WEBVTT 00:00:00.000 --> 00:00:11.840 Good morning, everyone. Welcome to this meeting of the City of Denton Hotel Occupancy Tax 00:00:11.840 --> 00:00:19.280 and Sponsorship Committee. It is 10.03 a.m. on June the 11th. Our first item on the agenda 00:00:19.280 --> 00:00:27.640 is hold a discussion and appoint a committee chairperson. Council Member Armitage. 00:00:27.640 --> 00:00:35.360 I would like to nominate Jesse Davis. I'll second that. Mr. Davis, I presume you're 00:00:35.360 --> 00:00:40.200 okay with that? Yes, thank you, Deb. I appreciate that and 00:00:40.200 --> 00:00:42.080 accept the nomination. Okay. 00:00:42.080 --> 00:00:46.440 Yes, sir. Do we need an official vote on that, I presume? 00:00:46.440 --> 00:00:51.600 Yes, sir. It's all in favor of Council Member Davis 00:00:51.600 --> 00:00:56.440 becoming the new chairperson of the Hotel Occupancy Tax and Sponsorship Committee signified 00:00:56.440 --> 00:00:59.520 by saying aye. Aye. 00:00:59.520 --> 00:01:04.720 Aye. All right. Motion carries unanimously. It is 00:01:04.720 --> 00:01:11.520 your meeting, Mr. Chairperson. Wonderful. Thank you, sir. With that, we'll 00:01:11.520 --> 00:01:18.680 move on to item 1B, consider approval of the minutes from May 14, 2020. Is there a motion 00:01:18.680 --> 00:01:24.920 to approve or any discussion on the minutes? I move to approve. 00:01:24.920 --> 00:01:29.000 I'll second. There's been a motion and a second. All 00:01:29.000 --> 00:01:31.440 those in favor say aye. Aye. 00:01:31.440 --> 00:01:35.680 Aye. Any opposed? None. So the minutes are approved 00:01:35.680 --> 00:01:40.960 from the May 14th meeting. Moving on to item 1C, receive a report, hold 00:01:40.960 --> 00:01:45.280 a discussion and provide recommendations regarding a budget change for Denton County 00:01:45.280 --> 00:01:49.680 Friends of the Family. And I believe we have a, do we have a presentation on this one or 00:01:49.680 --> 00:01:53.880 just conversation? No, sir. I just have a conversation. The 00:01:53.880 --> 00:01:58.760 Denton County Friends of the Family is a sponsorship recipient this year who already received their 00:01:58.760 --> 00:02:07.480 $1,500 to help put on a Friends of the Badge luncheon this year. And due to the situation, 00:02:07.480 --> 00:02:12.520 they are moving it to some type of virtual event in the next couple of months. And so 00:02:12.520 --> 00:02:17.400 they're asking that their $1,500 budget, which was earmarked in the contract for a venue 00:02:17.400 --> 00:02:24.740 cost, be moved to other items such as plaques and gift cards for the recipients of the event 00:02:24.740 --> 00:02:28.960 that they will still be able to have but do it virtually. So that is the main ask. And 00:02:28.960 --> 00:02:32.840 I will just have to amend the contract with your approval of this item, which will be 00:02:32.840 --> 00:02:38.540 executed by the city manager. Okay. Is there a motion on this item or any 00:02:38.540 --> 00:02:47.160 conversation? Councilmember Armitage. I move to approve. I'm happy to have conversation 00:02:47.160 --> 00:02:51.100 if others want to, but I'm fine with that. Yeah, I'll second that motion. 00:02:51.100 --> 00:02:56.180 Okay, there's a motion second for approval of this item. All those in favor? 00:02:56.180 --> 00:02:57.180 Aye. Aye. 00:02:57.180 --> 00:03:06.860 And opposed? I'll vote aye as well. And that item is approved. Item 1D, receive a report, 00:03:06.860 --> 00:03:11.480 hold a discussion and provide recommendations regarding hotel occupancy tax revenue and 00:03:11.480 --> 00:03:19.040 hotel occupancy tax and sponsorship expenses for current year FY 2019-20. 00:03:19.040 --> 00:03:25.120 Okay, there is a presentation on this one. So I will share my screen and give me a second 00:03:25.120 --> 00:03:44.480 to bring that up. All right. Everybody see that? There we go. Okay. This item is being 00:03:44.480 --> 00:03:53.000 brought to you. It's a little bit of a repeat from our last meeting. We are going to discuss 00:03:53.000 --> 00:03:59.160 the current year shortfalls and we gathered information from the recipients per your request 00:03:59.160 --> 00:04:02.960 from the last meeting. So we'll have that embedded in here. But the first couple of 00:04:02.960 --> 00:04:08.400 slides are a little repetitive. So it's just an overview of what we're going to talk about 00:04:08.400 --> 00:04:11.880 and then we'll get into more details about the actual recipients feedback that they provided 00:04:11.880 --> 00:04:18.560 to us in this last week. So our objectives are just to go over the hot program, the revised 00:04:18.560 --> 00:04:22.920 estimates, the recipient feedback, and then any discussions or recommendation you'd like 00:04:22.920 --> 00:04:29.680 to give to staff. So the program overview is that the applications are presented to 00:04:29.680 --> 00:04:39.560 the subcommittee meeting annually. We estimate revenues and establish the funding recommendations 00:04:39.560 --> 00:04:46.320 and request to you annually during usually the June or July meeting this year. Each recipient 00:04:46.320 --> 00:04:52.160 is provided with a contract that has an approved budget use of funds and how those budgets 00:04:52.160 --> 00:04:58.160 are paid out can be anything from a lump sum to four quarters spread throughout the program 00:04:58.160 --> 00:05:06.080 year. The quarterly reports that are embedded in the contract as requirements come in 30 00:05:06.080 --> 00:05:13.400 days after the finished quarter. And then the program year is from January 1 to December 00:05:13.400 --> 00:05:22.320 31, for hot recipients. Currently we have 19 contracts that are administrated in this 00:05:22.320 --> 00:05:28.960 calendar year. The majority do receive 25% of their budget in four quarterly payments. 00:05:28.960 --> 00:05:33.680 We have a few others that have lump sum payments and we have a few others that have two payments 00:05:33.680 --> 00:05:37.560 that will give them their full budget depending on where their event is throughout the program 00:05:37.560 --> 00:05:44.240 year. We also have three city departments or committees that receive funding as well. 00:05:44.240 --> 00:05:49.560 We have the Public Art Committee that receives at least 2.4% of the hotel revenue projected 00:05:49.560 --> 00:05:53.700 for this current year. We also have the Civic Center and the Waterworks Park. Those are 00:05:53.700 --> 00:06:01.640 all internal recipients that use their funding within the city's fiscal year. Last meeting 00:06:01.640 --> 00:06:07.260 we had a question on how we work the fiscal year with the program year for the recipients. 00:06:07.260 --> 00:06:11.600 So we created this little timeline here and I think the most important thing we need to 00:06:11.600 --> 00:06:19.760 note on this one is in Q4, the city's last quarter in September, I actually cut those 00:06:19.760 --> 00:06:25.320 checks out of the current fiscal year and I hold those until the next month for the 00:06:25.320 --> 00:06:29.120 recipients to actually receive those. So they receive them in the fourth quarter but I still 00:06:29.120 --> 00:06:37.680 have my four quarter payments in the actual fiscal year of the city. So this is a slide 00:06:37.680 --> 00:06:42.480 that has been updated for you. The year to date column is the main one that has been 00:06:42.480 --> 00:06:48.320 updated and we have received one more month of revenue from the hotel properties and that's 00:06:48.320 --> 00:06:58.720 where you will see the 1.4 million. We received $83,000 for April business which is 75% below 00:06:58.720 --> 00:07:05.360 budget and they also reported to me about 24% in occupancy for the entire month of April. 00:07:05.360 --> 00:07:11.800 So that is the first and largest decline we have seen since the COVID-19 has come into 00:07:11.800 --> 00:07:17.120 play. March receipts were down a little bit but really in April we saw a large decline. 00:07:17.120 --> 00:07:23.320 >> Mr. Chair, can I ask a question? >> Absolutely. Mayor Watts. 00:07:23.320 --> 00:07:29.160 >> I know that with our sales tax, that's usually like for March sales tax, we'll get 00:07:29.160 --> 00:07:35.000 them in mid-June. Is it the same timetable for the hotel occupancy taxes? 00:07:35.000 --> 00:07:39.120 >> The occupancy taxes run a month delay. So the year to date you see in front of you 00:07:39.120 --> 00:07:44.400 with the 1.4 is October business through April business. 00:07:44.400 --> 00:07:53.240 >> Okay. Okay. 1.4. So you're saying then for May, our May numbers will come in about 00:07:53.240 --> 00:07:56.200 when? >> The end of June. The end of this month. 00:07:56.200 --> 00:07:59.880 So hopefully when we meet in July, I'm going to have only one more month with me. 00:07:59.880 --> 00:08:05.960 >> Okay. All right. Because I just -- I mean, I know April probably is going to be the worst 00:08:05.960 --> 00:08:12.840 month hopefully. So typically then you're saying we would get about $300,000 -- between 00:08:12.840 --> 00:08:19.120 $250,000 and $300,000 a month in hotel taxes budgeted? 00:08:19.120 --> 00:08:24.520 >> Well, we kind of extrapolate it out depending on the time of year. But this time last year, 00:08:24.520 --> 00:08:27.960 we got about $275,000. And the current year budget was $313,000. 