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HomeMy WebLinkAbout2024-08-26 - Agendas - FinalFayetteville Advertising and Promotion Commission August 26, 2024 Location: Fayetteville Town Center, 15 W. Mountain Street Commissioners: Staff: Chrissy Sanderson, Chair, Tourism & Hospitality Representative Katherine Kinney, Tourism & Hospitality Representative Todd Martin, Tourism & Hospitality Representative Elvis Moya, Tourism & Hospitality Representative Andrew Prysby, Commissioner at-large Sarah Bunch, City Council Representative Mike Wiederkehr, City Council Representative Molly Rawn, CEO I. Call to order at 2:00 p.m. II. Old Business Agenda A. Review and approval of July minutes. III. New Business A. CEO Report. Molly Rawn. An executive overview of the previous month. 1. Formation of HMR task force 2. Recommendation of appointee to the TheatreSquared board B. Financial Report. Jennifer Walker, Vice President of Finance. C. Vote. Construction contract with Ellingson Contracting for Experience Fayetteville Renovation. D. Vote. Contract renewal with the City of Fayetteville for Collection of HMR Taxes. E. Additions to the agenda may be added upon request from a majority of the commissioners. IV. Adjourn Fayetteville Advertising and Promotion Commission Minutes July 22, 2024 Fayetteville Town Center Commissioners Present: Commissioners Absent: Staff: Chrissy Sanderson, Chair, Tourism & Hospitality Representative Elvis Moya, Tourism & Hospitality Representative Mike Wiederkehr, City Council Representative Andrew Prysby, Commissioner at-large Todd Martin, Tourism & Hospitality Representative (virtual) Katherine Kinney, Tourism & Hospitality Representative Sarah Bunch, City Council Representative Tyler Wilson, Executive Director, Fayetteville Town Center and Jennifer Walker, VP of Finance, I. Chair Sanderson called the meeting to order at 2:00 pm and declared a quorum. She noted that Molly Rawn, CEO, was not able to be present. Tyler Wilson, Executive Director, Fayetteville Town Center will be the staff facilitator for the meeting. II. Old Business A. Chair Sanderson presented the June minutes for approval with the following correction: she was present at the meeting and Todd Martin was not present. Commissioner Wiederkehr made a motion with Commissioner Prysby seconding it to approve the minutes as presented with the attendance correction to be made. III. New Business A. CEO Report The full CEO report will not be given today but will commence again next month. HMR collections were reviewed, and it was noted by Jennifer Walker that we have gone back and restated April, May and June collection amounts. Normally, we would not do that but because the amounts were so far behind what they normally would be because of the new reporting system, we felt this was appropriate. We may restate one more month. These numbers for April and May are much better than they were last month. The numbers last month showed that we were 5% below our seasonally adjusted budget (year to date) and this month we are only 1% below our seasonally adjusted budget year to date. We feel like we will continue to see improvement as more HMR partners become comfortable with using the online reporting system. B. Financial Report VP Walker stated that the June financials were in the agenda packets. The target budget for both expenses and revenue for June is 50%. With total revenue YTD at 49% and total expenses at 45%, we are staying well balanced. YTD HMR tax collections are right at $2,467,000 which is just 1% below the seasonally adjusted target. Our net income is $212,833 and on the balance sheet, our cash and investments are approximately $5.1 million dollars at the end of June. The town center unearned revenue is $306,000 for events reserved for 2024, that is a great revenue number, especially considering all of the down time the town center has had with the repairs and upgrades. Tyler Wilson added that we have finished the roof work and are starting on the solar panels. He also mentioned that we are starting conversations with the city to see if EV charging stations in the parking deck were an option. He also wanted to let the commissioners know that Lights of the Ozarks will be two separate events this year with the lighting night held when it typically is held, Friday, November 22 and the parade night will be a separate night on December 5th. Additionally, we are gearing up for August First Thursday next week. C. Vote. Renewal of Arrivalist subscription. Sarah King, VP of Marketing and