you you you you you you you you you you you you you you you you you you you you you Thank you. Okay. Let's begin our meeting of finance mission Wednesday for 23rd, we can be five of five PM. Sure, let's say the plight. We're gonna use the flag and ask it. Use our newest member, welcome and you can lead us in the pl pledge. Sounds great. We're placed right hand over your hearts. Ready to begin. I pledge allegiance to the flag of the United States of America and to the Republic for which to stand one nation under God, indivisible with the prettiest and the dozens of wrong. Thank you. Thank you. Okay. In gates. Vice Chair of the Grasso. Here. Mr. Sisteron. Here. There's your bags. Here. There's your anthem. Here. There's your very here. Mr. Hamilton is absent. Here we have a quorum. Okay, public comments. The City welcomes public comments on agendas or non agendas items, but please know finance commission can take no action on the state unless the item is agendas. Each speaker may have up to three minutes unless the volume of speakers warrants reducing time allowance and cannot donate time to others. wishing to speak to can do so in one of two ways. You can do a fill out in person fill out a request to speak for them or in writing you can submit written comments via email. Do we have any speakers? We have two speakers. Personal and being occasional. It And Stefan? Back to our favorite topic, Little Arc. So I gave you guys each a handout, and I'm gonna go quick, but I have the new information, and I found all of them from Travis and Bush, you think it was there as well. So if you just look at it, the page is starting number three because it was from a bigger presentation. And the basic idea is I'm going to go over some new information I got by SIPRA. So the repayments are late if they're not paid within 30 days. There's two components, okay. There's a base which is every month, 44, 314 and there's a variable based on the revenue. So they pay the base the month of that month and then 30 days later they pay the variable. Now one thing you gotta understand is that late fees are 10% a month that they don't pay. When they pay that principal amount, that stops the clock on the late fees, but they don't have to pay the late fees then. The late fees could be paid 100 years for now. They would never go up. The clock stops when the payment is made for that rent, okay? And that's really important to know. There's no late fee on late fees if they pay it late. So Davis Far found another next page that they got is over 400,000 late fees from 419 to 2333 and also missing you in. And so the city sent and the voice to them, the next page on five on 77 team for 413 968. And there's the invoice. Then the general council for artists responded, visit the new stuff on 815 a month later. And he cited three reasons why they thought that the amount of city and boys was not okay with them. The first was they said that the amount of damage done didn't amount to the amount of the city billed them. So they just aren't gonna pay it. The second was that they didn't think that they were in boys and it, hiding it in fashion, so they're not going to pay it. And the third one was they said, you can't do compound interest, but this guy's an attorney not a mathematician, it's simple interest, not compound interest. So that's the mood on his face. So they sent a check to the city for 10% of late fees and didn't pay any additional late fees. We sent a check for a one 18 in to the city, 820. And we have it. And then the city sent back a response in February to them. So about six months later, saying that would they disagree with their response to us? Okay, they didn't agree that they were off the the hook and that they should pay us. And Arcus responded two days later on, February 14th saying that the General Counsel is leaving for out of the country and he always found when he gets back in the country. And that's the last thing that I had. So there's still paying ways I told you last time, I did get some new information. They owe us $42,042 from this year, $2,240 payments. So this is in addition to about the $300,000 they owe us now. So everyone's looking about $350, okay. So thank you very much. Well, what I want to say is let's go get the money and let's get some new to run that off for it. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. a few minutes, months because I'm quite concerned. Lots of fact in the research report. I've been talking about it for five to two minutes, months because I'm quite concerned about the fact that the original report has said that 60% of the dollars are related to systems that are on the verge of failure. I believe that the public safety of the people at high and debiuch at risk, and I think we should know that it's forward, it's working as possible. The other thing that I'm concerned about is that I hope when it comes to financing and the infrastructure through comments. The alternative is as far as how those minds would raise, it'll be as close to people finding the beach for this be through proper, you know, parcel taxes and or user fees that people need to know. In the last point, actually, I'll have time to move forward. The last point is, I've mentioned it to civic councilmaning is that in 2002, the city commission, it has a report on the environment. In the report, there were many items of potential and national disasters that occur in the city. I would encourage you all to read it. It's very silly. 60% of the city, for example, is subject to mucleification. There's a lot of methane mutation going on because after all, we built, we are built in an olive oil field. How would it hold that when you, whether finally put together all the infrastructure infrastructure proposals that are addressing all of those items over in the process in 2022 report because of a dozen people are going to be better at risk of up and annoying. I appreciate the time for me to present this. I was told today may the infrastructure report would be something else. So, in the make my my recommendation and I'll be there again and report just in my thank you so much. Thank you. Definitely. Our speakers. Okay, let's approve our minutes for March 26th, 2020. I'm going to go for a second. That's right. I'll approve. Hi. Hi. Hi. I'm upstate. We just want to have an introduction. For Austin. Yeah. Why not? Yeah. Austin, do you want to introduce yourself to us? Hi, everyone. My name is Austin Edsel. I am virtually appointed and happy to join and serve with you guys. I have an accounting degree from Cal State Fullerton. So I'm hoping that will help us here. But I'm excited to serve. I come from the Community and Library Services Commission, or served as chair for the last three years, or two and a half years. And so I'm happy and excited to take that experience that I learned there and bring it here. And I excited to work with you folks. Well, we're excited to have you, so thank you so much for the service. So let's start with review of Visiting Sphere Relations. Yes, so Kelly Miller was able to make it today. He had a hip replacement the last. Days, I should be sharing that. Yeah, yeah. But Omar came this here and his whole team. And so maybe turn up to Omar and you can introduce. Maybe good. Afternoon everyone. Where should it be here? is Omar Coms. I am the chief marketing officer of the VHB. I've been with the organization just under five years and previous to hear. I was at Santa Monica travel in for about six years during heading the market as well. I'm Nicole Lido, visit Iainton Beach's VP of administration and community engagement. Been with the organization for now about 16 years. And I'm excited to be here. Everyone, I'm in Feldman, I'm Vice President of Sales. And I've been with, I'm meeting somebody here I have previous to that, I was 20 years down the road at U of Park H. Yeah, I have a trouble here. Sorry. And maybe you can stand up and maybe just be gladly. Sorry. Sorry about that. Hi, I'm Michelle Delaney. I'm VP of Sales with Visiting to Beach. And I've been with the organization for approximately a year and a half now. Prior to that, I was 20 years down the road at new per page. So, I'm very happy to be here. Good evening commissioners. I'm Claire Sang, I'm the VP of Pure and Communications. This is H like to meet and previously I was at LA tourism leading communication efforts for LA. So, I'm Melissa Knutson, I am the CPA for visit hunting to meet should have been for 10 years years maybe a year longer than a year. So happy to be here. Hi, I'm actually from Stivitas. My name is Kelly. We are a consulting firm. We're based in Sacramento, personally, I'm in Pasadena. We specialize in form