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HomeMy WebLinkAboutReg 2021-05-03 Item 5C- LTAC - Lodging Tax Funding Application: $20,000 for 2021 Seawolves PartnershipCOUNCIL AGENDA SYNOPSIS "•+a�' 44+5. Initials ITEM No. it Meeting Date Prepared by Mayor's review Council review 05/3/21 BJM 0 /4O 5.C. 190$ ITEM INFORMATION STAFF SPONSOR: B. MILES ORIGINAL AGENDA DATE: 5/3/21 AGENDA ITEM TITLE Lodging Tax Funding Requests CATEGORY ❑ Discussion Mtg Date 11 Motion Mtg Date 5/3/21 ❑ Resolution Mtg Date ❑ Ordinance Mtg Date ❑ Bid Award Mtg Date ❑ Public Hearing Mtg Date ❑ Other Mtg Date SPONSOR ❑ Council 11 Mayor ❑ Admin Svcs ❑ DCD ❑ Finance ❑ Fire ❑ P&'R ❑ Police ❑ PIF SPONSOR'S LTAC recommends approval of a lodging tax requests from the City of Tukwila Office of SUMMARY Economic Development for the 2021 Seattle Seawolves Partnership. The funds come from the City's lodging tax program and no general fund dollars will be used. REVIEWED BY ❑ Trans&Infrastructure Svcs ❑ Community Svcs/Safety ❑ Finance & Governance 11 ' LTAC ❑ Arts Comm. ❑ Parks Comm. ❑ DATE: LTAC, 4/8/21 PCD, 4/19/21 COMMITTEE CHAIR: KRULLER Planning & Community Dev. Planning Comm. AND HOUGARDY RECOMMENDATIONS: SPONSOR/ADMIN. Mayor's Office, Economic Development COMMITTEE Unanimous Approval; Forward to Consent Agenda COST IMPACT / FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $20,000 $225,000 $0 Fund Source: 101 FUND, LODGING TAX (TOURISM) Comments: Per State Law, lodging tax can only be used for tourism promotion activities. MTG. DATE RECORD OF COUNCIL ACTION 5/03/21 MTG. DATE ATTACHMENTS 5/3/21 Informational Memorandum, dated April 13, 2021. Updated, Six Year Financial Model City of Tukwila, Staff Report to Lodging Tax Committee, Seawolve Partnership City of Tukwila, Seawolves Partnership, Lodging Tax Application Minutes from the 4/19 PCD Committee Meeting 9 10 City of Tukwila Allan Ekberg, Mayor INFORMATIONAL MEMORANDUM TO: Planning and Community Development FROM: Brandon Miles, Business Relations Manager CC: Mayor Ekberg DATE: April 13, 2021 SUBJECT: Lodging Tax Funding Requests ISSUE Review of a lodging tax funding request from the City of Tukwila, Office of Economic Development for 2021 Seattle Seawolves Partnership. BACKGROUND The City collects a 1% lodging tax on certain qualifying overnight stays in paid accommodations (hotels/motels/Airbnb) in the City. State law limits the use of these funds to tourism promotion'. There is currently just over $1 million in lodging tax funds available for use. The City's Lodging Tax Advisory Committee (LTAC) reviews all requests for use of lodging tax funds. LTAC then forwards a list of recommended applications to the City Council for its review and consideration. If LTAC does not recommend an application be funded, that application is not forwarded to the City Council. The City Council may approve or deny any of the applications recommended by the LTAC. The City Council may also approve an application and increase or decrease the dollar amount awarded2. The City accepts applications on a rolling basis, with the LTAC reviewing requests monthly. Pending Applications Following its April 9, 2021 meeting, LTAC recommended approval of a lodging tax request from the City of Tukwila Office of Economic Development for $20,000 in lodging tax funds for the 2021 Seattle Seawolves partnership. 1 RCW 67.28.080 (6) defines "tourism promotion" as "...activities, operations, and expenditures designed to increase tourism, including but not limited to advertising, publicizing, or otherwise distributing information for the purpose of attracting and welcoming tourists; developing strategies to expand tourism; operating tourism promotion agencies; and funding the marketing of or the operation of special events and festivals designed to attract tourists." 