The URL can be used to link to this page

Home My WebLink AboutR8- Economic Development ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO REQUEST FOR COMMISSION/COUNCIL ACTION From: TIMOTHY C. STEINHAUS Subject: REQUEST FOR Agency Administrator ASSISTANCE FROM SAN BERNARDINO CONVENTION&VISITORS BUREAU Date: March 1, 1995 --------------------------------------------------------------------------------------------------------------------------------------- Synopsis of Previous Commission/Council/Committee Action(s): On February 23, 1995,the Redevelopment Committee forwarded the request for assistance to the Community Development Commission. --------------------------------------------------------------------------------------------------------------------------------------- Recommended Motion(s): (Community Development Commission) MOTION: That the Community Development Commission authorize the relief of rent due from the San Bernardino Convention&Visitors Bureau(SBCVB)for four months (February-June 1995) in the amount of$11,250.00,and the relief of janitorial charges for eight months(through June 1995)in the amount of$1,650.00, and authorize an increase of$50,000 of Commission budget appropriations to the SBCVB to fund deficits resulting from 1993 and 1994 Route 66 Rendezvous and provide additional funding for initial start-up activities for the 1995 Route 66 Rendezvous. TIMOTHY C.STEINHAUS Agency Administrator -------------------------------------------------------------------------------------------------------------------------------------- Contact Person(s): Timothy C. Steinhaus/Susan M. Morales Phone: 5081 Project Area(s): All Ward(s): 1 -7 Supporting Data Attached: Staff Report; Financial Report; Shortfall Report FUNDING REQUIREMENTS: Amount: $50,000(additional appropriations;$12,900 relief of contractual obligations) Source: Tax Increment Budget Authority: Requested --------------------------------------------------------------------------------------------------------------------------------------- Commission/Council Notes: --------------------------------------------------------------------------------- TCS:SMM:pc:rt66-cvb.cdc COMMISSION MEETING AGENDA Meeting Date: 03/06/1995 Agenda Item NumbeA_, ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO STAFF REPORT --------------------------------------------------------------------------------------------------------------------------------------- Request for Assistance from San Bernardino Convention& Visitors Bureau The Annual Route 66 Rendezvous event has generated regional,national and international media exposure for the City for San Bernardino. It is estimated that approximately 160,000 people migrate to downtown San Bernardino each year to participate in the numerous activities taking place. Since its inception,the San Bernardino Convention&Visitors Bureau(SBCVB)has coordinated the event with the cooperation of numerous city departments. The Rendezvous has grown from a two day event to last year's seven day extravaganza. Each budget has been prepared based on the previous year's expenditures and projected revenues. For the last two years, the event has suffered substantially reduced revenues. The SBCVB has submitted a request for assistance to offset the shortfall in revenues from the 1993 & 1994 Route 66 Rendezvous events. The request is broken down as follows: 1) Rent relief of occupied space in the $11,250.00 EDA office building at 201 North"E" St. for 4 months (February-June, 1995). 