improvement districts, so I work closely with the team to work on the modification just a couple of months ago and our firm worked at form the district, been with the firm for almost seven years, so happy to support them. All right, so we just have a quick presentation just to tell you a little bit more about this heading to beach. We saw a note that it is review of our operations. So we wanted to have a little interest so you understand our organization a bit better. That is very So. All right. So for those who don't know, visit Huntington Beach is the official destination management organization for Huntington Beach. We are a private nonprofit where a 5-1-C6 organization and we exist to promote tourism to Huntington Beach and order to increase overnight stays at our lodging properties. And that includes both hotels and short-term vacation rentals. Our mission is to support and advocate for the economic vitality and quality of life of the Huntington Beach community. And we do that by providing inspirational destination marketing and brand management. We are a fully accredited organization. We actually, oh yes. What is inspirational destination for marketing? Can you explain that to us? Yes. We'll actually get a little bit more into that, but it is essentially marketing the destination to people who are looking for vacations and travel so that they learn more about the destination are inspired to come here and to spend their money while they're here. We're trying to inspire people to travel to the beach. Why and how do you guys exist? I mean, who do you engage in this? As a 501 C3, you have no other clients, but honey, can be. That is correct. So you form this nonprofit. You come to somebody like Travis and say, we want to promote you. Does that what happened? No, actually. So back in 1988, the people that were building the Waterfront Hilton Hotel realized that this new hotel was being built in Hilton and there was no real history of promoting tourism to the area and they were worried about getting people to come and stay here. And so in order for that to happen, they realized that the destination needed a visitor bureau. So they actually collaborated with the Chamber of Commerce to form a 501C6 organization at that time. And that organization was founded with some of the former city staff, I believe, input, also the Chamber and then the owner of the Waterfront Hilton and some other community members as well. So then you're really operating as a visitor and church bro just operating within the 501C3 apparatus. So the donate or C6? Okay. Yeah, we are a 501C6 and we were created for that purpose. It was initially created. I believe we were funded by a grant from the city of Huntington Beach for the first few years. That grant eventually turned into a TOT agreement with the city of Huntington Beach. So the city of Huntington Beach actually contracted us to do tourism marketing under an agreement. We received a very small percentage of the TOT at that time. to meet. So the city of Huntington Beach actually contracted us to do tourism marketing under an agreement. We received a very small percentage of the TOT at that time. Still now received that. We do not know and I'll actually get more into that. We've got some more information about that as well. What's the like on that agreement, Travis? You know, there's a current agreement go tell a Chris Casanova from American Abbeyville. I Chris Casanova. I'm the study of the economics development manager. I'm kind of a reuse on on the city side with visit on to BH. So the current management agreement that we have with visit on is at BH'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure get your word out? So like people from Missouri might want to come to Huntington Beach or how do you what do you do about marketing? Well, yeah, I think that one. Because it's very different then when your organization first started obviously. So like many organizations we leverage digital platforms. It's the biggest bank for your button in terms of ROI or reaching the most amount of people with modest or fixed budgets. So there's several data sources that we use to determine who we call them target markets are. It's a mix of airplane data. We have geo location data that tracks cell phone devices and seeing travel patterns. The hotel industry themselves, they have a report that's called the Smith Travel Report, which tracks their performance in terms of ADR occupancy and red part. Oh, average daily rate. Think of average daily rate. They track the level of occupancy at each of the properties. And then red parts are kind of a ratio of the tube that just assesses the performance overall. We do, you know, even traditional methods like surveys right now every other year we do visitor inter-sub surveys and we make sure that the pool size is large enough so that it's statistically little bit and that feeds into kind of like getting a sense of the resident and excuse me, the visitor sentiment. And then we take all of that to kind of determine who we think are going to be the most responsive to our advertising. And then also the hotels themselves track who is staying in their destinations as well. And so for proprietary reasons, some of that information shared with us, you know, depends if they're corporate or they're more on pop. But essentially that may launch of all of that information is what we used to determine how we target. So who went back to your question, who then, what digital platform are you using to attract the person that's the NOH? This way advertising. So online banner ends and we target my zip code by that online banner end would be on what particular where would I see that when I'm shopping Amazon. When I get this or any any any one of those websites. So again, depending on the we have also have visitor profiles. So we do know what people do when they're here, what are the triggers for them in terms of attracting them to come to the HV. So based off of all of those parameters, we're able to pretty target pretty specifically to folks that we know are going to most likely respond to the ads, but more importantly, book something in here. So that Missouri, just that example, is not one of our target markets. It's like the place where people are like, I'd love to go to a new place. Yeah, but we have. So we have what's called right markets, which are folks that most likely visit the destination be a vehicle. We have regional, county, statewide. We have what's called flight markets. So for us that's New York some cities in Texas some cities in the Rockies Chicago those are flight markets and then on the travel trade side We have an international level of that. So for us it's on Canada on pause but Canada UK and Australia was one but we're waiting for that that end-bound flight travel to recent end-to-be pandemic hasn't hit there yet. So for us it's kind of like a tear, a tear too, but yeah. All right, so as I was mentioning we are accredited as an organization. There is an association that is global called destinations international. They are the association that oversees all visitor bureaus or destination management organizations like ours. We achieved accreditation with distinction about four years ago now. That means that we exceeded over 100 mandatory and voluntary performance standards. Those are the best practices for the industry. Fewer than 10% over 200 DIMOs that are accredited, achieve the win distinction mark, and that's what we were able to do about four years ago. We are also subject to the Brown Act. We actually voluntarily decided to make ourselves subject to the Brown Act. So we do the same as the city does when it comes to our meetings. I would never do that. You know, it's not easy and I understand why this is. It has come in handy. It's been helpful for his parents. We want people to understand that we are not trying to do anything. And so that being said, we do have board meetings quarterly at least. To read those board meetings, we approve monthly financial statements. We also do an annual financial audit. I overheard it as far as name earlier. We use the same auditing company as the city. They have done our audit for at least the last eight years. And then our annual financial audit and financial statements are presented at a sprint meeting and then set to the city staff. I mentioned that we do have a board. We also have our executive committee and they meet monthly and we also have two city council appointed liaison's this year. Those are gracey and Casey. We have this question. So who funds visit Huntington Beach? Our funding comes from visitors that stay in the lodging properties. So that agreement that we have with