00:08:27.960 --> 00:08:33.200 >> Okay. All right. Thank you. Appreciate it, Chair. Thank you, sir. 00:08:33.200 --> 00:08:42.420 >> Yeah. So a related question. And I apologize first because I used to serve on the CVB board. 00:08:42.420 --> 00:08:46.840 So I know that somewhere I have this information that I can look up. I just didn't have -- I 00:08:46.840 --> 00:08:54.080 wasn't able to before the meeting. But can you say off the top of your head, Randy, when 00:08:54.080 --> 00:09:05.680 in general are the times of feast and famine in the hotel occupancy in City of Denton? 00:09:05.680 --> 00:09:12.400 >> I could probably take an educated guess. I'm no expert. But I know obviously the summer 00:09:12.400 --> 00:09:19.240 months are pretty good. And we also have the NASCAR races, amazingly enough, would fill 00:09:19.240 --> 00:09:25.520 our hotels. In addition to the university's graduations and football games and parents 00:09:25.520 --> 00:09:31.000 weekends, those were a lot that also brought full capacity to the city. Other than that, 00:09:31.000 --> 00:09:36.960 we were pretty average. We stayed pretty well to meet budget over the whole year. But those 00:09:36.960 --> 00:09:42.120 upticks, you know, were in the spring with some of the events and then some fall information 00:09:42.120 --> 00:09:47.920 as well. >> Thank you. Thank you. 00:09:47.920 --> 00:09:55.800 >> Yes, ma'am. The other items that have changed on this slide since last time is the last 00:09:55.800 --> 00:10:01.480 three lines, estimated unspent funds, which we will go over in detail in future slides. 00:10:01.480 --> 00:10:07.960 But under the estimate column, recipients, hot recipients only have estimated that they 00:10:07.960 --> 00:10:15.200 are not going to use $476,000 in the full budgets that they have received, whether it's 00:10:15.200 --> 00:10:24.000 due to canceled events, postponed events, doing less than they have in years past. And 00:10:24.000 --> 00:10:28.720 those are just some savings that they foresee and project in their own budgets. And we will 00:10:28.720 --> 00:10:34.280 have that in detail. So that original change in fund balance when we brought to you last 00:10:34.280 --> 00:10:42.840 time was the million dollars, and then the estimated unspent is currently 476,989, which 00:10:42.840 --> 00:10:50.240 we will illustrate in the next slide. So this is the hot current year program 20. We have 00:10:50.240 --> 00:11:00.680 a budget of $2.5 million. And so far, the applicants or recipients have spent 655,000. 00:11:00.680 --> 00:11:06.480 They're estimating to spend another 1.3, and then the unspent balance that they're projecting 00:11:06.480 --> 00:11:14.800 is the 476,989. And at this point, we have 15 events that are planning their events as 00:11:14.800 --> 00:11:22.560 normal and adjusting for anything that comes through any declaration or any CDC rules and 00:11:22.560 --> 00:11:28.200 regulations. We have four events that created a new date within their contract, and they'll 00:11:28.200 --> 00:11:32.520 still be having their event. They've just adapted a little bit. And then we have four 00:11:32.520 --> 00:11:40.720 events that were completely canceled. So that is the overall status of our current recipients. 00:11:40.720 --> 00:11:46.840 And in detail, you've seen the next two slides, which there's many events, so we have to take 00:11:46.840 --> 00:11:53.440 it in two slides. So this slide shows you in the first column, the payments each organization 00:11:53.440 --> 00:11:59.900 has received so far, the name of their event, the name of their organization, if they've 00:11:59.900 --> 00:12:05.560 canceled or if they have not, and then their budget and all their expenses are expected 00:12:05.560 --> 00:12:11.780 to spend. So I don't think we need to go over those line by line now. We may refer back 00:12:11.780 --> 00:12:18.360 to the slide when we get to the conversation, but your end right column will show you what 00:12:18.360 --> 00:12:23.980 is expected to be unspent for this event. And at the bottom right, you can see the total 00:12:23.980 --> 00:12:28.320 of the $469.99. And these are for the hot funds only. 00:12:28.320 --> 00:12:36.580 Randy, I do have a question on these slides before we move on. Are there any of these 00:12:36.580 --> 00:12:41.200 kind of, so we're preparing ourselves for the conversation ahead. Are there any of these 00:12:41.200 --> 00:12:47.720 that in your conversations with these groups, you had any kind of red flags, like, you know, 00:12:47.720 --> 00:12:51.520 the way you're talking about doing that event doesn't sound like it's going to be within 00:12:51.520 --> 00:12:57.760 the contract or you're talking about making some major changes that aren't really in line 00:12:57.760 --> 00:13:01.840 with the grant you're receiving. Are there any of those that we need to kind of be thinking 00:13:01.840 --> 00:13:09.000 about before we start the conversation? I think the only one that may take some 00:13:09.000 --> 00:13:14.240 consideration because they did not go into great detail. So a lot of them are adapting 00:13:14.240 --> 00:13:19.440 with all the CDC rules and projecting that hopefully, you know, more of the businesses 00:13:19.440 --> 00:13:25.580 and more of the processes are opening up so the events that are coming in August, September 00:13:25.580 --> 00:13:33.200 and November, you know, won't have any restraints. But the only one that has told me that they 00:13:33.200 --> 00:13:37.200 are doing something a little bit different is the current Juneteenth event happening 00:13:37.200 --> 00:13:42.680 within the next week. And they're doing something virtual. Is there a plan? They're showing 00:13:42.680 --> 00:13:48.280 here on the chart that they expect to spend $5,000 of their $21,000. I do not know exactly 00:13:48.280 --> 00:13:54.160 what those expenses are yet. But I think that would just be a conversation that we would 00:13:54.160 --> 00:13:59.300 have if you're interested in supporting a virtual event due to the Hot Fund expenditure 00:13:59.300 --> 00:14:08.640 statute and what it states those goals are. Councilmember Armitage? So can you explain 00:14:08.640 --> 00:14:16.440 why the Juneteenth event that council approved that's happening, that's kind of with another 00:14:16.440 --> 00:14:25.600 group in conjunction with the traditional Juneteenth group, why the Hot Funds can't 00:14:25.600 --> 00:14:34.200 be, you know, reallocated to that? I assume there's a very good reason, legal reason. 00:14:34.200 --> 00:14:41.320 But if you could just explain. Are you asking if this original budget could be or should 00:14:41.320 --> 00:14:47.400 be or might be moved to the new group that's talking about doing a Juneteenth event? Yeah, 00:14:47.400 --> 00:14:55.040 yeah. Juneteenth and Cinco de Mayo are right under a contract by the Denton Parks Foundation. 00:14:55.040 --> 00:14:59.280 So these funds belong to the Denton Parks Foundation, who these two organizations work 00:14:59.280 --> 00:15:05.400 under. And so those are two separate groups, first of all. The original Juneteenth that 00:15:05.400 --> 00:15:13.040 we see here that was approved for Hot Funds only has no association at this point with 00:15:13.040 --> 00:15:17.760 the new event. So in the auspices of the Hot Committee and the Parks Foundation, we're 00:15:17.760 --> 00:15:23.040 only talking about the original Juneteenth virtual event. I understand. So that would 00:15:23.040 --> 00:15:36.880 mean that legally, you know, it would be like having a new applicant pass the deadline, 00:15:36.880 --> 00:15:45.120 right, without having applied for Hot Funds. In other words, there's no legal basis grounds 00:15:45.120 --> 00:15:50.360 to shift those funds over to a different event. Is that right? Right. Number one, they haven't 00:15:50.360 --> 00:15:55.120 requested anything from the city Hot Group or sponsorship. And number two, it's the Parks 00:15:55.120 --> 00:16:05.040 Foundation's discretion to spend those funds. Yeah. Okay. Got it. Got it. Yes. Yes. Randy, 00:16:05.040 --> 00:16:11.560 just on this. So I understand what I'm looking at here. Estimated unspent balances. Those 00:16:11.560 --> 00:16:18.920 are the balances that when we surveyed all the recipients, they're saying, we probably 00:16:18.920 --> 00:16:24.840 aren't going to spend this money. I mean, is this a commitment to not spend this money 00:16:24.840 --> 00:16:33.240 or is this just some guesstimate? The request is to give us an estimate on what they thought 00:16:33.240 --> 00:16:42.120 they may not spend based on the current conditions. Okay. So it could change. Yeah, that means 00:16:42.120 --> 00:16:47.480 that it could change either way. Like when I'm looking at this, I see that the lion's 00:16:47.480 --> 00:16:56.040 share of that 460 or 476 is obviously the Chamber of Commerce, Denton Visitors, Discovery 00:16:56.040 --> 00:17:04.840 Denton Welcome Center. Do we have an idea of what those savings represent or what those? 