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HomeMy WebLinkAbout1988-03-10; City Council; 9326; Transient Tax Increase Golf Course and Tennis-_ C17 OF CARLSBAD - AGEND BILL AB#-- MTG.+w DEPT. FIN 0 4 I m z TITLE: TRANSIENT TAX INCREASE- SPECIAL TAX FOR GOLF COURSE CITY MGR.-: TRC a k 0 a a, 0 3 a 0 .. a WG oa cn a0 .. z 0 F 0 a 6 z 3 0 0 Councilmember Mamaux is proposing that the City CounMl place before the voters a ballot measure calling for a two-percent increase the Transient Occupancy Tax would be used in accord with the following priorities: A. Provide $200,000 per year funding for td'Convention and Visitors Bureau. B. Provide up to $900,000 per year for debt-service payments on a bond issue of $8 to $10 million used to construct a major golf course and tennis facility. C. An additional $200,000 per year to fund golf courseltennis facility improvements or to construct an executive golf course. Rate effective beginning on July 1, 1989. The re ?' enue derived from this increase D. Any funds in excess of $1.3 million received from the tax annually could be returned to the General Fund. E. The additional tax of 2% would expire upon the payment of the final debt service payment related to any issue supported by the tax. The City's present Transient Occupancy Tax rate is 6%. Council is currently considering another action which could raise the TOT from 6% to 8% to provide funds for general operating costs. This action proposes an additional 2% be added to the TOT rate increasing it from 8% to 10%. The proposed increases could occur independently of one another. Under Article XIIIA of the Constitution, the proposed tax falls within the definition of a special tax. the Councilmembers to place the issue before the voters and 213 majority of the voters casting ballots in an election to enact the tax. The deadline for Council action is March 10, if this issue is to be placed before the voters at the June election. A special tax requires approval of the majority of FISCAL IKPACT: During 1986-87, the City received $1.7 million in Transient Occupancy Tax revenue. If the City had implemented a 2% tax increase during that year, an additional $570,000 would have been collected. For fiscal year 1988-89, projected TOT revenue (based on a 6% tax rate) is $2.2 million. For 1988-89, a 2% tax increase should provide about $730,000 in additional revenue or a total revenue of $2.93 million. The amount of revenue provided through this special tax each year will depend on the health of the tourist industry. The following table provides a rough estimate of the amount of revenue that could be provided by this tax in future years assuming the City sustains a 15% growth rate in the industry. ESTIMATED REVENUE FROM ADDITIONAL 2% SPECIAL TRANSIENT OCCUPANCY - TAX Amount Raised Year by 2% Tax 1988-89 $ 730,000 1989-90 840,000 1990-91 970,000 1991-92 1,110,000 1992-93 1,280,000 1993-94 1,470,000 Amount Allocated to corns $200,000 200,000 200,000 200,000 200,000 200,000 Amount Available for Debt Service $530,000 640,000 770,000 900,000 900,000 900,000 Amount Available for Constr. of Executive Golf Course 10,000 180,000 200,000 Possible General Fund Revenue - 170,000 Page 3 of AB 4) 7-72 6 The amount of a bond issue which could be supported by this debt-service schedule should be between $8 million and $10 million depending on interest rates and the taxable status of the issue. It is impossible to predict the bond market that will exist in 1989. A taxable issue may be necessary if certain legal tests cannot be passed. As the issue is structured, bond counsel will advise the City Council on the considerations going into this decision. A bond issue guaranteed by TOT revenue would require an additional pledge of General Fund revenue to secure the bondholder's position. Any shortfall in TOT revenues would have to be made up from City General Funds. Funding operating costs for the facilities under consideration is not a part of the City's long-range budget plan at this time. Facilities of this type should be designed to generate revenues sufficient to offset operating costs. EXHIBITS: 1. Resolution No. pf- 75-, 2. Resolution No. rF-76 , 3. Resolution No. p? -77, 4. Ordinance No. Ns-10 1 2 3 4 5 6 7 0 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 20 SHALL ORDINANCE NO. NS-10 BE ADOPTED AMENDING CHAPTER 3.12 OF THE RATE BY AN ADDITIONAL 2% TO PAY FOR THE PROMOTION OF TOURISM IN CARLSBAD MUNICIPAL CODE TO INCREASE THE TRANSIENT OCCUPANCY TAX THE CITY AND FOR A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FACILITIES? RESOLUTION NO. 88-75 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AMENDING RESOLUTION NOS. 88- 58 AND 88-59 CALLING AND GIVING NOTICE OF THE HOLDING OF THE SPECIAL MUNICIPAL ELECTION TO BE HELD IN THE CITY ON TUESDAY, JUNE 7, 1988, TO INCLUDE THE SUBMISSION TO THE QUALIFIED ELECTORS AN ORDINANCE RELATING TO INCREASING THE TRANSIENT OCCUPANCY TAX BY AN ADDITIONAL 2% TO PAY FOR THE PROMOTION OF TOURISM IN CARLSBAD AND TO FINANCE A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FAC I L IT1 ES . WHEREAS, pursuant to the requirements of the laws of the State of California relating to General Law Cities, there has been called and ordered to be held in the City of Carlsbad, California, on Tuesday, June 7, 1988, a Special Municipal Election for the purpose of submitting to the qualified voters an ordinance relating to increasing the Transient Occupancy Tax from 6% to 8%; and WHEREAS, the City Council desires to submit another measure to the voters relating to an additional increase in the Transient Occupancy Tax to pay for the promotion of tourism in Carlsbad and to finance a public golf course, tennis courts and related facilities. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows: SECTION 1. That the above recitations are true and correct. SECTION 2. That the City Council, pursuant to its right and authority, does order submitted to the voters at the Special Municipal Election the YES ----- NO fol 1 owi ng question : 1 2 3 4 5 6 7 0 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I ATTEST : I i SECTION 3. That the proposed ordinance submitted to the voters is attached ~ as Exhibit A. SECTION 4. That Resolution No. 88-58 is hereby amended to include this 1 additional measure to the qualified voters of the City at the Special Election to be held June 7, 1988. SECTION 5. That Resolution No. 88-59 is hereby amended to request the Board of Supervisors of the County of San Diego to authorize the Registrar of Voters to include this measure in the provision of specified services relating to the conduct of the election of the City of Carlsbad. SECTION 6. That the City Clerk shall certify to the passage and adoption ' of this Resolution and enter it into the book of original resolutions. PASSED, APPROVED AND ADOPTED at an Adjourned Regular Meeting of the City , 1988, by ~ Council of the City of Carlsbad on the 10th day of March the following vote, to wit: AYES: Council Members Lewis, Kulchin, Mamaux and Larson NOES: Council Member Pettine 18 19 20 21 22 23 24 25 26 27 28 Exhibit "A" to Resolution No. 88-75 ORDINANCE NO. NS-lo AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARISBAD, CALIFORNIA, AMENDING TITLE 3, CHAPTER 3.12 OF THE CARLSBAD MUNICIPAL CODE BY THE ADDITION OF SECTION 3.12.035 TO INCREASE THE TRANSIENT OCCUPANCY TAX RATE BY 2% TO PAY FOR THE PROMOTION OF TOURISM IN THE CITY AND FOR A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FACILITIES. The City Council of the City of Carlsbad, California does ordain as follows: SECTION I: That Title 3, Chapter 3.12 of the Carlsbad Municipal Code is amended by the addition of Section 3.12.035 to read as follows: "3.12.030 Imposition of additional amount -- where * payable -- D urposes. (a) In addition to the tax imposed by Section 3.12.030 for the privilege of occupancy in any hotel, eacl transient is subject to and shall pay a tax in the amount of two percent of the rent charged by the operator. Such tax constitute: a debt owed by the transient to the City which is extinguished only by payment to the operator or to the City. The transient shall pay the tax to the operator of the hotel at the time the rent is paid. If the rent is paid in installments, a proportionate share of the tax shall be paid with each installment. The unpaid tax shall be due upon the transient's ceasing to occupy space in the hotel. If for any reason the tax due is not paid to the operator of the hotel, the tax administrator may require that such tax shall be paid directly to the tax administrator. uses specified in this section in the following priority: (b) The proceeds of this tax shall be limited to the 1. The City Council shall make an annual appropriation beginning on July 1, 1989 to the Carlsbad Convention and Visitors Bureau of two hundred thousand dollars to be used for the promotion of tourism in the City of Carlsbad. If the Bureau ceases to exist or is otherwise unable to use the monel for such purposes it shall be deposited in the general fund. dollars per year shall be used by the City Council for the construction of an 18 hole championship public golf course and related facilities in the City of Carlsbad and for the construction of one or more complexes of public tennis courts and related facilities in the City of Carlsbad. 2. An amount up to the next nine hundred thousand 3. The next two hundred thousand dollars may be used by the City Council for the construction, reconstruction, 19 20 21 22 23 24 25 26 27 28 maintenance or repair of the facilities described in subsection (2) or for the construction of an executive golf course and related facilities in the city of Carlsbad. 