the city, we're no longer receiving any to your team any we have what's called it first of business improvement district. So that teabag is a collection of all of the lodging properties and the city of Huntington Beach that's about 21 hotels and a little over 200 short-term vacation rentals. They got together and said we need a way to promote visitation to our destination so that people know we exist and then they will come and stay with our hotels and our CDRs. So it's a self-assessment. The Kelly mentioned she worked with us to modify our assessment and last June, we went from 4% to 6%. So anyone who stays overnight in a hotel or a CVR, they had a 6% assessment added to their bill that funds are work. This is not a tax on local residents again, unless the resident is staying in a hotel. This is really meant to be driven by visitors that come into the destination. And STBR is a PRMIO or M-C. It is a short term vacation. Yes. Anything less than 30 days stay in the city. Anything less than 30 days stay. What if it's longer than 30 days? Then it is no longer considered a short term vacation rental. And so it doesn't get this tax or whatever you call it. Assessment. Assessment. I mentioned again it is something that is a fee that is charged for guessing overnight in those hotels. Bylaw and this is a state law, that money that is earned through the assessment must be used to promote things that will support the businesses that put money into it. So everything that we do has to support the hotels and the lodging properties and Huntington Beach. A quick question on that. So even though like downtown isn't a hotel, do you guys help with paying like cleaning that place up like sidewalk cleaning or Sure anything down there because our tourists probably spend a lot of time down there So we don't help with infrastructure costs of that sort We do help with the nighttime ambassador program. I'm not sure if you're familiar with that program that started on maybe about almost 10 years ago now. It was initially begun by PD. PD realized there was a need for this and then eventually it transitioned to visit Huntington Beach overseeing the operations and now it is with the downtown bid, but we do pay for about half of the program fees within here. I mentioned the TOT. So that TOT right now is 10% that's transient occupancy tax. So in addition to the TVID assessment when somebody stays at our hotels and STBRs, they also get it charged a 10% T.O.T. that T.O.T. goes directly to the general fund and it's a hundred percent of it that goes directly to the city's general fund. So whatever the city is using that general money money for comes from those visitors also that are staying in the hotels. Which means that the more visitors we are able to attract to honey to each the more that the city gets out of those TOT funds. And do you guys get any of the TOT fund? Okay, so that's straight. But I work out to on an annual basis since you're throwing in going back to 1996. The 200 million looks like a good number. What is it on a noir? Okay. Thank you. We have to believe that's not true. So we did do some research. I actually reached out to the city's finance department to get some of this information for the years, the four, two thousand and something. And so we were able to put together this chart. And so we can see how TOT has grown over time. We also dropped into here for our tourism business improvement district assessment that we have in that agreement with the city. As you can see, it has increased very slowly over time, but with each increase in that T even assessment, there has been a noticeable increase in T of T. Is that been 10% the whole time this this chart existed? Yes, as far as I know, it's been 10% since I've been here. Okay. Yeah. So how do you know if you're spending is directly impacting the visitor numbers? Do you have any kind of analysis that can speak to that? I think that's an industry one. Yes. So essentially in tourism marketing, there are two facets of marketing. There's the awareness, which is where mostly the DMO handles earlier in the funnel. And then the other portion is the actual bookings and the hotel performances. And that's usually the side where the hotels are more responsible for. So our charge is to drive the traffic through there. And so through those means, again, that's one of the benefits of having heavy digital marketing platforms, we are able to trace our dollar spend and what portion of that contributes to a level of awareness and what level of that connects to directly to bookings. And so, so if that's the number that actually tells you how you're spend have contributed to Rappuar disservative. So your target, I assume you have a target market profile of some kind. You've segmented the market, you've done all that neat stuff. What is your target and what is your awareness level for that target? Do you know that data? Yeah, I'll give you the short version. So we just recently updated that. We have essentially five different profiles that we have seen that come into the destination of the we're targeting. The brief version of that is I'll go back to 2020 because it's a significant moment. So we had, when I started at VHB, we had what we knew was we called them the repeat visitors, the people that we know were coming. And when 2020 happened with all the shutdowns and all of that stuff, we in the data show that we had an entirely new audience of folks that were coming to explore a country to engage for whatever reason, mostly because we had the beach, which was your huge advantage. All of our outdoor amenities and assets were a great respite to all of the closures and lockdowns in more urban centers. So when we identified that new audience, our charge is to try to convert as many of those first time visitors to repeat visitors. So over the last couple of years, what we did was develop a build customer profile of those new visitors, by again, tracking all the aforementioned things, their purchases, their phone devices, where are they coming from, how long are they staying, where they're here, where are they going, and then based off of that, we created a whole new marketing campaign where we had two prawn. One reaching targeting those who already have been to encourage them to return, and then these new visitors saying, hey, we see that you've discovered our city of USA. Here are all the reasons why you need to come back. So with this multi-year campaign, we've been really excited that this is actually this calendar year. We're going to share that data in our upcoming tourism summit on May 8th, but we were able to convert about 20% of those single time one time visitors to repeat visitors. And so that shows that by kind of building these profiles targeting those who we know have the highest propensity to shop, play and stay in HB, we are able to convert those types of visitors into repeat visitors. So what is, for example, what is the awareness level you've achieved? Well, okay, so there's brand recognition, Sir, City, USA, all of that. Our last visitor interest observing that we did, which was two years ago, and we're currently working on a new one this calendar year. It was about 87% recognition of the search city USA brand. One challenge that many destinations have is a constant education in terms of awareness is a sense of arrival and location. So for our example, one example can give you is that when I was in Santa Monica, a lot of times we would get phone calls from visitors coming to Santa Monica asking, oh, so working there in a car because I want to drive to San Francisco, just do a day trip and just drive from Santa Monica to San Francisco. So we're like, oh, you know, having to explain to them that, you know, that's not a two hour drive. So here in Huntington Beach, we have the same thing in terms of some of the, a lot of people thinking we're in San Diego or we're in more in Los Angeles County. So in that sense, we do do a lot of work trying to create a sense of place and arrive well, you know, in terms of being Orange County is Quinta Central California Beach destination. And the way we do that is again, using the data of this cyber we're going to target. We are. in terms of being Orange County's Clinton Central California Beach destination. And the way we do that is again, using the data of the cyber we're going to target. We are strategically located by major attractions such as Disney, not very fun, Sunos, Yvonne. We have three airports within driving distance, Long Beach, LAX, and John Wayne Airport. We target those. And again, because a good chunk of our visitation is drive markets. We do do LA County and the San Diego DMAs in terms of drive folks that are driving here to the destination because that is the majority of the visitation currently. So with all of that, we're going to kind of tell like, you know, who's coming? Is the recognition of the search city USA brand working or more importantly for us? Are people gaining a sense of where hunting to engage in this? And it's working. We do have a lot of sporting events to the have an NHV that certainly helps because you know, we leverage the media that those organizations use to promote their destinations to promote, excuse me, their events to promote our destinations so all of that collectively is inching us towards that higher awareness but it's a constant education we're now we're gonna be 100% there. I need to ask you some financial questions can I do that? Okay I'm guessing that in 2024 if you're getting 6% of the receipts for the hotels, then the city funding because it's getting 10%. So the city funding to be received $16 million in 2024, which means we're looking at $160 million of receipts, right? 