2011 22 Orly bt' , �el4_ ,-a-e uevl frz4?1 a-r t VY17 .nr r. G� d� yf3 // ., GO/ // lie spa /c- 'iJ C G r27io 3 ,99 O rid c /Vr-7 / 9, 2-e2/2_ . iGt,r� It c, Obtircj TO: Mayor Jim Haggerton and City of Tukwila Council members 9e9t/lc FROM: Tukwila Hotel TPA Ratepayers DATE: 3/29/2012 SUBJECT: Seattle Southside Tourism Promotion Area and Tourism Development Authority A Tourism Promotion Area (TPA) can only be created if the legislative authority receives an initiation petition signed by the hotel businesses that would pay 60 percent of the self - imposed surcharge (this is not a tax). As these funds would be dedicated for tourism promotion activities only as stated by RCW 35.101; we the potential ratepayers believe this initiative if spent effectively would bring more visitors to the City resulting in more visitor spending that would: bolster hotel occupancy, protect current jobs, create new jobs, increase business at restaurants and retail stores, and increase patronage at arts, cultural and sporting venues. Hoteliers are very supportive of forming a TPA and anxious to begin the process. However, as hoteliers we believe we are in the best position to understand and determine best uses for effectively promoting tourism in a way that generates overnights stays in our hotels. The lodging association has seen successful and some not so successful implementations of public funds for tourism promotion statewide. With lessons Teamed, we wish to bring forward a new and innovative proposal for the City Council's consideration that could result in an additional $1.5 to $2.5 million annually through a TPA that would enhance and build on Seattle Southside Visitor Services' already successful destination marketing efforts and would provide for public oversight but active, private sector participation. A win/win for all involved parties. Potential TPA ratepayers prefer that the TPA be managed and implemented through a Public Development Authority (PDA). We wish to work with the Cities to develop a Public Development Authority or "Seattle Southside Tourism Development Authority" (SSTDA). After careful analysis, we (potential TPA ratepayers) believe this option would provide: • Anatomy and oversight of the new TPA funds; • Assurance the funds would be used effectively to generate ovemight hotel stays; • Provide for a TPA disestablishment policy should the ratepayers desire to do so in the future; and • Redirect (but not increase) the current lodging tax revenues currently supporting Seattle Southside's marketing program. 23 Furthermore, we believe there are many benefits to the participating Cities: • Permits the participating cities to delegate tourism services to individuals with expertise; • Liability and financial risk to the participating cities is limited; and • Provides for effective oversight of public funds. Ratepayers want to work with the Cities to form a TPA and SSTDA. Any other organizational structure such as City dept. or 501c would not provide ratepayers with the above mentioned desires. Therefore, the initiation petitions will not precede until the above concept and the following draft documents are created and generally supported by all affected parties (1) Inter -local Agreement; (2) SSTDA Charter and Bylaws; (3) model ordinance to be adopted by participating cities. We encourage Tukwila City Administration to make this a high priority so we can all move forward. The Cities of Des Moines and SeaTac are already on board and SeaTac has agreed to sponsor the public entity SSTDA. Thanks for your continued support as always! dclGt-ekA Hotel Name: Signature: Hotel Name: f--frimP7;.-7 � /no Signatu��i J"../ Hotel Name: P--e$i c.-e_ IAA Y Mav,oV Tvkcii bi 26 1i'1:1hlr'nt a-te: Signature: Hotel Name: Signature: Hotel Name: Signature: Hotel Name: Signature 3/29/2 Date: 3 hy. �/L �o.G -4-4-- Date: -3t2.ql►Z Sccc*kt.L Date: Z� (( Z 6v\,M\ t )(4i v "ickec1 S +G,�Prrvt.e ; .te;Date: LjJ ?) )Z 24 Hotel Name: Signature: Hotel N Signa yv)ts-}el;d 5-i- . o Su• }S Date: H) `) 2 Date: 1/ 6;t -/C Hotel Name: Signature: Hotel Name: Signature: Hotel Name: Signature: Hotel Name: Signature: Hotel Name: Signature: Date: Date: Date: Date: Date: 25 26 tfIII to est. '< u Aihg Chamber of Commerce May 14, 2012 Derek Speck Economic Development Administrator City of Tukwila 6200 Southcenter Blvd. Tukwila, WA 98188 Dear Derek: RECEIVED MAY 21 2012 CITY OF TUKWILA MAYOR'S OFFICE The Southwest King County Chamber of Commerce supports area hotels and their efforts to create a Tourism Promotion Area for Seattle Southside. As major employers in our region, these entities are taking innovative steps to improve the marketing and promotion efforts of Southwest King County communities. By implementing the TPA, this would give Seattle Southside a boost in the marketing efforts of our area, which is critical, staying competitive with the other community's regional tourism markets. The Chamber also supports the opportunity to increase the number of room nights our local hotels should see with the additional marketing dollars. Our Chamber