HomeMy WebLinkAbout19 C47130 - CVB - GPSTBIDA - Continued from 6-24-2021CONTRACT NO. C41730
STAFF REPORT
CITY OF PALM DESERT
FINANCE DEPARTMENT MEETING DATE V ·2.-L-{ -'2-0 2::j
MEETING DATE : June 24 , 2021 r:icoNTINUEDTO Dctte uncer--t-zvn
0 PASSES TO 2ND READING ------PREPARED BY: Janet M . Moore , Director of Finance
REQUEST: Approve a collection agreement between the Greater Palm Springs
Convention & Visitors Bureau (CVB) and the City for the Greater
Palm Springs Tourism Business Improvement District Assessment.
Recommendation
That the City Council , by Minute Motion ,
1) Approve a collection agreement between the Greater Palm Springs
Convention & Visitors Bureau (CVB) and the City for the Greater Palm
Springs Tourism Business Improvement District (TBID) assessment on
vacation rentals , substantially as to form ; and
2) Authorize the City Attorney to finalize the agreement; and
3) Authorize the Mayor and/or the City Manager to execute any documents
necessary to facilitate the actions taken herewith .
Executive Summary
Beginning July 1, 2021 Short Term Rentals (STR) will be included in the Greater Palm
Springs Tourism Business Improvement District (TBID). The 1 % assessment is
calculated on gross rental revenue on short-term stays and is assessed to guests of
STRs by the TBID in addition to the City 's 11 % TOT.
The City will be collecting the TBID assessment on behalf of the CVB as part of the
City 's TOT tax return and remitting the amount to the CVB quarterly . This agreement
confirms the responsibilities of both the City and the CVB.
Background
The City is part of a Joint Powers Authority with the Greater Palm Springs Convention
and Visitor's Bureau (CVB). In 2010 , the City consented to be included in the Palm
Springs Desert Resort Communities Tourism Business Improvement District that
included a TBID assessment on large (over 50 rooms) convention hotels . The current
TBID (expiring June 30 , 2021) is assessed to guests and then paid directly by the hotel
to the TBID. At that time , the consent reduced the amount of the City 's contribution to
the CVB by the amount collected by the TBID from the included hotels in the city .
In 2015, the JPA agreement was amended and language was added to allow the for the
inclusion of STR 's as part of the TBID after an appropriate vote of the district. In
CONTRACT NO. C41730 �
June 24, 2021 - Staff Report
Collection Agreement CVB and City (Assessment on STR's)
Page 2 of 2
November of 2020 the TBID was renewed for a ten (10) year period beginning July 1,
2021 through June 30, 2031 with the inclusion of an additional 1°/o district tax on STRs.
Hotels will still pay their portion of the TBID directly, however, the City will be collecting
the TBID assessment as part of the City's TOT tax return. The City will then remit the
collected payments to the TBID. The City is not responsible for any uncollected
amounts, however, the City will provide the TBID with information related to any unpaid
assessments. The City will receive a nominal administrative fee for this
collection/remittance. The CVB is notifying STR permit holders of the assessment and
the City will include the flyer on its web-site.
To ensure the responsibilities of the parties are clear as to the roles of both the City and
the CVB, the City and the CVB desire to enter into this collection agreement.
Fiscal Analvsis
The City will receive a nominal administrative fee of 5% of the assessment collected on
short-term rentals. The City's annual administrative fee is expected to be between
$10,000 and $20,000 depending on the revenue collected for STRs.
LEGAL REVIEW
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FINANCIAL REVIEW ASSISTANT
CITY MANAGER
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Robert W. Hargreaves �anet M. Moore Janet M. Moore
City Attorney Director of Finance Director of Finance
City Manager, L Todd Hileman: L. TOdGI ht��Cw�Givt
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Draft for Discussion Purposes ONLY
1
GREATER PALM SPRINGS CONVENTION & VISITORS BUREAU
AGREEMENT FOR COLLECTION OF
THE GREATER PALM SPRINGS TOURISM BUSINESS IMPROVEMENT DISTRICT ASSESSMENT
ON SHORT TERM RENTALS
(City of Palm Desert)
1.PARTIES AND DATE.
This Agreement is made and entered into this ___ day of June, 2021, by and
between the Greater Palm Springs Convention & Visitors Bureau, a joint powers authority
operating under the Joint Exercise of Power Act (California Government Code §§6500 et
seq.), located in the County of Riverside, State of California (“CVB”), and the City of Palm
Desert, a California charter city (“City”). CVB and City are sometimes individually
referred to herein as “Party” and collectively as “Parties.”
2.RECITALS.
2.1 The Greater Palm Springs Tourism Business Improvement District Assessment
(“GPSTBID”).
On November 20, 2020, the JPA Executive Committee adopted and
approved Resolution No. JPA 2020-005 (“Resolution”), whereby the GPSTBID was
renewed for a ten (10) year period beginning July 1, 2021 through June 30, 2031.
Attached to the Resolution was the Management District Plan (Plan).
