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HomeMy WebLinkAbout1/9/2008 - STAFF REPORTS - 2.E. ?ALMS.. • iy c U y City Council Staff Report 4<1 FORK\ DATE: JANUARY 9, 2008 CONSENT CALENDAR SUBJECT: SECOND READING AND ADOPTION OF PROPOSED ORDINANCE NO. 1730, ADDING CHAPTER 5.26 TO THE PALM SPRINGS MUNICIPAL CODE RELATING TO THE ESTABLISHMENT OF A HOTEL OPERATIONS INCENTIVE PROGRAM FROM: David H. Ready, City Manager BY: Office of the City Clerk SUMMARY: The City Council will consider adoption of Ordinance No. 1730. RECOMMENDATION: Waive further reading and adopt Ordinance No. 1730, "AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING CHAPTER 5.26 TO THE PALM SPRINGS MUNICIPAL CODE RELATING TO THE ESTABLISHMENT OF A HOTEL OPERATIONS INCENTIVE PROGRAM." STAFF ANALYSIS: At its December 12, 2007, meeting the City Council introduced on first reading the proposed ordinance. This report provides for the City Council to waive further reading and adopt the ordinance. The ordinance shall be effective 30-days from adoption. 2 l mes Thompson David H. Ready, Esq. ity Clerk City Manager Attachment: Ordinance No. 1730 Item 2 . E . ORDINANCE NO. 1730 AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING CHAPTER 5.26 TO THE PALM SPRINGS MUNICIPAL CODE, RELATING TO THE ESTABLISHMENT OF A HOTEL OPERATIONS INCENTIVE PROGRAM. City Attorney's Summary This Ordinance establishes an incentive program for the operations and maintenance of hotel facilities in the City of Palm Springs. The City Council of the City of Palm Springs ordains: Section 1. Section 324.316 is added to the Palm Springs Municipal Code to read: 3.24.315. Hotel Operations Incentive Program In the event of any conflict between the provisions of Sections 3.24.030, 3.24.036, and 324.310 of this Code and Section 5.26.060 of this Code, the provisions of Section 5.26.060 shall control. Section 2, Chapter 5,26 is added to the Palm Springs Municipal Code to read: Chapter 5.26 HOTEL OPERATIONS INCENTIVE PROGRAM Sections: 5.26.010 Purpose 5.26.020 Definitions 5.26.030 Eligibility for Incentive Program 5.26.040 Incentive Program 5.26.050 Operating Covenants 5.26.060 General Fund Revenues 5.26.010 Purpose The purpose of this Chapter is to provide an incentive program for the operation and maintenance of Quality and First Class Hotel facilities which enhance the tourist and travel experience for visitors to the City of Palm Springs, maximize the use of the City's Convention Center, provide attractive and desirable visitor serving facilities and experiences, and assist the City in achieving its tourism goals. In the implementation of this program, the City Council finds: (a) The general welfare and material well being of the residents of the City of Palm Springs depend in large measure upon the growth and expansion of the tourism and travel industries in the City. 1 000002 55G513.1 (b) The operation, maintenance, and expansion of the inventory of Quality Hotels and First Class Hotels in the City of Palm Springs will create desirable visitor serving facilities that will contribute to the growth and expansion of tourism and travel opportunities in the City, ensure utilization of the City's Convention Center, provide employment opportunities for the residents of the City, and promote and enhance the economy of the City. (c) It is in the best interest of the City of Palm Springs to induce and encourage the , operation, and maintenance of hotel facilities that would not otherwise exist, thereby creating new sources of tax revenues for the City's General Fund which supports the public services that the City provides its residents. (d) The authority granted and the purposes to be accomplished by this Chapter are properly local governmental and public purposes for which public funds can be expended and that the operation, maintenance, and expansion of the inventory of Quality and First Class Hotels is of paramount importance to the City of Palm Springs, its residents, and businesses. 526.020 Definitions For the provisions of this Chapter, the following definitions shall apply: "Adjusted Tax Rate" shall mean the Hotel Performance Incentive Program tax rates which shall be exclusively utilized for the calculation of the operating assistance to be paid by the City to qualified Operators of Hotels participating in the Hotel Performance Incentive Program. For Hotels of one hundred twenty-four (124) rooms or less, the Adjusted Tax Rate shall be 10.4% of the rent charged by the Operator of the Hotel for transient occupancies. For Hotels of one hundred twenty-five (125) rooms or more, the Adjusted Tax Rate shall be 12.4% of the rent charged by the Operator of the Hotel for transient occupancies. The Adjusted Tax Rate set forth in this