supports the creation of the Tourism Promotion Area and the hotels self - assessment to fund new programs. The Chamber gives our full support to this project to ensure the future of a viable tourism industry in Southwest King County. Lynn Wallace President/CEO Phone: 206-575-1633 Fax: 206-575-2007 Web: www.swkcc.org aku, 14220 Interurban Avenue South, #134 Tukwila, WA 98168 27 28 Consent Agenda Item #4 AGENDA ITEM BUSINESS OF THE CITY COUNCIL City of Des Moines, WA FOR AGENDA OF: May 17, 2012 DEPT. OF ORIGIN: Economic Development DATE SUBMITTED: May 15, 2012 SUBJECT: Seattle Southside Tourism Development Authority ATTACHMENTS: Overview, Seattle Southside Tourism Promotion Area FAQ, Current Revenue and Service Structure, New Revenue and Service Structure CLEARANCES: [ ] Legal [ ] Finance [X] Economic Development G ervi Parks, Recreation & Senior Sces [ ] Planning, Building & PW APPROVED BY CITY MA FOR SUBMITTAL: Purpose and Recommendation The purpose of this agenda item is to seek Council direction to work with the Cities of Tukwila and SeaTac in the creation of the Seattle Southside Tourism Development Authority. Suggested Motion First Motion: I move to give direction to the City Manager and staff of the City of Des Moines to work with the other participating cities in the creation of the Seattle Southside Tourism Development Authority. Background Seattle Southside Visitor Services (SSVS) is a tourism promotion program administered by the City of Tukwila, serving the cities of SeaTac, Kent and Des Moines (participating cities) pursuant to separate interlocal agreements (ILA's). 27 1 29 SSVS has provided tourism promotion to participating cities since 2002 and has demonstrated steady growth and excellent Return on Investment (ROI). SSVS receives approximately $20,000 annually in lodging tax revenue from motels that are located in the City of Des Moines. Discussion As outlined by Director Katherine Kertznian at the April 26th, meeting, SSVS is proposing to form a new entity called Seattle Southside Tourism Promotion Area (the SSTPA), which will collect an amount not to exceed $2.00 per night from participating businesses. The City of Des Moines Hotel /Motel Tax Advisory Committee approved the creation of this new Tourism Promotion Area at their last meeting, as did the Hotel/Motel Tax Advisory Committee of SeaTac. The SSTPA will create a new source of revenue, which will be used together with the existing lodging tax revenues, to fund the Seattle Southside Tourism Development Authority (SSTDA). The SS'IDA will continue - and expand - the tourism promotion services currently provided by SSVS. In order to move forward with the plan to create the SSTPA, and subsequently SSTDA, SSVS needs two participating cities. SSVS has requested that Des Moines be one of these cities, and seeks Council direction in support of this request. Alternatives Do not carry the motion. Financial Impact None. Recommendation /Conclusion: Des Moines stands to benefit from the expansion of SVSS as it transitions into the (larger and better funded) SSTDA. Tourism promotion services will grow, with no additional revenues required from the City beyond the lodging taxes currently allocated. 30 FINANCE AND SAFETY COMMITTEE Meeting Minutes June 5. 2012 — 5:15p.m.; Conference Room #3 City of Tukwila Finance and Safety Committee PRESENT Councilmembers: De' Sean Quinn, Chair; Dennis Robertson and Kate Kruller Staff: Nick Olivas, Chris Flores, Ben Haymen, JeffJohnson, Tracy Gallaway, Katherine Kertzman, Peggy McCarthy, Derek Speck, David Cline, Mike Villa, Kristina Thorne, Ashley Comar, Meilee Anderson, and Kimberly Matej Guests: Deanna Gregory-, Pacifica Law Group; Lynn Wallace, SWKCC; Jeff Robinson, City of SeaTac; Mike Schabbing, Courtyard Seattle Southcenter; Hyon Sak Lee, Comfort Suites; Allison Jeong, Comfort Suites; Maureen Huffman, Embassy Suites; and Charles Lee, Comfort Suites CALL TO ORDER: Chair Quinn called the meeting to order at 5:17 p.m. *Items changed order from that outlined on the agenda front sheet in order to accommodate schedules and room size. I. PRESENTATIONS No presentations. II. BUSINESS AGENDA A. Event Update: Family 4"' at the Fort Per the request of the Committee, staff prepared an informational memo, included in the agenda packet, which provided additional details about the Family 4th at the Fort event as a result of the Fireworks Permit Application which recently came to Committee. The memo covered specifics which include: new pyrotechnic vendor, signage and public information regarding event changes, financial impacts, parking and restroom concerns. The information memo covered the majority of questions and therefore discussion was minimal. Committee Members thanked staff for the follow -up. INFORMATION ONLY. B. Interlocal Agreement: Fire Training Consortium Staff is seeking Council approval to enter into an interlocal agreement with the Kent Regional Fire Authority (RFA) to participate in a fire training consortium. Staff provided a brief history of formation of the fire training consortium and shared