Title
Authorization to Enter Into Agreement for FY 2021-22 and to Extend FY 2017-18 Agreement for Tourism and Hospitality Advisory Board Funds (Ordinance S-48114)
Description
Request to authorize the City Manager, or his designee, to enter into a contract with the Greater Phoenix Convention and Visitors Bureau (GPCVB) for FY 2021-22 Tourism and Hospitality Advisory Board (THAB) funds and to extend the FY 2017-18 THAB funding agreement with GPCVB for five additional years. Further request authorization for the City Controller to disburse all funds related to this item.
Report
Summary
The Tourism and Hospitality Advisory Board (THAB) is the City of Phoenix Board that, annually, reviews and recommends projects and/or programs that enhance the City's tourism and hospitality industry. The 14-member board is comprised of eight hoteliers (one from each Council district), two at-large members from hospitality related industries, two citywide representatives, one non-voting representative from City staff, and one non-voting member from the GPCVB. For FY 2021-22, $500,000 is appropriated for tourism and hospitality initiatives.
The hospitality industry has begun to gradually recover from the global Coronavirus pandemic. Robust booking activity for future conventions, trade shows and events in 2022 and beyond bodes well for the destination however, the industry continues to be impacted by the cancellation and/or postponement of some conventions, meetings and trade shows.
Procurement Information
The 2021-2022 funding recommendation is in accordance with City of Phoenix Administrative Regulation 3.10, following the approved City of Phoenix Request for Agreement (RFA) procurement process.
On September 21, 2021 at the THAB meeting, the GPCVB presented the proposed FY 2021-22 funding request and scope of work for consideration. In partnership with GPCVB, the current funding proposal will help aid in stimulating the local tourism and hospitality industry and assist in increasing activity to hotels and businesses in the local area; many impacted by the current pandemic. Under the proposal, the GPCVB will utilize THAB funding in the following areas to support the City's tourism and hospitality industry now and over the next several years:
Convention Client Hosting Obligations ($150,000) - Represents nine meetings and conventions to be held at the Phoenix Convention Center between June 2022 and November 2023. It is anticipated that these nine groups will generate approximately 48,000 convention attendees, more than 63,000 hotel room nights and more than $494 in direct spending for every dollar invested.
Phoenix Convention Center Promotional Support ($25,000) - Funds will be used to attract and support new convention business contracted during FY 2021-22 or later. The funds will assist newly contracted groups with support in areas of rental abatements, IT costs, AV costs, registration, or transportation assistance. GPCVB is targeting groups planning to host meetings or events during identified Phoenix Convention Center and Phoenix-area hotel need periods or short-term bookings exploring meeting options in the destination for 2022.
Mega Event Support for the 2023 NFL Super Bowl ($200,000) - Funds will be utilized to offset expenses, such as facility costs, personnel, public safety, traffic barricades and street closures, fan and media events and other such hosting costs. This will be the fourth year of a five-year request to support the Super Bowl in 2023.
Mega Event Support for the 2024 NCAA Men's Final Four ($125,000) - Funds will be utilized to offset expenses, such as facility costs, personnel, public safety, traffic barricades and street closures, fan and media events and other related hosting costs. This will be the third year of a five-year request to support the NCAA Men’s Final Four tournament in 2024.
Additionally, during the September 21, 2021 THAB meeting, the GPCVB presented the results of prior year agreements. It was noted that the 2017-18 THAB funding request secured numerous events that were scheduled to take place in 2020 and 2021. As a result of pandemic related cancellations or postponements, the 2017-18 THAB funds will not be fully expended prior to the expiration of the contract. Accordingly, THAB has recommended that the 2017-18 THAB funding agreement with GPCVB approved by City Council on October 4, 2017 under ordinance S-43953 be extended an additional five years to allow time for events postponed to be rebooked in future years or be replaced with like events.
Contract Term
The contract term is five years with no extension options.
Financial Impact
The budget will not exceed $500,000 over the life of the contract. Extending the term for the FY 2017-18 THAB funds agreement with GPCVB would result in no additional cost to the Phoenix Convention Center. THAB is funded through the Sports Facilities Fund, which is the hospitality industry's share of special excise taxes on hotel/motel lodging and rental cars.
Concurrence/Previous Council Action
The Economic Development and Equity (EDE) Subcommittee recommended approval of this item by a 4-0 vote at its October 27, 2021 meeting. This item was also unanimously approved by the Tourism and Hospitality Advisory Board at its September 21, 2021 meeting.
Department
Responsible Department
This item is submitted by Deputy City Manager Inger Erickson, and the Phoenix Convention Center Department.