Section shall exclusively apply for the calculation of any and all operating assistance for the term of the Hotel Performance Incentive Program without regard to any increases at any time in the City of Palm Springs' Transient Occupancy Tax Rates. "Committable Rooms Program" means the Palm Springs Convention Center's Committable Rooms Program which provides the Convention Center with a list of hotel properties and a count of hotel rooms available, one year in advance or more, for potential reservation by meeting groups and/or conventions in the City. "Existing Hotel" means a property that was constructed, occupied, and used as a Hotel on or before January 1, 2006. "First Class Hotel" means a Hotel which provides standards of physical features and operational services which meet or exceed the higher rating criteria established for hotels by the American Automobile Association, J.D. Power & Associates, Mobil Oil Company, or Smith's Travel Research Service. 2 O00003 556523 1 "First Class Hotel Standard" means standards of physical features and operation which qualify a hotel as a First Class Hotel and which include operation of the Hotel on a twenty-four (24) hour per day/seven (7) day a week basis with housekeeping services, food and beverage services, room services, banquet and meeting services, concierge and bellman services, and parking services. "Hotel" means any property containing six (6) or more guest rooms used by six (6) or more guests, for compensation and where the guest rooms are designed and intended as transient accommodations. "New Hotel" means a Hotel that is or was Under Construction as a Hotel after January 1, 2008, but before December 31, 2012. The term "New Hotel' does not include all, or any portion of, or addition to, an Existing Hotel. "New Quality Hotel" means a Hotel that is not a First Class Hotel and is a Hotel that is, or was, Under Construction as a Hotel after January 1, 2008, but before December 31, 2010. "Operating Covenants" means the Covenants described in Section 5.26.050 of this Cade. "Operator" means the person who is proprietor of a hotel, whether in the capacity of owner, lessee, sub-lessee, mortgagee in possession, licensee, franchisee, or any other capacity, or the assignee or designee of such proprietor. "Qualified Renovation Program" shall mean a Property Improvement Program undertaken by an Existing Hotel which invests no less than Fifteen Thousand Dollars ($15,000.00) per room, or invests no less than One (1) Million Dollars ($1,000,000.00) in ancillary non-hotel room facilities and/or space. The Property Improvement Program shall be comprehensively executed in a single renovation project on the property and be completed no later than December 31, 2012. "Transient Occupancy" means an uninterrupted stay of no more than twenty-eight (28) consecutive calendar days. "Transient Occupancy Tax Base" shall mean the average of the last thirty- six (36) months of annualized Transient Occupancy Tax owed to the City by an Existing Hotel prior to the commencement of a Qualified Renovation Program. "Transient Occupancy Tax Increment" shall mean the difference between the Transient Occupancy Tax Base and the amount of Transient Occupancy Tax owed to the City by an Existing Hotel after the recordation of the Operating Covenants by the City. "Under Construction" means that all necessary discretionary entitlements have been approved by the City of Palm Springs, grading and building permits have been issued, and that inspection approvals by the City of Palm Springs of 55fi5Z3 I 3 000004 grading and foundations to grade level have been obtained, vertical construction of hotel rooms has begun, and the Operating Covenants have been recorded. 5.26.030 Eligibility for Incentive Program (a) To qualify for the Hotel Operations Incentive Program for First Class New Hotels, the Operator shall: (1) Complete and submit to the City Manager, the City's application for the Hotel Operations Incentive Program. (2) Subscribe to the Palm Springs Convention Center's Committable Rooms Program- (3) Provide independent, third-party, certification acceptable to the City of the level of quality of the New Hotel as a First Class Hotel as defined in this 5.26.020. (4) Participate in the City's Convention Center Hotel Shuttle Service in a proportional basis equal to the number of total hotel, or condo—hotel rooms in the First Class New Hotel. (5) Execute the Operating Covenants which shall include provisions regarding continuing use, maintenance, non-discrimination, and such other provisions as the City Council in its sole discretion, may reasonably determine are necessary or appropriate to preserve the goals and intent of this Chapter. (b) To qualify for the Hotel Operations