Tukwila's experience with joint training opportunities as well as the benefits of such a consortium. Those benefits include but are not limited to: pooling of resources, documentation of training, availability of training, degree of specialties, and teaching of service delivery in a consistent and predictable manner. This interlocal agreement will allow Fire Department Training Division personnel to work directl with the training consortium which is comprised of the following entities: Kent Regional Fire Authority, Maple Valley, SeaTac and Tukwila. The effective date on the agreement will be changed to reflect an appropriate date that reflects Council approval. Currently, the draft agreement states that it will take effect on May 1, 2012; this was due to staff anticipating this item coming forward through Committee sooner. After discussion, Committee Members expressed an interest in making this agreement valid for more than 6 months in order to increase efficiency and reduce the number of times this item needs to be reviewed for renewal. Staff does not foresee an issue with such an extension and will discuss this with representatives from the Kent RFA. Additionally, Committee Chair Quinn requested the Fire Department report back to the Committee on the benefits and /or concerns as well as program outcomes that have resulted from the training consortium. There is no financial impact of this interlocal agreement to the City. UNANIMOUS APPROVAL. FORWARD TO JUNE 11 COW FOR DISCUSSION. 31 Finance & Safety Committee Minutes June 5, 2012 — Page 2 C. Tourism Promotion Area As information only, staff provided the Committee information regarding state law, which allows the formation of a tourism promotion area (TPA) that permits hoteliers, with 40 or more lodging units, the ability to charge up to $2 per hotel room per night specifically for tourism promotion. This new source of revenue would be used in conjunction with current lodging tax funding for tourism promotion services. Committee Members were complimentary of the information memo provided, stated that it provided a good introduction, and are generally supportive of the TPA idea. However, they stated there are many questions that need to be answered and feel that additional, specific information needs to be provided prior to sending this to full Council for discussion. Committee Chair Quinn reminded the group that it is the Committee's responsibility to ensure due diligence has been conducted, and whenever possible, move items forward with a recommendation. The Committee would like staff to return to Committee with additional information including: • What does the City of Tukwila Administration recommend and why'? • Who should belong to this organization, and who runs it? • How does the organization work'? • What legislative authority involved? • What will be required from the City in order to administrate it? • What is the timeline for implementation? • What are the staffing requirements? • Provide specific examples from other jurisdictions and identify the jurisdictions that would participate in this TPA. Many guests were in attendance at the meeting, so rather than delay additional discussion, Committee Chair Quinn asked those in attendance if there was any information they would like to share. Comments are summarized below. • Charles Lee with Comfort Suites stated that he was not in favor of the TPA, and that, as a hotelier with over 60 rooms, he is concerned about the impact. • Mike Schabbing with the Courtyard and as a member of the Tukwila Lodging Tax Advisory Board commented that outreach has been made with hotels since October, and about 75% of hotels would like to pursue this further. These hotels understand the importance and value in the charge. He also stated that this is a common practice throughout the area, including Pierce County, Spokane, and Seattle. • Lynn Wallace with the Southwest King County Chamber of Commerce stated that the Chamber is in support of the TPA, noting that it will help southwest King County to be a player in the region. Ms. Wallace was working for the Best Western in Puyallup when Pierce County formed a TPA. She commented that once the fee was explained to patrons, no one objected to incurring the charge. • Jeff Robinson, City of SeaTac Economic Development Manager, stated that the State of Washington is basically out of the tourism business; therefore, we have lost that ability to get the State to market on the hoteliers' behalf. Katherine Kertzman commented that this would be the first TPA in King County. RETURN TO FUTURE FINANCE & SAFETY COMMITTEE WITH ADDITIONAL INFORMATION. D. Interlocal Agreement: Animal Control Services Staff is seeking Council approval to enter into an interlocal agreement with Regional Animal Services of King County (RASKC) effective 2013 -2015. The current agreement will expire on December 31, 2012, and due to notification from the City of Auburn that they will not be renewing, a new contract has been developed. 