July 26, 2022
Agenda Item No. 12
TO:
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM:
Tara Finnigan, Assistant City Manager - 949-644-3001, [email protected] PREPARED BY:
Melanie Franceschini, Management Analyst
[email protected]
PHONE:
949-644-3028
TITLE:
Visit Newport Beach, Inc. FY 2023 and FY 2024 Destination Business Plan and Budget, and FY 2022 Performance Standards Report ABSTRACT:
Visit Newport Beach, Inc. (VNB), a business unit of Newport Beach & Company, provides destination marketing services to the City of Newport Beach (City) under an agreement for Tourism Promotion, Branding and Marketing Services. Under the terms of the agreement, VNB is required to submit certain records to the City Council for its review and/or approval. Newport Beach & Company has submitted the Fiscal Year (FY) 2023 and FY 2024 Destination Business Plan and Budget for the Council’s review and VNB’s FY 2022 Performance Standards Report for the City Council’s review and approval.
RECOMMENDATION:
a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; b) Review, receive and file the FY 2023 and FY 2024 Newport Beach & Company Destination Business Plan; c) Receive and file the Visit Newport Beach, Inc. Leisure Marketing (TOT) FY 2022 Performance Standards Report; and d) Review and approve the Visit Newport Beach, Inc. Leisure Marketing (TOT) FY 2023 and FY 2024 Budgets.
DISCUSSION:
Visit Newport Beach, Inc. (VNB)
VNB, a nonprofit organization (under IRS code §501(c)(6)), is the destination marketing organization for Newport Beach. Under an Agreement with the City, VNB provides marketing services to the City and community using transient occupancy tax revenues.
The agreement was entered into on September 27, 2011. It was first amended in January 2014 to extend the term to December 31, 2024, switch from an annual to biennial budget, update contact information and add public benefit funding. The City Council approved a second amendment to the agreement in August 2014 to change the reporting timeline for the Performance Standards (Attachment C), Marketing Goals and Marketing Plan (Attachment A) from annual to biennial to correspond with the biennial reporting timeline.
The VNB Board of Directors met on May 19, 2022 to approve the Destination Business Plan and Budget (Attachment A and B) for FY 2023 and FY 2024. After the close of the fiscal year, VNB staff updated and reworked the performance standards report required under its agreement with the City to better demonstrate the new campaigns and annual performance metrics it has adopted for its international sales and marketing campaigns as the industry continues to recover from the effects of the COVID-19 pandemic. All required documents were received by the City in July and are attached for the Council’s review.
FISCAL IMPACT:
Under its Agreement with the City, VNB receives 18% of all Transient Occupancy Tax collected by the City to fund destination marketing services and activities. VNB projects it will receive approximately $5,793,750 in TOT funding in FY 2023 and $5,844,877 in TOT funding in FY 2024 (Attachment B). The FY 2023 estimate is approximately 5% lower than the City’s estimate of $6,099,964, as included in our FY 2022-23 General Fund budget, due to VNB’s conservative approach to budgeting revenue.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item).
ATTACHMENTS:
Attachment A – FY 2023 and FY 2024 Newport Beach & Co. Destination Business Plan Attachment B – Visit Newport Beach, Inc. Leisure Marketing (TOT) FY 2023 and FY 2024 Budgets Attachment C – Visit Newport Beach, Inc. Leisure Marketing (TOT) FY 2022 Performance Standards Report 12-3
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Visit Newport Beach, Inc. FY 2023 and FY 2024 Destination Business Plan and Budget, and FY 2022 Performance Standards Report July 26, 2022
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