00:17:04.840 --> 00:17:09.120 Yes. Okay. Not in great detail, but I can tell you that obviously the Welcome Center 00:17:09.120 --> 00:17:15.840 was closed for a little bit. So those expenditures were not expended. They have had some staff 00:17:15.840 --> 00:17:19.840 change. They had one or two from the Welcome Center depart completely, so they had salary 00:17:19.840 --> 00:17:26.360 savings. And then obviously they can't market a location that is technically closed and 00:17:26.360 --> 00:17:33.760 having no events. So I think there's just a broad spectrum of items that just weren't 00:17:33.760 --> 00:17:39.720 able to be used and expended. And so they can't spend a lot of time ramping up with 00:17:39.720 --> 00:17:44.960 the unknown on what events are going to come and what are not. So I think that is a good 00:17:44.960 --> 00:17:56.200 estimate of what they may truly not spend. Okay. And on the North Texas Fair and Rodeo, 00:17:56.200 --> 00:18:03.200 so in essence, so let me just back up. So the ones that don't have any estimated unspent 00:18:03.200 --> 00:18:09.920 balance means they're going to expend their full allocation of the hot funds allocation 00:18:09.920 --> 00:18:14.360 for this year, the budgeted amount. That is their expectation. Yes, sir. If they haven't 00:18:14.360 --> 00:18:22.440 spent it already with their event. Okay. And we're expecting to have a decrease in revenue 00:18:22.440 --> 00:18:34.600 of almost looks like the expectation is half. Correct. Okay. You are correct. And so then 00:18:34.600 --> 00:18:41.680 taking all the unspent, all the projected fund balance that we talked about last time, 00:18:41.680 --> 00:18:47.480 you're saying that if every, if this whole snapshot happened the way it is, then our 00:18:47.480 --> 00:18:55.800 fund balance would be $1.433 million at the end of this fiscal, at the end of this year, 00:18:55.800 --> 00:19:02.200 the hot funds year. Are you referring to this slide six up here in the 1.4 down there? Yeah. 00:19:02.200 --> 00:19:10.960 Well, the one point it says updated fund balance estimate is 1.433. At the end of yes, I am 00:19:10.960 --> 00:19:16.560 correct. Because it says 9.56 in the preliminary FY 2021. Right. But down here it looks like 00:19:16.560 --> 00:19:23.520 you're crediting out or adding back the estimated unspent funds. I think we're trying to show 00:19:23.520 --> 00:19:31.880 what the estimated unspent funds would do if we did choose to use that to help our shortfall 00:19:31.880 --> 00:19:39.040 in revenue. There's some things to play in that. Number one is that these are unspent 00:19:39.040 --> 00:19:44.120 funds and it's an estimate, first of all. And second of all, they normally don't come 00:19:44.120 --> 00:19:49.560 into play until the end of the contract year. They aren't due to return these funds until 00:19:49.560 --> 00:19:56.360 the end of their contract. So I won't be getting them until January of 2021, you know, or another 00:19:56.360 --> 00:20:02.440 possibility depending on the committee's interest is, you know, could we use this dollar amount 00:20:02.440 --> 00:20:11.040 to reduce the current allocations for these events as part of the strategy to take care 00:20:11.040 --> 00:20:16.840 of the deficit? So I mean, this is just a working estimate. There's definitely nothing 00:20:16.840 --> 00:20:22.840 in definition there on how to assist the shortfall. Okay. All right. Because I know last time 00:20:22.840 --> 00:20:29.440 when we when we saw this first estimate line without the estimated unspent and so forth, 00:20:29.440 --> 00:20:34.160 if we funded everybody for our contract, our fund balance dropped from two million to nine 00:20:34.160 --> 00:20:38.940 hundred and fifty six thousand. Correct. And it seemed like the conversation was, well, 00:20:38.940 --> 00:20:43.400 we didn't want to really make a decision yet. We wanted to see what the need was. And so 00:20:43.400 --> 00:20:48.080 that's the conversation we're having today. Okay. Okay. I'm sort of talking about to myself. 00:20:48.080 --> 00:20:54.920 So no worries. Yeah. You know, I think so. I think some of the conversation to it goes 00:20:54.920 --> 00:21:01.480 into do you want to try to handle this this year versus next year and consider the applications 00:21:01.480 --> 00:21:06.000 when they come forward? And Randy knows the specifics, but there's there's some there's 00:21:06.000 --> 00:21:12.400 some of the events that had expenses prior to the event being canceled that they're they're 00:21:12.400 --> 00:21:18.440 expended expensed contracts this year are going to carry over to next year. So it should 00:21:18.440 --> 00:21:25.760 lessen their request next year as well. So there is a nuance with each one. That's my 00:21:25.760 --> 00:21:32.000 mentor. Do you have a question? Actually, I realize I was just going to kind of start 00:21:32.000 --> 00:21:37.360 deliberating, but I just realized we're not really quite done. The the hot. So so let 00:21:37.360 --> 00:21:43.040 me know when when we're ready. Are we do we plan to discuss the hot funds and then move 00:21:43.040 --> 00:21:49.040 on to the sponsorships and discuss that separately? You know what, let's go ahead and Randy, if 00:21:49.040 --> 00:21:52.640 it's all right with you, let's go ahead and get through the sponsorship slides. I mean, 00:21:52.640 --> 00:21:57.000 it's just such a smaller pot of money to talk about. And then we can come back and talk 00:21:57.000 --> 00:22:01.680 because I think we probably think about it more in terms of events and money expended 00:22:01.680 --> 00:22:05.920 by event than we do, you know, which bucket of money it comes from. So let's get through 00:22:05.920 --> 00:22:14.000 those first. OK, so here was the last slide on the hot hot current status, which shows 00:22:14.000 --> 00:22:19.800 the four seventy six nine eighty nine. Let's see what is next here. So the next is the 00:22:19.800 --> 00:22:25.200 sponsorship budget, which is very short amount of information. The current budget for that 00:22:25.200 --> 00:22:30.640 is eighty seven to fifty five. They've all received their money already. There's no shortfall. 00:22:30.640 --> 00:22:35.880 There's no revenue that is depicting what happens in this in this fund. So we have seven 00:22:35.880 --> 00:22:41.760 that are planning their event as normal to do have a new date within the contract, and 00:22:41.760 --> 00:22:46.840 we do have six that are canceled. So they have expended fifty eight thousand of the 00:22:46.840 --> 00:22:53.240 eighty seven as you can see here. The next slide will just go into the details of those. 00:22:53.240 --> 00:22:57.000 So here we have whether they're canceled or not canceled, how much they're spent on their 00:22:57.000 --> 00:23:03.120 budget and then what again what they're expected to return to the city. So it falls in the 00:23:03.120 --> 00:23:09.840 same character as the hot funds, except for we don't have to make any shortfall decisions 00:23:09.840 --> 00:23:17.480 in this fund. So this shows that currently unspent estimated balance is twenty two thousand 00:23:17.480 --> 00:23:25.840 three eighty two of the total. So this one really is just a general update to let you 00:23:25.840 --> 00:23:29.840 know what the status is and that they are trying to move forward as best they can within 00:23:29.840 --> 00:23:34.360 their program year, which is our fiscal year. So this one is a little bit different. They 00:23:34.360 --> 00:23:38.840 do all have their money. They have received it and they're just adapting as they go. And 00:23:38.840 --> 00:23:48.600 the ones that will be canceled will be returning their funds once. Yes. And this goes back 00:23:48.600 --> 00:23:53.560 to David's comment. So let's just take this slide number eleven, the sponsorship current 00:23:53.560 --> 00:23:59.920 status. So when I look under the Fourth of July fireworks, I see twenty five thousand 00:23:59.920 --> 00:24:05.820 and my understanding is that's primarily to have purchased the fireworks. That is correct. 