32 Finance & Safety Committee Minutes June 5, 2012 — Page 3 The new agreement at minimum, will maintain, but more than likely, increase the current level of service provided by King County. The cost of this three year agreement is estimated not to exceed $225,000. The estimated annual cost for 2013 is less than actual costs for 2011. Annual increases will be limited to the rate of inflation plus the rate of population growth for the preceding year for the County. Highlights and services of the new contract include: • Call center and animal control officers • Sheltering provided 7 days per week, 365 days per year, open to public • Operation and maintenance of unified licensing • Consistency is service due to regional system and economy of scale • Jurisdictional cost stability • New revenues and revenue focus Staff reported that there are two optional additions to the interlocal agreement: an Enhanced Control Services Contract and a Licensing Support Contract: however, there is not a recommendation to pursue either of these options at this time. The options can be selected on a periodic basis at a later time if the City identifies a need for such. According to feedback received from the Police Department and the City Clerk's Office, the City has not recently received complaints regarding King County animal control services and /or responses. UNANIMOUS APPROVAL. FORWARD TO JUNE 11 COW FOR DISCUSSION. E. Quarterly Update: Police Department As information only and per Committee request, staff gave a PowerPoint presentation on public safety activities and policing issues during the 1" quarter of 2012. The presentation included information on: crime statistics, strategic approaches for solving and mitigating problems, the police department vision, 1st quarter goals and objectives and achieving such, staffing, equipment, budget, training, and the way ahead. See agenda packet for detailed PowerPoint slides. INFORMATION ONLY. F. Update: Financial Planning Model and Capital Improvement Plan (CIP) Due to time, the Committee was unable to discuss this item, and requested it be moved to the next regularly scheduled Finance & Safety Committee. In the meantime, Committee Member Robertson suggested Committee Members review the information provided in the agenda packet and contact Peggy McCarthy with any comments /suggestions. RETURN TO COMMITTEE. III. MISCELLANEOUS Meeting adjourned at 8:23 p.m. Next meeting: Tuesday, June 19, 2012 — 5:15 p.m. — Conference Room #3 Committee Chair Approval Minutes by KAM. Reviewed by DS. 33 34 SeaTac City Council REQUEST FOR COUNCIL ACTION Department Prepared by: C.E.D. Agenda Bill #: 3433 TITLE: An Ordinance authorizing the City Manager to enter into an agreement for legal services with the Pacifica Law Group to assist in the creation of the Seattle Southside Tourism Promotion Area and a Public Development Authority, and amending the 2012 Annual City Budget. X Ordinance _Resolution _Motion Info. Only Other Date Council Action Requested: RCM 06/26/12 Ord/Res Exhibits: Review Dates: A &F: 10/11/11; H/M Committee: 03/14/12; 04/11/12; 05/9/12; CSS: 06/12/12 Prepared By: Jeff Robinson, Economic Development Mana er Director: City Attorney: Finance: BARS #: 107.000.13.557.30.41.000 City Manager: Applicable Fund Name: HotellMotel Tax Fund June 5, 2012 SUMMARY: This proposed Ordinance authorizes the City Manager to enter into a legal agreement and execute a Letter of Engagement with the Pacifica Law Group to prepare documentation for the establishment of the Southside Seattle Tourism Promotion Area (SSTPA) and Public Development Authority (PDA). The proposed Ordinance also amends the 2012 Annual City Budget to appropriate funding for this amendment. DISCUSSION / ANALYSIS / ISSUES: Tourism Promotion Areas (TPA) were created by State statute in 2003 with amendments in 2009 for the purpose of furthering additional positive impacts for tourism spending in local communities. The establishment of a TPA requires the participation of two or more local governments through an Interlocal Agreement (ILA). The SSTPA is envisioned as a joint effort by the cities of SeaTac and Tukwila. The establishment of the TPA also requires a petition from the hotels that will pay a minimum of 60% of the self - imposed assessments within the TPA. The SeaTac Hotel/Motel Advisory Committee and SeaTac lodging sector supports the TPA concept and also the plan to create a Public Development Authority (PDA) chartered by the City of SeaTac. Because SeaTac will most likely sponsor the PDA,,SeaTac- would-have the Pacifica -Law. Group represent -its interests -first and ,. foremost. SeaTac's role will be to take the lead at this point (for phase one) to facilitate the partnership with hoteliers, SSVS staff, and the potential partnering cities of Des Moines, Kent and Tukwila to create a TPA and a PDA. Asasoon :as he ,agreement is reached.and the TPA implemented with the framework for the' establshed;-the -PDA will °assume -legal costs (for phase two) forming the PDA: The legal documents to be drafted include the required Petition, Resolutions, Ordinances, ILAs and PDA Charter. RECOMMENDATION(S): It