Communications, presented this item. Arrivalist is a marketing software tool we adopted in 2023. It provides aggregate information from mobile devices and allows us to see where our visitors are from and where they are visiting. This is very helpful in planning and evaluating our marketing programs. Last year the appropriation for this service was almost double what we are requesting to renew today. We are able to just renew one module today that will help us move forward with the items we need to track. It was noted that the data captured has been very helpful in our work with Coraggio on our Master Tourism Plan. The module we are selecting is the trip information module. Chair Sanderson asked for a motion to authorize the CEO to renew the subscription for the Arrivalist Trip Dashboard for a total cost of $22,500. Commission Wiederkehr made the motion which Commission Prysby seconded. It was approved unanimously via a roll call vote. D. Vote. Memorandum of Understanding with TheatreSquared. Tyler Wilson reviewed the enclosed memorandum which outlined several items we wish to accomplish: - Better collaboration between our two entities and staff members - Our shared goal to strengthen the arts in Fayetteville, of which Theatre Squared plays a critical role - A continuation of A&P’s funding to Theatre Squared - A seat on Theatre Squared’s board of directors, to be held by either an A&P Commissioner or an employee of the commission (Experience Fayetteville). An MOU drafted by the commission’s legal counsel outlining the shared commitment to a board seat is attached to this memo. Shannon Jones, the Executive Director of TheatreSquared briefly spoke, reiterating their support for this project and shared Theatre Squared’s excitement about working with Experience Fayetteville. Commissioners Wiederkehr and Martin shared their appreciation of this partnership and what can be accomplished through the updated MOU. With no more questions, Chair Sanderson asked for a motion to authorize our CEO to execute the MOU for TheatreSquared. Commissioner Moya had a question about how the board seat would be assigned to either the commission or a staff member and how someone would express their interest in serving on the board. Wilson stated that he thought Rawn would welcome an email expressing interest in the position. Commissioner Wiederkehr stated he may be incorrect, but he thought that any vacancy on the commission could be filled by a nomination to the commission and that the first step would be having the MOU signed by both parties, hopefully before the next commission meeting. The motion was then made by Commissioner Wiederkehr and seconded by Commissioner Moya and approved unanimously via a roll call vote. E. Additions to the agenda Commissioner Moya gave a brief update on his recent visit to the Walker Stone House which was a coffee also attended by Commissioner Wiederkehr. Commissioner Moya brought up the topic of repairs such as painting and electrical needs. Tyler Wilson did state that the porch repairs have been made and the porch is able to be safely accessed. He also stated the utility company has been contacted and a new electrical pole is in the que to be installed. Wilson said that the next big project for the house will need to be window installation to continue the water abatement. Commissioners did agree that it would be wise to bring an agenda item on this topic. With no further business, the meeting was adjourned at 2:25pm. Minutes submitted by Amy Stockton, Director of Operations, Experience Fayetteville $382,586 Monthly A&P Tax Collections 2024** 0.24% -1.99% -3.15% % change from 2023 Previous YTD (July) HMR A&P Tax Collection Totals 2020 $1,688,304 2021 $2,182,175 2022 $2,576,978 2023 $2,876,318 2024 $2,922,497 $1,935 Prior Dues Collected $419,784 Total HMR Collected July Collection (June Activity) $85,035 Lodging $332,813 Restaurant + -20.63%29.25%18.09%11.62%1.61% % change over previous year ** This represents one half of the total HMR collections. The other half supports the Parks and Recreation department. $349,739 $401,088 $446,181 2.49% 4.59% 5.90% 2.09% $457,025 $466,094 $419,784 Memo To: Molly Rawn, CEO, Experience Fayetteville Fayetteville Advertising & Promotion Commissioners From: Jennifer Walker, VP Finance, Experience Fayetteville Date: August 10, 2024 Re: Financial Statements – July 2024 This packet contains Experience Fayetteville Financial Statements for the month ended July 31, 2024. The following reports are included in the packet:  Summary P&L