2 On August 17, 2016, the Washington State Attorney General's Office issued an informal opinion regarding whether a municipality could change the dollar amounts recommended by the local lodging tax advisory committee. Specifically, the informal opinion states: "When awarding lodging tax revenues pursuant to RCW 67.28.1816(2)(b)(ii), a municipality may award amounts different from the local lodging tax advisory committee's recommended amounts, but only after satisfying the procedural requirements of RCW 67.28.1817(2), according to which the municipality must submit its proposed change to the advisory committee for review and comment at least forty-five days before final action on the proposal." 11 INFORMATIONAL MEMO Page 2 1. City of Tukwila, Seattle Seawolves Partnership, $20,000 The City is the home for the two-time defending Major League Rugby (MLR) Champions, the Seattle Seawolves. Prior to the start of the 2020 season the City Council and LTAC approved an application for funding to partner with the Seawolves. However, due to MLR rugby matches be canceled due to COVID-19 the contract was terminated. The Office of Economic Development is requesting $20,000 in lodging tax funds for a 2021 partnership. The Seawolves are scheduled to begin their home matches in May, subject to COVID-19 restrictions. The partnership will focus on creating a better fan experience, bringing fans to the City, and branding the City as the center of rugby in the Pacific NW. The Seawolves have a strong and growing brand and the organization has been supportive of the City's marketing and branding efforts. LTAC Recommendation on Application: Do Fund Staff Recommendation on Application: Do Fund FINANCIAL IMPACT The total request for lodging tax funds is $20,000.00. No general fund dollars will be used. The six-year Tourism Financial Plan approved by the City Council in December of 2020 allocated a total of $150,000 in lodging tax funding for sponsorships in 2020. 2020 Tourism Six -Year Financial Plan Allocation Sponsorships: $150,000.00 Global to Local Request (Already Approved): ($5,000.00) City of Tukwila, Juneteenth Event (Pending with Full Council) ($5,000.00) City of Tukwila, Seawolves Partnership (Pending with PCD) ($20,000) Remaining Sponsorship Funds: $120,000.00 RECOMMENDATION Staff recommends that the Committee approve the funding request and forward the request to the May 3, 2021 consent agenda. ATTACHMENTS 1. Updated, Six Year Financial Model 2. City of Tukwila, Staff Report to Lodging Tax Committee, Seawolves Partnership 3. 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O 00 r -I ' 0 d' O ul ,-iN O N O N LO Ol C_i M o o t O O1 u1' M N t/? t/? t/? 00 ri O I� M Lfl 01 N N Oi Lr 00 N N N N 00 O 00o o m o0 d m N N N 1.4 r -i t0 O CO d N Ol O N c -I N t/? t/? t/? t/?O O O 0 0 0 0 Lit 0 0 0 0 N 1.0 O O O O 0 0 0 o N N0 0 0 01 r1 O C 0 0 O 0 Lit 0 co r1 O d- 0 01 dt O O ri ri ri N O Lfl 00 d' O O1 Lr1 d' O1 co" CU 0 M M M 0 u1 r-1 CO Lit Lit M N N ri M 'a , 00 .-i 01 ri N r•i ri .-i I?, m O r4 ,-I- ,-i- 0- N O Q O O N TS m Q a Six Year Financia C C z U- E 'i 3 i DRAFT - Updated March 3, 2021 Tourism Revenue Fee Generated in Tukwila 'romotion Area (TPA) Cares Act Reimbursement: Total Revenues: a a Q C Q CC 0~C C N ++ LI) v) N L L> > Q. 4) 4) C f0 0 v i.,o E con < U, > V1 m N C O a) a) s._ ro N N !0 00 C O O o N Q 0 C -cs coC 13 -Q03 a H C G1 c13c Q m _ a) C C U LL LL CD C Q O. N Q x co m O W X CL 1 -~Op fo EC d •00 Y H Y -O C .L r0 J H _S V I— a) COVID-19 Response tn. V1 00 Q a) C C LEV Q QV v) Li r6 LL c ro al Q tit V v Q U E O C J a) -a h0 Cta°v L CO a) ro 0) m E C rn w t E . Cl) Q LC ( y E CCC E 0 N o > a) > 0 4! C CO C d Seattle Souths Southcenter Art Investments Tukwila Pond General Administration Salary and Benefits t/? t/? t/? 