00:24:05.820 --> 00:24:11.480 They already have them. And so what we're saying and I'm trying to OK, like Arts and 00:24:11.480 --> 00:24:17.500 Jazz Festival, I guess my point being if somebody has spent money to purchase something for 00:24:17.500 --> 00:24:23.220 an event that they haven't used or they're not going to be able to use, are we anticipating 00:24:23.220 --> 00:24:28.600 that their budgets will their ask will be reduced by those funds or that they're I mean, 00:24:28.600 --> 00:24:32.320 the twenty five thousands already been spent. So next year, let's say, for example, I would 00:24:32.320 --> 00:24:38.120 think the Kiwanis would only be asking for fifteen thousand because that is the conversation 00:24:38.120 --> 00:24:41.560 that we will have because there's two here that you just pointed out. And the hot funds 00:24:41.560 --> 00:24:46.120 also have the arts and jazz in it. And she's and that has spent thirty thousand for the 00:24:46.120 --> 00:24:51.780 hot. OK, so what we can do and what we've talked about, pardon me, is that the ones 00:24:51.780 --> 00:24:56.320 that have expended and will be participating in the programs next year, we will amend their 00:24:56.320 --> 00:25:02.040 contract so that the twenty five thousand dollars for this one or the thirty thousand 00:25:02.040 --> 00:25:07.500 dollars for arts and jazz and hot will be included and afforded to expand to the twenty 00:25:07.500 --> 00:25:13.160 twenty one year. And then that will be in consideration for July 4th. They always ask 00:25:13.160 --> 00:25:18.400 for forty thousand. So when they ask for twenty twenty one, it will be less of the pyrotechnics 00:25:18.400 --> 00:25:28.200 they've already paid for. If that is the direction you all provide to us. OK, thank you. And 00:25:28.200 --> 00:25:39.840 are any other questions on sponsorship? OK, that's the last page. So that's the end of 00:25:39.840 --> 00:25:47.360 the slideshow. And what we're requesting is that the discussion we had from the last meeting, 00:25:47.360 --> 00:25:53.520 you all are. I'll bring this down if we need to. There we go. That you all were going to 00:25:53.520 --> 00:25:57.120 take a more tailored approach. So we came back this time with the itemized information 00:25:57.120 --> 00:26:02.400 from each each organization, whether it be hot or sponsorship, which I think hot obviously 00:26:02.400 --> 00:26:11.080 needs to be provided more more background. But we have those tailored itemized. Budgets, 00:26:11.080 --> 00:26:14.240 if you will, what they're expending, what they're not expending and what they're planning 00:26:14.240 --> 00:26:22.800 to do with their vets. So we are open to take whatever direction you all already speak with. 00:26:22.800 --> 00:26:28.240 So can you help us understand to let's say this doesn't happen too often. The city has 00:26:28.240 --> 00:26:35.600 to ask for its money back in these kind of deals. Can you tell us how that I know when 00:26:35.600 --> 00:26:42.040 you cut the checks, I know when you write the contracts, if an event, some event doesn't 00:26:42.040 --> 00:26:48.240 happen as planned, they don't expend the money as they plan to something goes different. 00:26:48.240 --> 00:26:54.200 At what point do we have kind of accountability over that? And if they've already been issued 00:26:54.200 --> 00:27:00.960 a check for that quarter, or maybe we're in Q4, and they've already got all their money, 00:27:00.960 --> 00:27:05.420 and their event doesn't go as expected, they don't spend what they expected to, they spend 00:27:05.420 --> 00:27:09.220 funds in a way that's different from what we would have been what we really budgeted 00:27:09.220 --> 00:27:13.880 for them to, how does that process go? If we have to have those kind of more difficult 00:27:13.880 --> 00:27:21.320 conversations, the hot process is a quarterly one. And so they get quarterly funding, and 00:27:21.320 --> 00:27:26.360 then they have to report to me 30 days after that what they spend it. And so that goes 00:27:26.360 --> 00:27:30.160 throughout the year. And then when we get to the December mark, and they have money 00:27:30.160 --> 00:27:36.080 left on the table, they report to me by the January and provide another quarterly report 00:27:36.080 --> 00:27:42.500 with the amount of unspent funds. So whether they have their event, or they had a rainout, 00:27:42.500 --> 00:27:47.840 or maybe they got some advertising given in kind that they were planning on spending, 00:27:47.840 --> 00:27:54.240 and they didn't spend it, whether it's $500,000 or $10,000, that quarterly reports will keep 00:27:54.240 --> 00:27:59.200 me in the process throughout the entire year. And that fourth quarterly report when we finalize 00:27:59.200 --> 00:28:03.160 that number will show the imbalance due to the city. And I would collect those funds 00:28:03.160 --> 00:28:07.440 in January of the following calendar year. 00:28:07.440 --> 00:28:15.960 Okay. So, and it looks like just kind of cocktail napkin numbers, we're expecting about 50% less 00:28:15.960 --> 00:28:23.520 in revenue in the hot funds. We have expected to be, the return to us are not expended, 00:28:23.520 --> 00:28:33.040 somewhere between like 18, 19%. So we've got, you know, a 25 or 30% shortfall, basically, 00:28:33.040 --> 00:28:40.160 but we've got to decide whether we just eat that through the fund, or we go start amending 00:28:40.160 --> 00:28:44.280 contracts and making changes and cutting budgets. Is that about right? 00:28:44.280 --> 00:28:51.360 Yes, sir. Whether we do it in the current year, reduction, use fund balance, or, you 00:28:51.360 --> 00:28:53.600 know, adapt the next year as well. 00:28:53.600 --> 00:28:58.200 And I would add, obviously, that's contingent on those estimates, and the estimates that 00:28:58.200 --> 00:29:04.640 we got are not binding in any way. So if we follow the current process, we just kind of 00:29:04.640 --> 00:29:09.600 have to wait until December and see what comes in and see where we stand. So we wouldn't 00:29:09.600 --> 00:29:15.000 know that going into the fiscal year. And obviously, as things continue to change each 00:29:15.000 --> 00:29:21.680 month, it is possible that some of these events come back sooner than they think. 00:29:21.680 --> 00:29:32.600 So for me, you know, my thinking on this is, I look at, you know, where is most of the 00:29:32.600 --> 00:29:41.960 money going to? And obviously, it's to the Chamber of Commerce, as CBB, Discovery, Denton, 00:29:41.960 --> 00:29:55.080 and Welcome Center. And I think, you know, how cannot be reduced and reallocated, and 00:29:55.080 --> 00:30:07.760 then, and thinking about kind of the function of that in terms of tourism in Denton, which 00:30:07.760 --> 00:30:20.640 is the reason for being of hot funds, and kind of thinking about the non-quantifiable 00:30:20.640 --> 00:30:30.320 in dollars, you know, impact of what that would mean for tourism in Denton, and also 00:30:30.320 --> 00:30:36.840 thinking about in terms of dollars, you know, what the impact would be in reducing that 00:30:36.840 --> 00:30:56.000 budget. So I look to reduce from there, and then I look at the second biggest expenses, 00:30:56.000 --> 00:31:08.640 the triple digit, I mean, six figure expenses, and, you know, and when it comes to those, 00:31:08.640 --> 00:31:16.840 you know, I'm not, for me, it's more difficult to think about how cuts should happen or shouldn't 00:31:16.840 --> 00:31:26.240 happen. So for me, kind of the big question for me personally is how much to reduce from 00:31:26.240 --> 00:31:36.840 that biggest piece of the pie, and then the question that we talked about this past season 00:31:36.840 --> 00:31:48.800 about the county, and you know, I still feel like I did then that, you know, I feel uncomfortable 00:31:48.800 --> 00:31:59.880 with us giving hot funds to another taxing entity. The county is unique in that among 00:31:59.880 --> 00:32:09.080 all of these. So anyway, that's just kind of where I stand in my thinking on this. That's 00:32:09.080 --> 00:32:13.440 how I'm approaching this, if that makes sense. 00:32:13.440 --> 00:32:23.560 Thank you. Mayor Watts? Oh, you're on mute, Mayor. 00:32:23.560 --> 00:32:34.680 Okay, now I get to be on the other side of it. Yeah. So what I'm hearing is that, well, 00:32:34.680 --> 00:32:43.280 for me, these unspent funds aren't necessarily them taking a cut. It's just whatever they 00:32:43.280 --> 00:32:47.920 were going to be spending them on, it just hasn't occurred. Like, let's say, for instance, 00:32:47.920 --> 00:32:52.760 in the Chamber of Commerce, this isn't them saying, oh, we're going to cut our spending 00:32:52.760 --> 00:32:58.160 from now to the end of the year so that we can save hot funds money. This is saying we 00:32:58.160 --> 00:33:02.680 didn't have to pay rent. We didn't have to pay utilities, really. We didn't have all 00:33:02.680 --> 00:33:07.520 those expenses with being open, and we've lost some salary. So this is a reallocation 00:33:07.520 --> 00:33:14.760 or reanalysis of their budget. So this isn't necessarily money that an organization is 00:33:14.760 --> 00:33:21.760 having to take a hit on. They're not being defunded a portion of their budget that they 00:33:21.760 --> 00:33:26.760 need. This is the amount of money that they're saying they don't need as far as an estimate. 00:33:26.760 --> 00:33:31.200 Is that my understanding? That is what they presented, is there are 00:33:31.200 --> 00:33:36.840 some shortfalls due to some salary savings, which are a fact, but they've also taken the 00:33:36.840 --> 00:33:42.600 time to look at their whole budget to see what's more realistic. If they didn't need 00:33:42.600 --> 00:33:49.320 to, could they spend more than they are here? Possibly, if they were given direction and 00:33:49.320 --> 00:33:55.600 we could go forward, but this is their estimate with some solid salary savings and reducing 00:33:55.600 --> 00:34:01.640 some things that they had to during the closings. So for me, I don't really have any heartburn 00:34:01.640 --> 00:34:14.160 either way on how we handle this, except that I don't want to have the entire shortfall 00:34:14.160 --> 00:34:19.200 whether they're, you know, I'm glad we have this unspended amount. So if they just kept 00:34:19.200 --> 00:34:23.400 the money, let's say, or I guess if they don't spend it, do they technically have to give 00:34:23.400 --> 00:34:26.840 it back? I mean, legally? Yes, sir. It's in the contract. 