is recommended that the proposed Ordinance be adopted. FISCAL IMPACT: The proposed amendment increases expenditures in the Hotel/Motel Tax Fund by $20,000 to fund this amendment. ALTERNATIVE(S): Do not adopt the Ordinance. ATTACHMENTS: 1) Memorandum dated June 8, 2012 regarding the Seattle Southside Tourism Promotion Area Agenda Bill Form Revised: February 15, 2011 35 36 ORDINANCE NO. AN ORDINANCE of the City Council of the City of SeaTac, Washington, amending the 2012 Annual Budget and authorizing the City Manager to execute a Letter of Engagement with Pacifica Law Group for the preparation of legal documents for the establishment of the Seattle Southside Tourism Promotion Area and Tourism Development Authority. WHEREAS, the SeaTac City Council has reviewed Agenda Bill #3433, submitted by the Community and Economic Development Department; and WHEREAS, the City's 2012 Annual Budget includes a line -item for Cooperative Tourism Promotion within Fund 107, the Hotel/Motel Tax Fund; and WHEREAS, it is now proposed that additional funding be directed toward the establishment of a Tourism Promotion Area and Tourism Development Authority as allowed by State Statute; and WHEREAS, an amendment to the City's 2012 Annual City Budget is necessary to provide additional appropriation authority to pay for legal costs not previously identified; and WHEREAS, the additional appropriation will utilize Hotel/Motel Tax Revenues; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SEATAC, WASHINGTON, DO ORDAIN as follows: Section 1. The 2012 Annual City Budget shall be amended to increase expenditures by $20,000.00 in the Hotel /Motel tax Fund #107. Section 2. The City Manager is authorized to sign a Letter of Engagement with Pacifica Law group in substantially similar form as attached hereto as Exhibit A, for the preparation of legal documents for the establishment of the Seattle Southside Tourism Promotion Area and Tourism Development Authority. Section 3. This Ordinance shall not be codified, and shall be in full force and effect five (5) days after passage and publication as required by law. Page - 1 37 on this ADOPTED this day of . 2012, and signed in authentication thereof ATTEST: day of ,2012. Kristina Gregg, City Clerk Approved as to Form: Mary E. Mirante Bartolo, City Attorney [Effective Date: [Tourism Promotion Area] 38 CITY OF SEATAC Tony Anderson, Mayor Page - 2 Attachment 1 �990 MEMORANDUM To: Mayor and City Council Through: Todd Cutts, City Manager From: Jeff Robinson, Economic Development Mana Date: June 8, 2012 Re: Tourism Promotion Area — Overview and Implementation ISSUE Hoteliers in southwest King County are preparing to initiate the formation of a Tourism Promotion Area ( "TPA ") by petitioning the legislative bodies of Tukwila, SeaTac and Des Moines pursuant to legislation passed in 2009. Formation of a TPA would permit qualifying hotels to impose up to a $2.00 per room, per night surcharge within the participating municipalities. The surcharge is not a tax, but a self- imposed special assessment that would be dedicated to funding tourism promotion within the TPA area. An overview of tourism promotion areas in Washington are attached as Attachment 1. The intent of this memorandum is to provide information about TPAs in Washington, inform the Council on the proposed TPA, and to request that the Council give direction to the SeaTac City Manager and staff to work with the other participating cities and Seattle Southside Visitor Services ( "SSVS ") staff to begin the formation and implementation of the Seattle Southside Tourism Promotion Area and the formation of the Seattle Southside Tourism Development Authority ( "SSTDA "). This memorandum also requests that the Council amend the 2012 budget in the amount of $20K and direct the City Manager to execute a "Letter of Engagement" with Pacifica Law Group LLP (PLG) to assist in the formation and implementation of the Southside Tourism Promotion Area and the formation of the SSTDA and related matters (collectively, the "Project "). The formal engagement of PLG is properly with the City of SeaTac as the City that will most likely charter the SSTDA to facilitate the Project. BACKGROUND 39 INFORMATIONAL MEMO Page 2 The City of Tukwila currently administers Seattle Southside Visitors Service, a $1.2 million tourism promotion program. SSVS is funded by lodging taxes imposed and collected within the cities of Tukwila, SeaTac, Kent, and Des Moines and remitted to SSVS in exchange for tourism promotion services. Staffing at SSVS is provided by the City of Tukwila. In 2010, hoteliers attending the SeaTac Hotel Motel Advisory Committee approached Jeff Robinson, Economic Development Manager of the City of SeaTac, and Katherine Kertzman, Executive Director of Seattle Southside Visitor Services, with the idea of forming a TPA for Seattle Southside to generate additional revenue for tourism promotion. The initiative is not intended to supplant lodging taxes currently funding the SSVS program, but to provide an additional revenue stream to keep the program