According to the Resolution, the annual assessment rate for the GPSTBID is
three percent (3%) of hotels’ gross short-term room rental revenue and one percent (1%)
of vacation rentals’ gross short-term rental revenue.
CVB and City desire to enter in to an agreement regarding City’s
agreement to collect the vacation rentals’ gross short-term rental revenue and deliver
said sums to CVB for the purpose of funding the activities set forth in the Plan to benefit
businesses in the GPSTBID.
3.TERMS.
3.1 Scope of Services and Term.
3.1.1 City’s Duties. City agrees to perform the following duties (“Services”)
with respect to the collection of the vacation rentals’ gross short-term rental revenue
and the delivery of said sums to CVB. All Services shall be subject to, and performed in
accordance with, this Agreement, the exhibits attached hereto and incorporated herein
by reference, and all applicable local, state and federal laws, rules, and regulations.
a.The annual assessment rate for the GPSTBID is one percent (1%)
of gross short-term room rental revenue of all vacation rentals.
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Based on the benefit received, assessments will not be
collected on stays of more than twenty-seven (27)
consecutive days.
b.City shall add the 1% GPSTBID collection for vacation rentals to
its transient occupancy tax (TOT) filing forms, whether paper or
digital, and remit aggregated collections to the CVB quarterly
net of collection fee, per section 3.1.1.c below. Such
remittance shall be made to the CVB by the 25th day of the
month following the close of each quarter for the months
collected during said quarter.
c.City shall retain a collection fee equal to five (5%) of the amount
of GPSTBID assessment collected for short-term vacation rental
revenue.
d.City may request a one-time set up fee for the purposes of
setting up the collection, to be mutually agreed to by the
Parties.
e.City shall add the information regarding the GPSTBID CVB has
provided to City’s short term rental website including CVB’s
logo.
f.City shall periodically provide CVB a listing of either a
complete updated address list, or additions to/deletions from
registered short term rentals in City.
g.To the extent such information is available or provided to the
City, the City shall provide CVB with the information from
individual property owners or managers that do not remit the
1% assessment to City. City shall provide this monthly report by
the 25th day of the month following the month of collection.
h.City shall not be liable for pursuing delinquent GPSTBID
assessments from assessed property owners but shall remit any
interest and penalties on delinquent assessments if they are
paid on the same form and at the same time as delinquent
TOT.
i.City shall provide CVB with the contact and business
information for any known delinquent property owners for
CVB’s collection efforts.
3.1.2 CVB Duties. CVB promises and agrees to perform the following
duties (“CVB Duties”) with respect to the collection of the vacation rentals’ gross short-
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3
term rental revenue and the delivery of said sums to CVB. All Services shall be subject to,
and performed in accordance with, this Agreement, the exhibits attached hereto and
incorporated herein by reference, and all applicable local, state and federal laws, rules,
and regulations.
a.CVB shall use the GPSTBID collection for vacation rentals
received from City for the purposes set forth in the Plan.
b.CVB shall be solely responsible for collecting any unpaid
assessments due from assessed property owners, including
imposing penalties and interest.
c.CVB shall ensure that permit holder payment Information
provided by City shall be confidential to the extent provided
by applicable state and federal law and is provided solely for
CVB’s use in determining GPSTBID assessment payments.
3.1.3 Term. The term of this Agreement shall be for the term of the
GPSTBID.
3.2. Representatives
3.2.1 City Representative. City hereby designates the City’s Finance
Director, or his or her designee, to act as its representative for the performance of this
Agreement (“City’s Representative”). City’s Representative shall have the power to act
on behalf of City for all purposes under this Agreement. CVB shall not accept direction
or orders from any person other than City’s Representative or his or her designee.
3.2.2 CVB’s Representative. CVB hereby designates the CVB’s Vice
President of Finance & Administration, or his or her designee, to act as its representative
for the performance of this Agreement (“CVB’s Representative”). CVB’s Representative
shall have full authority to represent and act on behalf of CVB for all purposes under this
Agreement.
3.3 Termination of Agreement.
3.3 .1 Grounds for Termination. Either side may terminate this Agreement,
with or without cause, by giving ninety (90) days’ written notice.
3.4 General Provisions.
3.4.1 Delivery of Notices. All notices permitted or required under this
Agreement shall be given to the respective Parties at the following addresses, or at such
other address as the respective parties may provide in writing for this purpose:
City:
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City of Palm Desert
Attention: Janet M. Moore, Director of Finance
73510 Fred Waring Drive
Palm Desert, CA 92262
CVB:
Greater Palm Springs Convention & Visitors Bureau
Attention: Bill Judson, Vice President of Finance &
Administration
70100 CA-111
Rancho Mirage, CA 92270
Such notice shall be deemed made when personally delivered or when
mailed, forty-eight (48) hours after deposit in the U.S. Mail, first class postage prepaid and
addressed to the party at its applicable address. Actual notice shall be deemed
adequate notice on the date actual notice occurred, regardless of the method of
service.