00:34:26.840 --> 00:34:31.080 Okay. So if that all stays the same, then they're going to have to write us a check 00:34:31.080 --> 00:34:37.160 back. And so that would go straight into the reserve fund, the fund balance. Is that correct? 00:34:37.160 --> 00:34:40.520 Yes. All right. Then I guess I'm trying to understand 00:34:40.520 --> 00:34:46.760 when you say either take care of it this year or next year, what were you, help me understand 00:34:46.760 --> 00:34:51.880 what you were describing there? We could reduce and during the last meeting 00:34:51.880 --> 00:34:56.560 in May, kind of laid out some of those, you could decide to reduce the fourth quarter 00:34:56.560 --> 00:35:01.600 payment to the entities. And that would be kind of handling it this year as opposed to 00:35:01.600 --> 00:35:05.620 just letting the process play out the way it is in the contract where we would get those 00:35:05.620 --> 00:35:13.320 funds back next fiscal year. Okay. Great. Honestly, I'm probably okay with 00:35:13.320 --> 00:35:20.000 the latter approach, as long as those people have indicated savings that we can pretty 00:35:20.000 --> 00:35:25.800 much, I know it's an estimate, but that we can rely upon that because the fund balance 00:35:25.800 --> 00:35:32.080 is, it looks good to me at the end of this year, even if we have the short, if they pay 00:35:32.080 --> 00:35:36.400 the money back, we're at 1.4. So that means we pulled about half a million out of the 00:35:36.400 --> 00:35:40.400 fund balance to help with this. And I don't think that's unreasonable. That is part of 00:35:40.400 --> 00:35:44.480 the reason we have the fund balance. The other is, is to ensure that if something comes along 00:35:44.480 --> 00:35:48.300 that's good for tourism, that we have some funds that we can move towards that. 00:35:48.300 --> 00:35:54.480 So I'm comfortable with if it plays out as indicated in this line under estimate on page 00:35:54.480 --> 00:36:03.860 six, slide six, with an updated fund balance of 1.433, I say we just put a stake in the 00:36:03.860 --> 00:36:09.240 ground and then next year we'll look at the analysis based upon what we see moving forward. 00:36:09.240 --> 00:36:12.600 Because by the time we look at the budget, or somebody looks at the budget too, I guess 00:36:12.600 --> 00:36:19.160 we'll look at the budget this year, we'll have an idea of what May and June collections 00:36:19.160 --> 00:36:27.040 are, which will indicate, you know, how are we coming back and things such as that. So 00:36:27.040 --> 00:36:34.800 I'm okay with, as it seems to be laid out, just getting the money back per the contract. 00:36:34.800 --> 00:36:40.360 As long as it's real close to this amount, quite frankly, I mean, and I don't know if 00:36:40.360 --> 00:36:43.920 we need to send something out saying to people, look, this is sort of what we're anticipating. 00:36:43.920 --> 00:36:48.400 If you don't, it's really far off from what you estimated not to spend, we need to have 00:36:48.400 --> 00:36:51.880 some understanding of that. So people just don't go out and spend it just because they 00:36:51.880 --> 00:36:55.280 can because we haven't said we're going to reduce your budget. So I want to make sure 00:36:55.280 --> 00:37:02.200 we have some kind of benchmark in that regard. So that's where I am on it. I mean, I'm okay 00:37:02.200 --> 00:37:06.840 if it plays out this way to just move forward with the new fund balance at 1.4 or approximately 00:37:06.840 --> 00:37:07.840 there. 00:37:07.840 --> 00:37:11.800 Councilmember Armenter, did I see your hand a moment ago? 00:37:11.800 --> 00:37:16.420 Yes, but then I realized that you had not yet weighed in Councilmember Davis, so I want 00:37:16.420 --> 00:37:18.680 to hear you. 00:37:18.680 --> 00:37:23.160 Thank you. No, I think you both raise excellent points. The only thing I would really add 00:37:23.160 --> 00:37:28.680 to the conversation is the purpose of these funds is exactly what we're talking about. 00:37:28.680 --> 00:37:34.440 An event happens that puts heads on pillows in hotels and that generates additional hot 00:37:34.440 --> 00:37:40.960 revenue. Some of these, I'll just pull the rodeo out for one, that's an event that we 00:37:40.960 --> 00:37:45.680 know puts heads on pillows. We know from the community markets economic analysis, we know 00:37:45.680 --> 00:37:54.000 they put some heads on pillows. And so I would say if we were to at this point, not being 00:37:54.000 --> 00:37:59.240 even I guess we're halfway through the program year, a little more through the fiscal year, 00:37:59.240 --> 00:38:03.280 if we were to start pulling back money now or making big cuts now or forcing people to 00:38:03.280 --> 00:38:09.120 reevaluate events, we're kind of shooting ourselves in the foot on future hot funds 00:38:09.120 --> 00:38:18.320 revenue. It looks to me like some of these events are going to need, you know, our economic, 00:38:18.320 --> 00:38:24.480 our hotel tourism industry needs the injection of cash, frankly. These events need to happen 00:38:24.480 --> 00:38:29.000 or this industry is going to take a big hit. So I think for all those reasons, I agree 00:38:29.000 --> 00:38:34.840 that the mayor said put a stake in the ground. I was going to say that we let it ride whatever 00:38:34.840 --> 00:38:40.720 metaphor or cliche you want to use. It seems like the conversations that we're needing 00:38:40.720 --> 00:38:45.720 to have with the program entities, they know we're watching, they know that we're curious 00:38:45.720 --> 00:38:48.480 about how they're going to spend their money and how they're going to run their events. 00:38:48.480 --> 00:38:53.520 They know that we're expecting those reports just like we do every year. But that's not 00:38:53.520 --> 00:38:59.480 a reason necessarily to start cutting budgets yet. I think we let it ride for now. Councilmember 00:38:59.480 --> 00:39:09.400 Armit. So thank you. So obviously, it's that's the consensus. I just want to just to kind 00:39:09.400 --> 00:39:18.560 of check with the two of you about the question. And by the way, I agree with you Councilmember 00:39:18.560 --> 00:39:33.160 Davis that something like the rodeo that has an impact on what the funds will be for next 00:39:33.160 --> 00:39:43.360 year is really important. And for me, that goes for all of the events. But again, when 00:39:43.360 --> 00:39:50.120 it comes down to it, it's these two of the Welcome Center, which I know helps to promote 00:39:50.120 --> 00:40:00.200 these events, right. And then the issue of the county, which for me is a separate issue 00:40:00.200 --> 00:40:05.560 of just kind of their their own taxing entity, you know, should we be kind of giving to the 00:40:05.560 --> 00:40:13.760 county in the first place, not nothing about the quality of this, of what they do and its 00:40:13.760 --> 00:40:18.880 ability to put heads of heads on beds and or whatnot. So, you know, those two issues 00:40:18.880 --> 00:40:29.000 are important to me. If I would like to, if it were up to me, I guess, you know, I would 00:40:29.000 --> 00:40:38.560 say look at the remainder of what's left in this, not in the estimated unspent balance, 00:40:38.560 --> 00:40:42.960 but in the expected to spend category. You know, in other words, what they haven't spent 00:40:42.960 --> 00:40:51.560 yet that they expect to spend. And I see that, you know, Welcome Center $830,000. And the 00:40:51.560 --> 00:41:04.760 county where the county go, $30,000. So we've got, yeah, you know, and add that to the $35,000. 00:41:04.760 --> 00:41:13.400 So anyways, we've got $30,000 from the county, $830,000 from Chamber of Commerce, the Welcome 00:41:13.400 --> 00:41:17.680 Center that they still expect to spend. I would like to see that come back into the 00:41:17.680 --> 00:41:25.000 fund for next year. And if they would have, I would like to see all of it from the county 00:41:25.000 --> 00:41:35.480 and from the Welcome Center, you know, I would like to ask them how do you, you know, how 00:41:35.480 --> 00:41:44.880 are you justifying this $830,000 and kind of give it a, give that more scrutiny than 00:41:44.880 --> 00:41:50.840 we normally would, you know, because of the circumstances. So anyway, it sounds like that's 00:41:50.840 --> 00:41:56.800 not the consensus, but I just, I wanted to let you know kind of more specifically that 00:41:56.800 --> 00:42:04.000 that's where I'm standing. And, you know, I'm curious if either of you have any input 00:42:04.000 --> 00:42:10.680 on that for now, or you'd rather just not discuss it since the consensus isn't there. 00:42:10.680 --> 00:42:17.880 I'm fine either way. Well, I think you raise a, you raise good points. What would you think 00:42:17.880 --> 00:42:24.320 about coming back to those items say in the late July or August timeframe, because my 00:42:24.320 --> 00:42:28.960 thinking is we don't have projections yet through the summer. You know, normally we 00:42:28.960 --> 00:42:33.420 have some summer events, we can kind of expect what some of our revenues are going to be 00:42:33.420 --> 00:42:37.000 for the summer. But I mean, things could be different just in a couple of months as things 00:42:37.000 --> 00:42:42.760 either open up or open up more slowly than anticipated, or there could be some changes. 