Financials for month ended July 31, 2024  Balance Sheet for month ended July 31, 2024 Target Budget July – 58% Revenue target 58% of budget or higher by the end of July 2024. Expenditures target 58% or lower at July 2024. Total Revenue YTD: $3,443,869 or 57%; We are 1% below target. Tax Receipts - $2,922,497 (0% variance - meeting budget ytd) Town Center - $376,403 (1% below budget ytd) Other - $144,969 Total Operating Expenditure YTD: $3,151,250 or 52%; this is 6% under budget. EF Main - $2,548,962 Town Center - $602,289 HMR tax – YTD July Collections (June activity) are 0.6% below the seasonally adjusted budget. Please note – the City of Fayetteville has moved to an online collection system for HMR tax revenue, which became mandatory in April 2024. We expect this revenue to rebound in the next few months while businesses adapt to the new process. Operating Net Income is $292,618 year to date. Modified Accrual Fayetteville A and P Commission Statement of Budget, Revenue and Expense Year-to-Date @ July 31, 2024 Actual Budget Over/(Under) Budget % of Budget Revenue Hotel, Motel, Restaurant Taxes Revenue 2,922,497 5,031,000 (2,108,503) 58.1% Rental Revenue 344,505 605,255 (260,750) 56.9% Event Revenue 21,498 60,000 (38,502) 35.8% Visitor Center Store Revenue 25,564 46,500 (20,936) 55.0% Parking Revenue 27,359 35,000 (7,641) 78.2% Advertising Revenue 2,275 4,000 (1,725) 56.9% Grant/Other Revenue 62,500 210,000 (147,500) 29.8% Interest and Investment Revenue 37,671 55,100 (17,429) 68.4% Total Revenue 3,443,869 6,046,855 (2,602,986) 57.0% Expenses Operating Expenses Rental Expenses 42,762 214,500 (171,738) 19.9% Event Expenses 40,408 130,100 (89,692) 31.1% Visitor Center & Museum Store 15,231 53,619 (38,388) 28.4% Personnel 1,106,404 2,060,934 (954,531) 53.7% Sales & Marketing 934,137 1,440,267 (506,130) 64.9% Office and Administrative 455,046 845,812 (390,766) 53.8% Bond Payments 407,050 700,000 (292,950) 58.2% Contribution to Capital Reserves - 100,000 (100,000) 0.0% Other Tourism Support - Community, Art Court, DFC 150,213 311,500 (161,287) 48.2% TheatreSquared Contribution - 200,000 (200,000) 0.0% Total Operating Expenses 3,151,250 6,056,732 (2,905,482) 52.0% Net Operating Income/(Loss) 292,618 (9,877) 302,495 -2962.6% Other Income Unrealized Gain/(Loss) on Investments 88,668 0.0% Other Expenses FFE & Improvements 316,371 971,000 (654,629) 32.6% Depreciation Expense 129,695 0.0% Cost of Goods Sold 3,941 0.0% Net Income/(Loss) (without CX Grants)(68,720) (980,877) 823,489 7.0% CONSOLIDATED Year-to-Date Modified Accrual Fayetteville A and P Commission Statement of Budget, Revenue and Expense Year-to-Date @ July 31, 2024 Actual Budget Over/(Under) Budget % of Budget Revenue Hotel, Motel, Restaurant Taxes Revenue 2,922,497 5,031,000 (2,108,503) 58.1% Rental and Event Revenue 17,030 46,350 (29,320) 36.7% Visitor Center Store Revenue 25,564 46,500 (20,936) 55.0% Advertising Revenue 2,275 4,000 (1,725) 56.9% Grant & Other Revenue 62,500 210,000 (147,500) 29.8% Interest and Investment Revenue 37,600 55,000 (17,400) 68.4% Total Revenue 3,067,466 5,392,850 (2,325,384) 56.9% Expenses Operating Expenses Event Expenses 30,016 97,100 (67,084) 30.9% Visitor Center & Museum Store 15,231 53,619 (38,388) 28.4% Personnel 739,184 1,397,503 (658,319) 52.9% Sales & Marketing 932,770 1,410,917 (478,147) 66.1% Office and Administrative 274,497 470,507 (196,010) 58.3% Bond Payments 407,050 700,000 (292,950) 58.2% Contribution to Capital Reserve - 100,000 (100,000) 0.0% Other Tourism Support - Community, Art Court, DFC 150,213 311,500 (161,287) 48.2% TheatreSquared Contribution - 200,000 (200,000) 0.0% Total Operating Expenses 2,548,962 4,741,146 (2,192,184) 53.8% Net Income/(Loss) Before Other Revenue and Expenses 518,504 651,704 (133,200) 79.6% Other Income Unrealized Gain/(Loss) on Investments 88,668 - 88,668 0.0% Other Expenses FFE & Improvements 52,221 511,000 (458,779) 10.2% Depreciation Expense 60,161 Cost of Goods Sold 3,941 Net Income/(Loss) 490,850 140,704 261,478 348.9% Experience Fayetteville Year-to-Date Modified Accrual Fayetteville A and P Commission Statement of Budget, Revenue and Expense Year-to-Date @ July 31, 2024 Actual Budget Over/(Under) Budget % of Budget Revenue Rental Revenue 344,505 605,255 (260,750) 56.9% Event Revenue 4,468 13,650 (9,182) 32.7% Parking Revenue 27,359 35,000 (7,641) 78.2% Interest and Investment Revenue 71 100 (29) 71.3% Total Revenue 376,403 654,005 (277,602) 57.6% Expenses Operating Expenses Rental Expenses 42,762 214,500 (171,738) 19.9% Event Expenses 10,392 33,000 (22,608) 31.5% Personnel 367,220 663,431 (296,211) 55.4% Sales & Marketing 1,366 29,350 (27,984) 4.7% Office and Administrative 180,549 375,305 (194,756) 48.1% Total Operating Expenses 602,289 1,315,586 (713,297) 45.8% Net Income/(Loss) Before Other Revenue and Expenses (225,886) (661,581) 435,695 34.1% Other Expenses FFE & Improvements 264,150 460,000 (195,850) 42.6% Depreciation Expense 69,534 0.0% Net Income/(Loss) (559,570) (1,121,581) 562,011 49.9% Town Center Year-to-Date ASSETS Current Assets Cash 3,707,047 Investments 1,284,632 Accounts Receivable 706,083 Prepaid Expenses 29,322 Deposits 40,838 Inventory Asset 20,043 Total Current Assets 5,787,966 Other Assets Capital Assets Furniture & Fixtures 169,248 Equipment 756,009 EF/CVB Building 940,410 EF/CVB Land 198,621 Building Additions 1,451,322 Walker-Stone House 1,174,064 Vehicles 122,860 Construction in Progress 19,205 Accumulated Depreciation (1,820,629) Total Other Assets 3,011,111 TOTAL ASSETS 8,799,076 LIABILITIES AND EQUITY Current Liabilities Accounts Payable 144,098 Unearned Revenue 337,198 Total Liabilities 481,296 Equity Unreserved Fund Balance 7,058,825 Operating Reserve 1,000,000 Capital Reserve 312,000 Temporarily Restricted Funds 45,558 Net Revenue Gain/(Loss) on Investments 36,521 Net Revenue (135,124) (98,603) Total Equity 8,317,780 TOTAL LIABILITIES AND EQUITY 8,799,076 Fayetteville A&P Commission Balance Sheet As of July 31, 2024 Memo To: Fayetteville Advertising and Promotion Commissioners From: Molly Rawn, CEO, Fayetteville A&P Date: August 21, 2024 Re: Agreement with JBZ, Inc. dba Ellingson Contracting The Commission previously entered into an agreement for architectural services with Flintlock Lab to establish the design scope and lead the renovation of 21 S Block Ave. In July of 2024, Flintlock issued a notice of public bid opening for the project. Ellingson was the only contractor to place a bid within the advertised time frame. Since then, Experience Fayetteville staff have met with the architect and contractors and through value engineering were able to reduce the scope cost by $49,587 as detailed in Exhibit A. The current estimate, after value engineering, is $546,100. Our initial projections estimated $432,581 and were budgeted based on that. Staff is recommending we omit the budgeted $100,000 contribution to capital reserves and instead expend those funds now to make up for the difference. The remaining shortfall will be pulled from the capital reserve. Not all of these expenses will occur in 2024, though we do expect the project to be at completion in January 2025. What this project achieves: -A much needed publicly accessible, ADA restroom to the Fayetteville Square -An ADA restroom for staff -An open work area accommodating up to four people to allow for collaborative work. -Ground floor storage. - Between 8-9 private offices (currently we have 7) -Energy efficient HVAC system Recommendation: The staff recommends the commission approve the contract with Ellingson Contracting. Memo To: Fayetteville Advertising and Promotion Commissioners From: Molly Rawn, CEO, Fayetteville A&P Date: August 21, 2024 Re: Collections Contract with City of Fayetteville Background: The proposed contract with the City of Fayetteville continues the longstanding procedure followed by the City of Fayetteville and the A&P Commission for the collection of Hotel, Motel and Restaurant taxes. This agreement would remain in effect for an initial term of five years with a renewal procedure. This agreement outlines the duties and obligations to be performed by the City of Fayetteville and outlines that A&P agrees to pay the city 2% of the A&P portion of the HMR taxes collected for performing the duties and obligations. Budgetary Impact: The 2024 budgetary impact is projected to be $100,000. The fee for collecting is 2% of A&P collections and budgetary impact varies depending on the amount of HMR revenue collected. Recommendation: The staff recommends the commission approve the contract with the City of Fayetteville, as presented, and authorize Chair Sanderson and CEO Molly Rawn to sign it. AGREEMENT This Agreement, made and entered into this _____ day of ________________, 2024, by and between the City of Fayetteville, Arkansas, a municipal corporation, and the Fayetteville Advertising and Promotion (A&P) Commission. WITNESSETH, IN CONSIDERATION of mutual promises of the parties contained herein and other good and valuable consideration, the parties agree as follows: 1. This agreement continues the longstanding procedure followed by the City and the A&P Commission for the collection of Hotel, Motel & Restaurant taxes. This agreement shall remain in full force and effect for an initial term of five years from the above date. Upon completion of the initial term, this agreement will automatically be renewed for an additional five year term unless either party notifies the other party in writing at least sixty (60) days prior to the expiration of the initial term that no renewal is desired. 