10%. That's the number. D-O-T. Right. For T-O-T, right? Okay, but you guys are getting 6% of that same number. I thought you said you were getting 6% of the hotel bill. Of the hotel bill. Okay, well that's what we're looking at. So it's 6% of that. 160 million, my correct. All right, so that comes out to about $9.6 million for 2024. We're on the same calendar year or fiscal year as the city. Oh, it's a chart. 2324, let me. I don't want to praise you. Yeah, that's okay. So that's 24, 16 million for the city, I need to make sure that would put you guys at 9.6 million or 2026, that's correct. 24. We received in hand, it was about 6.7 million. That was when it was 4%. When it was 4%. There was a change from 4 to 6 in the middle there. 6% in 2024, correct? How do you mean it changed in the middle? That's the probably. The change went from 4% to 6% in the middle of the day. Somewhere in the middle of their fiscal year. So, 2024? Yeah. I'm sorry that the beginning of this fiscal year. So it went into effect your life first of 2024. Okay, so really wasn't in that. Correct. It is not represented in this chart. This is showing the most recent full year showing a 4%. So let's let's say we do the same next day. Looks like our chart's gone up a little bit over here. 9.6 million to run that the business Now, my concern is that there's only so much you can charge in hotel tax to keep people coming to the hotels. You charge too much, they're not going to show up, correct? So when you folks take 6%, that 6% that the city funding to be cannot get, because, again get too high. No, it's gonna come I guess my question is are you guys operating okay on 9.6 million dollars a year? I wonder what is is are we fully funded here? That's 9.6 million. Well, I can tell you We actually employment staffing wise. We are for our budget size when compared to organizations like ours throughout the United States. We are about 30% lower staffing size. So we are actually not fully stepped up. That's not really one question. Are we able to operate on the 9.6 minute? My concern is if you want from four to six, because that's 2% that the one question. For the investment. Are we able to operate on the 9.6 minute? My concern is if you're one from four to six, because that's 2% that the city cannot put on the TOD, which my calculations are $2.5 million, that we're not gonna be able to get. And I guess my question is, and I know this is a voluntary thing for the hotels and they add that on themselves. Was it totally necessary to add that extra 2%? There was a reason why they did request, well, I should say a few reasons why we did request for the increase in assessment. The money that is the additional funds that are coming from that increased assessment, we're used for marketing purposes. So it's not going towards operations of the organization itself. It's not necessarily going to staffing. It's really going towards us being able to do more on the marketing side because we know that there is increased competition out there. Oh, Mark. Is there cities going up that we didn't know about? There are actually additional, we call them product, but basically it fings for people to do or places for people to stay outside of Huntington Beach. Omar mentioned OC vibe. That is a huge project that will be up and running within the next couple of years. that is going to attract people away from us. Also, Disneyland is expanding the all-new what's going on over there. There are a bunch of cities to the south of us that are really kind of trying to ride our co-tales on how how well we have done in the last few years and they are greatly expanding their their hotels, their attractions, the revamping their downtowns and so that competition is going to really impact us without being able to do more on the marketing side because we also don't have new product coming in to match what these other destinations are doing. What is the percent occupancy of your product? Do you have that number? Yeah, the everything. My tip. 100%. Also, so what is the, what are the other cities on these charts, charging in terms of TOT and the equivalent, T bit. I don't know if everybody does that same kind of thing. What is the norm in the cities on this chart on those things? That's a great question. We're actually just getting to that. Okay. We'll get there. Great question. So this chart just represents where other DMOs are in terms of their budgets. It's a DMO, destination marketing organization, essentially, tourism bureaus. And the oranges were we followed in the spectrum that we call them compset, the competitive set. And then we have San Diego, Anaheim, and Palm Springs up on the side. We call those larger DMOs, their budgets are massively larger than the ones along the bars, just again, get for that perspective. On some level, we still do compete with those. We call them new games. How do they, do they, does everyone have the same kind of relationship where it's a percentage of, of, each one has their own cost. Yes, I have a great question. Yes, but each destination has varying combinations of them. So for example, some of them do charge comparable or higher to have TOT rates. But one fundamental difference is that some of those cities do receive a good chunk of the TOT. whereas for us, yeah, we have a similar percentage in terms of the TOT rate, but we've received zero dollars. So it just, it depends on the destination. Now, some of them have a combination of T-Bid and TOT, or one or the other. So some of these DMOs get a percentage of TOT as well as a T-B. So some of them strictly have T-bit, some of them have greater sources of TOT than T-bits. But some of these have way more rooms. So I have a chart coming up, sir, with that, where... Yeah, I see that that and that's where I get into the percentage occupancy because we could spend $10 million more, but if we're filled up, but it's doing it good. So depending on how we fill, we are as anything more than we spend may not be very useful, unless we have more products. That's right. Yeah. That's the TBR equivalent to that. The number, legally operating rooms, and so the destinations. Okay, we have that. I'm 18. Yes, we have 218 permitted. We can stay in there. Oh, there's a lot of people are renting. So there there's a there's a underground Airbnb, the RBO, they don't they don't get permitted. They just do it anyway. How do we police that? There is a there is some attempt to try to police that. Originally this when the city started looking in short, so short, short, out in the rentals weren't allowed in the city to sound that all right. Then five years ago, and it risked Casanova. So five years ago, I think, or four years ago, we did, we allowed home-posted short-term rentals. And at that time, there was a study done and I think within the city there was 900, probably illegally operating short-term rentals at that time. And then through code enforcement and then this permitting process, I believe recently, I don't know the number recently, but it's down, they're still higher than our 218, but that's not being just non- the hosted. That's one variation when we are the numbers included in that 218 sunset beach is no I believe so. Well that's got to be a large chunk of it. Yes. But there's still I mean it's still you go on I don't know the RBL right now pull it up. Put it on I need to beach. Heck a lot more 218 of them. That's you guys should be enforcing that. This is taking money out of your pockets. You guys should be on top of it. Yeah, so this what this chart is just a budget to room ratio. So where did that land is just showing where we length in comparison to some of our competitors. So