competitive with other Destination Marketing Organizations in Washington State, bring more visitors to the area, bolster hotel occupancy, protect current jobs, create new jobs, increase business at restaurants and retail stores, and increase patronage at arts, cultural and sporting venues in an ever increasingly competitive marketplace. Depending on the rate of the assessment, the proposed TPA is projected to provide approximately $2.5 million of additional revenue for tourism promotion each year. The amount of revenue raised depends on the classifications used, occupancy rates at lodging businesses and any exceptions the hoteliers recommend in the initiation petition. For example, if a classification is chosen under which only properties with 61 or more rooms would be subject to the surcharge, minus four exceptions (the surcharge would not be imposed on rooms (a) where the occupant has stayed 30 or more days, (b) that are provided by a ratepayer to guests without charge for promotional purposes, (c) that are available exclusively to members or guests of members of a private member -owned club or its reciprocal clubs or (d) that are airline crew contract room nights as is done in other TPAs around the state), the proposed TPA would include 39 hotel properties located within city limits of the City of Tukwila, City of SeaTac and City of Des Moines and raise an estimated $2.5 million per year. TPA special assessment revenue may only be used to fund tourism promotion. Tourism promotion activities within the proposed TPA are expected to include: • advertising, sales and marketing services (strategic planning, market research, creative development, media placement, sales activities, hosting tourism industry events relating to promotion and marketing, etc.), and administrative and management support for such services. • New regional sales and marketing efforts could focus on items such as: ♦ small to mid -sized meetings & events • multi - property meetings & events • Canadian market development ♦ packaging with direct sales opportunities ♦ niche markets including urban, adventure, cultural, sports, incentive and geotourism • group tour product development C:\Documents and SettingsljrobinsonlMy Documents\SSTPA\SSTPA Council memo.docc 40 INFORMATIONAL MEMO Page 3 • FAM tours for targeted customers ♦ public relation programs including press /travel writer tours and coverage ♦ sporting event marketing enhancement The TPA proposal raised a number of organizational questions, and consequently SSVS staff and hoteliers reviewed a number of options for implementing and managing this potential new revenue source. The entrepreneurial nature of tourism promotion programs requires the active participation of members of the hospitality industry, the multiple revenue streams derived from taxes, donations, TPA assessment revenue and elsewhere require coordination, and the mix of public and private funding and staffing requires oversight and accountability. The options investigated by hoteliers and SSVS staff include whether the TPA should be a stand -alone entity, whether it should be administered by SSVS or one of the participating cities (e.g. as a city program), or whether the current SSVS structure should be replaced by a new entity to receive the two separate dedicated revenue sources (lodging taxes and TPA special assessment funds) and provide tourism related services currently provided by SSVS. SSVS staff and hoteliers considered formation of a 501(c) (3) corporation, a 501(c) (6) corporation, and a public development authority formed under chapter 35.21 RCW. In addition SSVS staff and hoteliers explored various options for how TPA special assessments could be collected and distributed. Under chapter 35.101 RCW, special assessments are collected by the lodging businesses from hotel guests, and remitted to the Department of Revenue. The State Treasurer then remits the funds on a monthly basis to the legislative authority or authorities on whose behalf the funds were collected. The charts and materials attached as Attachment 2 summarize the options considered. ANALYSIS Hoteliers are highly supportive of forming a TPA and anxious to begin the process. Furthermore, they dearly prefer that the TPA be managed and implemented through a public development authority created pursuant to an interlocal agreement with public oversight but active, private sector participation. The public development authority model optimizes the scale and efficiency of tourist promotion; encourages participation by hoteliers and other advocates; and provides for proper and effective oversight of public funds. A draft petition and talking points summarizing the proposed TPA and the public development authority supported by the hoteliers are attached as Attachment 3. The draft petition and talking points are provided for informational purposes only — at this time a petition has not been executed by qualified lodging businesses as potential TPA ratepayers desire to review the working drafts of the following documents prior to executing the