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HomeMy WebLinkAbout1992 - MINUTES - 7/7/1992 CITY OF PALM SPRINGS 0 3 2 � CITY COUNCIL MINUTES JULY 7, 1992 An Adjourned Regular Meeting of the City Council , of the City of Palm Springs, California, was called to order by Mayor Maryanov in the Large Conference Room, City Hall , 3200 Tahquitz Canyon Way, on Tuesday„ July 7, 1992, at 3:00 p.m. ROLL CALL: Present: Councilmembers Hodges, Lyons, Reller, Schlendorf, and Mayor Maryanov Absent: None REPORT OF POSTING OF AGENDA: City Clerk reported that the agenda was posted in accordance with Council procedures on July 3, 1992, and noted that Item 2 related to the tax increase, and Item 3 to tax allocation formula policy for tourism and visitor promotion. PUBLIC COMMENTS: a) Comments re Item 2: Gary Baker stated that he has chosen not to support the PSDRCVB, and if the tax is increased, he will be forced to join it at $5,000 per year in order to receive the mailing lists and leads; that he does not feel that would benefit him, and he would prefer the Council not to become involved in private business decisions. Eric Langman, President of the Hotel Association, stated that the association supported the increase as long as those who wanted the increase would be those who would pay the tax; that each of the potential hotels was to have been contacted, which has not occurred, and the Council may not have the proper information to make the decision; that he understood a revision was contemplated, which would raise the threshold from 50 rooms to 125 rooms. Bob Weithorn, Orchid Tree, submitted copies of letters from Shilo Inns and Las Brisas, concerning this subject, (140- copies of which are on file with the City Clerk, and 002) expressed concern about the 50 room criteria; that the hotel association members have not had an opportunity to agree or not agree, in that the survey by the City in some cases was responded to by account clerks, and not the manager of the hotel . Don Frank stated that Palm Desert has approved a 9% tax, and will receive the greatest benefit; and suggested that Palm Springs impose a 7% tax in competition. Paul Seck, Riviera, stated that many small hotels receive indirect benefit, in that they receive referrals from the large hotels; that Palm Springs alone cannot compete with other destination resorts, and that the entire valley must be marketed at a destination; and that the large and small hotels will benefit from the increased advertising. Council Minutes 7-7-92 Page 2 a) Comments re Item 2 (Continued) Herb Rafetto, Hyatt Suites, asked others present who support the increase to stand; and stated that Mr. Baker was the only large hotel over 125 rooms which objected; that the hotel industry is willing to fund it, and that the hotel owners are in agreement. Roger Garrett, Oasis Water Park Resort;, stated that if the criteria is 125 rooms, his hotel would not be included, although he understood 'there was the opportunity for voluntary participation to pay the 10.8% and receive the leads, which he would volunteer to do; that he has benefited from the CVB; that they are not the type of business that are meeting intense, rather recreation intense - attracting religious, fraternal and other group business. Ken Irwin stated that the issue is whether a regional , well-funded, and effective CVB is needed; that he believes that is necessary, and a two-tiered program is appropriate; that he did not believe the hotels should be segregated by categories, rather all hotels should pull together for the same goals; and that he did not believe there should be any membership requirement of any hotel , of any size. LEGISLATIVE ACTION: 1. MUNICIPAL CODE AMENDMENT - AIRPORT COMMISSION On July 2, 1992, the Council introduced ordinance to amend the Municipal Code to increase the membership of the Airport Commission to seven members; Section 2.16.010 is in form consistent with other seven-member commissionis, and provides for staggered terms of new members. City Clerk read title of Ordinance 1416, as follows AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, (060- AMENDING SECTION 2.16.010 OF CHAPTER 2.16 OF THE PALM 001) SPRINGS MUNICIPAL CODE, INCREASING THE NUMBER OF MEMBERS OF THE AIRPORT COMMISSION FROM FIVE TO SEVEN, AND SPECIFYING TERMS THEREOF. It was moved by Hodges, seconded by Schlendorf, and unanimously carried, 'that further reading be waived, and that Ordinance 1416 be adopted. 