The Oro Valley Town Council expressed its faith in the Tucson Regional Economic Opportunities (TREO) and Metropolitan Tucson Convention and Visitors Bureau (MTCVB) during the June 20 meeting, but the decision to approve funding for each organization didn’t come without some debate.
Funding for TREO, totaling $41,011 for the 2012-2013 fiscal year was approved unanimously, while MTCVB saw a 5-2 vote in favor of a three-year contract with the organization, which is designed to attract tourism to the region and Oro Valley.
In the financial participation agreement, the Town will fund the MTCVB for $74,970 the first year, $120,000 in the second year, and $175,000 in the third year.
TREO will receive $41,011 in a one-year contract with the Town, with an option to renew.
Councilman Mike Zinkin was the first to express a concern over a three-year contract with the MTCVB, an opinion shared by councilman Brendan Burns and councilman Bill Garner.
Zinkin said he didn’t think it was fair for he and Burns, the newcomers to council, to be asked to vote on a three-year commitment when they are dealing with MTCVB for the first time.
“I personally, as a member of council haven’t seen one year of the MTCVB,” said Zinkin. “I think it should be a one-year contract.”
Mayor Satish Hiremath said he respected the fact that Burns and Zinkin were new to council, and reminded them they could abstain from a vote.
While Zinkin would eventually vote in favor of the three-year contract, he called for amendments to the agreement, one of which would obligate the MTCVB to specify benefits specific to Oro Valley and not simply the region.
“These are things where I can look at members of the community, because it is their money, and I can say you’re getting your money’s worth,” said Zinkin.
Councilwoman Mary Snider took issue with a one-year contract, arguing that the MTCVB has proven its worth in the past, and deserves a lengthier commitment from the Town.
Snider referred to the USA Triathlon’s Duathlon Nationals in April, which brought a reported $477,000 to Oro Valley, courtesy of the MTCVB.
“That’s a significant return on a $74,000 investment, and that is just one event,” said Snider.
Snider argued that regional partnerships with organizations like the MTCVB are a key to Oro Valley’s economic success, and that the investment in MTCVB is also an investment in Oro Valley.
The conversation then shifted to Councilman Lou Waters and Garner. Waters called partners in regionalism “the new norm,” while Garner rebutted the statement, saying the new norm is financial accountability.
“The days of opening up the government’s wallet to give out money without the impact of that money have ended,” said Garner.
Garner pointed out that signing a one-year contract with the MTCVB would result in no loss of money to the bureau, while also allowing the Town to reexamine the contract at the end of the year.
Burns said he believes the economic status of Oro Valley is still too fragile to adopt a three-year financial agreement. Burns and Garner each expressed their faith in new MTCVB CEO Brent DeRaad and the bureau’s potential results, but voted against funding based on the contract term.
DeRaad acknowledged some of council’s concerns by saying he would be happy to demonstrate Oro Valley-specific results in future reports.
According to communications administrator Misti Nowak, the increase in funding each year is designed to align with the recovering economy and to match the contribution levels of other jurisdictions. The City of Tucson currently pays 20 percent of its Bed Tax funds into MTCVB, Pima County pays 50 percent, and Oro Valley pays 10 percent.
“By the end of the three-year period, when we’ve increased our contributions to $175,000, we’ll be at approximately 20 percent, which is on par with the other groups paying into MTCVB,” said Nowak.
In part, the financial participation agreement obligates the MTCVB to generate 275 convention sales leads for Oro Valley properties, conduct 35 customer interaction/site inspections for Oro Valley properties, confirm 12 convention bookings for future dates, and confirm convention bookings for future dates resulting in 6,000 room nights.
Hiremath was the last to speak on MTCVB. Though he agreed with Zinkin’s call for measurable metrics in the MTCVB reports, he wholeheartedly voiced support for “showing good faith” to the bureau by supporting a three-year contract.
The debate over TREO funding was met with less resistance than in the past, though several residents questioned why such controversial items are being placed on a consent agenda, rather than a regular agenda.
Waters and Hornat, the two Oro Valley councilmembers to attend TREO’s recent leadership exchange meeting in San Diego, each said the trip was beneficial, economically informative, and undeserving of the negative media attention it has received.
Waters’ written remarks on the trip can be read on Explorernews.com.
TREO CEO Joe Snell addressed council concerns over whether TREO would be willing to include specific deliverables to Oro Valley in its financial reports, to which he agreed. Snell also agreed to shorten the length of the annual financial audit from four months to 30 days after board approval.
Snell went on to address the importance of regional partnerships.
“We do have a common goal, and there are enough people who believe in that, and a large number of corporate executives all sitting at the table and putting substantial money, sometimes in excess of $50,000-$100,000 of their corporate money, because they believe in an organization that’s not perfect, but has one single mission, and that’s to improve their economy.”
As discussions on TREO wrapped up, the Town looked at the potential of creating a mixed-use land designation as part of the General Plan for zoning development. Currently, the code requires limitations on combining residential and commercial zones into a single planned area development. The mixed-use designation would allow integrated commercial and residential zones in single development of vertical and/or horizontal structures.
The item was not set for formal action, and was eventually held for further discussion at a later meeting.
Another agenda item saw the discussion and eventual approval of an additional $1.55 million for the expansion of the Oro Valley Aquatic Center.
The original $3.45 million budget approved last December proved insufficient as the bid process and planning has gotten underway.
Hornat adamantly supported funding.
“This is something we promised to the public, and it’s something we need to deliver,” he said.
The original $3.45 million in funding was split between Excise Tax Revenue Bonds, parks and recreation impact fees, and the Bed Tax Fund.
The additional $1.55 million will come from reallocated funding from Wal-Mart ($250,000), the Bed Tax Contingency Reserve ($300,000), General Government Impact Fees ($95,000), General Fund Contingency Reserves ($524,000), and Council Designated Reserves ($386,000).