4. Any proceeds from this tax in excess of the amounts necessary to satisfy the requirements of subsections (l), (2) and (3) or otherwise unexpended when this tax terminates shal be deposited in the general fund. (c) The tax imposed by subsection (a) shall be paid fo: a period beginning on July 1, 1989 and ending twenty years after the date the City sells the bonds necessary to fund the facilities described in Section (b) (2) .Iv SECTION 2: The City Council may amend this ordinance from time to time to add exceptions, or adjust the rate, or application of tax, or make such other changes as they determine to be necessary provided the rate of tax to be imposed by this ordinance shall not be increased and the allocation of funds for the promotion of tourism in the City or for the construction of the golf course or tennis courts shall not be decreased. SECTION 3: In accordance with Section 4013 of the Elections Code of the State of California, this ordinance shall be considered as adopted upon the date that the vote is declared by the city Council and shall go into effect ten days after that date. SECTION 4: This ordinance imposes a special tax and therefore requires the approval of two thirds of the voters voting thereon in the election. the same time as another ordinance requiring a majority vote which It will be presented to the voters at would raise the transient occupancy tax rate from 6% to 8%. If both ordinances are adopted the effect of this ordinance will be to increase the transient occupancy tax rate from 8% to 10%. If this ordinance passes and the other does not this ordinance would increase said rate from 6% to 8%. t 1E 1s 2c 21 22 23 24 25 26 27 28 u INTRODUCED AND FIRST READ at a regular meeting of the Carlsbad City Council on the 1988, and thereafter day of I PASSED AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad on the 1988, by the following vote, to wit: day of I AYES: NOES : ABSENT: APPROVED AS TO FORM AND LEGALITY VINCENT F. BIONDO, JR., City Attorney CLAUDE A. LEWIS, Mayor ATTEST: ALETHA L. RAUTENKRANZ, City Clerk 3. 1 SHALL ORDINANCE NO. NS-10 BE ADOPTED AMENDING CHAPTER 3.12 OF THE CARLSBAD MUNICIPAL CODE TO INCREASE THE TRANSIENT OCCUPANCY TAX RATE BY AN ADDITIONAL 2% TO PAY FOR THE PROMOTION OF TOURISM IN THE CITY AND FOR A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FAC I L IT1 ES? 2 YES ----- NO 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 20 RESOLUTION NO. 88-76 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, DIRECTING THE CITY ATTORNEY TO PREPARE AN IMPARTIAL ANALYSIS OF THE PROPOSED ORDINANCE PERTAINING TO AN INCREASE IN THE TRANSIENT OCCUPANCY TAX TO PAY FOR THE PROMOTION OF TOURISM IN THE CITY AND FOR A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FACILITIES. WHEREAS, a Special Municipal Election is to be held in the Ci,g Carlsbad, on June 7, 1988, at which there will be submitted to the qualif voters of said City, the following Proposition, to wit: of ed WHEREAS, the City Council desires to have an impartial analysis prepared showing the effect of the Ordinance on existing law and the operation of the Ordinance; NOW, THEREFORE, BE IT RESOLVED, DECLARED, DETERMINED AND ORDERED by the City Council of the City of Carlsbad as follows: SECTION 1. Pursuant to the provisions of Section 5011 of the Elections Code of the State of California, this City Council does direct the City Attorney to prepare an impartial analysis of the Ordinance. I// I// I// I// I// I// I// 1 2 3 4 5 6 7 a 9 10 11 12 13 14 15 16 17 ia 19 20 21 22 23 24 25 26 27 28 SECTION 2. PASSED, APPROVED AND ADOPTED at an Adjourned Regular Meeting of the City Council of the City of Carlsbad on the 10th day of March , 1988, by the following vote, to wit: The impartial ana ysis shall not exceed 500 words in length. AYES: Council Members Lewis, Kulchin, Mamaux and Larson NOES: Council Member Pettine ATTEST: 1 2 3 4 5 6 7 a 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SHALL ORDINANCE NO. NS-10 BE ADOPTED AMENDING CHAPTER 3.12 OF THE RATE BY AN ADDITIONAL 2% TO PAY FOR THE PROMOTION OF TOURISM IN CARLSBAD MUNICIPAL CODE TO INCREASE THE TRANSIENT OCCUPANCY TAX THE CITY AND FOR A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FAC I L IT I ES? RESOLUTION NO. 88-77 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING CERTAIN OF ITS MEMBERS TO FILE A WRITTEN ARGUMENT REGARDING A CITY MEASURE WHEREAS, a Special Municipal Election is to be held in the City of Carlsbad, California, on June 7, 1988, at which there will be submitted to the YES ----- NO voters the following measure: NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Carlsbad, California, does declare, determine and order as follows: SECTION 1. That the above recitations are true and correct. SECTION 2. That The City Council authorizes Claude Lewis Ann Kulchin John Mamaux Eric Larson to file a written argument regarding the City measure set forth in the recitals hereof in accordance with Article 4, Chapter 3, Division 5 of the Elections Code of the State of California, and to change the argument until and including the date fixed by the City Clerk after which no arguments for or against said City measure may be submitted to the City Clerk. /// //I /// 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PASSED, APPROVED AND ADOPTED at an Adjourned Regular Meeting of the C Council of the City of Carlsbad on the 10th day of March , 1988, the following vote, to wit: AYES: Council Members Lewis, Kulchin, Mamaux and Larson Council Member Pettine NOES: ABSENT : None ATTEST: ALETHA L. WUTENKRANZ, City Clerk (SEAL) .. 