2) Charges for Janitorial services at $ 1,650.00 201 North"E" Street for 8 months 3) Increase of budget appropriation to fund deficit created from 1993 and 1994 Route 66 ($40,000) and funding forstart-up activities for 1995 Route 66 event($10,000). The SBCVB staff have prepared detailed budget reports and a"shortfall report"which details the issues related to the reduction in revenue and increased expenses. The report further explains what steps are being taken to prevent future shortfalls. Staff recommends adoption of the form motion. TIMOTHY C.STEINHAUS,Agency Adminx trator Economic Development Agency --------------------------------------------------------------------------------- TCS:SMM:pc:rt66-cvb.cdc COMMISSION MEETING AGENDA Meeting Date: 03/06/1995 Agenda Item Number: 1995 ROUTE 66 RENDEZVOUS rm CONSOLIDATED FINANCIAL REPORT 1994 ROUTE 66 RENDEZVOUS""' BUDGET Budget Actual Total Revenues $276,400 $171,518 Total Expenses $255,203 $208,223 Surplus (Shortfall) $21,197 ($36,705) PROJECTED ANNUAL FINANCIAL IMPACT Projected Annual Economic Impact $4,500,000 Sales Tax Analysis September Sales Tax Collections have increased significantly since the Rendezvous developed into a major event in 1993 — 1990 1 1991 1 1992 1993 1994 Se tember 1$1,557,900 1$1,470,500 1$1,431,400 $1,887,729 $1,712,518 City of San Bernardino Sales Tax Analysis September Collections $2,000,000 7Z $1,800,000 $1,600,000 $1,400,000 A $1,200,000 $1,000,000 $800,000 co d $600,000 E $400,000 a $200,000 N $0 1990 1991 1992 1993 1994 Fiscal Year Source:City of San Bernardino Finance Dept. 1994-95 Route 66 Rendezvous Budget REVENUES Budgeted Actual Over(Under) 1994-95 1994-95 Budget Sponsorships $77,500 $78,277 $777 1994 Car Show Participants (765 c@ $33.33 avg.) $36,000 $25,500 ($10,500) 1995 Car Show Participants (100 @ $30 early entry) $3,000 Car Show Preferred Parking (125 spots x$10 x 2 days) $3,750 $150 ($3,600) Vendor Spaces Revenue (150 x$190) 1 $28,500 $40,095 $11,595 Car Show Trophy Sponsors (under Rend. Club) $0 $0 $0 Rendezvous Club Silver Memberships $12,500 $1,750 ($10,750) Rendezvous Club Gold Memberships $15,000 $3,500 ($11,500) T-Shirts(1642 x$6 $75,000 $6,311 ($68,689) Beer Garden--Court Street Square $8,000 $2,857 ($5,143) #2 Wine & Beer Garden $5,320 $2,530 ($2,790) Licensee Royaltees $0 $490 $490 Golf Tournament Entry Fees(50 @ $66 ea.) [30] $6,600 $1,980 ($4,620) Golf Tournament- other revenues (drinks, raffle, etc.) $750 $1,900 $1,150 Golf Tournament Tee & Green Sponsors (30 x$66) [30 x 66] $1,980 $1,980 $0 Kiwanis Carnival Revenue (Net) $5,000 $0 ($5,000) Soda Stands Revenue $0 $0 $0 Volunteer Party Revenues $0 $260 $260 Ice Revenues $500 $938 $438 Total Revenues $276,400 $171,518 ($107,882) 1994-95 1994-95 Over(Under) Budgeted Actual Budget Total Revenues $276,400 $171,518 ($107,882) Total Expenses $255,203 $208,223 ($46,980) Excess (Shortfall) $21,197 ($36,705) 1 1994-95 Route 66 Rendezvous Budget EXPENSES Budget Actual Over(Under) 1994-95 1994-95 Budget #1 Beer Garden Expenses $0 $0 $0 #2 Beer Garden Expenses 1 $0 $1,302 $1,302 Accommodations Expenses $2,000 $1,844 ($156) Advertising/Promotion 1 $5,000 $3,288 ($1,712) Advertising-Car Publications $4,748 $3,788 ($961) Car Show Trophies and Awards (50 x$22) [55 x 22] $1,100 $1,156 $56 City Services (permits,trash, police, etc.) $16,643 $10,083 ($6,560) Commercial Production Expenses $2,500 $2,173 ($327) Credentials 1 $0 $2,695 $2,695 DARE Luncheon &Awards $500 $194 ($306) Dash Plaques-Car Show Participants ($.80 each) $1,600 $1,600 $0 DJ 1 $1,000 $1,000 $0 Embroidered Apparel $1,000 $303 ($697) Entertainment $2,000 $2,000 $0 Equipment Rentals $6,000 $4,802 ($1,198) Golf Tournament Expenses (144 x$27) $3,888 $3,568 ($320) Golf Tournament Prizes $800 $252 ($548) Hot August Nights- Reno $3,146 $3,000 ($146) Ice 1 $1,000 $1,382 $382 Insurance-- Event $5,000 $8,175 $3,175 1-itter Removal $1,500 $1,500 $0 ,lileage (1000mi.x.25) $250 ($250) Miscellaneous Expenses $1,000 $1,397 $397 Photography $0 $701 $701 Planning meeting expenses $500 ($500) Portable Toilets $2,500 $1,840 ($660) Postage &Shipping $5,000 $4,500 ($500) Printing (flyers, etc.) $8,087 $5,850 ($2,237) Publicity I I 1 1 $74,826 $40,691 ($34,135) Radio Communications Rentals ($15x60x4)+($15x10x4) $4,200 $1,330 ($2,870) Security I 1 1 $3,500 $3,255 ($245) Shirts&Visors-Volunteers(300 x$26) 1 $7,800 $11,388 $3,588 Shirts-Car Show Participants (1200 x$5) $6,000 $4,095 ($1,906) Signage 1 $2,000 $3,370 $1,370 Soda Stands Expenses $0 $0 $0 Sound System $9,000 $8,900 ($100) Sponsor/VIP Hospitality $9,500 $10,792 $1,292 Sponsor Broker Commission $8,000 $0 ($8,000) Sponsorship Recognition Plaques (30 x$25) [16 x$21] $750 $336 ($414) T-Shirt Design Expenses $750 $300 ($450) Tape Duplication $2,000 $1,761 ($239) TV Show Production Costs $16,915 $18,985 $2,070 Utility Vehicles $0 $1,442 $1,442 Vendor Expenses $11,250 $14,870 $3,620 fendor Sales Commission $10,000 $11,371 $1,371 AP Invitations, mail labels $450 $97 ($353) Volunteer Appreciation Parties-2 pre and post event $6,000 $5,567 ($433) Volunteer Headquarters 1 $1,000 $912 ($88) Volunteer Refreshments during event $4,500 $371 ($4,129) Total Expenses 2 $255,203 $208,223 1 ($46,980) 1994 ROUTE 66 RENDEZVOUS"m SHORTFALL REPORT CITY/BUSINESS BENEFITS 1. Economic Impact(estimated): $4,500,000 2. Revenues to the City and businesses have far axceeded City/EDA contributions. 3. Regional/National/Intemational Exposure-- Route 66 RendezvousTm has generated regional, national and international media exposure for the City of San Bernardino via magazines, newspapers, television & radio, providing a positive image and perception of the city. SHORTFALL AMOUNTS (approximate) 1. $20,000 shortfall carry-over from 1993 2. $36,700 shortfall from 1994 SHORTFALL CAUSES Increased Expenses 1. Cost of servicing public has grown tremendously since 1992, along with the increase in attendance (SBPD estimates: from 15,000 in 1992 to 160,000 in 1994). Expenses have increased for signage,toilets,janitorial, trash receptacles,trash collection, street cleaning,traffic control services, police, other city services. 2. Cost of Event Insurance has grown 500% since 1992, due to increased attendance. 3. Several "In-kind services"sponsors dropped out just before event, resulting in large unexpected expenses 4. Cost of servicing vehicle entrants has grown faster than increases in entry fee. 5. Cost of servicing event volunteer staff was greater than expected --staff has grown from about 100 volunteers in 1993 to 400 in 1994. 6. Publicity costs have risen as size, scope and recognition of event has increased. 7. Paid advertising was initiated for the first time in 1994 (car publications) Reduced Revenues 1. Unable to gate event-- no admission revenues from general public. 2. Shortage of sponsor dollars-- potential sponsors reluctant to invest in San Bernardino (perception problem) 3. Shortage of T-shirt licensing revenues— a. Licensee didn't follow through on commitments b. Nostalgia Television Network didn't deliver on promised national promotional campaign 4. Airport Drags siphoned off potential participants 5. OTHG's continued negative PR campaign affected Downtown vehicle attendance (Overall vehicle attendance increased, but vehicles were spread throughout several venues-- Downtown, Orange Show, Airport Drags. Route 66 only received revenues from Downtown participants.) FUTURE EVENTS Budgetina Procedures Beginning in 1995-96, Route 66 RendezvousTm will have a zero-based, itemized budget separate and distinct from the San Bernardino Convention &Visitors Bureau budget. Expense Proiections 1. City services fees will continue to rise markedly in 1995 due to increased police and fire personnel costs. 2. Vendor/exhibitor expenses will decline due to management changes: A. Power and decorator costs (canopies, tables&chairs)will be handled by licensed companies, with CVB receiving a commission from sales. B. Beer garden to be produced solely by Main Street, Inc. (at Court Street Square), and CVB will realize a percentage of sales revenues. 3. Advertising expenses will decrease (or cease) due to increased acquisition of media sponsors (radio, newspaper, vehicle magazines) Revenue Proiections 1. Vendor/exhibitor revenues are expected to grow with the improved professionalization of vendor sales. (Vendor management company tripled revenues from 1993 to 1994 with only a 2'h-month window of sales opportunity.) 