Incentive Program for New Quality Hotels, the Operator of each New Quality Hotel shall: (1) Complete and submit to the City Manager, the City's application for participation in the Hotel Operations Incentive Program. (2) If requested by the City, subscribe to the Palm Springs Convention Center's Committable Rooms Program. (3) Execute the Operating Covenants which shall include provisions regarding continuing use, maintenance, non-discrimination, and such other provisions as the City Council in its sole discretion, may reasonably determine are necessary or appropriate to preserve the goals and intent of this Chapter- (c) To qualify for the Hotel Operations Incentive Program for Existing Hotels, the Operator of each Existing Hotel shall: (1) Complete and submit to the City Manager, the City's application for participation in the Hotel Operations Incentive Program, including 4 556523 1 000005 documentation satisfactory to the City certifying the renovation project for an Existing Hotel as a Qualified Renovation Program- (2) If requested by the City, subscribe to the Palm Springs Convention Center's Committable Rooms Program- (3) Execute the Operating Covenants which shall include provisions regarding continuing use, maintenance, non-discrimination, and such other provisions as the City Council in its sole discretion, may reasonably determine are necessary or appropriate to preserve the goals and intent of this Chapter. 5.26.040 Incentive Program (a) First Class New Hotels. The City shall pay to an Operator of a First Class New Hotel an amount equal to fifty percent (50%) of the Adjusted Tax Rate. Such payments shall be made for twenty (20) years or until the Operator has been paid Fifty Million Dollars ($50,000,000.00), whichever event occurs first. Without regard to any preceding conditions of this Section, the Program shall terminate at any point the First Class New Hotel is not operated as a First Class Hotel- (b) New Quality Hotels. The City shall pay to an Operator of a New Quality Hotel an amount equal to fifty percent (50%) of the Adjusted Tax Rate. Such payments shall be made for ten (10) years or until the Operator has received Twenty-Five Million Dollars ($25,000,000.00), whichever event occurs first. Without regard to any preceding conditions of this Section, the Program shall terminate at any point the New Quality Hotel is not operated as a New Quality Hotel. (c) Existing Hotels. The City shall pay to an Operator of an Existing Hotel an amount equal to fifty percent (50%) of the Transient Occupancy Tax Increment collected and remitted to the City pursuant to Chapter 3.24 of this Code. Such payments shall be made for ten (10) years, or until the Operator has been received Twenty-Five Million Dollars ($25,000,000.00), whichever event occurs first. Without regard to any preceding conditions of this Section, the Program shall terminate at any point the Existing Hotel is not operated as a Hotel. 5.26.050 Operating Covenants (a) Each Operator eligible to participate in the City's Hotel Operations Incentive Program shall execute Operating Covenants negotiated with the Operator, approved by the City Council, and recorded with the County of Riverside Recorder's Office. 5.26.060 General Fund Revenues 5 00000F, 556513.1 Notwithstanding the provisions of Sections 324.030, 3.24.035, and 3.24.310 of this Code, all Transient Occupancy Tax Revenues or Transient Occupancy Tax Increment remitted to the City by an Operator of a hotel covered by Operating Covenants as provided in this Chapter shall be deemed General Fund revenues of the City and shall be deposited in the City's General Fund. Section 3. The City Council of the City of Palm Springs has, as a result of its consideration and the evidence presented at hearings on this matter, determined that, as required pursuant to the California Environmental Quality Act ("CEQA") and the State CEQA Guidelines, that this Ordinance provides for a method of funding the continued operation and maintenance of previously approved and or existing first class hotel facilities. On the basis of this review, the City Council finds that there is no evidence from which it can be fairly argued that the approval of this Ordinance will have a significant adverse effect on the environment. The City Council hereby certifies and approves this determination and directs that an appropriate Notice of Determination be prepared and filed with the County Clerk of the County of Riverside in the manner required by law. Section 4. The Mayor shall sign and the City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same, or the summary thereof, to be published and posted pursuant to the provisions of law and this Ordinance shall take effect thirty (30) days after passage. 