CC 2019-09-24_11a SLO County Tourism Marketing District RenewalMEMORANDUM
TO: CITY COUNCIL
FROM: JAMES BERGMAN, CITY MANAGER
SUBJECT: CONSIDERATION OF SAN LUIS OBISPO COUNTY TOURISM MARKETING
DISTRICT (SLOCTMD) RENEWAL
DATE: SEPTEMBER 24, 2019
SUMMARY OF ACTION:
Adoption of a Resolution granting consent to the San Luis Obispo County Board of
Supervisors to renew the SLOCTMD for a 10-year period with a 1.5% assessment.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
There is no fiscal impact to the City from this action as the SLOCTMD assessment is paid by
visitors staying at lodging establishments within the City and remitted directly to Visit SLO
CAL. If the SLOCTMD is not renewed, there would be a loss of coordinated regional tourism
promotion in Arroyo Grande and throughout the County.
Based on the anticipated year-end results for FY 2018-19, the current SLOCTMD assessment
expected to be collected totals approximately $102,916. The proposed 1.5% SLOCTMD
assessment is estimated to generate an additional $51,458 in annual tourism assessment in
Arroyo Grande paid by hotel visitors. The City would continue to retain an administrative fee
of two percent (2%) of the assessment collected from Arroyo Grande lodging properties to
cover costs associated with collection and pass through to the County.
RECOMMENDATION:
The Arroyo Grande Tourism Business Improvement District Advisory Board recommends the
City Council adopt a Resolution granting consent to the San Luis Obispo County Board of
Supervisors to renew the San Luis Obispo County Tourism Marketing District, to include
lodging establishments within the City of Arroyo Grande, for a 10-year period with a 1.5%
assessment.
BACKGROUND:
The City is served by the local Arroyo Grande Tourism Business Improvement District
(AGTBID) and while these efforts are successful in the mission of increasing lodging
occupancy locally, lodging owners have acknowledged there is opportunity for businesses to
benefit from Countywide advertising and marketing efforts.
On June 10, 2015, with the consent of all seven municipalities, the San Luis Obispo County
Board of Supervisors unanimously approved the San Luis Obispo County Tourism Marketing
District (SLOCTMD), as proposed by Visit SLO CAL. Visit SLO CAL is a destination marketing
Item 11.a. - Page 1
CITY COUNCIL
CONSIDERATION OF RENEWAL OF THE SAN LUIS OBISPO COUNTY TOURISM
MARKETING DISTRICT (SLOCTMD)
SEPTEMBER 24, 2019
PAGE 2
organization with a mission of promoting the County as an attractive travel destination and
enhancing its public image as a dynamic place to live and work. Prior to establishment of the
SCLOTMD, Visit SLO CAL was funded through business membership and contributions from
local agencies, including the City’s pro rata share of marketing costs based on the annual
Transient Occupancy Tax (TOT) generated in Arroyo Grande. At that time, the City’s
contribution was funded through the AGTBID Annual Budget.
The SLOCTMD was approved as a five-year plan from 2015-2020 that established a unified
District with the goals of increasing awareness of San Luis Obispo County and its offerings,
as well as driving visitor demand. The establishment of the SLOCTMD placed a 1%
assessment on short-term lodging stays throughout San Luis Obispo County with funding
used to market San Luis Obispo County through regional, national, and international feeder
markets. Assessed lodging partners, including hotels and motels, vacation rentals, bed &
breakfasts, and homestays, receive Visit SLO CAL marketing benefits.
ANALYSIS OF ISSUES
Over the last four years, Visit SLO CAL has had a significant positive impact on tourism and
economic development in the County (Attachment 1). These impacts include:
Tourism spending in San Luis Obispo County has increased by approximately
4.5% per year since the creation of Visit SLO CAL (after accounting for the loss of
revenue due to the Highway 1 closure in 2016).
Visit SLO CAL currently generates over $40 in visitor spending for every dollar
invested. Opening new air travel markets and investing advertising efforts in those
new markets has generated over $50 in visitor spending for every dollar invested.
The visitor economy in San Luis Obispo County is growing faster than the County’s
overall economy. Employment and wages in tourism-dependent sectors are
increasing at above average rates. Tourism now makes up 9.7% of the countywide
GDP compared to 2.5% statewide.
The Visit SLO CAL website at www.slocal.com includes information about Arroyo Grande and
other cities in the County with Arroyo Grande’s information available at
https://www.slocal.com/explore/arroyo-grande/.
California state law allows the initial term of a Tourism Marketing District to operate for five
years before the lodging community has to reaffirm their support and agree to continue the
voluntary assessment. The SLOCTMD will reach the end of that initial term on June 30, 2020
and without the consent of all seven cities and the affirmation of the San Luis Obispo County
Board of Supervisors, the SLOCTMD and Visit SLO CAL will sunset in the next 10 months.
The lodging community, in partnership with Visit SLO CAL, is seeking the renewal of the
District for a 10-year period and an increased assessment from 1% to 1.5% as shown in the
new Management District Plan (Attachment 2). This increased assessment would provide an
estimated $2 million in additional revenue for Visit SLO CAL for a total budget of $6 million.
Item 11.a. - Page 2
CITY COUNCIL
CONSIDERATION OF RENEWAL OF THE SAN LUIS OBISPO COUNTY TOURISM
MARKETING DISTRICT (SLOCTMD)
SEPTEMBER 24, 2019
PAGE 3
The proposed Plan is the result of a strategic planning process undertaken by Visit SLO
CAL that explored what the future competitive landscape of tourism will look like and how to
best compete for visitors. Visit SLO CAL discussed key findings with lodging investors and
local government officials and identified five key areas of priority requiring long-term, strategic
investment to keep the SLO CAL destination competitive:
Increased advertising in Visit SLO CAL’s key domestic feeder markets
Elevation of key sales initiatives and support
Growth of international markets
Continued support and expansion of air service development
Execution of the destination management strategy recommendations that are
tourism-related and/or owned by Visit SLO CAL
These priorities are designed to benefit current members of the hospitality industry, the overall
economy of the region, and the 11.8% increase in lodging inventory currently under
construction in the County. As one indicator of the need for this type of investment, an
independent entity is projecting a 3.5% decrease in occupancy and 1.7% decrease in
RevPAR (revenue per available room) within the County for 2020 based on the 11.8%
increase in lodging inventory over the next 18 months. An additional 8% in lodging inventory
will be added over the following two (2) years.
At the request of the seven cities and the County, Visit SLO CAL undertook a return on
investment (ROI) analysis, to determine the projected payback to the local economy resulting
from an additional assessment on lodging establishments, in order to fund activities designed
to accomplish each of the five priorities identified above (Attachment 3). Selected results of
the ROI study include:
Even with Visit SLO CAL, San Luis Obispo County funds tourism promotion at a less
than half of the average rate for tourism-focused cities and counties throughout the
State.
As incomes continue to rise and the world becomes increasingly interconnected, this
trend will likely persist in the future, and the local tourism sector will become an
increasingly important driver of the County’s economy.
An increase in assessments of 0.5% is not likely to reduce room rates or demand. A
0.5% increase would place San Luis Obispo County at levels still below competing
destinations in terms of hotel taxes and assessments. It should also be noted that
several of those competing destinations are looking to increase their assessments and
that competing destinations also have resort and parking fees not levied in San Luis
Obispo County.
A half-percent increase in the current assessment would generate over $50 million
annually in additional visitor spending, if those additional assessment dollars are spent
in high-priority areas.
The projected $50+ million annual increase in visitor spending would represent a very
high rate of return.
Item 11.a. - Page 3
CITY COUNCIL
CONSIDERATION OF RENEWAL OF THE SAN LUIS OBISPO COUNTY TOURISM
MARKETING DISTRICT (SLOCTMD)
SEPTEMBER 24, 2019
PAGE 4
The SLOCTMD renewal process requires a series of hearings in each community and the
County to consider and approve the renewal of the SLOCTMD. The Board of Supervisors has
the final decision in renewing the SLOCTMD and Visit SLO CAL including the term length
and assessment rate. However, enabling legislation requires that each city in the County
consent to the County of San Luis Obispo renewing, operating, and modifying the SLOCTMD
covering lodging establishments within their city. The Resolution to grant this consent in
Arroyo Grande is included with this report. Below is the current timeline and status for each
jurisdiction’s consideration of this renewal:
Petition Launch - Week of July 29, 2019 (Completed)
Grover Beach - September 16, 2019 (Approved on 9/16/19)
Arroyo Grande - September 24, 2019
San Luis Obispo - October 1, 2019
Paso Robles - October 1, 2019
Morro Bay - October 8, 2019
Atascadero - October 8, 2019
Pismo Beach - October 15, 2019
County of San Luis Obispo Board of Supervisors Final Hearing - TBD (January,
2020)
The County mailed petitions to all lodging establishments in the seven cities and
unincorporated areas. Approvals are required from establishments generating over 50% of
the TOT revenue generated in calendar year 2018 for the Board of Supervisors to approve
the SLOCTMD renewal. Petitions in favor of the assessment have already been returned by
establishments generating over 83% of the TOT revenue in the City of Arroyo Grande.
On August 26, 2019, Visit SLO CAL made a presentation to the AGTBID Advisory Board and
the Board unanimously recommended that the City Council approve the renewal of the
SLOCTMD for a 10-year period with an increase in the assessment to 1.5%. A representative
from Visit SLO CAL will also be providing a presentation to the Council.
ALTERNATIVES:
The following alternatives are provided for the Council’s consideration:
1. Adopt a Resolution granting consent to the County of San Luis Obispo to renew
the San Luis Obispo County Tourism Marketing District (SLOCTMD) for a 10 year
period with an assessment of 1.5%;
2. Take no action, causing the SLOCTMD to sunset on June 30, 2020; or
3. Provide other direction to staff.
ADVANTAGES:
Having a sustainable and efficient Countywide marketing program focused on regional efforts
helps foster collaboration and ensures marketing dollars are spent in the most streamlined
manner possible for the County. It also allows the AGTBID to focus its efforts on attracting
Item 11.a. - Page 4
CITY COUNCIL
CONSIDERATION OF RENEWAL OF THE SAN LUIS OBISPO COUNTY TOURISM
MARKETING DISTRICT (SLOCTMD)
SEPTEMBER 24, 2019
PAGE 5
lodging customers to the City's specific properties, and be more effective in increasing lodging
stays within the City.
DISADVANTAGES:
There would be an additional 0.5% assessment on lodging room rentals.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with Government
Code Section 54954.2.