the ones in bold are some of the main destinations that we compete against. And so any of the dots that are above the line show that the ratio runs, puts them ahead of us in terms of ink competitive. And then those five lines are those smaller DMOs that are, this nation's that are up thing coming that we do keep an eye on because they do share, you know, they have, they have assets that are kind of similar to ours. And their communities are, you know, investing more in their marketing and their tell products. It's something that we will be updating as the years go by. Not to go but compared to the core concept, again, the destinations that I'm bolded. This is part of the recent further tea that somebody can remain competitive in that marketing landscape. San Luis Obispo has more rooms than Long Beach and Santa Barbara and Santa Monica. San Luis Obispo operates as a county. So it's the full county. Oh, it includes all of the Oh, very. Don again. So, uh, we already mentioned that back in June that was when the TB assessment change was approved. We did get the support of all of the major hotels for that increase. They were actually the ones who asked us to start going for the change in the assessment because they saw that they were going to start losing market share. And so it was actually a request from our hotel board members that spurred that whole thing. And then one thing we did know was if there was a change in TOT it would require a public vote. So this is a end-to-rip. A lot of those in the city. So, again, we did do some research. As you've heard a lot of what we do is based in research. And in that research, we found that. An increase in the tea bid versus an increase in the TOT would actually realize an increase in people visiting. would actually realize an increase in people visiting in a faster manner because we were putting work into doing marketing. Whereas if we're putting the money into an increase in T O T there is no money to be spent for marketing so it's really just kind of assuming people will come without trying to inspire them to make their travel plans. And so that's where this chart will work. Yeah, so essentially this chart is essentially trying to show that the rate of growth with DOT versus TB over the next 10 years. first couple of years, if we were to have done with the 2% TOT increase, the first couple of years would have superseded the rate of T-Bid collections. But after that, the T-Bid will supersede the rate of collection for TOT at the same percentage rate. And the reason why is because, again, PR and D.P. are a management district plan. We are required to use the majority of these funds to infuse the right back into marketing the destination. And it's called the regenerative effect. So the idea is generating more visitation, which in turn generates more spending, which in turn increases the TB and then by extension the TOT. So over time, the rate of collections for TB will be slightly higher than it would be if it was just a straight TOT. What's the assumptions behind this? I mean, the rate increases at the hotel, I mean, we're not growing hotel base or anything. So how are we getting the additional revenue? I think you want to send it back. You're asking how this via assessment in depth bringing more revenue into the city? Yeah, we go from like a 50% growth over the 10 years or or so without any hotel increase. So it's either got to be just the cost of the hotel is going up that rate or we're cramming more people in there somehow. Yeah. So, yeah. So the baseline, the black line's going up. That's kind of what you're talking about, that's going up anyway, right? That's going up 25%, but the other things, driving it up 50%, you know, I mean, it almost doubles it. Let me do work with other firms towards an economic specifically that studies this, in particular, of the impact of having a TB assessment in place and the impact of that over a TOT increase in a bit in by itself. So this just assumes an average door rate that's increasing every year? Yes, that's what they do. That's what it is. It's really good what you're saying, right? I'm asking again. The black puffer that I've mentioned that's only that the blood indicates that we were to do nothing. So our current, just if we had not done a TOT increase, TOT, 2% TOT increase or a T, 2% TV, that's what the black indicates. That would be the rate of growth with you just did nothing. And then again, the orange is the grade that you're going to be. And going back to this question, because what's the result? We do nothing. So again, that's just average draw rate increasing on its own. And nobody else knows anything about us and they just show up. And staying at the 4% so. This is the blue say because we're doing the 2% TB TB you're going to get this 2% TOT increase. What's the benefits of TOT by based on the increase in T-bit? It's an increase in occupancies. So this is since that because we are increasing T-bit, we have additional money to put towards marketing to increase the number of people that are coming to visit. That increases occupancy, which would then increase TOT to the city, because you have more people staying in the hotels. Is there a primary source or essential source of information industry wide that provides this information for you? Yes, so they are are really good to get based on. Yes sir, there is and also there is a tool in a tall implant that many industries use to plug in those numbers, put these numbers and then the software is what calculates those projections. So it's used in many industries not just just tourism, but yes, all of those factors are included in their teleperformance. They do tourism economics as Kelly mentioned. They did work with the city to get some information and all that so that they could make pre-functions with that information. And so And so again, we do have a chart that has the more detailed breakdown year over year. So again, the blue is the rate of increase. If we were to increase TOT by 2%. If that is on the model that they're using. Correct. If it's on the vote and given voted for a two percent TOT increase. That's the anticipated rate of increase. So, I'm looking for a different line. Because we went with the two percent key bit and you're going to be able to spend this great marketing money to get more people here. What's that going to do to our TOT baseline because we're going to get more people? What's that one? That's what I was thinking when I see this is that what the orange line is trying to show Is what the orange line is trying to show so the city so that this is the impact of the city I think is what it's trying to show so the the black line status quo, the blue line, you get, if you do a increment, you see that increase, but then the slope stays the same because you're saying those bracket. Right. Right. And usually they're saying if they get 2%, they go out and advertise for the city and they're saying in that orange line, so that's the key. Okay. I say, It makes sense. Over time. I think you had that. I'm not guessing. We'll rate, we'll, pretty. So, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, it's pretty, 10% we get for T O T will be on a higher number because more people are over time We'll get even get more than we would if we did the 2% to We were charging 12% Right on T O T. Yes, yes, compared to 12 That's what I think. I understand the concept. I'm not seeing it. I don't understand how that chart moved that way. I mean, there's gotta be there's there's there's assumptions in there. Correct? Okay. Because that's a big gap that first two, three years. That's a big gap. And our budget sure could use that gap, but we're not gonna use it. We're not gonna get it because you guys are gonna get it. Right? This is the 2% I was talking about from four to six. Right. Okay, big gap. So, a far assumptions are correct. By the time I'm dead and gone, we've got a gain here, right? 