5,26.070 Administrative Rules and Regulations Consistent with the intent and goals of this Chapter, the City Manager may adopt administrative rules and regulations for implementation and furtherance of the requirements of this Chapter. PASSED AND ADOPTED THIS DAY OF 2007. AYES- NOES- ABSTAIN: ABSENT: STEVE POUGNET, MAYOR ATTEST: City Clerk APPROVED AS TO FORM City Attorney 3565231 6 00I6007 CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. I, JAMES THOMPSON, City Clerk of the City of Palm Springs, California, do hereby certify that Ordinance No. is a full, true, and correct copy, and was introduced at a regular meeting of the Palm Springs City Council on and adopted at a regular meeting of the City Council held on by the following vote: AYES: NOES: ABSENT: ABSTAIN: James Thompson, City Clerk City of Palm Springs, California 7 000062 ssr,sza i PROOF OF PUBLICATION This is space for County Clerk's Filing Stamp (2015.5.C.C.P) STATE OF CALIFORNIA County of Riverside I am a citizen of the United States and a resident of Proof of Publication of the County aforesaid;I am over the age of eighteen ------- ----------- years,and not a party to or interested in the above-entitled matter.I am the principal clerk of a printer of the,DESERT SUN PUBLISHING COM PANY a newspaper of general circulation, printed and published in the city of Palm Springs, County of Riverside,and which newspaper has been adjudged a newspaper of general circulation by the Superior Court of the County of Riverside,State of California under Life date of March 24,1988.Case No 0133 CIrY OF PALM SPRINGS Number 191236;Lira[the notice,of which the ORDINANCE NO. 1A30 annexed is a printed copy(set in type not smaller than non paricl,has been published in each regular AN ORDINANCE OF THE CITY OF PALM TO TH SPRINGSCALMS CALIFORNIA ADDING M ICIPAL CO�e -26REL T NG TO and entire issue of said newspaper and not in any THE ESTABLISHMENT OF A HOTEL OPERATIONS supplement thereof on the following dates,to Wit: INCENTIVE PROGRAM. CI Afmmay's SUmmu ra Thrs Ordinance establishes an mean ela propfsin tar January 19 ,2008 tlla o ora0onS and msinlonsnce of hotel inClllnes In tha - ,--"-- -.,--��---�,.—,-�- City of Palm Springs I�pring James Thompson hereby certify hat the I[*,goinpaolr dinanceg'was duiycintrotluced at a an adjourned re lir All in the year 2005 .......��- -----� sip adopted al en Counci feguleemmeol 9 0�4[01the City Count11 on January 61 2009,by the following volo' AYES Countllmember Hutch .Councllmemberl I Certify(or declare)under penalty of perjury that the Wit, Counoilmember WeigOt Mayor Pro Tein Feat, foregoing is true and Correct. and Mayor Pougnet NOES: None ABSENT: Nona Dated at Palm Springs,California this----21'r,,—day ABSTAIN' None ,TAMES THOMPSON City Clerk -----,2008 Publleheda/t91oa Of�------•- January- --•-- _ Cii7 �n�� Stgrt hme )Co-) �� 1w Ea. Ln aCo-) -7- //� G, r� r a N • CITY OF PALM SPRINGS 0 PUBLIC HEARING NOTIFICATION (a OFFICE OF THE CITY CLERK James Thompson, City Clerk City Council Meeting Date: January 9, 2008 Subject: Ordinance No. 1730 AFFIDAVIT OF PUBLICATION I, Kathie Hart, CMC, Chief Deputy City Clerk, of the City of Palm Springs, California, do hereby certify that summary Ordinance No. 1730, adopted by the City Council on January 9, 2008„ was published in the Desert Sun on January 19, 2008. 1 declare under penalty of perjury that the foregoing is true and correct. Kathie Hart, CMC Chief Deputy City Clerk AFFIDAVIT OF POSTING I, Dolores Strickstein, Secretary, of the City of Palm Springs, California, do hereby certify that the summary and a copy of Ordinance No. 1730 was posted at Office of the City Clerk, City Hall, 3200 E. Tahquitz Canyon Drive, on the exterior legal notice posting board and in the Office of the City Clerk on or before January 16, 2008. 1 declare under penalty of perjury that the foregoing is true and correct. / Dolores Strickstein, Secretary CITY OF PALM SPRINGS ORDINANCE NO. 1730 AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING CHAPTER 5.26 TO THE PALM SPRINGS MUNICIPAL CODE, RELATING TO THE ESTABLISHMENT OF A HOTEL OPERATIONS INCENTIVE PROGRAM. Cit Attorne 's Summar This Ordinance establishes an incentive program for the operations and maintenance of hotel facilities in the City of Palm Springs. I, James Thompson, City Clerk of the City of Palm Springs, California, hereby certify that the forgoing ordinance was duly introduced at a an adjourned regular meeting of the City Council on December 12, 2007, and adopted at an adjourned regular meeting of the City Council on January 9, 2008, by the following vote: AYES: Councilmember Hutcheson, Councilmember Mills, Councilmember Weigel, Mayor Pro Tern Foat, and Mayor Pougnet NOES: None ABSENT: None ABSTAIN: None � MES THOMPSON ity Clerk = H-\t1SERS\C-CMKath1eH\0rd Summary\Ord 1730-Summary doc ORDINANCE NO. 1730 AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, ADDING CHAPTER 5.26 TO THE PALM SPRINGS MUNICIPAL CODE, RELATING TO THE ESTABLISHMENT OF A HOTEL OPERATIONS INCENTIVE PROGRAM. City Attorney's Summary This Ordinance establishes an incentive program for the operations and maintenance of hotel facilities in the City of Palm Springs. The City Council of the City of Palm Springs ordains: Section 1. Section 3.24.315 is added to the Palm Springs Municipal Code to read: 324.315. Hotel Operations Incentive Program In the event of any conflict between the provisions of Sections 3.24.030, 3.24.035, and 3.24.310 of this Code and Section 5.26.060 of this Code, the provisions of Section 5.26.060 shall control. Section 2. Chapter 526 is added to the Palm Springs Municipal Code to read: Chapter 5.26 HOTEL OPERATIONS INCENTIVE PROGRAM Sections: 5.26.010 Purpose 5.26.020 Definitions 5.26.030 Eligibility for Incentive Program 5.26.040 Incentive Program 5.26.050 Operating Covenants 5.26.060 General Fund Revenues 5.26.010 Purpose The purpose of this Chapter is to provide an incentive program for the operation and maintenance of Quality and First Class Hotel facilities which enhance the tourist and travel experience for visitors to the City of Palm Springs, maximize the use of the City's Convention Center, provide attractive and desirable visitor serving facilities and experiences, and assist the City in achieving its tourism goals. In the implementation of this program, the City Council finds: (a) The general welfare and material well being of the residents of the City of Palm Springs depend in large measure upon the growth and expansion of the tourism and travel industries in the City. (b) The operation, maintenance, and expansion of the inventory of Quality Hotels and First Class Hotels in the City of Palm Springs will create desirable visitor serving 1 556523.1 facilities that will contribute to the growth and expansion of tourism and travel opportunities in the City, ensure utilization of the City's Convention Center, provide employment opportunities for the residents of the City, and promote and enhance the economy of the City. (c) It is in the best interest of the City of Palm Springs to induce and encourage the, operation, and maintenance of hotel facilities that would not otherwise exist, thereby creating new sources of tax revenues for the City's General Fund which supports the public services that the City provides its residents. (d) The authority granted and the purposes to be accomplished by this Chapter are properly local governmental and public purposes for which public funds can be expended and that the operation, maintenance, and expansion of the inventory of Quality and First Class Hotels is of paramount importance to the City of Palm Springs, its residents, and businesses. 5.26.020 Definitions For the provisions of this Chapter, the following definitions shall apply: "Adjusted Tax Rate" shall mean the Hotel Performance Incentive Program tax rates which shall be exclusively utilized for the calculation of the operating assistance to be paid by the City to qualified Operators of Hotels participating in the Hotel Performance Incentive Program. For Hotels of one hundred twenty-four (124) rooms or less, the Adjusted Tax Rate shall be 10.4% of the rent charged by the Operator of the Hotel for transient occupancies. For Hotels of one hundred twenty-five (125) rooms or more, the Adjusted Tax Rate shall be 12.4% of the rent charged by the Operator of the Hotel for transient occupancies. The Adjusted Tax Rate set forth in this Section shall exclusively apply for the calculation of any and all operating assistance for the term of the Hotel Performance Incentive Program without regard to any increases at any time in the City of Palm Springs' Transient Occupancy Tax Rates. "Committable Rooms Program" means the Palm Springs Convention Center's Committable Rooms Program which provides the Convention Center with a list of hotel properties and a count of hotel rooms available, one year in advance or more, for potential reservation by meeting groups and/or conventions in the City. "Existing Hotel" means a property that was constructed, occupied, and used as a Hotel on or before January 1, 2006. "First Class Hotel" means a Hotel which provides standards of physical features and operational services which meet or exceed the higher rating criteria established for hotels by the American Automobile Association, J.D. Power & Associates, Mobil Oil Company, or Smith's Travel Research Service. "First Class Hotel Standard" means standards of physical features and operation