petition: (1) Interlocal Agreement; (2) SSTDA Charter and Bylaws; (3) SSTDA — City of Tukwila Support Services Agreement; (4) model ordinance to be adopted by participating cities; and (5) TPA Initiation Petition with summary points. SSVS and City staff will work with PLG on drafting these initial C:IDocuments and Settingsljrobinson\My Documents ISSTPAISSTPA Council memo.docx 41 INFORMATIONAL MEMO Page 4 documents which, with respect to documents (1) through (4), will require subsequent Council approval. RECOMMENDATION Informational only; Discussion of TPA and PDA will be scheduled for June 12, 2012 Council Study Session ATTACHMENTS Attachment 1 — Overview of Tourism Promotion Areas in Washington Attachment 2 — TPA Revenue Options Attachment 3 — Draft Petition and Talking Points Attachment 4 — Letter of Engagement C:1Documents and Settings ljrobinsonIMy Documents \SSTPA\SSTPA Council memo.docx 42 Page 1 of 4 TO: Todd Cutts, City Manager City of SeaTac City PROM: City of SeaTac TPA Ratepayers Committee DATE: September 25, 2012 SUBJECT: Tourism Promotion Area (TPA) and Public Development Authority (PDA) Letter of Support A Tourism Promotion Area can only be created if the Iegislative authority receives an initiation petition signed by the hotel businesses that would pay 60% of the assessment (this is not a tax). Hoteliers in Seattle Southside are preparing to initiate the formation of a TPA. Formation of a TPA would permit qualifying hotels to impose up to a $2.00 per room, per night assessment within the participating municipalities that would be dedicated to funding tourism promotion on behalf of the TPA zone. The City of SeaTac has signed a letter of engagement with Pacifica Law Group (PLG) to begin development of a Seattle Southside Tourism Development Authority (SSTDA), the potential TPA ratepayers in SeaTac, Tukwila and Des Moines stated desired management structure for oversight of the new funds. The City of SeaTac will likely be the sponsoring city for the SSTDA which will govern the use of additional funds collected through the new hotel TPA assessment. Potential SeaTac TPA ratepayers recommend the City of SeaTac continue moving forward and begin constructing the essential legal documents (in partnership with the City of Des Moines and potential TPA ratepayers) that would create a SSTDA wherein hoteliers will initiate the TPA petitions. Hoteliers in SeaTac appreciate the City of Tukwila's attention is currently focused on other urgencies and welcome their participation in the process as soon as city resources can be freed up. The City of Kent hoteliers are in the midst of determining their level of interest and support for a TPA. In the meantime, progress can be made toward drafting the SSTDA legal documents that may result in the TPA being initiated by hoteliers in each participating city before the next legislative session. As hoteliers, we believe this is the best strategy for keeping the momentum alive. Hotel Name: La L\ fi {` ` ^:\\ Signature: Hotel Name: Signa Hotel Name:a �1 -. Date: Signature: Hotel Name: di- Date: 9 - L /Z Signature: Hotel Name: ? Signature: Date: Iiii. Sit 4-r 5 Hotel Name: Date: g/2 Signature: 7,-- t Date: 6 (v5-1[7.-- 43 Page 3 of 4 Hotel Name: , � $(' 5'0 II ! t Hotel Name: Signatuire: , !: Hotel Name:��"�'�''`� Signature: Signature: Date: Hotel Name: &� Date: '2.-5 -1`L- Signature: Date: Hotel Name: fi Hotel Name: Signa % Date: *--"IL Signature: Date: Hotel Name: #/4/ Alfu1424`e- Hotel Name: Signature: Date: /•� Signature: Date: Date: Hotel Name: L— Signature: Date: Hotel Name: gv/id {/ /4 SeafiC Hotel Name: Signature: I/� �� Date :7 /Signature: Date: Hotel Name: Hotel Name: Signature: Date: Signature: Date: 44 Hotels and Motels in SeaTac Hotel Name Best Western Airport Execute) Cedarbrook Lodge Clarion Hotel Seattle Airport Westcoast Gateway Hotel Comfort Inn & Suites SeaTac Airport Days Inn Seattle SeaTac Airport Doubletree Seattle Airport Econo Lodge SeaTac Airport South Seattle Fairfield Inn Seattle SeaTac Airport Hampton Inn Seattle Airport Hampton Inn and Suites (BMI Hospitality) Hilton Seattle Airport & Conf Center Holiday Inn Express & Suites Seattle SeaTac Holiday Inn SeaTac International Airport La Quinta Inn & Suites Seattle SeaTac Marriott Seattle Airport Motel 6 Seattle Airport Motel 8 Seattle SeaTac Airport South Motel 6 Seattle South Quality Inn SeaTac Airport Seattle Radisson Seattle Airport Ramada Inn SeaTac Red Lion Hotel Seattle Airport Red Roof Inn Seattle Airport Sleep Inn SeaTac Airport Super 8 Seattle SeaTac Intrntl Arprt Sutton Suites & Extended Stay Jet Motel Sandstone Inn Skyway Inn SeaTac Inn SeaTac Crest Motor Inn Rodeway Inn New West Motel (a) Americas Best Value Airport Inn Example Classifications Alt 40+ Rooms 60+ Rooms 140 140 140 104 104 104 214 214 214 143 143 143 176 176 176 104 104 104 850 850 850 94 94 94 146 146 146 130 130 130 218 218 218 396 396 369 171 171 171 259 259 259 143 143 143 459 459 459 109 109 109 144 144 144 124 124 124 104 104 104 204 204 204 155 155 155 144 144 144 152 152 152 105 105 105 119 119 119 71 71 71 51 51 94 94 94 58 58 - 39 - 46 46 59 59 . 