2031, 2032. I'm starting to see something from that extra advertisement. My question is how do you know how do you make that assumption that that actually that that extra advertising is going to process blue line? It is based off of historical you know from that's what we we base it off of. We again, I do have a more extensive report that gets into all of that. This was just a high highlight, kind of picture of it, but we do have confirmation that explains all of that. We're happy to share that. Do you know if we, I mean, putting on this Bob Robert, do you know if we did any assumptions relative to our budget planning relative to increased revenues? Because of this T-Vin. T-O. TOT is a, is he, you know, just a straight percentage? A little different because they're factoring in their assumptions. Right. They're basically saying we're going to get better revenues because of this new T-bit assessment. We're asking that if we just raise the TOT, unless we do marketing right there will be a bunch of an impact. There will be at one time. There will be a one-time pop that you see right there. And then go with the slowly. Yeah. What do other cities do? Other cities have a 6% T bed and are you guys looking at like if the normal T bed rate or what if it with all of their cities. Very, is by sitting some are lower than ours. There are a couple locally that are able to ours or slightly higher that are actually working on an increase right now. When we did our increase a couple of other cities announced that they were also going to go for an increase of. Okay. And I don't know how much tourists will go. Well, we're gonna see a good part, high at versus things to me because they're TV's. Like I don't. They never see that. You never, you don't see it until you check out. Yeah. I just stayed in a resort in Scottsdale and that never came up as part of my build until when I left. Yeah. They get to surprise you. Thank you. Just curious. I just want to mention one thing too. So just like the three lines, this is showing the rate of TOT. So black is if we did nothing. It would be really helpful if I could see a breakdown of where specifically you're spending your marketing budget. We looked at your taxi turns. Then give the kind of detail that we'd really like to see. I have some questions about that, but I'll say that to the end. The reality of it is, I don't know if I'm really seeing the connection here. I want to think you guys are having an impact, but you're not showing me anything that just smacks me in the head that says, this is exactly what the numbers are. This is where we were. This is what we're doing. And this is the result. The numbers have gone from here to here. You follow them saying, I mean, we're now doing a debate over the line charts, which really don't, that doesn't make my heart flutter here. I want to know what it is you guys are doing to impact what you said you're trying to achieve. And I'm not really seeing that. I just want to cut and drive. A couple of slides that just tell me, hey, we're responsible for this. We're spending this on a per head count basis, you know, this is where the number was and this is where it's going. And in order for us to accelerate that or grow that number, we're gonna need to take it here. That I can understand. You put that all on one slide. You follow me? 100%. So we do, so this presentation today was more of a kind of the HBU high level the HB101 and you have all of the information that you're seeking. Most recently the only thing I can think of right now most immediately is every year we as part of our MTP we are required to submit our annual report that has all of that information, level of investment, the ROI, in every aspect, every department of the organization. And we submit that to City Council for Review. They have any questions and, you know, a eventual approval. And so that happens usually the latter of the sometime on September, October. So that's the last entry court that was submitted was around that time. And the next one for this past fiscal year will be sometime later this summer. Every other year we have been through our tourism summit and just by coincidence, on May 8th, we will be sharing kind of like a use that opportunity to kind of share all of those performance metrics at the tourism summit, but But relative to this conversation and to City Council and City staff we will be submitting that annual report later this year and it has all of that so Let me investment what a poor body of work the programs. What's the ROI the direct relationship with the level of investment and and what are the results of the campaign in terms of, again, for our KPIs, awareness, bookings, and obviously the spend, which is where it ties to more local taxes and stuff like that. And so we can send the last one, if you've not had an opportunity to see that, we can send the last end report so you can have a good sense of all of the things that we do try. In there too, we also have a chart that I did create last year when we were doing a quote-tipit thing. It does show up on a week. We probably do track about 50 KPIs that we use in varying combinations depending on what report we're reporting on, to assess the performance of everything that we do as an organization. And so that chart, I feel, does a really good job of kind of showing the top five key performance issues to the public. Top five key performance issues. But you're not. I mean, yeah. So for us, it's double telefpi occupancy. I wish daily rate. We have part of that ratio awareness of the destination. Because we are now member base, we have the wonderful fortune of using the entire destination as our product. So we do engage with all the other key stakeholders, the bids, the Chamber, the city in terms of promoting local businesses using those as passes to build equity in the visitation experience. So those are all we do we use flight information. Again, we work with airport data to pay attention to what we call it airlift, what airlines, what destinations are feeding passenger in travel to John Wayne, for example, into the destination. So you look at like PASER AI information to do that. Yes, sir. So, so we have we have a derivative of that we use from a data from a company that's called data, Phi geolocation data is the same thing same thing. Placers more point of interest related, whereas a data file tracks movement and visitor trends. So collectively that helps build a picture of what people are doing with their end of the station and where they're coming from, etc. Well, I would hope that basically you couldn't spell out for the city council then. Here's what our occupancy was prior to the 2% increase. Here's what our occupancy was after the two protectors, year runway or something after that 2% increase. Because that on a tie directly to how is your bargaining doing with that increase in budget? Yeah. So, as part of the approval for the 2% increase, the city required visit high and to reach to dedicate 10% of their budget towards and enhancement projects. So, these are more infrastructure projects. So, all that whole 2% is not necessarily going towards marketing. So there is investments that they're required to make downtown. That's good. Yeah, just about a million dollars. That's helpful. A year. Just I just think just boiling it down to something real simple for for the city to see. How's that doing? How's that going? And I think that would be the best indicator based on what you were saying. And I said that. Yeah, for me, it's, and I think Frank's question is valedict to the point. When you're looking at our return on investment at ROI, we'd just like to have an idea of what's the real number in dollars that you're regenerated in revenue to the hotels, I was just reflected in the red bar and reflected in the average store rate. But when that happens, how do you know you attributed that, that equated into dollars and that equated into whatever else however that spent went here in the city, in other areas? Yeah, because I mean that, can't see that. It's a little. We want to take out the, for black, we better turn the inflationary aspect of those bar graphs. It's just that's just rate increases at the hotels that's driving that tax increase versus wow, we really got really good benefit from that marketing dollars. Now Now we got occupancies going up, so we're really taking advantage of it. So, you know, you know, you know, I'm saying. Yes, 100%. And we're happy to report that we have all about information. Just to give you a quick snapshot, this is we just recently received the information for calendar year 2024. So last year we had 2.3, 4 million visitors to Huntington Beach. And for us, as a destination, we define a visitor, someone who is visiting Huntington Beach for the day or overnight and who resides outside of the geographic boundaries of Orange County. That's a 4.4% increase compared to last year. So about 2.5 million, excuse me, 90,000 folks more. The average day of stay is two nights. First time visitors, 36% of them last year were first time visitors. 