4 5 18 19 20 21 22 23 24 25 26 27 28 0 ORDINANCE NO. NS-10 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AMENDING TITLE 3, CHAPTER 3.12 OF THE CARISBAD MUNICIPAL CODE BY THJ3 ADDITION OF SECTION 3.12.035 TO INCREASE THE TRANSIENT OCCUPANCY TAX RATE BY 2% TO PAY FOR THE PROMOTION OF TOURISM IN THE CITY AND FOR A PUBLIC GOLF COURSE, TENNIS COURTS AND RELATED FACILITIES. The City Council of the City of Carlsbad, California does ordain as follows: SECTION I: That Title 3, Chapter 3.12 of the Carlsbad Municipal Code is amended by the addition of Section 3.12.035 to read as follows: 1'3.12.035 ImDosition of additional amount -- where payable -- D umoses. (a) In addition to the tax imposed by Section 3.12.030 for the privilege of occupancy in any hotel, eac transient is subject to and shall pay a tax in the amount of two percent of the rent charged by the operator. Such tax constitute a debt owed by the transient to the City which is extinguished only by payment to the operator or to the City. The transient shall pay the tax to the operator of the hotel at the time the rent is paid. If the rent is paid in installments, a proportionate share of the tax shall be paid with each installment. The unpaid tax shall be due upon the transient's ceasing to occupy space in the hotel. If for any reason the tax due is not paid to the operator of the hotel, the tax administrator may require that such tax shall be paid directly to the tax administrator. uses specified in this section in the following priority: (b) The proceeds of this tax shall be limited to the 1. The City Council shall make an annual appropriation beginning on July 1, 1989 to the Carlsbad Convention and Visitors Bureau of two hundred thousand dollars to be used for the promotion of tourism in the City of Carlsbad. If the Bureau ceases to exist or is otherwise unable to use the mone for such purposes it shall be deposited in the general fund. 2. An amount up to the next nine hundred thousand dollars per year shall be used by the City Council for the construction of an 18 hole championship public golf course and related facilities in the City of Carlsbad and for the construction of one or more complexes of public tennis courts and related facilities in the City of Carlsbad. 3. The next two hundred thousand dollars may be used by the City Council for the construction, reconstruction, 3. 1 2 3 4 5 6 7 8 9 10 11 12 18 19 20 21 22 23 24 25 26 27 28 maintenance or repair of the facilities described in subsection (2) or for the construction of an executive golf course and related facilities in the city of Carlsbad. 4. Any proceeds from this tax in excess of the amounts necessary to satisfy the requirements of subsections (l), (2) and (3) or otherwise unexpended when this tax terminates shall be deposited in the general fund. (c) The tax imposed by subsection (a) shall be paid for a period beginning on July 1, 1989 and ending twenty years after the date the City sells the bonds necessary to fund the facilities described in Section (b) (2) .'I SECTION 2: The City Council may amend this ordinance from time to time to add exceptions, or adjust the rate, or application of tax, or make such other changes as they determine to be necessary provided the rate of tax to be imposed by this ordinance shall not be increased and the allocation of funds for the promotion of tourism in the City or for the construction of the golf course or tennis courts shall not be decreased. SECTION 3: In accordance with Section 4013 of the Elections Code of the State of California, this ordinance shall be considered as adopted upon the date that the vote is declared by the City Council and shall go into effect ten days after that date. SECTION 4: This ordinance imposes a special tax and therefore requires the approval of two thirds of the voters voting thereon in the election. It will be presented to the voters at the same time as another ordinance requiring a majority vote which would raise the transient occupancy tax rate from 6% to 8%. If both ordinances are adopted the effect of this ordinance will be to increase the transient occupancy tax rate from 8% to 10%. If this ordinance passes and the other does not this ordinance would increase said rate from 6% to 8%. \. 1 \ 2 3 a 9 10 11 12 18 19 20 21 22 23 24 25 26 27 2a INTRODUCED AND FIRST READ at a regular meeting of the Carlsbad City Council on the 10th day of March I 1988, and thereafter PASSED AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad on the 22nd day of March I 1988, by the following vote, to wit: AYES: Council Members Lewis, Kulchin, Mamaux and Larson NOES: Council Member Pettine ABSENT: None APPROVED AS TO FORM AND LEGALITY ATTEST: ALF4$HA L/BBd TEEPKRAN Z, City Clerk *EN R. KUNDTZ, Deputy City Clerk 3.