50 50 35 properties 5575 . 5536 5245 Minimum needed for initiation petition (60 %) Minimum needed for successful protest vote (50 + %) 3322 3147 2768 2623 Notes (a) Room count information was unavailable at the time of this report. (b) Hotel data provided by Seattle Southside Visitor Services 7/25112 (c) Per RCW 35.101.020 an initiation petition must be signed by persons who operate lodging businesses who would pay sixty percent or more of the proposed charges. (4) Per RCW 35.101.070 the proposed action to create a tourism promotion area must terminate if protested by the lodging businesses which would pay a majority of the proposed charges. 90+ Rooms Signatures on Letter of Support 140 140 104 104 214 214 143 176 104 850 850 94 146 146 130 218 218 396 396 171 171 259 259 143 459 459 109 144 124 104 204 204 155 144 152 152 105 119 119 94 2657711 31 assessment '$2 assessment 90+ rooms 5201 $0 Des Moines "Until the Artemis is Bt TBD Kent 3121 3432 66% $1,328,856 $2,657,711 SeaTac 2601 $926,954 Tukwila 12 assessment $3,584,665 Total ($1,072,640) Minus contracted rooms 30% $2,512,025 Estimate TPA Revenue 46 Hotel Owner /GM Initials Best Western Airport Execute) Scott Brown Cedarbrook Lodge Scott Ostrander r� Clarion Perry Wall V' v Coast Gateway Hotel Tonya DeLaCurz Comfort Inn & Suites Carl Anderson Days Inn Seattle SeaTac Angel Kipilli ,r'J DoubleTree /Hilton Frank Welton Econo Lodge Parnit Singh Fairfield Inn - ne•Clemons Hampton Inn and Suites Justin So Inn Seattle Airport Mark Takahashi Holiday Inn Express Vickie Molzer �l Holidaylnn SeaTac Chandler Vadhera La Quinta Mason Schumacher Marriott Seattle Airport Drew Hayden Motel 6 Seattle Airport Cynthia Sleeman Motel 6 Seattle South Quality Inn Peter Shin Radissson Seattle Michael Pitstick Ramada Inn Alim Ratanshi Red Lion Hotel Shawn Darling (" . Red Roof Inn Sung Park Sleep Inn SeaTac Yuri Chung Super 8 Seattle Airport Jacque Eells Sandstone Inn Bob Sheen Embassy Suites- Tukwila Maureen Huffman -"j Courtyard by Marriott- Tukwila Mike Schabbing Hampton Inn and Suites- Kent David Kwok tr 1. Y` t � S ! n t� l 47 48 Chamber o f �� O mm mm e r c e November 30, 2012 Greetings Mayor Haggerton and City Councilmembers, The Southwest King County Chamber would like to first and foremost congratulate Derek Speck and the city administration on the recent signing of a DDA for Tukwila ViIIage. We are excited for the growth this busiriess deveopment will bring to Tukwila and the surrounding community. As the business advocate for Tukwila and neighbonng cities, the Chamber seeks economic development opportunities that benefit local businesses and cities alike through public and private partnerships. The area hotels of Tukwila and SeaTac represented by the Chamber have proposed an establishment of a Tourism Promotion Area (TPA) to help increase tourisrn to Southwest King County. The TPA woufd allow hota|ahmosoesms2pernzumniQhthofundondcnaahaanavonueoourceforbxuhmmpmmoUon.Thioself- assessment would generate approximately $2.5 million per year to promote local tourism, and position Southwest King County as a major contender against the tourism dollars of King and Pierce counties. Along with the establishment of the TPA, the Chamber also supports the hotels only recommendation of a Public Development Authority (PDA) for the management structure and oversight of the funds used by the TPA. The City of Tukwila should already be familiar with PDA's and their structure, since Tukwila does have an established PDA and interlocal agreement with SCORE jail. The PDA management structure allows the hotels (ratepayers) to have autonomy and oversight of the use of funds through a Board of Oirecbzrs, while still maintaining the current lodging tax dollars collected, The City of SeaTac has agreed to be the sponsoring city of the TPA, and has hired Pacific Law Group to begin drafting necessary documents for review. The establishment of a TPA managed by a PDA structure requires swift action. The TPA funds will not only build hotel occupancies, they will boosboostthe sales and revenues oftourism-related businesses. Increased TPA revenues mean increased sales tax revenues to the cities. If we fail to act soon, there is a real possibility the state could implement its own aoaoammmnt, which would etiminate our ability to create a local TPA. Losing local control of TPA dollars would cost our region $2.5 million annually to promote local bourism, which could generate up to $20 million in additional taxable revenue to the cities. Our region cannot afford to lose ground to the TPAs of Seattle and Tacoma, not to mention other regional competitors. We must take advantage of this opportunity soon in order to keep Southwest King County competitive and flourishing. The Southwest King County Chamber of Commerce fully endorses and supports the efforts of the local area hotels of Tukwila and SeaTac and strongly urges the City of Tukwila to make this public/private partnership a priority. Sincerely, Ra dy Cop en 2013 Chair Louise Strander 2013 Chair-Elec