2. Vehicle Registration revenues should improve annually as registration fees and number of participant vehicles increase. 3. Sponsor revenues will continue to grow as event grows in popularity and size. ban Bernardino CONVENTION & VISITORS BUREAU QUARTERLY REPORT 2nd Quarter, Fiscal Year 1994-95 Ending December 31, 1994 EXECUTIVE SUMMARY The following information is a synopsis of the highlights of the sales &marketing programs, and other significant activities and accomplishments, of the San Bernardino Convention &Visitors Bureau for the 1st quarter ending December 31, 1994: Sales Activities. The first six months of the 1994-95 fiscal year ended N ith an increase in the transient occupancy tax collections of 6.7%over FY 1993-94. This also represented the third straight quarter that the TOT collections have increased over the prior year. The following chart is a comparison of the TOT collections, as reported by the Business License Division of the City Clerk's Office, on a monthly basis for the first six months of Fiscal Year 1993-94 versus 1994-95. City of Sari ono Traniert Occupancy Tax CdIections $160;000 i $140,000 >+ $120,000 = a= $100,000 .o — I o 2 '030 — 0199394 w o - m V $60,000 �" ® 1994-95 _ $40,000 t= X0,000 T — id. A-9. Sept. Oct. Nov. Dec. Mortth The following is a list of the organizations we have solicited in the past quarter, With a qualified Bureau sales lead being distributed to San Bernardino lodging facilities, to attract their fiiture corporate meetings or conventions, N;Ith their anticipated meeting dates: AACE International -November 1995 Low Income Housing Information Service -Fall 1995 National Guard Bureau - 1995 The Robert Wood Johnson Foundation - 1995 201 North"E"Street,Suite 103•San Bernardino,California 92401 �� 909/889.3980❑ 800/TO-RTE-66 ❑ FAX 909/888.5998 fq , �" The Success Team - Jan. or Feb. 1995 American Chemical Society- Feb. or Mar/Sept. or Oct. 1996 National Association of College Admissions Counselors -May 3-5, 1995 California Agricultural Aircraft Association -Jan. 1996 Tech Data Corporation -Mar., Oct. Nov. or Dec. 1995 Micromanagement, Inc. -Late Mar. or early Apr. 1995 Productions BDC -June 1997 Wright State University-July 1996 Center for Disease Control &Prevention -Apr. 1995 Miami-Dade Community College- 1996 National Grand Lodge F&AAY Masons - 1997-98 Black Caucus of the American Library Association - 1999 American Forest- Jun. 1997 &Nov. 1997 National Black Police Association - 1999 The R. Fields Group, Inc. - Oct. 1995 G&G Enterprises - Spring 1995 American Federation of School Administrators -July 1997 Hewlett-Packard -Feb. 1996 American Black Chiropractors Association-Aug. 1997 Thrift Depositor Protection Oversight Board-Jan. 18, 1995 Ecclesia Christian Fellowship -Mar. 11, 1995 National Rainbow Coalition -May or Jun. 1996 The following is a list of the organizations we have solicited in the past quarter, with a qualified Bureau sales lead being distributed to San Bernardino lodging facilities,to attract their future group tour& travel business with their anticipated tour dates they would include San Bernardino in their tour itineraries: N&C International -December 1994 Lambert's Tour &Travel -year around Territorial Tour, Ltd. -Mar.-Nov. Cajun Tours of Terrebonne, Inc. - Spring, Fall &Dec. 29, 1995 Globus Gate«•ay/Cosmos -year around Heritage Festival/American Travel Center/Educational Study Tours -Spring 1995 Southwest Discovery Tours - Spring, Summer&Winter Parker Tours, Inc. -year around Tours of Distinction- Sept.-Nov./year around Raz Transportation Company-Dec.-Feb., Jun.-Aug. &Mar. 1996 Zifi Trips, Inc. - Spring & Summer Tauck Tours, Inc. -year around Short Hills Tours -Apr. 1996 Ray & Ross Transport, Inc. -year around 1995 Antelope Valley Bus, Inc. -year around Gulf South Travel - Mar.