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HomeMy WebLinkAboutReso 2012-203RESOLUTION NO. 2012-203 RESOLUTION OF THE CITY COUNCIL OF CHULA VISTA DISESTABLISHING THE CHULA VISTA TOURISM AND MARKETING DISTRICT AND DIRECTING THE DIRECTOR OF FINANCE TO DISTRIBUTE ANY REMAINING CVTMD REVENUES AND ASSETS PURSUANT TO STREETS AND HIGHWAYS CODE SECTIONS 36670-36671 WHEREAS, the Chula Vista Tourism and Mazketing District (CVTMD) is a business improvement district established under the Property and Business' Improvement District (PB1D) Law; and WHEREAS, the PBID Law allows disestablishment of the district by resolution upon submittal of a petition (or petitions) by a majority of the owners of businesses in the district who, in aggregate, pay 50 percent (50%) or more of the assessments levied; and WHEREAS, the period for presenting such a petition is the 30-day period commencing each year on the anniversary of the establishment of the district; and WHEREAS, the CVTMD was established on July 14, 2009; and WHEREAS, the petition period for 2012 commenced on July 14th and ended on August 13`"; and WHEREAS, in January 2012, a number of the hotel/motel owners assessed under the TMD submitted petitions to disestablish the CVTMD, although these petitions were not submitted during the time period provided by state law and did not contain all the information necessazy to process; and WHEREAS, the City Attorney's Office identified the need for procedures to supplement the State code in this area; and WHEREAS, at the City Council meeting on March 13, 2012, the Council requested that draft procedures be brought back in April for Council's input, and those draft procedures were submitted to the Council on April 24, 2012; and WHEREAS, staff met with, and presented draft procedures to: Chamber of Commerce representatives; the Chamber's TMD Board (May 2nd); and the Chamber's Hotel/Motel Committee (May 8th); and WHEREAS, draft procedures, along with a request for comments, were also transmitted directly to the CVTMD hotel/motel owner/operators in advance of the May 8th Hotel/Motel Committee meeting; and Resolution No. 2012-203 Page No. 2 WHEREAS, additional direction was received from the City Council at its May 22, 2012 meeting; and WHEREAS, on June 12, 2012, the City Council adopted a resolution approving administrative procedures for the handling of petitions that might be submitted for disestablishment of the CVTMD; and WHEREAS, on June 20, 2012 the Director of Finance/City Treasurer notified all members of the TMD of the commencement of the petition period and provided them with a copy of the adopted administrative procedures and a sample petition form, and copies of the notice, administrative procedures, and sample petition form were also made available at the Finance Department's public counter and on the City's website; and WHEREAS, during the petition period, petitions to disestablish the CVTMD were received from twelve (12) members of the CVTMD; and WHEREAS, a review performed by Finance Department staff has determined that all petitions received meet the business ownership and/or authorized agent requirements of the administrative procedures; and WHEREAS, as of the August 30th deadline established in the administrative procedures, all twelve businesses submitting petitions were current on their assessments for the subject period; and WHEREAS, a review performed by Finance Department staff has determined that petitions to disestablish the CVTMD were received from business owners representing 53.37% of the total CVTMD assessments for the subject period ($484,775); and WHEREAS, the petitions were forwazded to the City Clerk on August 29th, and the City Clerk has made the required verification; and WHEREAS, the requirements of Section 36670(a)(2), allowing for disestablishment by petition, have been met; and WHEREAS, when the petition requirements have been met, Section 36670(b) requires that the City adopt a resolution of intention to disestablish the CVTMD and notice a heazing on disestablishment; and WHEREAS, the resolution of intention to disestablish, meeting the above requirements, was adopted by the City Council on September 20, 2012; and WHEREAS, the City Council also set the public hearing for October 23, 2012, and notice of the hearing was given by mail to the owner of each business subject to the assessment, in accordance with the PBID Law; and Resolution No. 2012-203 Page No. 3 WHEREAS, the PBID Law requires that the resolution of intention contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district; and WHEREAS, the resolution of intention adopted by the City Council on September 23rd contained such a proposal which was prepared by the Director of Finance and recommended in the event of disestablishment, the liquidation of CVTMD assets; and WHEREAS, the proposal further recommended that the annual financial audit required by the adopted Agreement for Tourism Marketing District Management Services ("Agreement") be used to identify the assets to be liquidated; and WHEREAS, per the terms of the Agreement, the audit for Fiscal Year 2011/2012 was to be submitted to the City no later than September 30, 2012, for the period July 1, 2011 through June 30, 2012; and WHEREAS, staff recommended that the audit period be extended to cover activity through the date of disestablishment; and WHEREAS, under the disestablishment procedures established in the PBID Law [Section 36671(a)], all revenues remaining after payment of outstanding debts shall be refunded to the district members using the same basis that was used to calculate the assessments levied; and WHEREAS, the revenues to be refunded in this manner include both assessments levied and funds derived from the sale of asset; and WHEREAS, if disestablishment is implemented staff recommends that all funds on account with the CVTMD operator be turned over to the City within 1 week of the disestablishment of the district; and WHEREAS, any expenditure of these funds would then be made by the City after confirming the expense was an existing obligation at the time of disestablishment; and WHEREAS, following the payment of all verified debts, the City would refund the funds on account and the proceeds of the asset sale to the district members based upon their proportionate weight of the total CVTMD assessments levied in Fiscal Year 2011/2012; and WHEREAS, any additional assessments collected by the district members and remitted to the City subsequent to disestablishment ofthe district would be refunded directly to the payer; and WHEREAS, a public hearing was held on October 23, 2012, and evidence and testimony was presented with respect to the requested disestablishment. Resolution No. 2012-203 Page No. 4 NOW, THEREFORE, BE IT RESOLVED, based on information provided by staff and testimony and evidence presented at the public heazing that the City Council of the City of Chula Vista does hereby confirm the validity of disestablishment petitions presented, disestablish the Chula Vista Tourism Mazketing District and direct the Director of Finance to distribute any remaining CVTMD revenues and assets pursuant to staffs recommendation and Streets and Highways Code Sections 36670-36671. Presented by len R: fioogins Ci ey Approved as to form by ~``~ Y Glen R. oogins omey PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista, California, this 23rd day of October 2012 by the following vote: AYES: Councilmembers: Aguilar, Castaneda and Ramirez NAYS: Councilmembers: Bensoussan and Cox ABSENT: Councilmembers: None ATTEST: ~~~~~ Donna R. Noms, CMC, City Clerk STATE OF CALIFORNIA COUNTY OF SAN DIEGO CITY OF CHULA VISTA L Cheryl Cox/ M or I, Donna R. Norris, City Clerk of Chula Vista, California, do hereby certify that the foregoing Resolution No. 2012-203 was duly passed, approved, and adopted by the City Council at a regular meeting of the Chula Vista City Council held on the 23rd day of October 2012. Executed this 23rd day of October 2012. Donna R. Norris, CMC, City Clerk