ATTACHMENTS:
1. SLOCTMD Scorecard to Date
2. SLOCTMD Management District Plan
3. Allocation of Additional Funding
Item 11.a. - Page 5
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ARROYO GRANDE GRANTING CONSENT TO THE
COUNTY OF SAN LUIS OBISPO TO RENEW THE SAN
LUIS OBISPO COUNTY TOURISM MARKETING DISTRICT
(SLOCTMD)
WHEREAS, on January 13, 2015, the City Council adopted Resolution No. 4644 granting
consent to the County of San Luis Obispo to form the San Luis Obispo County Tourism
Marketing District (SLOCTMD) for a five-year term ending June 30, 2020; and
WHEREAS, the County of San Luis Obispo is beginning the process of renewing the
SLOCTMD for a ten-year term beginning July 1, 2020 pursuant to the Property and
Business Improvement District Law of 1994, Streets and Highways Code sections 36600
et seq., to promote lodging businesses in San. Luis Obispo County, including the cities of
Arroyo Grande, Atascadero, Grover Beach, Morro Bay, Paso Robles, Pismo Beach and
San Luis Obispo; and
WHEREAS, Streets and Highways Code Section 36620.5 requires the City of Arroyo
Grande to grant consent to the County of San Luis Obispo for the City of Arroyo Grande
to be included in the renewed SLOCTMD; and
WHEREAS, on August 26, 2019, the Arroyo Grande Tourism Business Improvement
District Advisory Board considered the proposal to renew the SLOCTMD and
recommended approval.
NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Arroyo Grande,
that:
1. The above recitals are true and correct.
2. The City Council consents to the County of San Luis Obispo renewing the
SLOCTMD, which District shall include the City of Arroyo Grande.
3. The City Clerk is hereby directed to transmit a certified copy of this Resolution to
the Clerk of the Board of the County of San Luis Obispo.
4. This Resolution is effective upon its adoption.
On motion of Council Member ________________, seconded by Council Member
_______________, and on the following roll call vote, to wit:
AYES:
NOES:
ABSENT:
the foregoing Resolution was passed and adopted this 24th day of September, 2019.
Item 11.a. - Page 6
RESOLUTION NO.
PAGE 2
CAREN RAY RUSSOM, MAYOR
ATTEST:
KELLY WETMORE, CITY CLERK
APPROVED AS TO CONTENT:
JAMES A BERMAN, CITY MANAGER
APPROVED AS TO FORM:
HEATHER WHITHAM, CITY ATTORNEY
Item 11.a. - Page 7
Tourism
MarketingDistrict
RESULTS to Date
Visit SLO CAL has a three-year track record of success on behalf of our lodging
investors and the tourism community. We need your support to see the district
renewed. Over the next few pages we’ve outlined some of our key successes
and the return on investment that Visit SLO CAL brings. As we approach the
“vote” we need your support to renew the Tourism Marketing District.
ATTACHMENT 1
Item 11.a. - Page 8
'1 I S I r
SAN LUIS OBISPO COUNTY
CALIFORNIA@
$2,100
STRATEGIC DIRECTION 2020
BRAND RESEARCH
OPTIMIZE
OUR ORGANIZATIONAL CAPACITY
ESTABLISH
BRAND CLARITY AND INCREASED
AWARENESS THROUGH UNIFIED EFFORTS
ADVOCATE
FOR THE DEVELOPMENT OF CRITICAL
TOURISM INFRASTRUCTURE
DEMONSTRATE
VALUE TO OUR STAKEHOLDERS,
PARTNERS AND COMMUNITIES
BUILD and EXPAND
STRATEGIC PARTNERSHIPS
Mom to
the Max
ACTIVE
ADVENTURER
CULTURED
CLASS
HIGH PROPENSITY TO VISIT & SPENDLOW AWARENESS //
NEW SLO CAL BRAND
LAUNCHED JANUARY 2017
AVERAGE 70%AVERAGE VISITORSPEND IN SLO CAL
TOURISM ECOSYSTEM
SAN FRANCISCO
LOS ANGELES
LAS VEGAS
PHOENIX
DENVER
SEATTLE
Visit SLO CAL funded a first-of-its-kind research co-op for the county to inform the development of a new brand and future marketing campaigns.
LODGING, RESTAURANTS, ATTRACTIONS, RETAIL
BUSINESS
BIDS/CVB
CITY/TOWN
VISIT SLO CAL
SLO CAL
CCTC
CENTRAL COAST
VISIT CALIFORNIA
CALIFORNIA
BRAND USA
USA
SOURCE: MERRILL RESEARCH
IMPERATIVE: ESTABLISH BRAND CLARITY AND INCREASED AWARENESS THROUGH UNIFIED EFFORTS
TARGET MARKETS
TARGET PERSONAS
Item 11.a. - Page 9
CIRCULATION
PARTNER ADS
180,000
163
VISITOR MAGAZINE HIGHWAY 1 DETOUR SUPPORT & RE-OPENING
BRAND ADVERTISING
SUPPORTING OUR LOCAL PARTNERS
spend IMPRESSIONSCLICKS$3.3m 651,531,7832,662,381
PROGRAMS
SPEND
PARTNERSHIPS
IMPRESSIONS
9
$642,417
44
75,990,979
Co-op ad programs
PROPERTY VISITS
VISITOR CENTER & CHAMBER VISITS
CO-OP SPEND
INTERNATIONALLY-TRANSLATED DETOUR MAPS
224
24
$86k
6
CRISIS RESPONSE
• Crisis Communication Plan Created
(September 2015)
• Chimney Fire
(August - September 2016)
• Highway 1 Closure
(November 2016)
• Thomas Fire
(December 2017)
• Highway 1 Dream Drive & Re-Opening
(July 2018)
*Metrics reflect data through March 2019
IMPERATIVE: ESTABLISH BRAND CLARITY AND INCREASED AWARENESS THROUGH UNIFIED EFFORTS
IMPERATIVE: DEMONSTRATE VALUE TO OUR STAKEHOLDERS, PARTNERS AND COMMUNITIES
NEW
SLOCAL.COM
Item 11.a. - Page 10
::J ·············································
~
·-~.r: ............................................................................................................................................................................................... .
r ~
· ,4...,/.,BrvOND :•
0:ROANIC SESSIONS
er CY C¥ CY
2015 2018 2017 20 18
TOTAL SESSIONS BY MARKET
Bo '.UN 1C-E AmAGE ~,.: OllCiA NI C -R; ATE: SESSION IMJAA no.~ [MIN]
Jill
Cl' CY
2015 2018
45.,. ..
:I ii !I !I !I 11 al~ ~1 ~ a,~
20 (5 2tl18 2015 2018 2015 , 2:0 18
LOUNGEW SAN FRANllSCD SEATTLE
26 5"' ♦ 90"' 't 1286"' ♦
iCV I C'r'
2015 Will
DENVER
1724"'•
'".-:. -E, 1 --·= .•
I ~J~~t.~, -~-................................................... .
-. . •· ri -· --·
l.f. \\ "I'' \ \ -~~ · ,fl } ')
",r, 1w .~ ... ~~ ,ri,.. LA VJ ~ ,\.nmt·ir rt;;:
"
$130 k
2016
EVENTS and PARTNERSHIPS
PUBLIC RELATIONS TRAVEL TRADE
MEETINGS TRADE SHOWS
IMPRESSIONS
APPOINTMENTS
COUNTRIES - EXPOSURE
BUYING POWER
ARTICLES
MISSIONS
AD EQUIVALENCY
FAM ATTENDEESFAM ATTENDEES
COUNTRIES
1,166 26
679M
796
16
$400M
710
16
$8M
165308
6
EVENTS
IMPACT:
SPONSORSHIP
PRODUCTIONS
FILMING DAYSYEARS INCOUNTY
HOURS OF
INTERNATIONAL
TV COVERAGE
EVENTS
IMPRESSIONS
IMPRESSIONS
partnerships REACH
REFERRALS
MEDIA REACHED
INTERNATIONAL MISSIONS
INTERNATIONAL TV SPOTS
43
$19 MREACH
SINCE THE START OF THE TMD
17M
3
4
392
1,135
6
3.6B
5.3B
59 32k
36,547
1,380
9
3
SAN DIEGO SEATTLE
PARTNERSHIP with
in UNITED KINGDOM & IRELAND
BLACK DIAMOND
$100 k
*Metrics reflect data through March 2019. AMGEN metrics reflect data through May 2019.
IMPERATIVE: BUILD AND EXPAND STRATEGIC PARTNERSHIPS
IMPERATIVE: ESTABLISH BRAND CLARITY AND INCREASED AWARENESS THROUGH UNIFIED EFFORTS
2017
NATIONAL PUBLIC
RELATIONS PARTNER
TURNER PR
2018 CURRENTLY RUNNING
Item 11.a. - Page 11
...................................................................................................................................................................................
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, 111 ~
IL •"
·~•c-·~ 0"~;~~: .
. . . . . . . . . . . . . . . . . . . . . . . ~ ..................... .
····························.:.. .. ~· ~:. "" ... ·~ ... ~ -.. ...
'"' -~· -~-•~\:·-~.
Air SERVICE
65%
GROWTH
BRAND LIFT TRACkED ARRIVALS
CONFERENCE CENTER
Research Now measures the consumer-brand interaction post marketing
campaign and helps identify favorable changes in the customer journey.COLORADO // 3%
WASHINGTON // 5%
OTHER // 4%
NEVADA // 2%
ARIZONA // 5%
TEXAS // 1%HAVE VISITED SLO CAL IN THE PAST
UP FROM 36% in Wave 1*38%
ADDITIONAL
SEATS
IN 3 YEARS270K
93%
**Metrics reflect data through March 2019
VERY LIKELY
SOMEWHAT UNLIKELY
SOMEWHAT LIKELY
45%
12%
38%
VERY UNLIKELY
5%
SOURCE: RESEARCH NOW SOURCE: ARRIVALIST
LIKELIHOOD TO
CONSIDER VISITING
AFTER SEEING ADS
WOULD VISIT AGAIN
FEASIBILITY STUDY
81% WOULD BOOK IN SLO CAL IF NEW FACILITY WAS BUILT
79% ARE LIKELY TO RETURN IF NEW FACILITY WAS BUILT
MID-WEEK & SHOULDER SEASON
SHOW HIGHEST POTENTIAL
15-20,000 SQFT
BALLROOM DESIRED
*Wave 1 was conducted February 2017; Wave 3 was conducted August 2018
IMPERATIVE: ESTABLISH BRAND CLARITY AND INCREASED AWARENESS THROUGH UNIFIED EFFORTS
IMPERATIVE: ADVOCATE FOR THE DEVELOPMENT OF CRITICAL TOURISM INFRASTRUCTURE
$1M in Air Service Marketing Support
CALIFORNIA // 80%
SOURCE: VOLAIREItem 11.a. - Page 12
Item 11.a. - Page 13
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . IMPEJ!AllYI: l)Ht □HSTIIUE JJ~ LUE TO OUR STltKEHOUlERS . PARTNERS ANO CO'-IMU NIHES .......................................... .
v1;1roK lv,oLUMt·
····················~~-··~········~·············································~··············
••••• 2015
10. 2· 0/o GROWTH
I 2014-2018
DO~~ESTIC'
MSAKE'I'
SOURCE : TOURISM fCO NQ.i.lilCS
JOP OR IGW'ATl~B
METROP'01!1TAH S1ATISTICAIL AR EA O~SAl
l!Y SPEND AMOUPIT (S~U
LO.= LA/ORMI GE COUITTY/RIVEROCt FR = flIS~
SF = SAN FRAt,mcnt □AKtANll/™ J05E Bif = 13.AJ(EP.SFELD
SB = &AfjlA 8ARBARMSMITA MARIA Sil = SAN [IGO
INTER N /\Ji. ION AL TOP 011161NAflrt'O COUNTRIES f.J~ 1 il\' SPtN[) IIMllUNT ISM ]
CO UlflRV KE't'
CN =OIIHA
U:K " OOITEO K'1WJM
CA " CAH&OA
DE = GER~1 ANY
FR = FRli.tlCE
AU " ~.USTRALl/1
LODGING OTHER
Sl.'9 BIL LI ON -• 54.8 BILLION
• 56.1 BILLI ON
1/. 2015-2018
SOURCES : TOURISJIA ECONOMICS.:
DEAN' RUNYAN , IN C.