-Aug. 1995 Note: a qualified sales lead represents a company or organization's expressed interest in holding a meeting or bringing a group tour through and staying overnight in San Bernardino. There may be other cities competing for this particular business among which San Bernardino is being considered. The Bureau's sales staff works diligently to position our member lodging and meeting facilities to be able to convert this potential business into actual bookings. However, the Bureau is only a promotional marketing -2 - organization and it is ultimately up to each individual lodging facility to negotiate space requirements, dates and rates. Staff Activities. The executive director has been appointed by the president of Cal Poly University Pomona to serve as the alumni representative on a combined search committee for the Directors of Alumni Affairs, Development and Public Affairs. Special Events. Planing is undenN?ay for the sixth annual Route 66 Rendezvous"",to be held September 14-17, 1995. The volunteer committees are already meeting and preparing their work agendas. The following chart is a five year comparison of sales tax collections, from the records of the City Finance Dept., for the month of September. Although Route 66 RendezvousTM cannot be directly attributable to the increases the past two years; it is significant that the sales tax has been markedly higher the past two years when it has posted its highest attendance figures. City of San Bernardino Sales Tax Analysis September Collections 52,000,00 $1,887,729 $1,800,0D0 51,712,518 G 51,557,900 U 51,600,0D0 tj 2 7 . rn �j $1,400,000 - - x 51,200,000 SIM m 51,000,000 w $800,000 _.. $600,000 S 5400,000 G - V' S200,000 — so 1990.91 1991-92 1992.93 1993-94 1994-95 Fiscal Year SALES & MARKETING ACTIVITY REPORT The following data represents the results of the sales &marketing efforts of the San Bernardino Convention &Visitors Bureau for the second quarter of fiscal year 1994-95, ending December 31, 1994:. ❑ Total estimated potential economic impact as a direct result of the Bureau's combined sales & marketing efforts for the past three months: 52,832,908 ❑ Total estimated potential economic impact as a direct result of the Bureau's combined sales & marketing efforts for the fiscal year to date: 57,821,117 ❑ The City of San Bernardino's potential return on investment (the total estimated potential economic impact, divided by the Bureau's 20% share of the Transient Occupancy Tax collections, estimated to be approximately 5300,000 for fiscal year 1994-95, plus the San Bernardino Economic Development Agency's additional contribution of 5153,277, totaling $453)277): 517.25 : S1. -3 - VISITOR INFORMATION ACTIVITY ❑ Walk-in requests for visitor information for the past three months: 61 0 Telephone calls received requesting visitor information for the past three months: 222 ❑ Information mailed in response to requests for visitor information for the past three months: 183 0 Total activity responding to visitor information requests for the past three months: 466 ❑ Total activity responding to visitor information requests fiscal year to date: 6,267 CONVENTION SALES ACTIVITY 0 Number of qualified convention and meeting sales leads generated for the past three months: 21 0 Total number of qualified convention and meeting sales leads generated for the fiscal year to date: 30 0 Number of potential room nights for all convention and meeting sales activity for the past three months: 16,336 ❑ Total number of potential room nights for all convention and meeting sales activity for the fiscal year to date: 18,715 0 Potential economic impact as a result of all convention and meeting sales activity for the past three months: $2,564,7521 ❑ Potential economic impact as a result of all convention and meeting sales activity for the fiscal year to date: $2.938.255 TOUR & TRAVEL SALES ACTIVITY ❑ Responses from, and subsequently information provided to, travel agents as a result of San Bernardino's cooperative ad appearing in the 1993-94 edition of the California Travel Planning Guide year to date: 385 