64% are repeat visitors. And as I mentioned earlier, that's a 56% shift. That's after two years of investing in those first time visitors. We've been able to shift a good portion of that first-time visitor segment into repeat visitors. It's exciting. Our top destinations of Los Angeles, Phoenix, Vegas, San Diego, San Francisco Bay Area, Salt Lake City, Denver, Seattle, Dallas-F Fort Worth, New York. 24% 24.5% of overnight visitors and like most destinations are greater majority our day visitors still in close to us. Nine, nine percent of people who visited in 2024 were international. That's a 20% increase compared to 2023 which is awesome awesome. And then as I mentioned earlier, we have the five new visitor personas. We have a page at the HP collection, but essentially those who who's stay in the for beach from properties, we have Huntington Beach lover, those who are repeat visitors, those who have never been to LA or Huntington Beach before, we still want to reach out to those first time or new visitors. Hidden gem cultural traveler, we have a lot of people who come to the destination for cultural reasons, you know, the ecological reserve or central park into that nature, arts culture, and then we have the, what we call the select services. So some of the more modest rated hotels, hotels with more modest hotel rates. And so with that profile, you know, in the sheet, like I said, I will make sure to share this with you guys. We have kind of like the demographics, what their age range is, what their HHI is, whether they're married, if they have children, what percentage are male versus female, what are their interests that drive them, and then most importantly, what are their peak visitations, periods. The reason why that's important is because one of our goals is our number one charge, obviously, is to make sure that we're driving business during the soft season of the hotel period, but more importantly than that, which just goes in the next line. I'm going to pause that. Yeah, there we go. So with this chart shows, we have this for occupancy, AVR and Repa. This is historical, well since I've been here. So it shows the pattern for all the previous years. And so you can see it on a monthly level, and then just in terms of trends, how over the course of a calendar year, the destination performance. So the reason why this is important is, I get it's hard to read, because they want to find it. Yeah, it's a lot of lines. Yeah, I can't read your graph at the bottom. So I don't know which line. You don't know which line you want to color on. Thank you. It's better. So the reason why this is important is because two things. We want to make sure that the trend, like the great line obviously was covenier in the pandemic. So we want to make sure that not only the trends remain consistent year over year. I'll be it slight variance is of course, but the general pattern of business is the same. But more importantly, one of the things we strive to do is try to mitigate having an EKG-like type of performance so that way, you know, the business is a bit more predictable for the hotels and not having to kind of rush to fill in need periods beyond what's traditionally their needs periods, which tends to be November to February of the subsequent year. So ways we've done that is again really hyper-focused targeted marketing. Another thing that we have done to leverage and spread the the love so to speak or the business across the course of a calendar year is the events, right? Really partnering with the events that come through working with the city to kind of spread the love of really selecting events that have been during non-peak so that we again we're ensuring a more consistent regular pattern of business with the person of the year and it certainly Michelle's universe with group sales, you know, making sure that we're booking events, group sales and events that also during the midweek periods are typically the persons of the week that will tell us the for us to try to book business versus the weekends because again the midweek is where there are areas of needs. So all of that is part of what all of the things that we're doing is to ensure kind of that kind the pattern over the past year. So, which is? You said our international, of our international exposure, everybody 20% is in? Visitation to the destination, yes sir. Yeah, mainly UK and Canada. What percentage of your budget do you spend on international advertising? I would say, well, in terms of like marketing, like digital marketing, I would say, maybe 5% and the reason being is because there's another area called travel trade is kind of tourism development. And what that entails is, DMOs typically engage and partner with two operators, travel agents, people who have clients that book vacations and what DMS often do is we'll partner with those organizations to educate them on the product, the AK-8 Huntington Beach in this case so that way they are informed of the destination and when they're selling options for their clients, they're top-work type of line. People are looking for beef destinations or California getaway. So we do invest in education trainings, we call them familiarization tours where we will get high net worth and top tour operator and travel agents sellers to come experience the destination, educate them on the assets, have them experience it firsthand so that when they're going back to their offices, again it remains top of mine and firsthand experience with the kind of demorning the product to their clients. And so that's a very common practice in tourism. So for us we do have a level of our budget that is a portion to the traveling space. So this is just the average daily rate parable of the same chart again, the gray line, you know, you'll see the recurring theme that's COVID. The red and the green, just to offer a little extra insight for our hotel partners, I have elected to put that so what the red and the green indicate is the destinations overall record in terms of the best screen and then the worst red just so that it offers perspective on the worst performance ever, the best performance ever and then just the trends over the course of the calendar year. And then on the top right is just showing, we provide these to our hotels every month. So what I do is I just, I give them the, excuse me, the year over year comparison of how much better we're doing compared to the month previous or the year previous for that same time period. So it allows them to kind of assess, you know, how we're doing on a month, they're looking for multi-scope, poor and annual scope. You guys only, this is like a bed tax thing, right? They don't think we would dinner at the hotel. That doesn't get included or the spa services or conference services were the, okay, so it's just just just a, you got to stand a room. Okay. If I could try to crystallize the information you're just sharing, the number that's, that I'm hanging on to is 2.3 million visitors. That's it. That's the number that we're going around 2.3 million. So my question comes back to what did we spend just in marketing. I don't fear about that. The overhead, the rent and all the other stuff. The pure marketing budget, which by my calculations, we're rich odds here on what the number is, but my calculations, your budget's going to grow to 10.6 million next year. Ballpark, is that close? Ballpark, yes. Of that, what goes into direct marketing is my question, because I want to know what that span is doing to generate 2.3 million visitors. So, we, we, it's not in here. We do have a chart that shows that based off of our MDP, how those money is supposed to be split. Well, percentage sales and marketing. Thank you, Kelly. So we, everybody needs to kill me. I agree. I agree. According to the M5 and this is this is for us. The city. I She should be very. Okay. Okay. So, included in our NPP, we have a breakdown of, well, the city. That's one. The NPP is the management district plan. And that is the document that kind of offers the business improvements district and what council ultimately had to modify to approve the assessment increase. So it provides the breakdown of where the money is set. And for sales and marketing, they're combined. We were 65% of the budget goes to sales and marketing. But so that's for with based off of 10 million. This is just again, I off of that that 6.5 million So that's 6.5 million is Sales and marketing so that's the group all the things that the group sale department does we have a chart We have a slide later that shows the breaks out of the departments Visitor services marketing group sales, all of that falls under that 6.5. But the gentleman's question about what's marketing programs specifically, the investment of marketing programs specifically, that should be to the destination marketing that we do. That vary. you know, we've had it. The media because there's some that we do, that varied. So, you know, we've had it the media, because we have the media vibe. But again, it's the trainings, there's