which qualify a hotel as a First Class Hotel and which include operation of the Hotel on a twenty-four (24) hour per day/seven (7) day a week basis with housekeeping services, 2 55G523.1 food and beverage services, room services, banquet and meeting services, concierge and bellman services, and parking services. "Hotel" means any property containing six (6) or more guest rooms used by six (6) or more guests, for compensation and where the guest rooms are designed and intended as transient accommodations. "New Hotel" means a Hotel that is or was Under Construction as a Hotel after January 1, 2008, but before December 31, 2012. The term "New Hotel' does not include all, or any portion of, or addition to, an Existing Hotel. "New Quality Hotel" means a Hotel that is not a First Class Hotel and is a Hotel that is, or was, Under Construction as a Hotel after January 1, 2008, but before December 31, 2010. "Operating Covenants" means the Covenants described in Section 526.060 of this Code. "Operator" means the person who is proprietor of a hotel, whether in the capacity of owner, lessee, sub-lessee, mortgagee in possession, licensee, franchisee, or any other capacity, or the assignee or designee of such proprietor. "Qualified Renovation Program" shall mean a Property Improvement Program undertaken by an Existing Hotel which invests no less than Fifteen Thousand Dollars ($15,000.00) per room, or invests no less than One (1) Million Dollars ($1,000,000.00) in ancillary non-hotel room facilities and/or space. The Property Improvement Program shall be comprehensively executed in a single renovation project on the property and be completed no later than December 31, 2012. "Transient Occupancy" means an uninterrupted stay of no more than twenty- eight (28) consecutive calendar days. "Transient Occupancy Tax Base" shall mean the average of the last thirty-six (36) months of annualized Transient Occupancy Tax owed to the City by an Existing Hotel prior to the commencement of a Qualified Renovation Program. "Transient Occupancy Tax Increment" shall mean the difference between the Transient Occupancy Tax Base and the amount of Transient Occupancy Tax owed to the City by an Existing Hotel after the recordation of the Operating Covenants by the City. "Under Construction" means that all necessary discretionary entitlements have been approved by the City of Palm Springs, grading and building permits have been issued, and that inspection approvals by the City of Palm Springs of grading and foundations to grade level have been obtained, vertical construction of hotel rooms has begun, and the Operating Covenants have been recorded. 6.26.030 Eligibility for Incentive Program 3 556523 1 (a) To qualify for the Hotel Operations Incentive Program for First Class New Hotels, the Operator shall: (1) Complete and submit to the City Manager, the City's application for the Hotel Operations Incentive Program. (2) Subscribe to the Palm Springs Convention Center's Committable Rooms Program. (3) Provide independent, third-party, certification acceptable to the City of the level of quality of the New Hotel as a First Class Hotel as defined in this 526.020. (4) Participate in the City's Convention Center Hotel Shuttle Service in a proportional basis equal to the number of total hotel, or condo—hotel rooms in the First Class New Hotel- (6) Execute the Operating Covenants which shall include provisions regarding continuing use, maintenance, non-discrimination, and such other provisions as the City Council in its sole discretion, may reasonably determine are necessary or appropriate to preserve the goals and intent of this Chapter. (b) To qualify for the Hotel Operations Incentive Program for New Quality Hotels, the Operator of each New Quality Hotel shall: (1) Complete and submit to the City Manager, the City's application for participation in the Hotel Operations Incentive Program. (2) If requested by the City, subscribe to the Palm Springs Convention Center's Committable Rooms Program. (3) Execute the Operating Covenants which shall include provisions regarding continuing use, maintenance, non-discrimination, and such other provisions as the City Council in its sole discretion, may reasonably determine are necessary or appropriate to preserve the goals and intent of this Chapter. (c) To qualify for the Hotel Operations Incentive Program for Existing Hotels, the Operator of each Existing Hotel shall: (1) Complete and submit to the City Manager, the City's application for participation in the Hotel Operations Incentive Program, including documentation satisfactory to the City certifying the renovation project for an Existing Hotel as a Qualified Renovation Program. (2) If requested by the City, subscribe to the Palm Springs Convention Center's Committable Rooms Program- 4 356523 1 (3) Execute the Operating Covenants which shall include provisions regarding continuing use, maintenance, non-discrimination, and such other provisions as the City Council in its sole discretion, may reasonably determine are necessary or appropriate to preserve the goals and intent of this Chapter. 