0 Number of qualified group tour sales leads generated for the past three months: 16 0 Number of qualified group tour sales leads generated for the fiscal year to date: 39 0 Number of potential room nights for all group tour sales activity for the past three months: 850 0 Number of potential room nights for all group tour sales activity for the fiscal year to date: 1,708 0 Potential economic impact from group travel sales activity for the past three months: 5268,1561 0 Potential economic impact from group travel sales activity for the fiscal year to date: $402,8621 -4- SPECIAL EVENTS PRODUCTION ACTIVITY ❑ Number of visitors estimated by the San Bernardino Police Department to have attended Route 66 Rendezvous on September 15-18, 1994: 160,000 ❑ Estimated economic impact from special event activity for the fiscal year to date: 54,480,000$ ---------------------------------------------------------------------------------------------------------------------------------- j To calculate economic impact for meetings and conventions,the International Association of Convention &Visitors Bureaus does a yearly survey that estimates what delegates for conventions and meetings,trade shows, etc., spend on a daily average. The figure is currently$15 7. Although there may be more than one delegate in each room, we take the conservative approach that there is only one delegate per room, per night, and use the S 157 per delegate per room night as the basis of figuring the economic impact. It should also be noted that this potential future sales information is reported using 1993 dollars and assumes that the hotel sales departments negotiate contracts and thus convert it to actual business. Some of these leads are for as soon as 1994 but a majority are for future dates to as far out as the year 2006. $ 1994 Route 66 Rendezvous average per capita spending is estimated at$28. This takes into account that the event is free, ran for four days and there are many more local citizens that attend than out of town town staying in hotels. However, out of ton visitors staying overnight increased this year over 1993. IN-KIND SERVICES REPORT The following information represents in-kind services and their approximate value, as provided to the San Bernardino Convention &Visitors Bureau for the three months ending December 31, 1994: Mirau. Edwards. Cannon&Harter, San Bernardino For corporate legal services rendered by Mark C. Edwards, Esq.: ❑ Legal consultations and contract preparation $200.00 Inland Empire Symphony, San Bernardino For quarterly membership meeting door prize: ❑ 2 complimentary tickets $ 0.00 C.I.D., San Bernardino For quarterly membership meeting door prize: ❑ 8 complimentary tickets to the Harvest Fair $30.00 Harris', San Bernardino For quarterly membership meeting door prize: ❑ Gift Certificate $20.00 Jeff's Sandwich Shoppe, San Bernardino For quarterly membership meeting door prize: ❑ Complimentary lunch for two S12.00 GRAND TOTAL OF IN-KIND SERVICES THIS PAST QUARTER: 5312.00 GRAND TOTAL OF IN-KIND SERVICES FISCAL YEAR TO DATE: $54,102.41 -5 - NOTE: Those organizations and businesses providing goods and services to the San Bernardino Convention&Visitors Bureau are fully aware that as an independent, 501(c)(6), non-profit mutual benefit corporation their contributions are not tax deductible from either state or federal income taxes and that these contributions have been made in order to assist in the on-going programs,goals and objectives of the San Bernardino Convention&Visitors Bureau. We are deeply grateful for their generosity as the funds saved by these contributions are directed toward further enhancing the Bureau's sales &marketing programs to create additional economic impact and developmental opportunities through tourism. -5en bizrnardino Located in the Heart of Southern California "No longer a place to go through... It's the place to come to!" Respectfully submitted, S. Daniel Stark, Jr. Executive Director -6 -