·15 ·m ·n ·10
~r
'15 'lll 'n7 'lB
~p
'15 '16 '17 '18 '15 '16 '17 '18
CA
'15 ']6 '17 18 '15 '1 6 '17 '18
!)£ FK
SOURCE : VVT/VISJ\ "Thes.e figures reflect !he impocr in 'M1totrqn due to 1he Highway l dos1Jre
Item 11.a. - Page 14
. . . . . . . . . . . . . . . . . . . . . . . . . . .. .. . . . . . . . . . . . . . . IMPUIATIVE: DEMOHSTRUE IJllLUETO OUR Sllt:KEHOLDERS. PJ\RTHBRS Arf□ COMMUNIJ[E:S ........................................ , .
,Q% Jt'lff3115 ·0EC2019'
. ~,t!'.W.:t IIU' LU'~U
32 6'
50 1jii '-----1-------le-----+-----1------"1-----1----1-------1----1----1---~'------1 24-lk
IJ;~ L: 1,1.~ ~UG
~190 .00
1187 .50
1145 .00
1122 .50
'100.00
lllY ll~
211 16 21117 21119 9 21120 20,lll ... , ·• .. :SJ..:if'f'I.Y T~E NO • • • • • • rOltE-C.A~! __j
AVERAGE DAILY RATE [ADR1
II.II JLU 1,11 ILU l~k L: JlN AUO
2017 2017 2018 2018 2019 2020 2020
TnND ,Iii, Iii.;, •••
9
_J fC•.:EC/,,,1
REVENUE PER AVAILABLE RODM CREVPARJ
J~N L: 2019 9
TI!E NO • • • • • •
TREND ·• • • • • •
SO UR CES: STR , INC ; VISIT SlO CA L 'The:.e f-i9ure$ r•efle-c t lhe impoct in vi silotiori due lo lne Hi9hwoy 1 do:.~•re .
Item 11.a. - Page 15
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IMPERATIVE: l!D\l'OCATI: FOR ntE DEVELOPMENT OF CRfflCA hTOURlSM INFRJ\STiRUCTURE ............................................... .
PU.CE WHERE
PEOPU W4NT TO/ 1-LAVETO
VISIT
ECDNOMIIC
DEVELOPMENT
ECOSYSTEM
F.M 15/2 16
G-□-' A L I OUTLINE THE PJOLUTION .
. M.A. RK·E·T. l:NIG AND. MANAO.·EMENT. OF
. 1 DUH DESTINATION 20·30 YEARS
. INTO THE FUTURE
• PROTECT OUR QUALITY OF UFE
• ENHANCE SLD CAL AS A PLACE TO LIVE , v.mnK AND VISIT
• RESPONStBLV STEWAHD OUR LOCAL RESOURCES
2·100 IN ,PERSON 2,080 VISITOR 5,053 RISIOENT I:.
STAKEHOLDER INTERVIEWS SURVEY R:E SPONSES SURV EY RE SPONSES
8 FDCUS AREAS AND 28 RECOMMENDAIIONS
F11NAL STRATEGY TO BE DELIVERED SUMMER 2019
~3.05M
SAN LUIS OBISPO COUNTY
TOURISM MARKETING DISTRICT
MANAGEMENT DISTRICT PLAN
August 5, 2019 Prepared pursuant to the Property and Business Improvement District Law of
1994, Streets and Highways Code section 36600 et seq.
ATTACHMENT 2
2020-2030
Item 11.a. - Page 16
CONTENTS
I. OVERVIEW ........................................................................................................................................ 2
II. BACKGROUND ................................................................................................................................ 3
III. MAJOR ACCOMPLISHMENTS ..................................................................................................... 4
IV. BOUNDARY ....................................................................................................................................... 5
V. BUDGET AND SERVICES ............................................................................................................. 6
A. Annual Service Plan ............................................................................................................................. 6
B. Annual Budget ...................................................................................................................................... 8
C. California Constitutional Compliance ............................................................................................... 8
D. Assessment .......................................................................................................................................... 10
E. Penalties and Interest ......................................................................................................................... 10
F. Time and Manner for Collecting Assessments .............................................................................. 11
VI. GOVERNANCE ............................................................................................................................... 12
A. Owners’ Association .......................................................................................................................... 12
B. Brown Act and California Public Records Act Compliance ........................................................ 13
C. Annual Report .................................................................................................................................... 13
D. Audits and Accounting ...................................................................................................................... 14
APPENDIX 1 – LAW .................................................................................................................................... 15
APPENDIX 2 – ASSESSED BUSINESSES ............................................................................................. 26
Prepared by
Civitas
(800)999-7781
www.civitasadvisors.com
Item 11.a. - Page 17
••• • • CIVITAS
PAll T Mtlt$WIP$ • PROGRUS • PR0$P£11!1TY
SIQ
(AL I
SAN LUIS OBISPO COUNTY
CAL IF ORN I A -1>
SLOCTMD Management District Plan 2
August 5, 2019
I. OVERVIEW
Developed by San Luis Obispo County Visitors and Conference Bureau (Visit SLO CAL), the San
Luis Obispo County Tourism Marketing District (SLOCTMD) is an assessment district proposed to
provide specific benefits to payors, by funding marketing, advertising, and sales efforts for assessed
businesses. The countywide TMD is a cooperative effort to collectively market all that San Luis
Obispo County (SLO CAL) has to offer for the benefit of assessed lodging businesses.
Location: The renewed SLOCTMD includes all lodging businesses located within the boundaries
of the cities of Arroyo Grande, Atascadero, Grover Beach, Morro Bay, Paso Robles,
Pismo Beach, and San Luis Obispo, and the unincorporated portions of the County
of San Luis Obispo, as shown on the map in Section IV.
Services: The SLOCTMD is designed to provide specific benefits directly to payors by
increasing awareness and demand for room night sales. Marketing, advertising, and
sales will increase demand for overnight tourism and market payors as tourist, meeting
and event destinations, thereby increasing demand for room night sales.
Budget: The total SLOCTMD annual budget for the initial year of its ten (10) year operation
is anticipated to be approximately $6,000,000.
Cost: The annual assessment rate is one and one-half percent (1.5%) of gross short-term
room rental revenue. Based on the benefit received, assessments will not be collected
on: stays of more than thirty (30) consecutive days; stays by any officer or employee
of a foreign government who is exempt from Transient Occupancy Taxes by reason
of express provision of federal law or international treaty; stays by employees of
Federal Credit Unions while on official credit union business; and stays pursuant to
contracts executed prior to July 1, 2015. Stays pursuant to contracts executed between
July 1, 2015 and June 30, 2020 shall be subject to assessment at the rate of one percent
(1%) of gross short-term room revenue.
Collection: The County and cities will be responsible for collecting the assessment on a monthly
or quarterly basis (including any delinquencies, penalties and interest) from each
lodging business located in the boundaries of the SLOCTMD, within their respective
jurisdictions. The County and cities shall take all reasonable efforts to collect the
assessments from each lodging business.
Duration: The renewed SLOCTMD will have a ten (10) year life, beginning July 1, 2020 through
June 30, 2030. Once per year, beginning on the anniversary of SLOCTMD renewal,
there is a thirty (30) day period in which owners paying fifty percent (50%) or more of
the assessment may protest and initiate a Board of Supervisors hearing on SLOCTMD
termination.
Management: Visit SLO CAL will continue to serve as the SLOCTMD’s Owners’ Association. The
Owners’ Association is charged with managing funds and implementing programs in
accordance with this Plan, and must provide annual reports to the Board of
Supervisors.
Item 11.a. - Page 18
SLOCTMD Management District Plan 3
August 5, 2019
II. BACKGROUND
TMDs are an evolution of the traditional Business Improvement District. The first TMD was formed
in West Hollywood, California in 1989. Since then, over ninety California destinations have followed
suit. In recent years, other states have begun adopting the California model – Montana, South Dakota,
Washington, Colorado, Texas and Louisiana have adopted TMD laws. Several other states are in the
process of adopting their own legislation. The cities of Wichita, Kansas and Newark, New Jersey used
an existing business improvement district law to form a TBID. And, some cities, like Portland,
Oregon and Memphis, Tennessee have utilized their home rule powers to create TMDs without a
state law.
California’s TMDs collectively
raise over $250 million
annually for local destination
marketing. With competitors
raising their budgets, and
increasing rivalry for visitor
dollars, it is important that
SLO CAL lodging businesses
continue to invest in stable,
lodging-specific marketing
programs.
TMDs utilize the efficiencies
of private sector operation in
the market-based promotion of tourism districts. TMDs allow lodging business owners to organize
their efforts to increase demand for room night sales. Lodging business owners within the TMD pay
an assessment and those funds are used to provide services that increase demand for room night sales.
In California, TMDs are formed pursuant to the Property and Business Improvement District Law of
1994. This law allows for the creation of a benefit assessment district to raise funds within a specific
geographic area. The key difference between TMDs and other benefit assessment districts is that funds raised are
returned to the private non-profit corporation governing the district.
There are many benefits to TMDs:
Funds must be spent on services and improvements that provide a specific benefit only to those
who pay;
Funds cannot be diverted to general government programs;
They are customized to fit the needs of payors in each destination;
They allow for a wide range of services;
They are designed, created and governed by those who will pay the assessment; and
They provide a stable, long-term funding source for tourism promotion.