2. The A&P Commission agrees to pay 2% of the A&P portion of the Hotel, Motel, Restaurant (HMR) taxes collected by the City in consideration of the following duties and obligations to be performed by the City: a. Provide reporting forms and handle all communications with the tax remitters concerning the HMR tax; b. Receive tax reports and remittance forms from the tax remitters; c. Check tax reports for accuracy and timely reporting; d. Invoice tax remitters for underpaid taxes and/or penalties and interest if applicable; e. Perform collection efforts in accordance with established procedures as described in Exhibit “A”; f. Disburse funds to Bond Trustees for debt service on outstanding bonds supported by the A&P Commission’s portion of the HMR taxes; g. Provide a monthly accounting of all revenues collected for the previous month and remit the collections less the bond payments and collection fees to the A&P Commission by the 15th of the month; h. Invest funds not needed for immediate expenditures as part of the City’s pooled investments and allocate interest on the basis of percentage of ownership in the pool. 3. The City of Fayetteville and the Fayetteville Advertising and Promotion Commission agree to work collaboratively to develop necessary rules and regulations to implement Sections 35.26 and 35.27 of the Code of Fayetteville. 4. Neither party may assign any of its rights or obligations under this agreement, without the express written consent of the other. 5. The parties agree and understand that this Agreement is exclusive of any and all other agreements, and that it in no way alters, amends or abridges any rights, obligations or duties of the parties contained in such agreements. 6. A waiver by either party of any of the terms or conditions herein shall be limited to that particular instance, and shall not be construed as a general waiver of any other breaches by either party. 7. This Agreement constitutes the entire understanding of the parties, and no modification or variation of the terms of this agreement shall be valid unless made in writing and signed by the duly authorized agents of the City and the A&P Commission. IN WITNESS WHEREOF, the City of Fayetteville and the Advertising and Promotion Commission have executed this Agreement on or as of the date first written above. FAYETTEVILLE CITY OF FAYETTEVILLE, ADVERTISING & PROMOTION ARKANSAS COMMISSION By: _________________________________ By: _____________________________ Chrissy Sanderson, Chairperson Lioneld Jordan, Mayor Witness: Attest: By: _____________________________ By: _____________________________ Molly Rawn, Chief Executive Officer Kara Paxton, City Clerk/Treasurer Exhibit “A” HMR COLLECTION PROCEDURES ACCOUNTING DIVISION At the end of each month, after balancing collections with General Ledger accounts: 1. Analyze listing of payments received for the year to determine which establishments are delinquent. 2. Prepare a list of all establishments that are delinquent. If an establishment has had to be prosecuted within the last two years, immediately refer to the City Prosecutor. Indicate on the list if the delinquent establishment also has an alcoholic beverage permit. If an establishment has a private club or an on-premises consumption permit, also indicate if they are delinquent in their supplement beverage tax payments. 3. Send notices to all establishments that are delinquent in their HMR remittances. This notice shall advise each establishment of the date (21 days after notice mailed) delinquent taxes must be paid to avoid referring the case to the City Prosecutor. 4. If delinquent taxes are not paid by the stated date, refer the case to the City Prosecutor’s Office. CITY PROSECUTOR’S OFFICE 5. Upon receipt of the delinquent HMR file, the City Prosecutor may send a letter/notice that charges will be filed unless delinquent taxes are paid within thirty (or fewer) days. The City Prosecutor shall be authorized to commence prosecution anytime after thirty days from the initial delinquency.