AGENDA CORRESPONDENCE
CORRESPONDENCE RECEIVED BY THE
CITY COUNCIL FOR PUBLIC REVIEW
PRIOR TO THE MEETING
AGENDA NO: 4b
MEETING DATE: January 14, 2025
2 2033: 1205 Embarcadero, 2035: 1185 Embarcadero;
source: https://www.morrobayca.gov/DocumentCenter/View/6781/Harbor-Lease-Sites-List11918?bidId=)
3. Reporting and collecting percent gross. For decades, Harbor Enterprise Fund budgeting on the revenue side has been mostly a guessing game until year end when leaseholds are required to report and remit percent gross revenue numbers. As a former accountant and auditor, I'm not sure I've seen anything like it (though we have made some improvements by tracking sales tax revenues and TOT). We can't look backward and rewrite past lease agreements, but we can look forward and tweak language in future leases. Any time the City of Morro Bay is in a position to revise the reporting and collecting terms of percent gross revenue - which may or may not be the case during today's simple lease assignment - we should be doing so rather than copy-andpasting old lease terms that hurt city financial planning. Ideally, we should require monthly or (at least) quarterly reporting (perhaps w/ optional collections that would further help demonstrate tenant-in-good-standing status) in all future leases that would additionally help the Harbor Vitality Director maximize his pseudo-entrepreneurial role (much like the role served by Visit Morro Bay's executive director). For comparison, every hotel and STVR must report and remit payment every 30 days, and the financial models that TBID is able to develop as a result prove invaluable to future decision-making. After all, what chance does the Harbor Vitality Director have if "Last month wasn't great, but this month is picking up" is the most precise interim reporting he receives?
Thank you for your time and consideration, and best wishes during your deliberations.
Sean Green
Morro Bay, CA
Estero Inn (2012; no private parking in right of way)
Estero Inn (2023; private parking in right of way)
3