01 -I N Lf1 01 m 01 0 c-1 M Lf1 '4 ri M Lc) M 01 c i c -I -L/1- 0 /? N O m N O N Ol ri Lrl ri m O N Ol r -- ,-i' ri r1 ,_,- 00 O N CO 0 -i -i 01 ri ri O 01 LD N ri Total Expenditures: C C co as cc m m CO C C LL LL 00 0.0 C C C Q C C Lu v CO 0� d 0 z This document does not bind the City to provide funds nor does it authorize any funding. All use of lodging tax funds must be approved by LTAC and the City Council through an application process. The shaded cells indicate approved applications. The lodging tax revenues are estimated as of May 7, 2020 and reflect staffs prediction based on COVID-19. TPA revenue estimate assumes 29% of the fees collected within the three city Tourism Promotion Area were collected by Tukwila hotels. TPA revenue for 2020 and 2021 is based on the SSRTA's revised, adopted budget. After 2021 revenues are staff estimates. Salary/Benefits for Business Relations Manager is split 50/50 between general fund and lodging tax and is estimated to increase 3% annually after 2022. The City overhead charge is charged to all special funds. It recoups the cost to the general fund to support the lodging tax fund. It includes facilities, technology, legal, accounting, and record keeping services and is estimated to increase 3% annually after 2022. Because 100% (less 1% Department of Revenue Fee) of all TPA revenue is estimated to be passed through to the SSRTA, the Ending Fund Balance is only lodging tax funds. CARES Act Funds provided as reimbursement for staff time associated with emergency response. For 2020, preliminary actuals are provided, but are not yet confirmed. 13 14 Staff Memorandum Lodging Tax Advisory Committee Funding Request Name of Applicant: City of Tukwila Address: 6200 Southcenter Blvd Total Funds Requested: $20,000 About the Applicant: )T41(iNiila City of Tukwila Office of Economic Development is responsible for overseeing the City's tourism programs, which includes the City's direct marketing, destination development, and tourism promotion activities, as well as overseeing contract with SSRTA, Starfire, and other organizations. Funds Previously Awarded: The City of Tukwila has received lodging funds in the past for a variety of initiatives. In 2020, the City was granted $39,000 in lodging tax funds for a partnership with the Seawolves. However, due to COVID the contract was terminated. Funding Request Narrative: The City is requesting funding to partner with the Seattle Seawolves in 2021. The partnership will focus on creating a better fan experience, bringing fans to the City, and branding the City as the center of rugby in the Pacific NW. Staff Comments: This application helps build Tukwila's brand as the epicenter of rugby in the Pacific NW. The Seawolves have a strong brand that is consistent with the City's brand, both in its goal and target audience. Consistency with Six Year Financial Model: For 2021, the Six Year Financial Plan shows the City spending $150,000 for sponsorship, such as this. There will be sufficient funds remaining in the budget for other 2021 sponsorships. City of Tukwila 6200 Southcenter Blvd. Tukwila, WA 98188 15 Sponsorship Funds Provided in Six Year Financial Plan: $150,000 Spice Bridge Request (Approved) ($5,000) Juneteenth (Pending with City Council) ($5,000) Seawolves (Pending) ($20,000) Remaining Funds: $120,000 City of Tukwila Staff Recommendation to LTAC: Approval Notes: None. 16 ())1TitkiPliik City of Tukwila 6200 Southcenter Blvd. Tukwila, WA 98188 Application to the City of Tukwila for Use of 2021 Lodging Tax Funds Event or Activity Name (if applicable): 2021 Seawolves Partnership Amount of Lodging Tax Requested: $20,000 Applicant Organization: City of Tukwila Federal Tax ID Number: 91-6001519 Mailing Address: Office of the Mayor 6200 Southcenter Blvd Tukwila, WA 98188 Primary Contact Name: Brandon Miles Primary Contact Phone: 206-431-3684 Primary Contact Email Address: Brandon.Miles@Tukwilawa.gov Check all the service categories that apply to this application: Tourism promotion or marketing. Operation of a special event or festival designed to attract tourists. Operation of a tourism -related facility owned or operated by a non-profit organization. Operation and/or capital costs of a tourism -related facility owned by a municipality or a public facilities district. Check which one of the following applies to your agency: Non -Profit (Note: Attach a copy of your current non-profit corporate registration from the Washington Secretary of State Office) Municipality For