2. T.O.T. - RATE INCREASE On July 2, the Council directed that urgency and non-urgency ordinances be presented to provide an increase of .8% percent in the Room Tax applicable to "convention" or "group meeting" hotels, subject to certain conditions. The urgency ordinance requires 4/5 vote and would only require one reading, and would be effective upon adoption; (140- the non-urgency ordinance requires two readings at least 002) 5 days apart, a majority to adopt, and is effective upon adoption. City Manager stated that it makes sense for the Valley to be a regional market, and that its competition, per se, is outside of the Valley, and he recommended approval of the tax increase. Council Minutes 7-7-92 Page 3 2. T.O.T. RATE INCREASE (Continued) In answer to question by Council , Mike Fife, PSDRCVB Executive Director, staged that Mr. Baker would not have to join the CVB, rather he would receive a free membership for 1992-93, entitling him to receive weekly listings and other information; that he would not receive anything different in terms of convention sales or leads than he is now receiving, unless the definition is changed, or if he is doing group sales and paid the 10.8%. Councilmember Lyons stated that with the change in definition, (shown in revised proposed ordinance distributed at the meeting) only the 8 larger hotels will be affected, and at that point it is a business decision as to how they want to run their hotels, and is not a matter for other hotels to support or oppose, since they will not be affected; and that he agreed with the Hotel Association's concerns before, but with the new definition, does not find any problems with the proposal . Mayor stated that the 8 hotels affected area Riviera P.S. Resort, Wyndham, Marquis, P.S. Hilton, Ramada Hotel Resort, P.S. Spa, Hyatt Regency Suites, Autry, and P.S. Courtyard, and inquired of those present in the audience whether they supported or opposed the increase, to which representations were made in the affirmative, including comment by the Mayor that he spoke with Mrs. Autry who is willing to support the increase. City Attorney stated that he has some concerns about sub-definition (4) of the proposed "Group Meeting Hotel " definition in the ordinance in terms of whether the Council should impose the tax based on performance of an agency outside of the City, and that he felt he could pull paragraph (4) and the remainder of the section together to accomplish the desired result but in more concise language, and if it did not meet the intent, the ordinance could be reintroduced for first reading. Councilmember Schlendorf stated that she is not opposed to the CVB, and favors City funding for it; that the issue, however, is not funding the CVB, rather a tax ordinance to be written and implement, clearly, concisely, and fairly; and that she did not feel the ordinance before the Council at the last meeting accomplished that purpose. Councilmember Hodges stated that much progress has been made in the language of the ordinance, and she respected the hotel industry's judgement and opinion that it will benefit the hotels; however, she felt the hotel and tourist communities were being divided, and the tax is discriminatory; that she was not opposed to hoteliers committing to and collecting through their rates, funds that would be passed on to the CVB, but that the proposal is a tax, and is discriminatory against the community and the tourists. Mayor commented that federal , state and other taxes are also discriminatory, citing income taxes, social security and property taxes; and that the room tax is not discriminatory, per se, rather is passed to achieve specific goals. Council Minutes 7-7-92 Page 4 2. T.O.T. RATE INCREASE (Continued) Councilmember Hodges stated that she appreciated state and federal levels, but she did not think it proper to discriminate within one' s Oran city, and although it has been a cooperative effort for a desired goal , the person who will pay the tax - the tourist - has been left out of the process; and the tax is mandatory, not discretionary on the taxpayer. Councilmember Lyons stated that a voluntary program will only work if it is valley-wide, and funded in a significant way; that he will continue to monitor room rates, and if there is not a marked increase in the number of rooms sold - without alibi that fewer would have been sold without the added funding - he will look to an early sunset of the provisions. Councilmember Schlendorf stated that the decision is being made before the need has been shown; that this matter has been under study for 90 days, and questioned why it is urgent now; that she has not seen the OVB budget, or projections, and felt she was not being accorded the respect of a professional person capable of making the decision whether this was best for Palm Springs; that the Council is faced with the loss of millions of dollars contingent on adverse State action; that the decision relates to close to a $500,000 expenditure; and that: there is no financial data on which to determine whether it is a good decision to move forward, even in the face of city employee layoffs; and that the City has used