1 2 4 6 9 12
19
25 29 32
38
46
61 64
70 75
88
95 99 100
0
20
40
60
80
100
19891995200020012002200320042005200620072008200920102011201220132014201520162017Number of Districts Operating in California
Item 11.a. - Page 19
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August 5, 2019
III. MAJOR ACCOMPLISHMENTS
From 2015-2020, Visit SLO CAL accomplished significant efforts within the SLOCTMD. These
accomplishments are listed below:
• Tourism Marketing District Approved (June 2015)
• Developed Crisis Communication Plan (September 2015)
• Economic Impact of Tourism Exceeds $1.5B (December 2015)
• First Shoulder Season Marketing Campaign Launched (January 2016)
• New Booking Engine Partnership (March 2016)
• First-of-their-Kind Countywide Research Studies Completed (April 2016)
• AMGEN Tour of California in SLO CAL (Morro Bay) (April 2016)
• National Advertising Agency Hired (May 2016)
• Strategic Direction 2020 Approved (June 2016)
• Chimney Fire - Crisis Communication Plan Activated (August 2016)
• First SAVOR - A San Luis Obispo County Experience - San Diego (November 2016)
• Highway 1 Closure (November 2016)
• UK Trade & Media Representation Contract Begins (November 2016)
• Inclusion in Visit California Television Ad (Morro Rock) (Winter 2016)
• SLO CAL Brand and Life's Too Beautiful to Rush Campaign Launched (January 2017)
• SAVOR - A San Luis Obispo County Experience – Seattle (February 2017)
• New Air Service from Seattle Begins (April 2017)
• AMGEN Tour of California in SLO CAL (Pismo Beach/Morro Bay) (April 2017)
• Conference Center Feasibility Study Completed (April 2017)
• New Air Service from Denver Begins (June 2017)
• $1M Ad Campaign Launched (October 2017)
• Hired National PR Agency (TURNER PR) (November 2017)
• Inclusion in Visit California Television Ad (Oceano Dunes) (Winter 2017)
• Thomas Fire - Crisis Communication Plan Activated (December 2017)
• Launched SLOCAL.com, SLO CAL Connection and CRM (February 2018)
• Poppy Award for Best Digital Campaign (February 2018)
• Launched Destination Management Strategy Process (May 2018)
• Launched “SLO CAL Storytellers” Ambassador Program (June 2018)
• Received DMAP Accreditation (July 2018)
• Highway 1 Re-Opens (July 2018)
• Visit SLO CAL Champions Dream Drive Event (August 2018)
• $1M Ad Campaign Launched (September 2018)
• New Air Service from Dallas Begins (April 2019)
• Completion of Destination Management Strategy (Spring 2019)
Item 11.a. - Page 20
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IV. BOUNDARY
The SLOCTMD will include all lodging businesses, existing and in the future, available for public
occupancy within the boundaries of the cities of Arroyo Grande, Atascadero, Grover Beach, Morro
Bay, Paso Robles, Pismo Beach, and San Luis Obispo, and the unincorporated portions of the County
of San Luis Obispo.
Lodging business shall mean any structure, or any portion of any structure, which is occupied or
intended or designed for occupancy by transients for dwelling, lodging, or sleeping purposes, and
includes any hotel, inn, tourist home or house, motel, studio hotel, short-term vacation rental,
bachelor hotel, lodging house, rooming house, apartment house, dormitory, public or private club,
mobile home or house trailer at a fixed location or other similar structure or portion thereof; and shall
further include any space, lot, area or site in any trailer court, recreational vehicle park, mobile home
park, camp, park or lot where a trailer, tent, recreational vehicle, mobile home, motorhome, or other
similar conveyance is occupied or intended or designed for occupancy by transients dwelling, lodging
or sleeping purposes.
The boundary, as shown in the map below, currently includes 2,666 lodging businesses. A complete
listing of lodging businesses within the renewed SLOCTMD can be found in Appendix 2.
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August 5, 2019
V. BUDGET AND SERVICES
A. Annual Service Plan
Assessment funds will be spent to provide specific benefits conferred or privileges granted directly to
the payors that are not provided to those not charged, and which do not exceed the reasonable cost
to the County of conferring the benefits or granting the privileges. The privileges and services
provided with the SLOCTMD funds are marketing, advertising, and sales programs available only to
assessed businesses. There shall be industry-specific marketing included in the marketing program,
including marketing of bed and breakfasts, vacation rentals, and RV parks.
A service plan budget has been developed to deliver services that benefit the assessed businesses. A
detailed annual budget will be developed and approved by the Visit SLO CAL Board. The table below
illustrates the initial annual budget allocations. The total initial budget is $6,000,000.
Although actual revenues will fluctuate due to market conditions, the proportional allocations of the
budget shall remain the same. However, the County and the Visit SLO CAL board shall have the
authority to adjust budget allocations between the categories by no more than twenty-five percent
(25%) of the total budget per year. A description of the proposed improvements and activities is listed
below. The same activities are proposed for subsequent years. In the event of a legal challenge against
the SLOCTMD, any and all assessment funds may be used for the costs of defending the SLOCTMD.
Each budget category includes all costs related to providing that service, in accordance with Generally
Accepted Accounting Procedures (GAAP). For example, the marketing budget includes the cost of
staff time dedicated to overseeing and implementing the marketing program. Staff time dedicated
purely to administrative tasks is allocated to the administrative portion of the budget. The costs of an
individual staff member may be allocated to multiple budget categories, as appropriate in accordance
Marketing, Sales,
Advertising, and
Destination Management,
$4,920,000 , 82%
Administration,
$660,000 , 11%
Contingency / Renewal,
$300,000 , 5%
Collection Costs,
$120,000 , 2%
Initial Annual Budget -$6,000,000
Item 11.a. - Page 22
SLOCTMD Management District Plan 7
August 5, 2019
with GAAP. The staffing levels necessary to provide the services below will be determined by Visit
SLO CAL and their Board on an as-needed basis.
Marketing, Sales, Advertising & Destination Management
A marketing, sales, advertising, and destination management and advertising program will promote
SLO CAL as a tourist, meeting, and event destination. The program will have a central theme of
promoting SLO CAL as a desirable place for overnight visits. Sales efforts will be designed to attract
group, leisure travel, meetings and conferences and event business to SLO CAL. The program will
have the goal of increasing awareness for overnight visitation and demand for room night sales at
assessed businesses, and may include the following activities:
Strategic planning and message positioning to attract overnight visitors to assessed businesses;
Brand development and management to attract overnight visitors to assessed businesses;
Digital marketing, advertising and promotions to drive demand for lodging sales at assessed
businesses, including blogs, e-newsletters, social media and direct response campaigns;
Website development and maintenance to drive demand for lodging sales at assessed
businesses;
Media and public relations to increase destination awareness and demand for overnight stays
at assessed businesses;
Radio, print and tv advertising to increase destination awareness and demand for overnight
stays at assessed businesses;
Domestic and international sales missions to increase awareness and demand for overnight
stays at assessed businesses;
Staff engaged in implementing marketing, advertising, promotions and sales activities to
increase awareness and demand for overnight stays at assessed businesses;
Seasonal and event-related promotions and event guides to drive demand for lodging sales at
assessed businesses;
Strategic partnerships with travel associates to increase awareness and demand for overnight
stays at assessed businesses;
Management of a resource library to assist assessed businesses with sales and marketing
efforts;
Event marketing to increase awareness and demand for overnight stays at assessed businesses;
Consumer communication for the benefit of assessed businesses;
Working with and as the Film Commission (Film SLO CAL) to increase awareness and
demand for overnight stays at assessed businesses;
Attendance of conferences, events, and trade shows to showcase the destination and to
increase awareness and demand for overnight stays at assessed businesses;
Research on market conditions and opportunities to increase awareness and demand for
overnight stays at assessed businesses;
Management of a destination media kit to increase awareness and demand for overnight stays
at assessed businesses;
Development, production and distribution of a destination visitors’ magazine to increase
awareness and demand for overnight stays at assessed businesses; and
Destination management for the benefit of assessed businesses.
Item 11.a. - Page 23
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August 5, 2019
Administration
The administrative and operations portion of the budget shall be utilized for administrative (non-
program) staffing costs, office costs, and other general program-related administrative costs such as
insurance, legal, auditing, and accounting fees.
Collection Costs
The County and each City shall retain a fee equal to two percent (2%) of the amount of assessment
collected, within their respective jurisdictions, to cover its costs of collection and administration.
Contingency/Renewal
The budget includes a contingency line item to account for uncollected assessments, if any. If there
are contingency funds collected, they may be held in a reserve fund or utilized for other program,
administration or renewal costs at the discretion of the Visit SLO CAL Board. Policies relating to
contributions to the reserve fund, the target amount of the reserve fund, and expenditure of monies
from the reserve fund shall be set by the Visit SLO CAL Board. Contingency/renewal funds may be
spent on District programs or administrative and renewal costs in such proportions as determined by
the Visit SLO CAL Board. The reserve fund may be used for the costs of renewing the SLOCTMD.
B. Annual Budget
The total ten (10) year improvement and service plan budget is projected at approximately $6,000,000
annually, or $60,000,000 through 2030. This amount may fluctuate as sales and revenue increase at
assessed businesses, but is not expected to change significantly over the term.
C. California Constitutional Compliance
The SLOCTMD assessment is not a property-based assessment subject to the requirements of
Proposition 218. Courts have found Proposition 218 limited the term ‘assessments’ to levies on real
property.1 Rather, the SLOCTMD assessment is a business-based assessment, and is subject to
Proposition 26. Pursuant to Proposition 26 all levies are a tax unless they fit one of seven exceptions.
Two of these exceptions apply to the SLOCTMD, a “specific benefit” and a “specific government
service.” Both require that the costs of benefits or services do not exceed the reasonable costs to the
County of conferring the benefits or providing the services.
1. Specific Benefit
Proposition 26 requires that assessment funds be expended on, “a specific benefit conferred or
privilege granted directly to the payor that is not provided to those not charged, and which does not
exceed the reasonable costs to the local government of conferring the benefit or granting the
privilege.”2 The services in this Plan are designed to provide targeted benefits directly to assessed
businesses, and are intended only to provide benefits and services directly to those businesses paying
the assessment. These services are tailored not to serve the general public, businesses in general, or
parcels of land, but rather to serve the specific businesses within the SLOCTMD. The activities
described in this Plan are specifically targeted to increase room night sales for assessed lodging
businesses within the boundaries of the SLOCTMD, and are narrowly tailored. SLOCTMD funds
will be used exclusively to provide the specific benefit of increased room night sales directly to the
assessees. Assessment funds shall not be used to feature non-assessed lodging businesses in
SLOCTMD programs, or to directly generate sales for non-assessed businesses. The activities paid
1 Jarvis v. the City of San Diego 72 Cal App. 4th 230
2 Cal. Const. art XIII C § 1(e)(1)
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SLOCTMD Management District Plan 9
August 5, 2019
for from assessment revenues are business services constituting and providing specific benefits to the
assessed businesses.
The assessment imposed by this SLOCTMD is for a specific benefit conferred directly to the payors
that is not provided to those not charged. The specific benefit conferred directly to the payors is an
increase in demand for room night sales. The specific benefit of an increase in demand for room
night sales for assessed lodging businesses will be provided only to lodging businesses paying the
district assessment, with marketing, advertising, and sales programs promoting lodging businesses
paying the SLOCTMD assessment. The marketing, sales, and advertising programs will be designed
to increase demand for room night sales at assessed lodging businesses. Because they are necessary
to provide the marketing, advertising, and sales programs that specifically benefit the assessed lodging
businesses, the administration and contingency services also provide the specific benefit of increased
demand for room night sales to the assessed lodging businesses.