00:42:42.760 --> 00:42:49.560 My concern with the, I'm not going to weigh in on the county aspect, but on the CVB and 00:42:49.560 --> 00:42:53.160 Chamber of Commerce, my concern would be some of those are kind of what I'll call fixed 00:42:53.160 --> 00:43:01.320 or structural costs, you know, personnel running the Welcome Center, things that if they turn 00:43:01.320 --> 00:43:04.800 the lights on, the electric bill is going to be the same regardless of people are coming 00:43:04.800 --> 00:43:09.920 in or not, you know. So I'd kind of like to get some more, before we started talking about 00:43:09.920 --> 00:43:13.880 pulling back from their budget, I'd really like to get some more granularity from them 00:43:13.880 --> 00:43:19.080 on what are you, how are you spending, what are you spending? We know there's some kind 00:43:19.080 --> 00:43:25.200 of intuitive savings from the COVID situation, but also what are you, what are you doing differently? 00:43:25.200 --> 00:43:28.760 Like Randy said, you know, they're not, the Welcome Center wasn't open, they weren't, 00:43:28.760 --> 00:43:33.160 they weren't advertising spaces, they weren't promoting Denton as the destination during 00:43:33.160 --> 00:43:39.600 some of those times, but at the same time, maybe that industry, they stepped some things 00:43:39.600 --> 00:43:44.360 up that they didn't necessarily do last year. Maybe they're advertising in two publications 00:43:44.360 --> 00:43:51.200 instead of one for third quarter of the year, you know. So maybe just later in the summer, 00:43:51.200 --> 00:43:56.240 we could get before the end of our fiscal year, before those September cut and hold 00:43:56.240 --> 00:44:03.400 checks get cut, we can get an update on those big, those big ticket items. Would that be 00:44:03.400 --> 00:44:06.840 okay? Yes, absolutely. Absolutely. I would love that. 00:44:06.840 --> 00:44:09.280 Randy, it looks like you've got something to say. 00:44:09.280 --> 00:44:16.600 I would just like to note of the Chamber CVB's $1.3 million budget, only $235,000 of that 00:44:16.600 --> 00:44:22.360 is the Welcome Center. So we do, we do have that broken out and it's all salaries. 00:44:22.360 --> 00:44:30.400 Okay, thank you. All salaries. Okay, sure. Thank you. Yeah. So maybe, yeah, so, yeah, 00:44:30.400 --> 00:44:34.680 the next time this comes to us, when we see this, because we'll, I imagine, what is it, 00:44:34.680 --> 00:44:39.320 did you say August, when it comes to July, August? I just threw those out, maybe late 00:44:39.320 --> 00:44:49.160 August, early, late July, early August, because before the fair is what, mid August, so, or 00:44:49.160 --> 00:44:54.040 early to mid August. We won't have their numbers back, but we'll maybe at least have another 00:44:54.040 --> 00:44:59.000 month or two of revenue numbers under our belt and we'll know a little bit better what 00:44:59.000 --> 00:45:03.080 we're looking at. Yeah, yeah, so that, yeah, that sounds good. 00:45:03.080 --> 00:45:09.080 And so when that, when that time comes, I myself would love to see, in addition to the 00:45:09.080 --> 00:45:18.840 slides like this, that these slides that just break everything down, like an Excel sheet, 00:45:18.840 --> 00:45:25.520 a separate slide on CVB, Chamber of Commerce. I'm not saying don't include it in this list 00:45:25.520 --> 00:45:33.760 of everything else, but also something else that really gives that a bit more attention, 00:45:33.760 --> 00:45:38.480 the breakdown of that. Sure. Well, it sounds like Mayor Watts, did 00:45:38.480 --> 00:45:44.600 you have something else to add? Yeah, just real quick. Help, remind me when 00:45:44.600 --> 00:45:50.520 the committee will begin to look at allocations for the next budget year. When are we starting 00:45:50.520 --> 00:45:54.400 to do that? Is that next month? Yes, we are a month behind, technically. We 00:45:54.400 --> 00:46:00.000 usually do this in June, because our budget process goes along with the city. So I'm going 00:46:00.000 --> 00:46:05.640 to put out the applications for HOT in sponsorship today. And they're going to be back the first 00:46:05.640 --> 00:46:11.240 week of July, next week, July 16, when we should be making decisions and recommendations 00:46:11.240 --> 00:46:17.880 on 2021. So in one month, I'll only have one more month of revenue to forecast and look 00:46:17.880 --> 00:46:24.440 at for 2021. We'll have to turn that budget into a budget. 00:46:24.440 --> 00:46:29.040 To me, that's going to be the real challenge. I mean, this is, you know, we're looking at 00:46:29.040 --> 00:46:34.200 this just, to me, the line where it says we've got a fund balance of 1.4, that's sort of 00:46:34.200 --> 00:46:38.280 worst case scenario unless somebody really spends a lot of money that they said they 00:46:38.280 --> 00:46:45.200 weren't going to spend. If somehow the Chamber of Commerce or the CVB doesn't spend the 830 00:46:45.200 --> 00:46:49.600 or the rodeo, which they will, that's the worst case scenario. The big challenge, and 00:46:49.600 --> 00:46:56.560 I think we need to somehow include this in the applications that go out, is that there's 00:46:56.560 --> 00:47:01.680 no way we're probably going to be able to, number one, do a very accurate forecast on 00:47:01.680 --> 00:47:07.920 the next year's revenue. And number two, it's probably not going to be, even if we could, 00:47:07.920 --> 00:47:13.040 it's going to be less than what we forecasted for this last year just because of everything 00:47:13.040 --> 00:47:19.440 drawing out and especially with cases going up and all these kinds of things. So that's 00:47:19.440 --> 00:47:24.480 going to be the challenges for these applicants to understand that even if they kept everything 00:47:24.480 --> 00:47:30.960 the same, their whole budget the same as they did this last year, it's very likely that 00:47:30.960 --> 00:47:36.880 we won't have the funds generated to be able to pay that is what my hunch is. But I could 00:47:36.880 --> 00:47:44.420 be wrong, but I think that's a, I mean, I think that's a very realistic scenario. So 00:47:44.420 --> 00:47:50.640 anyway, I want to just throw that out because next month will be a challenging discussion. 00:47:50.640 --> 00:47:55.120 Absolutely. And then the flip side of that challenge, too, is a lot of these, this is 00:47:55.120 --> 00:48:01.360 not the only revenue stream for a lot of these events. And there are other revenue streams 00:48:01.360 --> 00:48:04.760 are going to be challenged as well. So they're going to be coming to us, we're going to say 00:48:04.760 --> 00:48:08.360 there's less than the pot and they're going to say we need more from the pot than I did 00:48:08.360 --> 00:48:13.600 last year. And we're just going to have to, we're just going to work that out. It's going 00:48:13.600 --> 00:48:20.200 to be rough. Yes, Councilmember Armitage. Something that I've been thinking about and 00:48:20.200 --> 00:48:24.920 please who's in charge, I guess that would be Mac, just tell me if I'm off topic and 00:48:24.920 --> 00:48:28.120 then I'll put this in concluding remarks because this is something I planned on bringing up 00:48:28.120 --> 00:48:35.560 in concluding remarks, which is the next item. And my feelings won't be hurt if it is off 00:48:35.560 --> 00:48:40.320 topic. Would you, would you rather, I think, I think we're kind of at a stopping point 00:48:40.320 --> 00:48:46.800 with this one. Would you rather that we just move off this agenda and call concluding items? 00:48:46.800 --> 00:48:51.600 I'd rather just kind of put this out here first, just in case we could deliberate on, 00:48:51.600 --> 00:48:54.360 just in case that's a possibility. And by the way, the two of you might not want to 00:48:54.360 --> 00:49:02.020 in which case so, but I would be curious to know y'all's feedback on it if that's allowable. 00:49:02.020 --> 00:49:10.120 And that is that, you know, because Hot Funds is all about hotel revenue and the hotel industry 00:49:10.120 --> 00:49:19.440 is really struggling right now. And, you know, the amount of money that they bring in determines 00:49:19.440 --> 00:49:30.000 everything for these funds. I would like to have the, you know, people from the hotel 00:49:30.000 --> 00:49:42.480 industry or CVB, you know, people in CVB who are, who are focused on hotels, specifically 00:49:42.480 --> 00:49:51.320 hotel and tourism and to come before us and to tell us what kinds of ideas they have about 00:49:51.320 --> 00:49:59.720 new creative ways to bring in hotel revenue that could help, you know, amp up these funds. 