3.4.2 Indemnification. To the fullest extent permitted by law, CVB shall
defend, indemnify and hold City, its directors, officials, officers, employees, volunteers
and agents free and harmless from any and all claims, demands, causes of action, costs,
expenses, liability, loss, damage or injury of any kind, in law or equity, to property or
persons, including wrongful death, in any manner arising out of, pertaining to, or incident
to any alleged acts, errors or omissions of CVB, its officials, officers, employees,
subcontractors, consultants or agents in connection with the performance of this
Agreement, including without limitation the payment of all consequential damages,
expert witness fees and attorneys’ fees and other related costs and expenses, except to
the extent any such claim arising out of the sole negligence, recklessness or willful
misconduct of City.
To the fullest extent permitted by law, City shall defend, indemnify and hold
CVB, its directors, officials, officers, employees, volunteers and agents free and harmless
from any and all claims, demands, causes of action, costs, expenses, liability, loss,
damage or injury of any kind, in law or equity, to property or persons, including wrongful
death, in any manner arising out of, pertaining to, or incident to any alleged acts, errors
or omissions of City, its officials, officers, employees, subcontractors, consultants or agents
in connection with the performance of this Agreement, including without limitation the
payment of all consequential damages, expert witness fees and attorneys’ fees and
other related costs and expenses, except to the extent any such claim arising out of the
sole negligence, recklessness or willful misconduct of CVB.
3.4.3 Independent Contractor. It is agreed and understood that CVB is
a wholly independent contractor. This Agreement is not intended and shall not be
construed to create the relationship of agent, employee, servant, partnership, joint
venture or association as between CVB and City. Neither City nor its agents shall have
control over the conduct of CVB except as set forth herein. City shall have no liability or
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responsibility for payment of any wage or benefits to CVB’s employees, for whom CVB
shall bear sole responsibility and liability.
3.4.4 Successors and Assigns. This Agreement shall be binding on the
successors and assigns of the Parties.
3.4.5 Construction; References; Captions. Since the Parties or their agents
have participated fully in the preparation of this Agreement, the language of this
Agreement shall be construed simply, according to its fair meaning, and not strictly for or
against any Party. Any term referencing time, days or period for performance shall be
deemed calendar days and not work days. All references to CVB include all personnel,
employees, agents, and subcontractors of CVB, except as otherwise specified in this
Agreement. All references to City and CVB include its elected officials, officers,
employees, agents, and volunteers, except as otherwise specified in this Agreement. The
captions of the various articles and paragraphs are for convenience and ease of
reference only, and do not define, limit, augment, or describe the scope, content, or
intent of this Agreement.
3.4.6 Amendment; Modification. No supplement, modification, or
amendment of this Agreement shall be binding unless executed in writing and signed by
both Parties.
3.4.7 Waiver. No waiver of any default shall constitute a waiver of any
other default or breach, whether of the same or other covenant or condition. No waiver,
benefit, privilege, or service voluntarily given or performed by a Party shall give the other
Party any contractual rights by custom, estoppel, or otherwise.
3.4.8 No Third Party Beneficiaries. There are no intended third party
beneficiaries of any right or obligation assumed by the Parties.
3.4.9 Invalidity; Severability. If any portion of this Agreement is declared
invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the
remaining provisions shall continue in full force and effect.
3.4.10 Cooperation; Further Acts. The Parties shall fully cooperate with one
another, and shall take any additional acts or sign any additional documents as may be
necessary, appropriate or convenient to attain the purposes of this Agreement.
3.4.11 Attorney’s Fees. If either party commences an action against the
other party, either legal, administrative or otherwise, arising out of or in connection with
this Agreement, the prevailing party in such litigation shall be entitled to have and
recover from the losing party reasonable attorney’s fees and all other costs of such
action.
3.4.12 Governing law. This Agreement shall be governed by the laws of the
State of California, with venue being proper in the Superior Court for the State of
California, County of Riverside.
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3.4.13 Time of Essence. Time is of the essence of each and every provision
of this Agreement.
3.4.14 Authority to Enter Agreement. Each Party warrants that the
individuals who have signed this Agreement have the legal power, right, and authority
to make this Agreement and bind each respective Party.
3.4.15 Counterparts. This Agreement may be signed in counterparts, each
of which shall constitute an original.
3.4.16 Entire Agreement. This Agreement contains the entire Agreement of
the Parties with respect to the subject matter hereof, and supersedes all prior
negotiations, understandings or agreements.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above.
City of Palm Desert Greater Palm Springs Convention &
Visitors Bureau
By: By:
Title:___________________________ Title: President & CEO
Date:________________________ Date:___________________________
ATTEST: ATTEST:
__________________________
City Clerk Clerk of the JPA
APPROVED AS TO FORM: APPROVED AS TO FORM:
_____________________________ _____________________________
Robert Hargreaves, Esq. Lena D. Wade, Esq.
City Attorney General Counsel
CONTRACT NO. C41730