Profit Corporation I am an authorized agent of the organization/agency applying for funding. I understand that: • I am proposing a tourism -related service for 2021. If awarded, my organization intends to enter into a services contract with the City; provide liability insurance for the duration of the contract naming the City as additional insured and in an amount determined by the City; and file for a permit for use of City property, if applicable. • My agency will be required to submit a report documenting economic impact results in a format determined by the City. Signature: /s/ Date: March 10, 2021 17 1) Describe your tourism -related activity or event. The City of Tukwila (the "City") is requesting lodging tax funds to partner with the Seattle Seawolves for the team's 2021 season. The Seattle Seawolves are a professional rugby team in Major League Rugby (MLR). The team trains and plays all of their home games at Starfire Sports in Tukwila. The Seawolves are the most successful and dominate team in MLR. The team has won the last two MLR Championships. Rugby as a whole is growing in popularity in the United States. We had originally had a funding request in place with the Seawolves for the 2020 season, but due to COVID-19 this agreement was terminated at the start of the season when the entire MLR season was canceled. In 2018 and 2019, every MLR home game hosted by the Seawolves has sold out, with nearly 4,000 people attending each match. In person attendance for 2021 will be limited due to COVID-19. The Seawolves also have a very strong digital following and a growing brand identity in the Seattle metro region. Through the Experience Tukwila digital accounts the City has done some limited campaigns with the Seawolves to promote both the Seawolves and the City. For 2021, the City would like to partner with the Seawolves on initiatives that focus on three distinct areas: 1. Drive Heads in Beds. Tukwila hotels will be the official hotel for away teams for the 2021 season 2. Drive More Traffic to Area Businesses. As we hopefully emerge from COVID-19 it is important that we help highlight that our restaurants and retailers are open in order to get our market share back. In person attendance at game will be limited due to restrictions in place for COVID- 19. 3. Building the Tukwila Brand. The Seawolves have a strong and growing brand in the Seattle region. Additionally, the Seawolves have a very strong brand following by millennials and families, part of the City's overall target audience for branding. The City's internal brand essence is "Accessible Fun." The Seawolves games are easily "accessible fun." The game are reasonably priced, fun, and safe for families. The City also has an opportunity to build a rugby brand for the City. Like we have done for soccer, Tukwila could be known as the epicenter of soccer in the Pacific NW. Supporting the Seawolves can help attract more rugby matches to the City. 1) If an event, list the event name, date(s), and projected overall attendance. Multiple dates for home games. The exact attendee number for the 2021 game will be dependent upon reopening related to COVID-19. The following are specific examples based upon limited in person capacity. Page 2 of 7 18 Allowable Capacity Number of Attendees Per Game Estimated Total Attendees for 2021 season (does not include playoffs) 100% 3,051 21,357 75% 2,100-2,200 14,700-15,400 50% 1,300-1,400 9,100-9,800 25% 500-600 3,500-4,200 2) Is your event/activity/facility focusing on attracting overnight tourists, day tourists, or both? Both, both directly and indirectly by building a rugby brand. 3) Describe why visitors will travel to Tukwila to attend your event/activity/facility. The Seawolves have been playing in Tukwila since the team was founded. Each game is sold out, with nearly 4,000 rugby fans attending the games. In 2019, the City partnered with the Seawolves on two international matches. As part of these matches the City and Westfield Southcenter hosted a fan event before one of the games. This fan event was well attended. The Seawolves team has a loyal fan following. In 2020 Seawolves players participated in a drive through Halloween event at Westfield Southcenter and the player's presence and attitude help to drive visitors to the mall. 4) Describe the geographic target of the visitors you hope to attract (locally, regionally, nationally, and/or internationally). Regionally. Most fans are located within the Greater Seattle region. Home games may also produce a small number of traveling fans from throughout the United States. These homes games would also generate hotel stays by the away team. Besides attendance at games, the City is also hoping to get branding exposure with the Seawolves 5) Describe the prior success of your event/activity/facility in attracting tourists. The Seawolves have shown the ability to bring fans to the City. In 2019 year the City partnered with the Seawolves on two international matches. Both games were well attended. Nearly all home matches in 2019 were sold out. 6) If this your first time holding the event/activity/facility provide background on why you think it will be successful. N/A 7) Describe the media strategy you employ to promote your event/activity/facility to attract overnight and/or day tourists? Please list any digital or print media (newsletters, e -blasts, social media, etc.) your agency uses or intends to use to promote your event/activity/facility. Page 3 of 7 19 The City will utilize Experience Tukwila and the Seawolves digital and social media for promotion. The City will bring in additional partners and these partners would be required to also promote various events, such as the fan day event or viewing parties. 8) Describe how you will promote lodging establishments, restaurants, retailers, and entertainment establishments in the City of Tukwila. Various ways, through digital media and by hosting specific events. 9) Is the City able to use your digital and print media for collaborative marketing? Yes. 10) Describe how you will use the name, "Tukwila" in publications, promotions, and for your event? This event will be promoted as being in Tukwila. 11) Measurements and Metrics (Note: You will be required to report these metrics as part of the close out of the agreement between your organization and the City.) As a direct result of your proposed tourism -related service, provide an estimate of: a. Overall attendance at your proposed event/activity/facility. 9,000 to 21,000 (dependent upon COVID-19 restrictions). b. Number of people who will travel fewer than 50 miles for your event/activity. 90% c. Number of people who will travel more than 50 miles for your event/activity. 10% d. Of the people who travel more than 50 miles, the number of people who will travel from another country or state. Approximately 200. e. Of the people who travel more than 50 miles, the number of people who will stay overnight in Tukwila. Approximately 200. Page 4 of 7 20 f. Of the people staying overnight, the number of people who will stay in PAID accommodations (hotel/motel/bed-breakfast) in Tukwila. 200 g. Number of paid lodging room nights resulting from your proposed event/ activity/facility (for example: 25 paid rooms on Friday and 50 paid rooms on Saturday = 75 paid lodging room nights) 400 12) What methodologies did you use to calculate the estimates and what methodologies will you use to track outcomes, such as total participants, estimated visitor spending, etc? These are estimates based upon a variety of factors, including fan attendance at games, fan attendance at special events, overnight stays by the away teams, etc. The numbers provided are for estimated in person attendance and do not include media and social media exposure. 13) Are you applying for lodging tax funds from another community? If so, which communities and in what amounts? No. 14) Are you applying funding from Seattle Southside Regional Tourism Authority (SSRTA)? If so, in what amount? No. 15) What is the overall budget for your event/activity/facility? What percent of the budget are you requesting from the City of Tukwila? The City is requesting $20,000 of lodging tax funds for this event. 16) What will you cut from your proposal or do differently if full funding for your request is not available or recommended? We would not be able to have a paid sponsorship with the Seawolves. Applications are considered on a rolling basis. Please contact staff to discuss the process for having the application reviewed by the City's Lodging Tax Advisory Committee. Completed applications should be submitted to: Lodging Tax Advisory Committee c/o Brandon Miles City of Tukwila Page 5 of 7 21 6200 Southcenter Blvd Tukwila, WA 98188 Or, Brandon.Miles@Tukwilawa.gov Questions? LTAC Contact: Brandon J. Miles (206) 431-3684 Brandon.Miles@Tukwilawa.gov. Updated: January 5, 2021 Page 6 of 7 22 Tentative Scope of Service • Non -Exclusive use of Seattle Seawolves marks for advertising and promotional purposes • Presenting sponsor of one (1) Seawolves home match o Presenting sponsor benefits include: ■ Promotion of game on ROOT Sports television broadcast including "Presented by" including the City's name and tourism mark exposure. ■ Social media post leading up to the match with City's tourism mark and tag. • Presenting sponsor of upcoming "Get to know the Seawolves" social media campaign. o Seawolves produced player videos posted to Seawolves social channels with "Welcome back to Tukwila" or "Welcome to Tukwila" messaging in body of post and City of Tukwila tag. • Halftime recognition at two (2) Seawolves home matches for mutually agreed upon City of Tukwila businesses or first responders. o Business recognition to include: ■ PA announcement recognizing Tukwila business / first responders who persevered through the adversity of 2020 ■ Logo on videoboard • At least one (1) ROOT Sports TV Billboard per home ROOT Sports broadcast (includes eight seconds of copy and tourism mark exposure) • Location for all 2021 home games shall be listed as "Tukwila" and not reference Seattle. • A lodging establishment within the City of Tukwila, chosen by the Seawolves, shall serve as the official hotel for all visiting teams • City of Tukwila listed on Seawolves partner page with logo and copy • Five (5) pieces of autographed Seawolves merchandise • Five (5) one-hour player appearances Page 7 of 7 23 24 City of Tukwila City Council Planning & Community Development Committee Meeting Minutes April 19, 2021 - 5:30 p.m. - Electronic Meeting due to COVID-19 Emergency Councilmembers Present: Kathy Hougardy, Chair; Verna Seal, Thomas McLeod Rachel Bianchi, Derek Speck, Niesha Fort -Brooks, Brandon Miles, Laurel Humphrey Chair Hougardy called the meeting to order at 5:30 p.m. Staff Present: I. BUSINESS AGENDA A. Interlocal Agreement: South King Housing & Homelessness Partners Staff is seeking Council approval of an interlocal agreement with South King Housing & Homelessness partners to allow parties to pool all or a portion of its tax receipts received under RCW 82.14.540. Committee Recommendation Unanimous approval. Forward to May 3, 2021 Regular Consent Agenda. Lodging Tax Application: 2021 Seawolves Partnership Staff is seeking Council approval of $20,000 for the City of Tukwila to support the 2021 Seattle Seawolves partnership Committee Recommendation Unanimous approval. Forward to May 3, 2021 Regular Consent Agenda. C. City of Tukwila Juneteenth Event Staff presented an update on efforts toward a 2021 Juneteenth virtual event, which received $5,000 funding from lodging tax. Item(s) for follow-up Provide briefing to the full City Council when the plan is finalized. Committee Recommendation Discussion only. ��. MISCELLANEOUS Councilmember Hougardy reported that she met with City and County staff on the Health through Housing program. As previously discussed, staff is working with the County to get responses to the community's questions and will return to Committee with more information. The meeting adjourned at 6:04 p.m. ) Committee Chair Approval Minutes by LH 25