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TO: Mayor Thomas J. Weisner
FROM: Alex Voigt, Management Analyst
DATE: December 2, 2015
SUBJECT:
A Resolution Authorizing the Execution of an Agreement in Support of the Aurora Area Convention and Visitors Bureau through the Hotel Operators’ Occupation Tax.
PURPOSE:
To obtain the City Council’s approval of a resolution that would extend the City of Aurora’s participation in the Aurora Area Convention and Visitors Bureau from December 15, 2015 through December 22, 2016. Aurora agrees to contribute 90% of its revenues collected through the Hotel Operators’ Tax during this period up to $175,000 annually.
BACKGROUND:
In 1987, the city entered into an intergovernmental agreement (IGA) with the Villages of North Aurora, Sugar Grove and Montgomery concerning the imposition of a hotel/motel tax and the use of the proceeds of that tax to promote tourism in the greater Aurora area (Resolution No. R87-3668). Originally, the communities agreed to impose a 3% hotel/motel tax and give 80% of the proceeds to the Aurora Area Convention and Tourism Council (now named the Aurora Area Convention and Visitors Bureau [AACVB]).
Since the execution of the original agreement, it has been amended and its term has been extended several times. Over the course of the extensions, the number of participating municipalities increased and the amount of hotel/motel tax proceeds conveyed to the AACVB increased from 80% to 90% of total collections.
DISCUSSION:
The extension of the sixth amendment to the Intergovernmental Agreement will expire on December 15, 2015 (Resolution No. R14-014). In 2013, the City of Aurora re-evaluated the terms of the previous extensions with the AACVB based on the city's significant financial contribution compared to other member municipalities.
The re-evaluation led to Aurora and the AACVB Board agreeing to significant changes to the terms of the Agreement. The changes limited Aurora’s financial contribution and increased its direct representation on the Board, all while preserving current levels of formula grant funding provided by the State of Illinois to the AACVB. The revised terms also called for the agreement between Aurora and the AACVB to be limited to two years, however, the current proposed contract is requesting a renewal term of one year.
The City Council recently received an update on the accomplishments of the AACVB from the new Executive Director, Cort Carlson. A summary of some significant accomplishments are summarized below:
1) The Board of Directors hired a new Executive Director, Cort Carlson to lead the AACVB in 2015.
2) Per the terms of the agreement, the City of Aurora increased Board Representation, Aurora now accounts for fifty percent (50%) of the Board, including an allotment for three (3) Executive Board positions.
3) The total expenditures for 2014 (compared to 2013) were up 4.9%, payroll increased by 3.65%, employment by 1.1% and local tax receipts saw an increase of 4.6%.
4) As of September of 2015, hotel occupancy increased 6.1% and the revenue per average rate increased by 11.6% compared to 2014.
IMPACT STATEMENT:
Not Applicable
RECOMMENDATIONS:
It is recommended the Finance Committee forward this resolution to Committee of the Whole for the Tuesday, December 15, 2015 meeting.
cc: Alderman O’Connor, Chairman
Alderman Mervine
Alderman Bohman
Alderman Mesiacos, Alternate
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Authorizing the Execution of an Agreement in Support of the Aurora Area Convention and Visitors Bureau through the Hotel Operators' Occupation Tax.
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, the City has previously approved agreements with the Aurora Area Convention and Visitor’s Bureau (“AACVB”), providing for the payment of certain collected Illinois hotel operator’s occupation tax dollars from the City to the AACVB in exchange for the promotion and development of tourism within the Aurora area; and
WHEREAS, the first of such agreements was approved December 15, 1987 via Resolution R87-3668 and the most recent extension of the 6th Amendment was approved via Resolution R14-014 and expired on December 15, 2015; and
WHEREAS, it is the desire of the City of Aurora and the AACVB to authorize an amended agreement in accordance with the attached terms.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: the City of Aurora shall enter into a one-year Agreement with the Aurora Area Convention and Visitor’s Bureau substantially in conformance with the proposed terms attached, and the Mayor is hereby authorized to execute said Agreement on behalf of the City of Aurora.
PASSED AND APPROVED on ______________.
AYES ____ NAYS ____ NOT VOTING ____ ABSENT ____
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Alderman Bohman, Ward 1 Alderman Garza, Ward 2
____________________________ __________________________
Alderman Mesiacos, Ward 3 Alderman Donnell, Ward 4
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Alderman Franco, Ward 5 Alderman Saville, Ward 6
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Alderman Hart-Burns, Ward 7 Alderman Mervine, Ward 8
____________________________ __________________________
Alderman Bugg, Ward 9 Alderman Johnson, Ward 10
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Alderman Irvin, At Large Alderman O’Connor, At Large
ATTEST:
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City Clerk Mayor