00:49:59.720 --> 00:50:05.080 I'm not off topic, Mac, are you sure? Yeah. I think you're getting close to the line or 00:50:05.080 --> 00:50:13.920 maybe. Okay. So in which case then, my concluding remark will be really short. I'll just say 00:50:13.920 --> 00:50:18.520 what I said. But anyway, I did want to throw that out there in case there is any chance 00:50:18.520 --> 00:50:25.720 that to hear y'all's ideas on it. But I'm really curious to hear. I know that they're 00:50:25.720 --> 00:50:30.760 thinking about it. And by the way, I'm not saying that that we that this is a matter 00:50:30.760 --> 00:50:35.840 of like the city giving them money to do what they're talking about, but for us to hear 00:50:35.840 --> 00:50:43.920 what they're thinking about, have that conversation. Okay. Well, real quick to wrap up this agenda 00:50:43.920 --> 00:50:49.880 item and then come back on including items. Are there any other questions on kind of what 00:50:49.880 --> 00:50:56.520 sounds like the consensus to hold Pat and see how things go and then revisit this conversation 00:50:56.520 --> 00:51:02.080 in the late summer? Are there any other any other discussion or comment on that? Randy? 00:51:02.080 --> 00:51:08.280 I just want to clarify a couple of things that I need to walk away with the aspect of 00:51:08.280 --> 00:51:13.880 having some type of virtual expenses in the current year. If that is something we want 00:51:13.880 --> 00:51:18.880 to consider because we have one that is attempting to do that. And once that is done, there are 00:51:18.880 --> 00:51:25.080 others that may want to take that Avenue. So I need declaration on that. And then also 00:51:25.080 --> 00:51:34.480 on the couple events, arts and jazz and Kiwanis that have spent funds for this year that are 00:51:34.480 --> 00:51:39.540 going to be held over for next year that we can go ahead and accept that and let that 00:51:39.540 --> 00:51:46.660 play out in an amended contract for next year. Have those let's let's do that last one first. 00:51:46.660 --> 00:51:52.620 Have those groups said that's like I don't know how what the shelf life is a fireworks 00:51:52.620 --> 00:51:58.000 or if it's a if it's a store credit with the with the vendor, you know, we didn't we didn't 00:51:58.000 --> 00:52:02.120 pull those from your inventory. So we get them back. We can we can use them at a future 00:52:02.120 --> 00:52:07.960 date. Have those groups all indicated that that's their preference that the an amended 00:52:07.960 --> 00:52:14.480 contract to to allow the expenditures you're talking about or so far since they like for 00:52:14.480 --> 00:52:20.600 arts and jazz, it's a deposit for musicians. And so if we pull that back, then they no 00:52:20.600 --> 00:52:27.880 longer have the the artist or group set for the new date. So the deposit is holding those 00:52:27.880 --> 00:52:33.040 groups or performances for them and they can do that. They've already said they could. 00:52:33.040 --> 00:52:36.240 And so they've spent that money. They'd have to get the money back from the artist, pull 00:52:36.240 --> 00:52:41.280 it back in and then refund it to us and Kiwanis is just paid an invoice. They get a discount 00:52:41.280 --> 00:52:45.280 for paying in advance. I think they paid December of last year. So they don't actually have 00:52:45.280 --> 00:52:49.520 the fireworks or anything done. They just pay the invoice in advance. So both of those 00:52:49.520 --> 00:52:54.160 two entities that I know of are the main ones that are saying, you know, they'll hold it 00:52:54.160 --> 00:52:57.760 over for next year. We just need to do on our end. But we need to do them in the contract 00:52:57.760 --> 00:53:02.520 to allow them to do so. I think I find that deficit. So you kind of nodding your head 00:53:02.520 --> 00:53:07.460 there, too. I mean, both of those sound pretty reasonable. Oh, yeah. Actually, to me, I mean, 00:53:07.460 --> 00:53:13.040 those are my my dream answers. You know, number one, I was I'm glad you asked about that Castle 00:53:13.040 --> 00:53:19.840 member Davis. I was worried about do we have an enormous building full of fire because 00:53:19.840 --> 00:53:24.480 that's a lot of fireworks. So I was hoping that would be the answer. And, you know, how 00:53:24.480 --> 00:53:29.880 can we if that's the case, how can we protect it? But yeah, so I'm really glad. And then 00:53:29.880 --> 00:53:42.080 just knowing that this this money went to artists instead of for, you know, sunk cost 00:53:42.080 --> 00:53:47.320 in advertising for an event that's not going to happen. And I'm not saying the artists 00:53:47.320 --> 00:53:53.480 are just, you know, spend spend going and paying off their rent for an entire year with 00:53:53.480 --> 00:54:02.240 those deposits. But that makes me feel really good to know that. So anyway, I'm glad to 00:54:02.240 --> 00:54:08.720 hear both answers. And those are good questions. Thanks. Mayor, did you have anything on that? 00:54:08.720 --> 00:54:14.080 No, I think if we can just carry that over. But I think we need to communicate to those 00:54:14.080 --> 00:54:21.240 organizations that to fully expect that we expect that their contract ask next year will 00:54:21.240 --> 00:54:28.920 be minus whatever funds that they've held over for this year and have spent for parts 00:54:28.920 --> 00:54:34.200 of their event for the following year. And Randy, it looks like your other question 00:54:34.200 --> 00:54:40.320 was the the virtual events and the events that are kind of shifting what they're doing 00:54:40.320 --> 00:54:47.520 to a virtual event. My first thought there was if it's inside the contract that we that 00:54:47.520 --> 00:54:53.920 we have with them. And that's, that's kind of an easy call. Are you saying that there 00:54:53.920 --> 00:54:58.240 are some that would need a contract amendment because their budgets are very different? 00:54:58.240 --> 00:55:03.440 Or, or just kind of generally, what's the committee's feeling about that? I think it's 00:55:03.440 --> 00:55:08.720 a question of legality issue because of the the hot statute state, state the heads in 00:55:08.720 --> 00:55:12.280 beds and promoting tourism. If you have an online event, you don't have any tourists 00:55:12.280 --> 00:55:19.640 here or here to see that. So the the ones that are interested do have a budget already 00:55:19.640 --> 00:55:25.800 for musicians or site operation types of things that they could expend on it. But they would 00:55:25.800 --> 00:55:29.520 be spending on an event that was happening in person. And now they're they're trying 00:55:29.520 --> 00:55:34.360 to move that so it's really about missing the target of the statute of the heads in 00:55:34.360 --> 00:55:39.400 beds and promoting tourism. Can I give a lawyer answer? Maybe Matt can tell me how good it 00:55:39.400 --> 00:55:46.640 is. Maybe there's a stretch in the statute, maybe it's not. But, you know, we give CBB 00:55:46.640 --> 00:55:53.160 money, and they spend some of that money promoting Denton outside of Denton. Some of what they 00:55:53.160 --> 00:56:02.260 do is advertising outside of Denton, sending personnel to trade shows, and marketing opportunities. 00:56:02.260 --> 00:56:10.200 If we think of a virtual event as a marquee internet billboard for for Denton and for 00:56:10.200 --> 00:56:14.200 Denton tourism, and then not to mention an event, let's say, you know, everybody knows 00:56:14.200 --> 00:56:17.800 the arts and jazz festival is everybody knows what the blues festival is, people know about 00:56:17.800 --> 00:56:24.560 our Juneteenth celebration. If those events take a hiatus, you know, you miss a year and 00:56:24.560 --> 00:56:28.920 a big annual event, your attendance the next year may not be what it was the year before 00:56:28.920 --> 00:56:35.880 the one you missed. So I think there's some interest in promoting tourism and continuity 00:56:35.880 --> 00:56:41.760 of an event. Not to mention some of these events that can bring in, you know, headline 00:56:41.760 --> 00:56:48.400 acts and a musician. Maybe that musician is playing from their basement or their garage. 00:56:48.400 --> 00:56:53.920 But we're still saying in Denton, we rate the caliber of musician that is today playing 00:56:53.920 --> 00:56:59.080 from their garage, but next year, come back and see him in person. Mack, would that get 00:56:59.080 --> 00:57:02.600 us a little that kind of thinking get us a little closer to the statute? 00:57:02.600 --> 00:57:06.440 It does. Yeah, initially, when the COVID thing was happening, and just starting, there was 00:57:06.440 --> 00:57:09.320 some discussion about how these funds could be used throughout the state. A lot of cities 00:57:09.320 --> 00:57:14.080 were wrestling with it. And that's kind of the one area where there was some justification 00:57:14.080 --> 00:57:20.720 potentially to do some alternative funding with the hotel taxes is marketing specifically, 00:57:20.720 --> 00:57:25.280 which is allowed under the statute. But yeah, we'd have to look at specifically what they're 00:57:25.280 --> 00:57:30.400 planning to do and make sure that component of it's there, that the city actually is being 00:57:30.400 --> 00:57:35.880 marketed and promoted during their virtual event. But yeah, that's the one way you might 00:57:35.880 --> 00:57:41.520 be able to get there is through the marketing justification. Mayor, Councilmember Armenter? 00:57:41.520 --> 00:57:46.160 Mayor, I think I saw your hand first. Do you have any heartburn about that? 00:57:46.160 --> 00:57:51.760 Well, the only the only question I have is, if we make that policy decision, does that 00:57:51.760 --> 00:57:57.080 substantially change the estimate for the funds not spent? 00:57:57.080 --> 00:58:11.560 Right now, Juneteenth is the one that is promoting the the virtual event. And so they're only 00:58:11.560 --> 00:58:17.360 estimating to need $5,000 out there, 21 to do that. So those are the only facts that 00:58:17.360 --> 00:58:23.240 I know for virtual. I think others will consider it if things change. But if they can have 00:58:23.240 --> 00:58:26.240 in person events, they're going to do that first. 00:58:26.240 --> 00:58:34.200 Because didn't we really? Didn't our last agenda item sort of address that policy question 00:58:34.200 --> 00:58:38.040 indirectly because they went to a virtual meeting and we said that they could just go 00:58:38.040 --> 00:58:42.920 ahead and keep those funds for that virtual meeting? Is that it wasn't that decision sort 00:58:42.920 --> 00:58:45.600 of applied in that? Or did I miss something there? 00:58:45.600 --> 00:58:50.600 I don't recall the Friends of the Family event, the Friends of the Family, that sponsorship 00:58:50.600 --> 00:58:57.520 funds, which don't have any restrictions. So on the Juneteenth virtual, because there 00:58:57.520 --> 00:59:04.080 is going to be a Juneteenth in person. So I mean, it might be from a different group, 00:59:04.080 --> 00:59:11.160 but yet. Yeah, okay. So that's really the only one you're talking about is the $5,000 00:59:11.160 --> 00:59:16.720 for the Juneteenth. So far, yes, sir. And that won't change a contract amendment because 00:59:16.720 --> 00:59:21.560 they have this the funds to spend on those things already. And they just won't be physical. 00:59:21.560 --> 00:59:27.120 And so we can handle that within the staff. Yeah, okay. Are you okay with that Councilmember 00:59:27.120 --> 00:59:39.040 Armitage? Yes, I think as I understand it, can you just repeat it in a nutshell exactly 00:59:39.040 --> 00:59:50.840 what this means in terms of for the for funding? I think the if I can in Randy and Mac, tell 00:59:50.840 --> 00:59:56.760 me if I'm off here. But the question was, does a virtual event meet the qualifications 00:59:56.760 --> 01:00:03.000 for Hot Funds expenditures? The there's some wiggle room in the statute and how you interpret 01:00:03.000 --> 01:00:10.200 or how you read it. And that if you consider a marketing, excuse me, if you consider a 01:00:10.200 --> 01:00:16.920 virtual event, marketing for the city, then that's an allowable expenditure of Hot Funds. 01:00:16.920 --> 01:00:21.800 And so even if you don't have people coming into town, going to hotels, that kind of stuff, 01:00:21.800 --> 01:00:28.040 as long as the city sees it as a marketing tool, then that could qualify under Hot Funds. 01:00:28.040 --> 01:00:33.040 And then the mayor's question got us to that we're talking, talking really about roughly 01:00:33.040 --> 01:00:41.960 $5,000 is the are the funds in question. I guess the other possibility to though, with 01:00:41.960 --> 01:00:46.400 the other groups Juneteenth is if the Parks Foundation made a decision that they were 01:00:46.400 --> 01:00:52.000 going to become involved with the other groups event, they could still be within contract 01:00:52.000 --> 01:00:55.880 to do that. But to date, we haven't seen that they're gonna that they're gonna do that. 01:00:55.880 --> 01:01:02.920 Is that right? Correct. So far, they are not under the umbrella of the Parks Foundation, 01:01:02.920 --> 01:01:09.160 the new in person event. And this is the first year doing it. So, you know, they might work 01:01:09.160 --> 01:01:13.240 out a relationship. Okay, yeah, so excellent. And thank you. And I was just I was just want 01:01:13.240 --> 01:01:20.680 to make sure we weren't making a commitment about how a specific, you know, group versus 01:01:20.680 --> 01:01:27.240 another group could count their their virtual, you know, marketing, but it is just kind of 01:01:27.240 --> 01:01:31.400 an across the board way of way of looking at it. So I completely agree. I think that's 01:01:31.400 --> 01:01:45.080 great. You know, I wondered too about I'd be curious to know about what what kinds of 01:01:45.080 --> 01:01:52.920 ideas that the hotel industry might have about how hotels could be used for virtual events. 01:01:52.920 --> 01:02:00.640 I don't know if you, for instance, you know, if musical event where you have the, you know, 01:02:00.640 --> 01:02:09.840 you have a band that's playing from the hotel. So that would be a way that are we are we 01:02:09.840 --> 01:02:17.240 discussing the concluding items at this point? Oh, no, no. It's a little off. Yeah, okay. 01:02:17.240 --> 01:02:26.800 So, but my point being that a virtual event could use hotel space in a way that that brings 01:02:26.800 --> 01:02:32.680 in hotel revenue. It's what I'm saying. In other words, not putting heads on. Well, actually, 01:02:32.680 --> 01:02:39.720 it could even be putting heads on beds. So with that, Mac, you know, if a virtual event 01:02:39.720 --> 01:02:53.640 could be shown to use hotel space, contribute to hotel revenue, you know, with with with 01:02:53.640 --> 01:03:01.320 that count with that help. Well, it certainly puts us in a better position if the hotel 01:03:01.320 --> 01:03:05.600 is actually getting people to come in and use the hotel. If they're staying there, ideally, 01:03:05.600 --> 01:03:09.840 that's that's like, that's the gold standard. We need people to be in our hotels. That's 01:03:09.840 --> 01:03:14.760 the primary purpose. So yeah, anything along those lines would help. Yeah, but but does 01:03:14.760 --> 01:03:22.520 like hotels used as event space? Even if people don't stay the night, that's that is still 01:03:22.520 --> 01:03:31.760 hotel, hotel revenue, right? Or does the this hot funds? That's not occupancy revenue, right? 01:03:31.760 --> 01:03:40.680 Okay. Yeah, okay. Mayor, I see your hand there. Do you have something? No, no, I'm just, I'm 01:03:40.680 --> 01:03:46.280 just trying to keep the company. Yeah, I think we were all like, I'm just trying to, it sounds 01:03:46.280 --> 01:03:51.280 like it was related to the concluding item request of additional revenue. I probably 01:03:51.280 --> 01:03:56.000 didn't articulate it well enough. But yeah, I'm just trying to think about other ways 01:03:56.000 --> 01:04:07.120 that virtual events could, you know, could could fall under that the description of the 01:04:07.120 --> 01:04:12.800 legal description of hot funds and hotel revenue heads on beds. But you're right. So specifically, 01:04:12.800 --> 01:04:21.600 occupancy means occupying rooms overnight, right? Randy, are there any other unresolved 01:04:21.600 --> 01:04:28.720 issues we need to talk about in this conversation? I don't think so. Okay. Well, then that concludes, 01:04:28.720 --> 01:04:34.160 I think we don't need a motion for that. This is all kind of direction, correct? Yes. That 01:04:34.160 --> 01:04:39.280 concludes this agenda item. Our final agenda item is number two, concluding items. Councilmember 01:04:39.280 --> 01:04:44.240 Armenter, if I'm articulating this correct, you'd like to hear a report of some kind from 01:04:44.240 --> 01:04:52.320 CVB or the hotel industry about kind of how they see things unfolding from here and the kind of 01:04:52.320 --> 01:04:58.000 things that we could partner, partner with them on to put their industry in a better position 01:04:58.000 --> 01:05:04.240 going forward from the COVID crisis. Is that? Yes. Yeah. You know, and I would throw in the word 01:05:07.200 --> 01:05:13.280 creative and the word brainstorming, you know, so kind of for them to be asked, you know, what 01:05:13.280 --> 01:05:22.240 creative new ideas do you have? What brainstorming have you done about 01:05:22.240 --> 01:05:33.680 ways to bring in more hotel revenue, hotel occupancy expenses, tax revenue, 01:05:34.400 --> 01:05:40.160 that in the pre-COVID economy wasn't even something you would think about, you know? 01:05:40.160 --> 01:05:47.440 And I would be really surprised if we hear, oh, we haven't really given any thought to that. 01:05:47.440 --> 01:05:54.640 I'm sure people are spending every, you know, are losing sleep over that and people can get really 01:05:54.640 --> 01:06:01.840 creative in a crunch. So I would just love to know what all those ideas are. And I would also throw 01:06:01.840 --> 01:06:09.520 in the word obstacles too. I'd like to know from them, like what obstacles exist to, if any, to 01:06:09.520 --> 01:06:17.520 these different ways of conceiving, bringing in hotel occupancy tax and yeah, how can we, how can 01:06:17.520 --> 01:06:25.360 we help with that? Good deal. Randy, did you catch that? Yes, sir. Good. Any other concluding items? 01:06:25.360 --> 01:06:30.640 All right. With that, I think we've exhausted our agenda and I thank y'all so much for the 01:06:30.640 --> 01:06:38.800 work going into this and we'll see you the next time. Thank you. Thank you. Thanks.