5.26.040 Incentive Program (a) First Class New Hotels. The City shall pay to an Operator of a First Class New Hotel an amount equal to fifty percent (50%) of the Adjusted Tax Rate. Such payments shall be made for twenty (20) years or until the Operator has been paid Fifty Million Dollars ($50,000,000.00), whichever event occurs first. Without regard to any preceding conditions of this Section, the Program shall terminate at any point the First Class New Hotel is not operated as a First Class Hotel. (b) New Quality Hotels. The City shall pay to an Operator of a New Quality Hotel an amount equal to fifty percent (50%) of the Adjusted Tax Rate. Such payments shall be made for ten (10) years or until the Operator has received Twenty-Five Million Dollars ($25,000,000.00), whichever event occurs first. Without regard to any preceding conditions of this Section, the Program shall terminate at any point the New Quality Hotel is not operated as a New Quality Hotel. (c) Existing Hotels. The City shall pay to an Operator of an Existing Hotel an amount equal to fifty percent (50%) of the Transient Occupancy Tax Increment collected and remitted to the City pursuant to Chapter 3.24 of this Code. Such payments shall be made for ten (10) years, or until the Operator has been received Twenty-Five Million Dollars ($25,000,000.00), whichever event occurs first. Without regard to any preceding conditions of this Section, the Program shall terminate at any point the Existing Hotel is not operated as a Hotel. 5.26.050 Operating Covenants (a) Each Operator eligible to participate in the City's Hotel Operations Incentive Program shall execute Operating Covenants negotiated with the Operator, approved by the City Council, and recorded with the County of Riverside Recorder's Office. 5.26.060 General Fund Revenues Notwithstanding the provisions of Sections 3.24.030, 3.24.035, and 3.24.310 of this Code, all Transient Occupancy Tax Revenues or Transient Occupancy Tax Increment remitted to the City by an Operator of a hotel covered by Operating Covenants as provided in this Chapter shall be deemed General Fund revenues of the City and shall be deposited in the City's General Fund. Section 3. The City Council of the City of Palm Springs has, as a result of its consideration and the evidence presented at hearings on this matter, determined that, as required pursuant to the California Environmental Quality Act ("CEQA") and the State CEQA Guidelines, that this Ordinance provides for a method of funding the continued 5 556523 1 operation and maintenance of previously approved and or existing first class hotel facilities. On the basis of this review, the City Council finds that there is no evidence from which it can be fairly argued that the approval of this Ordinance will have a significant adverse effect on the environment. The City Council hereby certifies and approves this determination and directs that an appropriate Notice of Determination be prepared and filed with the County Clerk of the County of Riverside in the manner required by law. Section 4. The Mayor shall sign and the City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same, or the summary thereof, to be published and posted pursuant to the provisions of law and this Ordinance shall take effect thirty (30) days after passage. 5.26.070 Administrative Rules and Regulations Consistent with the intent and goals of this Chapter, the City Manager may adopt administrative rules and regulations for implementation and furtherance of the requirements of this Chapter. PASSED AND ADOPTED THIS 9th DAY OF January, 2008. AYES: Councilmember Hutcheson, Councilmember Mills, Councilmember Weigel, Mayor Pro Tern Foat, and Mayor Pougnet. NOES: None. ABSENT: None. ABSTAIN: None. CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. I, JAMES THOMPSON, City Clerk of the City of Palm Springs, California, do hereby certify that Ordinance No. 1730 is a full, true, and correct copy, and was introduced at a regular meeting of the Palm Springs City Council on December 12, 2007, and adopted at a regular meeting of the City Council held on January 9, 2008, by the following vote: AYES: Councilmember Hutcheson, Councilmember Mills, Councilmember Weigel, Mayor Pro Tern Foat, and Mayor Pougnet. NOES: None. ABSENT: None. ABSTAIN: None. James Thompson, City Clerk City of Palm Springs, California 6 SSG52? I