the Room Tax for other purposes. Mayor noted that the program is only for one year; that there are no General Fund monies involved; that he felt, from a practical standpoint, the Council could not use the Room Tax for other purposes; that preliminary CVB budget figures were available; that the proposal represents a major step, since other communities are now willing to proceed with a tiered-funding program; that there must be time in which to implement it:, i .e. , by August 1; and that all of the cities must agree to the program. City Clerk read title of the Ordinance, as follows: AN ORDINANCE OF THE CITY OF PALM SPRINGIS, CALIFORNIA, ADDING SECTION 3.24.037 TO THE PALM SPRINGS MUNICIIPAL CODE IMPOSING AN ADDITIONAL EIGHT-TENTHS OF ONE PERCENT ( .B%) TRANSIENT OCCUPANCY TAX, AND AMIENDING CERTAIN OTHER SECTIONS OF CHAPTER 3.24 OF THE MUNICIPAL CODE, ADOPTED PURSUANT 70 GOVERNMENT CODE SECTIONI 36937(d). It was moved by Lyons, seconded by Reller, and unanimously carried, that further reading be waived; and it was moved by Lyons, seconded by Reller, and carried by the following vote that the Ordinance be introduced for first reading, subject to revision of Section 3.24.020 (9) 4) , et seq, as noted by the City Attorney: AYES: Lyons, Reller, Schlendorf & Maryanov NO: Hodges ABSENT: None Council Minutes 03 3 1 7-7-92 Page 5 3. T.O.T. POLICY On July 2, 1992, the Council continued for consideration, actions relative to policy on the expenditure of the transient room tax, including concurrence by P.S. Desert Resort CVB JPA member cities, sunset provision concerning .B% allocation for advertising, and, go impact on termination clause of JPA. Councilmember Schlendorf stated that she supported the tax increase to demonstrate that the Council is able to (114- do so; that she did not favor voting on the distribution 004) of the funds until it is shown that it is a proper distribution, and that the CVB plan is what the Council wants to agree to. Councilmember Lyons stated that he would also like firm commitment from the other cities as to their participation. In answer to question by Council , Mr. Fife stated that the other cities will have to agree to the change in definition, but he did not anticipate any problem, since it should not adversely impact them. He a'Bso offered to provide copies of the past two financial statements, the actual budget from 1991-92, and the proposed budget as it is to be presented the following week to the PSDRCVB Board. It was moved by Reller, seconded by Lyons, and unanimously carried, that this matter be continued to July 15, 1992. 4. RENT REVIEW COMMISSION - MEMBERSHIP ELIGIBILITY At the June 23 study session, Council directed City Attorney to report on possibility of lifting eligibility requirements for membership on the Rent Review Commission, i .e. , prohibition against members being tenants or landlords subject to the provisions of the ordinance; and, if appropriate, to provide Municipal Code providing such amendment. City Attorney recommended that the Council not proceed with the ordinance draft which was presented, and stated (060- that the Rent Control ordinance provides that the Council 016) may change the ordinance so long as the change is beneficial to the tenant; that if both a tenant and landlord were included in the membership, it could be arguable that the landlord viewpoint would not be beneficial to the tenant; and that if only tenants were included in membership, it could be argued that the landlord was deprived of due process; that the Council may choose to: a) modified current ordinance provisions concerning reappointments with respect to the Rent Review Commission; b) allow use of a hearing officer to reduce impact on commissioner's time; or c) solicit input from the Commission as to alternative means of addressing the concerns for broader involvement. C),332 Council Minutes 7-7-92 Page 6 4. RENT REVIEW COMMISSION (Continued) Councilmember Hodges stated that she agreed that the Council should not discriminate with either only tenant or landlord membership; that it should be a combined opportunity, unless there was :some type of tenant group or interested parties concurrence; and that perhaps the Commission should review the options and report back to the Council . She added that she would want the need for a hearing officer to be substantiated; that the possibility of reappointment might be considered for any commission which has only a few applicants; and that changing the effective date of appointments should also be addressed, i .e. , from July 1 to October 1. It was the consensus of the Council to refer these matters to the Rent Review Commission for its consideration by December 31, 1992. ADJOURNMENT There being no further business, Mayor declared the meeting adjourned. JUDITH SUMICH-- City Clerk