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BACKGROUND REPORT
SUMMARY
On November 15, 2011 the Council adopted a Resolution of Intention to Form the
National City Tourism Marketing District. The NCTMD is being formed pursuant to the
Property and Business Improvement District Law of 1994 (1994 Law). The 1994 Law
requires submission of signed petitions from assessed businesses, adoption of a
resolution of intention, a public meeting for comment, and a public hearing. After
adoption of the resolution of intention, a notice of the public meeting and public hearing
was mailed to affected lodging businesses. Mailing of the notice began a forty-five (45)
day period in which lodging businesses may protest district formation. If, after the close
of the forty-five (45) day period and the public hearing, no majority protest exists (a
majority protest is defined as written protest submitted by 50% lodging businesses,
which protests are weighted by the amount each business will pay), Council may adopt
this Resolution.
DISCUSSION
Tourism improvement districts have been widely used throughout California; there are
currently fifty-nine tourism districts throughout the state, and the concept has spread to
other states including Washington and Montana. Tourism districts create a stable
funding source for destination marketing tied directly to the lodging industry. Funds
raised by the district are collected by the city and returned to a private non-profit
corporation, which manages the funds in accordance with a written Management District
Plan. The Management District Plan is attached hereto as Exhibit A. It is proposed that
the National City Chamber of Commerce be the management corporation for the
district. If the district is formed, the City would enter into a contract with the Chamber
for management of the district funds.
Adopting this resolution will create the district and place a two and one-half percent
(2.5%) assessment on all hotels within the City. Lodging businesses within the City
have requested Council begin the process of forming a tourism district. A listing of
hotels proposed to be included in the district is attached to the Management District
Plan. Businesses which will pay 70.4% of the proposed assessment have submitted
petitions in favor of forming the district, which exceeds the legal requirement of 50%.
The clerk has not received any opposition to the proposed district.
Adopting this Resolution is the final step in the district formation process.