the events aboard, there's, you know, the sponsorships, there's the group sales. So currently for this fiscal year, I use that as an example. Our media vibe is about 700,000 and it's outperforming, you know, and um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, um, it's outperforming, you know, it's doing very well. So it's about 700,000. And so that number is what we would use in terms of assessing what the ROI on that is. So again, And so the two KPIs we use is, what's the, what was the awareness impact of that spend? And then what is the hotel booking impact of that spend? So there's a portion of my buy that we, there's certain platforms like Expedia, kayak, those kinds of things that track hotel booking and sales from relative to your marketing, right? Someone sees your ad, they click, they go to the website to book, they actually book, there's that whole funnel. Via that, platform is where we're able to attribute marketing dollars to bookings. But again, because hotels typically in our industry, that's their charge, the booking, the book, the responsibility of the bookings, we're just an additional component and extension of that brand, that marketing capability. One of the benefits of a DMO, especially for smaller hotels that don't have the resources, is that we are essentially an extension of that resource. You know, we do, we're able to, because of the collective resources, the T-bit hotels put into, we're able to do marketing levels the collective resources the T-bit will tell us put into, we're able to do marketing on levels that some of the smaller properties can, and then conversely for some of the larger properties that might be bound by corporate restrictions, and you know, they might not be able to be as creative or out the box as maybe they'd like to be, we can fill that gap for them. And so employing those two strategies have served the home sales very well. Now we aren't able to achieve our $ag dollars specific to those two KPIs, the awareness level and then what how many heads of events are we having as a result of one respecting? You get 22 hotels that you represent, is that correct? Is that the member I saw? You've got four large hotels. So we got 18 medium, small, what's the breakdown on that? I mean, we have some smaller independent operations that the Western Yeah, yeah, yeah, yeah, uh, Daniel speeds, uh, comfort speeds, best time. All four of the large hotels are their partners. Yeah, we've got more than 18 more hotels in the city, right? And so what's the percentage? Those are Westminster. Yeah. Yeah. There are some hotels outside of the city boundaries that like to claim they're in Huntington Beach. We've have to, they come to us all the time trying to get us to work with them. And we have to politely decline because they're not part of our team it. We can't represent them if they are not contributing to the team it. But there's there's other hotels in any debates that don't want right? No, if you have a license to operate a lodging property in Huntington Beach you are part of the team it. Oh it's mandatory. Yes that was that was actually a part of the original team it contracted the city. the city. And Kelly, is that a requirement of T-Bid in general? Yeah, so to give a little history of background. So our owner, CEO, he wrote a law that enables for these improvement districts, called the property and business improvement district law. So yes, when the boundary is defined, we define what kind of business is going to be assessed through this T-Bid. It does then become then become compulsory. So then your assessment district is the entire city of it to be. It is. But it's only 22 hotels of the city. Yes. Hey, talking. I don't know. I don't know. I don't know. I don't know. I don't know. And I include to the sense that beach property. Right. Right. There's one that's here. There. Yeah. All your favorite ones down on Beach Boulevard of Seattle. And Travis, what was the number you said of all the illegal? Well, it's so the short term rentals. We did a study. We had a firm help us figure out how much we had five years ago. And I thought it was around 900. You don't think so, what's the number? Tell me the number that's it. Say no, then you got to tell me a number. So, what's it, John? It's really huge. We know that there are a lot more, so there's a tool that we use called key data, right? They essentially do what Smith Travel Report does with hotels. They track STBR performance and destinations. So when I'm looking at that data, I know that there's way more operating beyond the A1s. So that's another factor. So when I'm parsing that data, I have to make it very aware, very conscious of the fact of how I use that data because it's rough down. They have no way of knowing who's registered or not. That industry are trying to work with municipalities to figure out a way to do that. I can make some kind of unique codes that partnership city, that's one of the conversation. It's about a little over 200. So we have 218 registered, go up and down over time. That could be another seven that aren't. It is actually, yeah. It is actually,000. Go up and down over time. That could be another $700 that aren't. It is interesting. It is interesting. No. What percentage of the dollars is coming from those now? I'm asking the RDS. Less than one percent. Less than one percent. Yeah, where I was going with that is the majority, I think over 80% comes from the door. The whole number of rooms you have in all the hotels combined is what, $5,000? No, $2,000. $2,000. So we're missing, seebably, another 500 right, which is a big $860. $860. But you just look at Newport Beach. It's obviously done something. They got 1500 registered STBRs. Right. Right. And there's not as many structures. So one of the up. So we have sure. So we're sure. That's one of the things. She's never damned. And then one of the options for us, the city council to consider, we've discussed that as, but we haven't moved forward on this yet, is to allow a certain amount of hosted, or non-hosted short-term rentals. So the city could allow to a number, how many, how many non-hosted, if the city would like to increase that number and permit those? Oh, are we purposely keeping the number? No, 218 is, if you want to do a host, there's no limits to the number. I think the limit is having a host that, like you're pointing out, is there's somebody on the property or it's a multiple you know duplex or something like that word that word. Oh, that's hosted versus that's hosted versus. So these two hundred and eighteen what did you call them? S T as did the other. Who bought it? How do we know that we're getting every six percent on that? Right, so, um, no, so you said he's going to. Going to? Yes. I'm good. Should that have been in place before we said we could go ahead and do this? Yeah, I mean, we can't get money from a golf course. How are we going to get it from his mom and father? Well, you fight him. It's just going to be You understand understand that. Even the ones under registered, how do you know that they're paying their bills? So we should be able to be on it, and also we are working with our Treasury Department to work on the information that they provide. When you can look at the information to see if it's a spec, you can, and you can go. Doesn't, I don't, you don't even trail when they, Peter's coming. Go out, you know? We usually, these folks feel like registered with like Airbnb or B or B or B. So don't, don't they provide, but don't they provide, you have companies that go online and look at what they can find out online if things are being rented or not and for what dollar amount and then they can help the city compare. What they're turning in. Well, well, the city do that. We're working to have somebody working to do that right now. And we're looking to reinstitute our TOT for all the hotels.its over the next year. I would think it'd be easier to audit the the health thing that it would be Fred and Julie's house in my backyard because they got countless and they got they got paperware. Yeah, more does. I think it needs to be enforced. That whole thing needs to be enforced. I'm ready to announce. You guys, you guys, the city council, some city council approved these things without having the enforcement structure in place, which was as far as I'm concerned, that should never have approved these things, but still all that enforcement was in place. They made all these promises about it can only be hosted and we're going to charge in the same taxes as we charge the hotels and nobody's checked get online and see these rooms, these, uh, PRBS and I need to be well over to it. 2018. Nobody's checking. