CITY OF CARMEL-BY-THE-SEA

CITY COUNCIL
Staff Report

October 2, 2018
CONSENT AGENDA

TO: Honorable Mayor and City Council Members

SUBMITTED BY: Sharon Friedrichsen, Director of Budget and Contracts

APPROVED BY: Chip Rerig, City Administrator

Resolution No. 2018-105, Granting Consent to the City of Monterey to Establish the
SUBJECT:
Monterey County Tourism Improvement District

RECOMMENDATION:
Resolution 2018-105, Granting Consent to the City of Monterey to Establish the Monterey County Tourism
Improvement District.

BACKGROUND/SUMMARY:
Lodging businesses located within the City of Carmel-by-the-Sea are currently part of the Monterey County
Tourism Improvement District (MCTID). The MCTID is a benefit assessment district that assess all lodging
businesses within the unincorporated areas of Monterey County and within various Monterey Peninsula cities in
order to fund marketing and sales promotion efforts intended to increase room night sales. As part of the
MCTID, both the County and the various cities collect the assessments from the lodging establishments located
within their respective boundaries and then disperse these funds, less the one percent administration fee, to the
Monterey County Convention and Visitors Bureau (MCCVB), which is tasked with administering the MCTID.

The MCTID was established in 2006 under State law known as the Parking and Business Improvement Area
Law of 1989 (1989 Law). In addition to the 1989 Law, tourism business improvement districts may also be
formed under the Property and Business Improvement District Law of 1994 (1994 Law). With the onset of this
newer law, many tourism improvement districts have undergone a process to be disestablished under the 1989
Law and then reconstituted under the 1994 Law. (The Carmel Hospitality Improvement District went through a
similar process in November 2015- January 2016). One of the primary differences between these two models is
that the 1994 Law allows a district to be formed for up to five years initially with a renewal term of up to ten years, as
compared to the 1989 Law that allows a district to be formed and renewed for a one-year term.

In order to initiate this process, the City of Monterey adopted a resolution of intent to establish the MCTID
(under the 1994 Law) during its August 21, 2018 meeting. During the same meeting, the City of Monterey also
adopted a resolution requesting the consent of the Monterey County jurisdictions to create the MCTID. As such,
the purpose of this agenda item is for the City of Carmel-by-the-Sea Council to adopt a resolution granting
consent to the City of Monterey to establish the MCTID. The City of Monterey will hold public hearings on the
establishment of the MCTID and its intent to levy an assessment on lodging businesses within the District on
September 18, 2018 and October 16, 2018.
A summary of the MCTID salient features includes the following components:
It includes all lodging businesses within the unincorporated areas of Monterey County and the cities of
Carmel-by-the-Sea, Del Rey Oaks, Marina, Monterey, Pacific Grove, Sand City Salinas and Seaside;
It is designed to provide specific benefits to payors by generating room night sales. Group sales and
services and marketing communications programs will generate overnight tourism and market Monterey
County as a tourist, meeting and event destination, thereby generating room night sales for the assessed
lodging businesses.
It anticipates an annual budget for the initial year of its five-year operation of approximately $4,542,000.
It includes an annual assessment rate for Zone 1, which includes the City of Carmel-by-the-Sea, of $2.00
per paid occupied room per night for full service lodging businesses and $1.00 per paid occupied room
per night for limited service lodging businesses.
During the MCTID’s five-year term, the assessment rate may be increased by the MCCVB’s TID
Committee to a maximum of $3.00 per paid occupied room per night for full service lodging businesses
and $1.50 per paid occupied room per night for limited service lodging businesses in Zone 1.
It will have a proposed five-year duration of January 1, 2019 through December 31, 2023.
It will require cities and the County to collect the assessment on a monthly, bimonthly or quarterly basis
from each lodging business located within their boundaries.
It will designate the MCCVB as the “Owners’ Association” that is charged with managing funds and
implementing programs outlined within the Management District Plan.
FISCAL IMPACT:
The City will be required to collect the assessment on a bimonthly basis from each lodging business located
within its boundary. The City is allowed to keep one percent of the assessments as an administration fee. The
administration fee for Fiscal Year 2017-2018 was $3,069.

PRIOR CITY COUNCIL ACTION:

Council adopting Resolution 2006-042 on July 11, 2006 that granted consent to the City of Monterey to form the
Monterey County Tourism Business Improvement District and adopted Resolution 2006-073 on December 5,
2006 to enter into agreement with the Monterey County Convention and Visitors Bureau to administer
the Monterey County Tourism Business Improvement District .

ATTACHMENTS:

Resolution Granting Consent

 CITY OF CARMEL-BY-THE-SEA Attachment 1
CITY COUNCIL

RESOLUTION NO. 2018- 105

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA GRANTING CONSENT

TO THE CITY OF MONTEREY TO ESTABLISH THE MONTEREY COUNTY TOURISM IMPROVEMENT
DISTRICT

WHEREAS, the City of Monterey is beginning the process to establish the Monterey County Tourism
Improvement District (MCTID) pursuant to the Property and Business Improvement District Law of 1994, Streets
and Highways Code section 36600 et seq., to promote tourism and the lodging businesses in Monterey County;
including the cities of Carmel-by-the-Sea, Del Rey Oaks, Marina, Monterey, Pacific Grove, Salinas, Sand City,
and Seaside; and

WHEREAS, the City Council of the City of Monterey has requested consent to establish the MCTID in
the City of Carmel-by-the-Sea with adoption of City of Monterey City Council Resolution No. 18-143, dated
August 21, 2018

NOW THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF CARMEL-BY-
THE-SEA DOES HEREBY:

Section 1: The above recitals are true and correct.

Section 2: The City Council consents to the City of Monterey establishing, operating, and renewing the
MCTID, which District shall include the City of Carmel-by-the-Sea.

Section 3: The City Clerk is hereby directed to transmit a certified copy of this Resolution to the Monterey
City Clerk.

Section 4: This Resolution is effective upon its adoption.

PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA this
2nd day of October 2018, by the following roll call vote:

AYES: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:

ABSTAIN: COUNCILMEMBERS:

SIGNED: ATTEST:

_______________________ ______________________
Steve G. Dallas, Mayor Thomas A. Graves, MMC
City Clerk