Although the SLOCTMD, in providing specific benefits to payors, may produce incidental benefits
to non-paying businesses, the incidental benefit does not preclude the services from being considered
a specific benefit. The legislature has found that, “A specific benefit is not excluded from classification
as a ‘specific benefit’ merely because an indirect benefit to a nonpayor occurs incidentally and without
cost to the payor as a consequence of providing the specific benefit to the payor.”3
2. Specific Government Service
The assessment may also be utilized to provide, “a specific government service or product provided
directly to the payor that is not provided to those not charged, and which does not exceed the
reasonable costs to the local government of providing the service or product.”4 The legislature has
recognized that marketing and promotions services like those to be provided by the SLOCTMD are
government services within the meaning of Proposition 265. Further, the legislature has determined
that “a specific government service is not excluded from classification as a ‘specific government
service’ merely because an indirect benefit to a nonpayor occurs incidentally and without cost to the
payor as a consequence of providing the specific government service to the payor.”6
3. Reasonable Cost
SLOCTMD services will be implemented carefully to ensure they do not exceed the reasonable cost
of such services. The full amount assessed will be used to provide the services described herein.
Funds will be managed by the Visit SLO CAL Board, and reports submitted on an annual basis to the
County. Marketing materials, sales leads generated from SLOCTMD-funded activities, advertising
campaigns, and other SLOCTMD-funded services will be designed only to increase additional demand
for room night sales at assessed lodging businesses. Non-assessed lodging businesses will not receive
these, nor any other, SLOCTMD-funded services and benefits.
The SLOCTMD-funded programs are all targeted directly at providing additional demand for room
nights only at assessed businesses. It is, however, possible that there will be a spill over benefit to
non-assessed businesses. If non-assessed lodging businesses receive incremental room nights, that
portion of the promotion or program generating those room nights may be paid with non-SLOCTMD
funds. SLOCTMD funds shall only be spent to benefit the assessed businesses, and shall not be spent
3 Government Code § 53758(a)
4 Cal. Const. art XIII C § 1(e)(2)
5 Government Code § 53758(b)
6 Government Code § 53758(b)
Item 11.a. - Page 25
SLOCTMD Management District Plan 10
August 5, 2019
on that portion of any program which directly generates incidental room nights for non-assessed
businesses.
D. Assessment
The annual assessment rate is one and one-half percent (1.5%) of gross short-term room rental
revenue. Based on the benefit received, assessments will not be collected on: stays of more than thirty
(30) consecutive days; stays by any officer or employee of a foreign government who is exempt from
Transient Occupancy Taxes by reason of express provision of federal law or international treaty; stays
by employees of Federal Credit Unions while on official credit union business; and stays pursuant to
contracts executed prior to July 1, 2015. Stays pursuant to contracts executed between July 1, 2015
and June 30, 2020 shall be subject to assessment at the rate of one percent (1%) of gross short-term
room revenue.
The term “gross room rental revenue” as used herein means: the consideration charged, whether or
not received, for the occupancy of space in a lodging business valued in money, whether to be received
in money, goods, labor or otherwise, including all receipts, cash, credits and property and services of
any kind or nature, without any deduction. Gross room rental revenue includes, but is not limited to,
fees, such as parking fees, resort fees, cleaning fees, pet fees, roll-away bed fees, energy fees, or
miscellaneous fees and non-refundable deposits (including reservation fees) charged as a condition of
occupying a room or rooms. Gross room rental revenue shall not include any federal, state or local
taxes collected, including but not limited to transient occupancy taxes.
The assessment is levied upon and a direct obligation of the assessed lodging business. However, the
assessed lodging business may, at its discretion, pass the assessment on to transients. The amount of
assessment, if passed on to each transient, shall be disclosed in advance and separately stated from the
amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for
payment from the business. If the SLOCTMD assessment is identified separately it shall be disclosed
as the “TMD Assessment.” As an alternative, the disclosure may include the amount of the
SLOCTMD assessment and the amount of the assessment imposed pursuant to the California
Tourism Marketing Act, Government Code §13995 et seq. and shall be disclosed as the “Tourism
Assessment.” The assessment is imposed solely upon, and is the sole obligation of the assessed
lodging business even if it is passed on to transients. The assessment shall not be considered revenue
for any purpose, including calculation of transient occupancy taxes.
Bonds shall not be issued.
E. Penalties and Interest
The SLOCTMD shall reimburse the cities and County for any costs associated with collecting unpaid
assessments. If sums in excess of the delinquent SLOCTMD assessment are sought to be recovered
in the same collection action by the cities and County, the SLOCTMD shall bear its pro rata share of
such collection costs. Assessed businesses which are delinquent in paying the assessment shall be
responsible for paying:
1. Original Delinquency
Any business which fails to remit the assessment within the time required shall pay a penalty
of ten percent (10%) of the amount of the assessment in addition to the amount of the
assessment.
2. Continued Delinquency
Item 11.a. - Page 26
SLOCTMD Management District Plan 11
August 5, 2019
Any business which fails to remit any delinquent remittance on or before a period of thirty
(30) days following the date on which the remittance first became delinquent shall pay a second
delinquency penalty of ten percent (10%) of the amount of the assessment in addition to the
amount of the assessment and the ten percent (10%) penalty first imposed.
3. Fraud
If it is determined that nonpayment of any remittance is due to fraud, a penalty of twenty-five
percent (25%) of the amount of the assessment shall be added thereto in addition to the above
penalties.
4. Interest
In addition to the penalties imposed, any business which fails to remit any assessment shall
pay interest at the rate of one-half of one percent (0.5%) per month or fraction thereof on the
amount of the assessment, exclusive of penalties, from the date on which the assessment first
became delinquent until paid.
5. Penalties Merged with Assessment
Every penalty imposed and such interest as accrues shall become part of the assessment
required to be paid.
F. Time and Manner for Collecting Assessments
The SLOCTMD assessment will be implemented beginning July 1, 2020 and will continue for ten (10)
years through June 30, 2030. The cities and County will be responsible for collecting the assessment
on a monthly or quarterly basis (including any delinquencies, penalties and interest) from each lodging
business located in their respective jurisdictions. The cities and County shall take all reasonable efforts
to collect the assessments from each lodging business within their respective jurisdiction.
The cities and County shall forward the collected assessment to the Owners’ Association within thirty
(30) days of receiving the assessments. Any City or County that is delinquent in forwarding the collected
assessment to the Owners’ Association shall be responsible for paying:
1. Original Delinquency
Any City or County which fails to remit the assessment within the time required shall pay a
penalty of ten percent (10%) of the amount of the assessment in addition to the amount of
the assessment.
2. Continued Delinquency
Any City or County which fails to remit any delinquent remittance on or before a period of
thirty (30) days following the date on which the remittance first became delinquent shall pay a
second delinquency penalty of ten percent (10%) of the amount of the assessment in addition
to the amount of the assessment and the ten percent (10%) penalty first imposed.
Item 11.a. - Page 27
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VI. GOVERNANCE
A. Owners’ Association
The Board of Supervisors, through adoption of this Management District Plan, has the right, pursuant
to Streets and Highways Code §36651, to identify the body that shall implement the proposed
program, which shall be the Owners’ Association of the SLOCTMD as defined in Streets and
Highways Code §36612. The Board of Supervisors has determined that San Luis Obispo County
Visitors and Conference Bureau (Visit SLO CAL) will serve as the Owners’ Association for the
SLOCTMD.
Board of Directors
The Visit SLO CAL Board will strive to ensure that each jurisdiction is represented in approximate
proportion to the amount contributed by lodging businesses in that jurisdiction. Each Director must
be the owner or the general manager of an assessed lodging business, except for the County
representative. The Directors will include the following:
At least one representative of a lodging business in each jurisdiction
At least one representative each from a vacation rental, a bed and breakfast, and an R.V. park
At least one representative who is appointed by the County of San Luis Obispo
At least one at-large assessed lodging business member
The Board of Directors shall be selected as follows:
At least one lodging business representative from each of the cities shall be appointed by the
respective jurisdiction’s city council or tourism organization, as each city determines
At least one lodging business representative shall be appointed by the County Board of
Supervisors
At least one additional representative at-large shall be appointed by the County Board of
Supervisors
Nominations shall be sought from the assessed lodging businesses for the remaining at-large
seats. Nominations will be verified by the nominating committee, and a slate provided to the
Board of Directors for election. The slate will take into consideration the requirement for
various business types.
The Board of Directors shall serve for staggered three-year terms.
As part of the annual budget process, the Visit SLO CAL Board will review all staffing costs, including
salaries and benefits.
Visit SLO CAL will also maintain two committees that will assist in managing and implementing the
TMD funds and programs and communicating with the various jurisdictions.
Marketing Committee
The marketing committee’s purpose will be to align marketing objectives and complementary
strategies between community and county tourism marketing programming to optimize collaboration
and reduce duplication. The committee will consist of managers and marketing professionals who
have been selected through an application process that is managed and reviewed by the Visit SLO
CAL Board of Directors and staff. The committee’s recommendations will be submitted to the Visit
SLO CAL Board of Directors for approval.
Item 11.a. - Page 28
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August 5, 2019
The Marketing Committee will include the following:
The DMO manager from each community and the county unincorporated area
At-large members, representing a mix of different sectors
DMO managers will have a standing seat on the Marketing Committee. At-large members shall serve
for staggered three-year terms. At the initial meeting, each at-large member shall draw lots to
determine their term.
Advisory Committee
The advisory committee will be comprised of one elected official and one city manager/county official
from each participating community. Each community will determine its representative(s) to the
committee. The participating communities or advisory committee may determine on their own to
establish a core group of advisory committee individuals who will represent the broader group and
interests of the communities on their behalf. The advisory committee will meet with the Visit SLO
CAL Executive Committee a minimum of twice per year and no more than four times per year at the
request of the advisory committee. Members of both bodies will be able to place items for discussion
on the agenda. The advisory committee’s input, concerns, and recommendations will be considered
by Visit SLO CAL’s Executive Committee when taking action on behalf of the organization. The
advisory committee will liaise back to the communities they represent with programming updates and
overall metrics demonstrating the impacts of the TMD on the County and cities.
B. Brown Act and California Public Records Act Compliance
An Owners’ Association is a private entity and may not be considered a public entity for any purpose,
nor may its board members or staff be considered to be public officials for any purpose. The Owners’
Association is, however, subject to government regulations relating to transparency, namely the Ralph
M. Brown Act and the California Public Records Act. These regulations are designed to promote
public accountability. The Owners’ Association acts as a legislative body under the Ralph M. Brown
Act (Government Code §54950 et seq.). Thus, meetings of the Visit SLO CAL Board and certain
committees must be held in compliance with the public notice and other requirements of the Brown
Act. The Owners’ Association is also subject to the record keeping and disclosure requirements of
the California Public Records Act. Accordingly, the Owners’ Association shall publicly report any
action taken and the vote or abstention on that action of each member present for the action.
C. Annual Report
The Visit SLO CAL shall present an annual report by October 31, for the previous fiscal year of
operation, to the Board of Supervisors pursuant to Streets and Highways Code §36650 (see Appendix
1). The annual report shall include:
Any proposed changes in the boundaries of the improvement district or in any benefit zones
or classification of businesses within the district.
The improvements and activities to be provided for that fiscal year.
An estimate of the cost of providing the improvements and the activities for that fiscal year.
The method and basis of levying the assessment in sufficient detail to allow each business
owner to estimate the amount of the assessment to be levied against his or her business for
that fiscal year.
The estimated amount of any surplus or deficit revenues to be carried over from a previous
fiscal year.
Item 11.a. - Page 29
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August 5, 2019
The estimated amount of any contributions to be made from sources other than assessments
levied pursuant to this part.
D. Audits and Accounting
The County of San Luis Obispo shall be allowed to review the financial records of Visit SLO CAL
relative to the SLOCTMD. Visit SLO CAL shall engage either an independent certified public
accountant or the County auditor-controller to conduct annual audits. The audit report must be
submitted to the County no more than six (6) months after the fiscal year ends.
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APPENDIX 1 – LAW
*** THIS DOCUMENT IS CURRENT THROUGH THE 2018 SUPPLEMENT ***
(ALL 2017 LEGISLATION)
STREETS AND HIGHWAYS CODE
DIVISION 18. PARKING
PART 7. PROPERTY AND BUSINESS IMPROVEMENT DISTRICT LAW OF 1994
CHAPTER 1. General Provisions
ARTICLE 1. Declarations
36600. Citation of part
This part shall be known and may be cited as the “Property and Business Improvement District Law of 1994.”
36601. Legislative findings and declarations; Legislative guidance
The Legislature finds and declares all of the following:
(a) Businesses located and operating within business districts in some of this state’s communities are
economically disadvantaged, are underutilized, and are unable to attract customers due to inadequate
facilities, services, and activities in the business districts.
(b) It is in the public interest to promote the economic revitalization and physical maintenance of business
districts in order to create jobs, attract new businesses, and prevent the erosion of the business districts.
(c) It is of particular local benefit to allow business districts to fund business related improvements,
maintenance, and activities through the levy of assessments upon the businesses or real property that receive
benefits from those improvements.
(d) Assessments levied for the purpose of conferring special benefit upon the real property or a specific
benefit upon the businesses in a business district are not taxes for the general benefit of a city, even if property,
businesses, or persons not assessed receive incidental or collateral effects that benefit them.
(e) Property and business improvement districts formed throughout this state have conferred special benefits
upon properties and businesses within their districts and have made those properties and businesses more
useful by providing the following benefits:
(1) Crime reduction. A study by the Rand Corporation has confirmed a 12-percent reduction in the
incidence of robbery and an 8-percent reduction in the total incidence of violent crimes within the
30 districts studied.
(2) Job creation.
(3) Business attraction.
(4) Business retention.
(5) Economic growth.
(6) New investments.
(f) With the dissolution of redevelopment agencies throughout the state, property and business improvement
districts have become even more important tools with which communities can combat blight, promote
economic opportunities, and create a clean and safe environment.
(g) Since the enactment of this act, the people of California have adopted Proposition 218, which added
Article XIII D to the Constitution in order to place certain requirements and restrictions on the formation of,
and activities, expenditures, and assessments by property-based districts. Article XIII D of the Constitution
provides that property-based districts may only levy assessments for special benefits.
(h) The act amending this section is intended to provide the Legislature’s guidance with regard to this act, its
interaction with the provisions of Article XIII D of the Constitution, and the determination of special benefits
in property-based districts.
(1) The lack of legislative guidance has resulted in uncertainty and inconsistent application of this
act, which discourages the use of assessments to fund needed improvements, maintenance, and
activities in property-based districts, contributing to blight and other underutilization of property.
(2) Activities undertaken for the purpose of conferring special benefits upon property to be assessed
inherently produce incidental or collateral effects that benefit property or persons not assessed.
Therefore, for special benefits to exist as a separate and distinct category from general benefits, the
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SLOCTMD Management District Plan 16
August 5, 2019
incidental or collateral effects of those special benefits are inherently part of those special benefits.
The mere fact that special benefits produce incidental or collateral effects that benefit property or
persons not assessed does not convert any portion of those special benefits or their incidental or
collateral effects into general benefits.
(3) It is of the utmost importance that property-based districts created under this act have clarity
regarding restrictions on assessments they may levy and the proper determination of special benefits.
Legislative clarity with regard to this act will provide districts with clear instructions and courts with
legislative intent regarding restrictions on property-based assessments, and the manner in which
special benefits should be determined.
36602. Purpose of part
The purpose of this part is to supplement previously enacted provisions of law that authorize cities to levy assessments
within property and business improvement districts, to ensure that those assessments conform to all constitutional
requirements and are determined and assessed in accordance with the guidance set forth in this act. This part does not
affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or
the raising of revenue for these purposes.
36603. Preemption of authority or charter city to adopt ordinances levying assessments
Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different
method of levying assessments for similar or additional purposes from those set forth in this part. A property and
business improvement district created pursuant to this part is expressly exempt from the provisions of the Special
Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)).
36603.5. Part prevails over conflicting provisions
Any provision of this part that conflicts with any other provision of law shall prevail over the other provision of law,
as to districts created under this part.
36604. Severability
This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall
remain in full force and effect. Assessments levied under this part are not special taxes.
ARTICLE 2. Definitions
36606. “Activities”
“Activities” means, but is not limited to, all of the fo llowing that benefit businesses or real property in the district:
(a) Promotion of public events.
(b) Furnishing of music in any public place.
(c) Promotion of tourism within the district.
(d) Marketing and economic development, including retail retention and recruitment.
(e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services
supplemental to those normally provided by the municipality.
(f) Other services provided for the purpose of conferring special benefit upon assessed real property or
specific benefits upon assessed businesses located in the district.
36606.5. “Assessment”
“Assessment” means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and
providing activities that will provide certain benefits to properties or businesses located within a property and business
improvement district.
36607. “Business”
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“Business” means all types of businesses and includes financial institutions and professions.
36608. “City”
“City” means a city, county, city and county, or an agency or entity created pursuant to Article 1 (commencin g with
Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the public member agencies of which
includes only cities, counties, or a city and county, or the State of California.
36609. “City council”
“City council” means the city council of a city or the board of supervisors of a county, or the agency, commission, or
board created pursuant to a joint powers agreement and which is a city within the meaning of this part.
36609.4. “Clerk”
“Clerk” means the clerk of the legislative body.
36609.5. “General benefit”
“General benefit” means, for purposes of a property-based district, any benefit that is not a “special benefit” as defined
in Section 36615.5.
36610. “Improvement”
“Improvement” means the acquisition, construction, installation, or maintenance of any tangible property with an
estimated useful life of five years or more including, but not limited to, the following:
(a) Parking facilities.
(b) Benches, booths, kiosks, display cases, pedestrian shelters and signs.
(c) Trash receptacles and public restrooms.
(d) Lighting and heating facilities.
(e) Decorations.
(f) Parks.
(g) Fountains.
(h) Planting areas.
(i) Closing, opening, widening, or narrowing of existing streets.
(j) Facilities or equipment, or both, to enhance security of persons and property within the district.
(k) Ramps, sidewalks, plazas, and pedestrian malls.
(l) Rehabilitation or removal of existing structures.
36611. “Management district plan”; “Plan”
“Management district plan” or “plan” means a proposal as defined in Section 36622.
36612. “Owners’ association”
“Owners’ association” means a private nonprofit entity that is under contract with a city to administer or implement
improvements, maintenance, and activities specified in the management district plan. An owners’ association may be
an existing nonprofit entity or a newly formed nonprofit entity. An owners’ association is a private entity and may not
be considered a public entity for any purpose, nor may its board members or staff be co nsidered to be public officials
for any purpose. Notwithstanding this section, an owners’ association shall comply with the Ralph M. Brown Act
(Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), at all times
when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California
Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code),
for all records relating to activities of the district.
36614. “Property”
“Property” means real property situated within a district.
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36614.5. “Property and business improvement district”; “District”
“Property and business improvement district,” or “district,” means a property and business improvement district
established pursuant to this part.
36614.6. “Property-based assessment”
“Property-based assessment” means any assessment made pursuant to this part upon real property.
36614.7. “Property-based district”
“Property-based district” means any district in which a city levies a property-based assessment.
36615. “Property owner”; “Business owner”; “Owner”
“Property owner” means any person shown as the owner of land on the last equalized assessment roll or otherwise
known to be the owner of land by the city council. “Business owner” means any person recognized by the city as the
owner of the business. “Owner” means either a business owner or a property owner. The city council has no obligation
to obtain other information as to the ownership of land or businesses, and its determination of ownership shall be final
and conclusive for the purposes of this part. Wherever this part requires the signature of the property owner, the
signature of the authorized agent of the property owner shall be sufficient. Wherever this part requires the signature
of the business owner, the signature of the authorized agent of the business owner shall be sufficient.
36615.5. “Special benefit”
“Special benefit” means, for purposes of a property-based district, a particular and distinct benefit over and above
general benefits conferred on real property located in a district or to the public at large. Special benefit includes
incidental or collateral effects that arise from the improvements, maintenance, or activities of property-based districts
even if those incidental or collateral effects benefit property or persons not assessed. Special benefit excludes general
enhancement of property value.
36616. “Tenant”
“Tenant” means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner.
ARTICLE 3. Prior Law
36617. Alternate method of financing certain improvements and activities; Effect on other provisions
This part provides an alternative method of financing certain improvements and activities. The provisions of this part
shall not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or
activities or the raising of revenue for these purposes. Every improvement area established pursuant to the Parking
and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500) of this division) is valid and
effective and is unaffected by this part.
CHAPTER 2. Establishment
36620. Establishment of property and business improvement district
A property and business improvement district may be established as provided in this chapter.
36620.5. Requirement of consent of city council
A county may not form a district within the territor ial jurisdiction of a city without the consent of the city council of
that city. A city may not form a district within the unincorporated territory of a county without the consent of the board
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August 5, 2019
of supervisors of that county. A city may not form a district within the territorial jurisdiction of another city without
the consent of the city council of the other city.
36621. Initiation of proceedings; Petition of property or business owners in proposed district
(a) Upon the submission of a written petition, signed by the property or business owners in the proposed
district who will pay more than 50 percent of the assessments proposed to be levied, the city council may
initiate proceedings to form a district by the adoption of a resolution expressing its intention to form a district.
The amount of assessment attributable to property or a business owned by the same property or business
owner that is in excess of 40 percent of the amount of all assessments proposed to be levied, shall not be
included in determining whether the petition is signed by property or business owners who will pay more
than 50 percent of the total amount of assessments proposed to be levied.
(b) The petition of property or business owners required under subdivision (a) shall include a summary of
the management district plan. That summary shall include all of the following:
(1) A map showing the boundaries of the district.
(2) Information specifying where the complete management district plan can be obtained.
(3) Information specifying that the complete management district plan shall be furnished upon
request.
(c) The resolution of intention described in subdivision (a) shall contain all of the following:
(1) A brief description of the proposed improvements, maintenance, and activities, the amount of
the proposed assessment, a statement as to whether the assessment will be levied on property or
businesses within the district, a statement as to whether bonds will be issued, and a description of
the exterior boundaries of the proposed district, which may be made by reference to any plan or map
that is on file with the clerk. The descriptions and statements do not need to be detailed and shall be
sufficient if they enable an owner to generally identify the nature and extent of the improvements,
maintenance, and activities, and the location and extent of the proposed district.
(2) A time and place for a public hearing on the establishment of the property and business
improvement district and the levy of assessments, which shall be consistent with the requirements
of Section 36623.
36622. Contents of management district plan
The management district plan shall include, but is not limited to, all of the following:
(a) If the assessment will be levied on property, a map of the district in sufficient detail to locate each parcel
of property and, if businesses are to be assessed, each business within the district. If the assessment will be
levied on businesses, a map that identifies the district boundaries in sufficient detail to allow a business owner
to reasonably determine whether a business is located within the district boundaries. If the assessment will
be levied on property and businesses, a map of the district in sufficient detail to locate each parcel of property
and to allow a business owner to reasonably determine whether a business is located within the district
boundaries.
(b) The name of the proposed district.
(c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for
establishment or extension in a manner sufficient to identify the affected property and businesses included,
which may be made by reference to any plan or map that is on file with the clerk. The boundaries of a
proposed property assessment district shall not overlap with the bounda ries of another existing property
assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created
pursuant to this part to overlap with other assessment districts established pursuant to other provisions of law,
including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing
with Section 36500)). This part does not prohibit the boundaries of a business assessment district created
pursuant to this part to overlap with another business assessment district created pursuant to this part. This
part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap
with a property assessment district created pursuant to this part.
(d) The improvements, maintenance, and activities proposed for each year of operation of the district and the
maximum cost thereof. If the improvements, maintenance, and activities proposed for each year of operation
are the same, a description of the first year’s proposed improvements, maintenance, and activities and a
statement that the same improvements, maintenance, and activities are proposed for subsequent years shall
satisfy the requirements of this subdivision.
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(e) The total annual amount proposed to be expended for improvements, maintenance, or activities, and debt
service in each year of operation of the district. If the assessment is levied on businesses, this amount may
be estimated based upon the assessment rate. If the total annual amount proposed to be expended in each year
of operation of the district is not significantly different, the amount proposed to be expended in the initial
year and a statement that a similar amount applies to subsequent years shall satisfy the requirements of this
subdivision.
(f) The proposed source or sources of financing, including the proposed method and basis of levying the
assessment in sufficient detail to allow each property or business owner to calculate the amount of the
assessment to be levied against his or her property or business. The plan also shall state whether bonds will
be issued to finance improvements.
(g) The time and manner of collecting the assessments.
(h) The specific number of years in which assessments will be levied. In a new district, the maximum number
of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years. Notwithstanding
these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy
assessments until the maximum maturity of the bonds. The management district plan may set forth specific
increases in assessments for each year of operation of the district.
(i) The proposed time for implementation and completion of the management district plan.
(j) Any proposed rules and regulations to be applicable to the district.
(k) (1) A list of the properties or businesses to be assessed, including the assessor’s parcel numbers for
properties to be assessed, and a statement of the method or methods by which the expenses of a
district will be imposed upon benefited real property or businesses, in proportion to the benefit
received by the property or business, to defray the cost thereof.
(2) In a property-based district, the proportionate special benefit derived by each ident ified parcel
shall be determined exclusively in relationship to the entirety of the capital cost of a public
improvement, the maintenance and operation expenses of a public improvement, or the cost of the
activities. An assessment shall not be imposed on a ny parcel that exceeds the reasonable cost of the
proportional special benefit conferred on that parcel. Only special benefits are assessable, and a
property-based district shall separate the general benefits, if any, from the special benefits conferred
on a parcel. Parcels within a property-based district that are owned or used by any city, public
agency, the State of California, or the United States shall not be exempt from assessment unless the
governmental entity can demonstrate by clear and convincing evidence that those publicly owned
parcels in fact receive no special benefit. The value of any incidental, secondary, or collateral effects
that arise from the improvements, maintenance, or activities of a property-based district and that
benefit property or persons not assessed shall not be deducted from the entirety of the cost of any
special benefit or affect the proportionate special benefit derived by each identified parcel.
(l) In a property-based district, the total amount of all special benefits to be conferred upon the properties
located within the property-based district.
(m) In a property-based district, the total amount of general benefits, if any.
(n) In a property-based district, a detailed engineer’s report prepared by a registered profession al engineer
certified by the State of California supporting all assessments contemplated by the management district plan.
(o) Any other item or matter required to be incorporated therein by the city council.
36623. Procedure to levy assessment
(a) If a city council proposes to levy a new or increased property assessment, the notice and protest and
hearing procedure shall comply with Section 53753 of the Government Code.
(b) If a city council proposes to levy a new or increased business assessment, the notice and protest and
hearing procedure shall comply with Section 54954.6 of the Government Code, except that notice shall be
mailed to the owners of the businesses proposed to be assessed. A protest may be made orally or in writing
by any interested person. Every written protest shall be filed with the clerk at or before the time fixed for the
public hearing. The city council may waive any irregularity in the form or content of any written protest. A
written protest may be withdrawn in writing at any time before the conclusion of the public hearing. Each
written protest shall contain a description of the business in which the person subscribing the protest is
interested sufficient to identify the business and, if a person subscribing is not shown on the official records
of the city as the owner of the business, the protest shall contain or be accompanied by written evidence that
the person subscribing is the owner of the business or the authorized representative. A written protest that
does not comply with this section shall not be counted in determining a majority protest. If written protests
are received from the owners or authorized representatives of businesses in the proposed district that will pay
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August 5, 2019
50 percent or more of the assessments proposed to be levied and protests are not withdrawn so as to reduce
the protests to less than 50 percent, no further proceedings to levy the propo sed assessment against such
businesses, as contained in the resolution of intention, shall be taken for a period of one year from the date
of the finding of a majority protest by the city council.
(c) If a city council proposes to conduct a single proceeding to levy both a new or increased property
assessment and a new or increased business assessment, the notice and protest and hearing procedure for the
property assessment shall comply with subdivision (a), and the notice and protest and hearing procedure for
the business assessment shall comply with subdivision (b). If a majority protest is received from either the
property or business owners, that respective portion of the assessment shall not be levied. The remaining
portion of the assessment may be levied unless the improvement or other special benefit was proposed to be
funded by assessing both property and business owners.
36624. Changes to proposed assessments
At the conclusion of the public hearing to establish the district, the city council may adopt, revise, change, reduce, or
modify the proposed assessment or the type or types of improvements, maintenance, and activitie s to be funded with
the revenues from the assessments. Proposed assessments may only be revised by reducing any or all of them. At the
public hearing, the city council may only make changes in, to, or from the boundaries of the proposed property and
business improvement district that will exclude territory that will not benefit from the proposed improvements,
maintenance, and activities. Any modifications, revisions, reductions, or changes to the proposed assessment district
shall be reflected in the notice and map recorded pursuant to Section 36627.
36625. Resolution of formation
(a) If the city council, following the public hearing, decides to establish a proposed property and business
improvement district, the city council shall adopt a resolution of formation that shall include, but is not limited
to, all of the following:
(1) A brief description of the proposed improvements, maintenance, and activities, the amount of
the proposed assessment, a statement as to whether the assessment will be levied on property,
businesses, or both within the district, a statement on whether bonds will be issued, and a description
of the exterior boundaries of the proposed district, which may be made by reference to any plan or
map that is on file with the clerk. The descriptions and statements need not be detailed and shall be
sufficient if they enable an owner to generally identify the nature an d extent of the improvements,
maintenance, and activities and the location and extent of the proposed district.
(2) The number, date of adoption, and title of the resolution of intention.
(3) The time and place where the public hearing was held concerning the establishment of the
district.
(4) A determination regarding any protests received. The city shall not establish the district or levy
assessments if a majority protest was received.
(5) A statement that the properties, businesses, or properties and businesses in the district established
by the resolution shall be subject to any amendments to this part.
(6) A statement that the improvements, maintenance, and activities to be conferred on businesses
and properties in the district will be funded by the levy of the assessments. The revenue from the
levy of assessments within a district shall not be used to provide improvements, maintenance, or
activities outside the district or for any purpose other than the purposes specified in the resolution
of intention, as modified by the city council at the hearing concerning establishment of the district.
Notwithstanding the foregoing, improvements and activities that must be provided outside the
district boundaries to create a special or specific benefit to the assessed parcels or businesses may
be provided, but shall be limited to marketing or signage pointing to the district.
(7) A finding that the property or businesses within the area of the property and business
improvement district will be benefited by the improvements, maintenance, and activities funded by
the proposed assessments, and, for a property-based district, that property within the district will
receive a special benefit.
(8) In a property-based district, the total amount of all special benefits to be c onferred on the
properties within the property-based district.
(b) The adoption of the resolution of formation and, if required, recordation of the notice and map pursuant
to Section 36627 shall constitute the levy of an assessment in each of the fiscal ye ars referred to in the
management district plan.
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36626. Resolution establishing district
If the city council, following the public hearing, desires to establish the proposed property and business improvement
district, and the city council has not made changes pursuant to Section 36624, or has made changes that do not
substantially change the proposed assessment, the city council shall adopt a resolution establishing the district. The
resolution shall contain all of the information specified in Section 36625.
36627. Notice and assessment diagram
Following adoption of the resolution establishing district assessments on properties pursuant to Section 36625 or
Section 36626, the clerk shall record a notice and an assessment diagram pursuant to Section 3114. No other provision
of Division 4.5 (commencing with Section 3100) applies to an assessment district created pursuant to this part.
36628. Establishment of separate benefit zones within district; Categories of businesses
The city council may establish one or more separate benefit zones within the district based upon the degree of benefit
derived from the improvements or activities to be provided within the benefit zone and may impose a different
assessment within each benefit zone. If the assessment is to be levied on businesses, the city council may also define
categories of businesses based upon the degree of benefit that each will derive from the improvements or activities to
be provided within the district and may impose a different assessment or rate of assessment on each category of
business, or on each category of business within each zone.
36628.5. Assessments on businesses or property owners
The city council may levy assessments on businesses or on property owners, or a combination of the two , pursuant to
this part. The city council shall structure the assessments in whatever manner it determines corresponds with the
distribution of benefits from the proposed improvements, maintenance, and activities, provided that any property -
based assessment conforms with the requirements set forth in paragraph (2) of subdivision (k) of Section 36622.
36629. Provisions and procedures applicable to benefit zones and business categories
All provisions of this part applicable to the establishment, modification, or disestablishment of a property and business
improvement district apply to the establishment, modification, or disestablis hment of benefit zones or categories of
business. The city council shall, to establish, modify, or disestablish a benefit zone or category of business, follow the
procedure to establish, modify, or disestablish a property and business improvement district.
36630. Expiration of district; Creation of new district
If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section
36622, a new management district plan may be created and the district may be renewed pursuant to this part.
CHAPTER 3. Assessments
36631. Time and manner of collection of assessments; Delinquent payments
The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by
the city council in the resolution levying the assessment. Assessments levied on real property may be collected at the
same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and
penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part may be charged
interest and penalties.
36632. Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion
of residential and agricultural property
(a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated
benefit to the real property within the property and business improvement district. The city council may
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August 5, 2019
classify properties for purposes of determining the benefit to property of the improvements and activities
provided pursuant to this part.
(b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit
to the businesses within the property and business improvement district. The city council may classify
businesses for purposes of determining the benefit to the businesses of the improvements and activities
provided pursuant to this part.
(c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively
presumed not to benefit from the improvements and service funded through these assessments, and shall not
be subject to any assessment pursuant to this part.
36633. Time for contesting validity of assessment
The validity of an assessment levied under this part shall not be contested in any action or proceeding unless the action
or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section
36626. Any appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry
of judgment.
36634. Service contracts authorized to establish levels of city services
The city council may execute baseline service contracts that would establish levels of city services that would continue
after a property and business improvement district has been formed.
36635. Request to modify management district plan
The owners’ association may, at any time, request that the city council modify the management district plan. Any
modification of the management district plan shall be made pursuant to this chapter.
36636. Modification of plan by resolution after public hearing; Adoption of resolution of intention
(a) Upon the written request of the owners’ association, the city council may modify the management district
plan after conducting one public hearing on the proposed modifications. The city council may modify the
improvements and activities to be funded with the revenue derived from the levy of the assessments by
adopting a resolution determining to make the modifications after holding a public hearing on the proposed
modifications. If the modification includes the levy of a new or increased assessment, the city council shall
comply with Section 36623. Notice of all other public hearings pursuant to this section shall comply with
both of the following:
(1) The resolution of intention shall be published in a newspaper of general circulation in the city
once at least seven days before the public hearing.
(2) A complete copy of the resolution of intention shall be mailed by first class mail, at least 10 days
before the public hearing, to each business owner or property owner affected by the proposed
modification.
(b) The city council shall adopt a resolution of intention which states the proposed modification prior to the
public hearing required by this section. The public hearing shall be held not more than 90 days after the
adoption of the resolution of intention.
36637. Reflection of modification in notices recorded and maps
Any subsequent modification of the resolution shall be reflected in subsequent notices and maps recorded pursuant to
Division 4.5 (commencing with Section 3100), in a manner consistent with the provisions of Se ction 36627.
CHAPTER 3.5. Financing
36640. Bonds authorized; Procedure; Restriction on reduction or termination of assessments
(a)The city council may, by resolution, determine and declare that bonds shall be issued to finance the
estimated cost of some or all of the proposed improvements described in the resolution of formation adopted
pursuant to Section 36625, if the resolution of formation adopted pursuant to that section provides for the
issuance of bonds, under the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500))
Item 11.a. - Page 39
SLOCTMD Management District Plan 24
August 5, 2019
or in conjunction with Marks-Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section
6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). Either act, as the case may be, shall
govern the proceedings relating to the issuance of bonds, although proceedings under the Bond Act of 1915
may be modified by the city council as necessary to accommodate assessments levied upon business pursuant
to this part.
(b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements
specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of
those improvements, specify the number of annual installments and the fiscal years during which they are to
be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated
to be raised from assessments over 30 years.
(c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on
any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with
the timely retirement of the debt.
CHAPTER 4. Governance
36650. Report by owners’ association; Approval or modification by city council
(a) The owners’ association shall cause to be prepared a report for each fiscal year, except the first year, for
which assessments are to be levied and collected to pay the costs of the improvements, maintenance, and
activities described in the report. The owners’ association’s first report shall be due after the first year of
operation of the district. The report may propose changes, including, but not limited to, the boundaries of the
property and business improvement district or any benefit zones within the district, the basis and method of
levying the assessments, and any changes in the classification of property, including any categories of
business, if a classification is used.
(b) The report shall be filed with the clerk and shall refer to the property and business improvement district
by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain
all of the following information:
(1) Any proposed changes in the boundaries of the property and business improvement district or in
any benefit zones or classification of property or businesses within the district.
(2) The improvements, maintenance, and activities to be provided for that fiscal year.
(3) An estimate of the cost of providing the improvements, maintenance, and activities for that fiscal
year.
(4) The method and basis of levying the assessment in sufficient detail to allow each real property
or business owner, as appropriate, to estimate the amount of the assessme nt to be levied against his
or her property or business for that fiscal year.
(5) The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal
year.
(6) The estimated amount of any contributions to be made from sources other than assessments
levied pursuant to this part.
(c) The city council may approve the report as filed by the owners’ association or may modify any particular
contained in the report and approve it as modified. Any modification shall be made pursuant to Sections
36635 and 36636.
The city council shall not approve a change in the basis and method of levying assessments that would impair
an authorized or executed contract to be paid from the revenues derived from the levy of assessments,
including any commitment to pay principal and interest on any bonds issued on behalf of the district.
36651. Designation of owners’ association to provide improvements, maintenance, and activities
The management district plan may, but is not required to, state that an owners’ association will provide the
improvements, maintenance, and activities described in the management district plan. If the management district plan
designates an owners’ association, the city shall contract with the designated nonprofit corporation to provide services.
CHAPTER 5. Renewal
36660. Renewal of district; Transfer or refund of remaining revenues; District term limit
Item 11.a. - Page 40
SLOCTMD Management District Plan 25
August 5, 2019
(a) Any district previously established whose term has expired, or will expire, may be renewed by following
the procedures for establishment as provided in this chapter.
(b) Upon renewal, any remaining revenues derived from the levy of assessments, or any revenues derived
from the sale of assets acquired with the revenues, shall be transferred to the renewed district. If the renewed
district includes additional parcels or businesses not included in the prior district, the remaining revenues
shall be spent to benefit only the parcels or businesses in the prior district. If the renewed district does not
include parcels or businesses included in the prior district, the remaining revenues attributable to these parcels
shall be refunded to the owners of these parcels or businesses.
(c) Upon renewal, a district shall have a term not to exceed 10 years, or, if the district is authorized to issue
bonds, until the maximum maturity of those bonds. There is no requirement that the boundaries, assessments,
improvements, or activities of a renewed district be the same as the original or prior district.
CHAPTER 6. Disestablishment
36670. Circumstances permitting disestablishment of district; Procedure
(a) Any district established or extended pursuant to the provisions of this part, where there is no indebtedness,
outstanding and unpaid, incurred to accomplish any of the purposes of the district, may be disestablished by
resolution by the city council in either of the following circumstances:
(1) If the city council finds there has been misappropriation of funds, malfeasance, or a violation of
law in connection with the management of the district, it shall notice a hearing on disestablishment.
(2) During the operation of the district, there shall be a 30-day period each year in which assessees
may request disestablishment of the district. The first such period shall begin one year after the date
of establishment of the district and shall continue for 30 days. The next such 30 -day period shall
begin two years after the date of the establishment of the district. Each successive year of operation
of the district shall have such a 30-day period. Upon the written petition of the owners or authorized
representatives of real property or the owners or authorized representatives of businesses in the
district who pay 50 percent or more of the assessments levied, the city council shall pass a resolution
of intention to disestablish the district. The city council shall notice a hearing on disestablishment.
(b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing
required by this section. The resolution shall state the reason for the disestablishment, shall state the time and
place of the public hearing, and shall contain a pro posal to dispose of any assets acquired with the revenues
of the assessments levied within the property and business improvement district. The notice of the hearing
on disestablishment required by this section shall be given by mail to the property owner of each parcel or to
the owner of each business subject to assessment in the district, as appropriate. The city shall conduct the
public hearing not less than 30 days after mailing the notice to the property or business owners. The public
hearing shall be held not more than 60 days after the adoption of the resolution of intention.
36671. Refund of remaining revenues upon disestablishment or expiration without renewal of district;
Calculation of refund; Use of outstanding revenue collected after disestablishment of district
(a) Upon the disestablishment or expiration without renewal of a district, any remaining revenues, after all
outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired
with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property
or businesses then located and operating within the district in which assessments were levied by applying the
same method and basis that was used to calculate the assessments levied in the fiscal year in which the district
is disestablished or expires. All outstanding assessment revenue collected after disestablishment shall be
spent on improvements and activities specified in the management district plan.
(b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that
was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the
amount of any refund.
Item 11.a. - Page 41
ALLOCATION of ADDITIONAL FUNDING
ADVERTISING & MARKETING
Increased campaign investment in key feeder markets (Los Angeles, San Francisco, Phoenix, Seattle,
Denver, Dallas-Fort Worth and Las Vegas) to drive demand during need times and increase length
of stay through highly-targeted brand marketing and co-ops, in order to offset a 20% increase in
countywide lodging inventory over the next four years
STR is forecasting a 3.5% decrease in occupancy and a 1.7% decrease in RevPAR in 2020
The countywide Tourism Marketing District will expire in June 2020 and the lodging community, in partnership with
Visit SLO CAL, is seeking the renewal of the District. Visit SLO CAL has worked with lodging investors to identify and
plan for priority investment needs and growth opportunities over the coming decade. Through a ten-year renewal
and increase in assessment from 1% to 1.5%, additional funding would be allocated in the following ways:
SALES SUPPORT
Help communities manage the unprecedented 20%
increase in countywide lodging inventory over the next
four years through the growth of travel trade initiatives
AIR SERVICE DEVELOPMENT
Grow economic impact of tourism through continued
development of additional flights and new air service
markets
DESTINATION MANAGEMENT
STRATEGY (DMS) RECOMMENDATIONS
Implement Visit SLO CAL owned tourism-related
recommendations coming out of the DMS
Cultivate
Awareness
INTERNATIONAL MARKETS
Investment in top inbound international
markets and key new growth markets
TOGETHER WE CAN SECURE SLO CAL’S SUCCESS
Establish
New Markets
Drive More
Demand
Advocate for
Our Future
Foster International
Visitation
ATTACHMENT 3
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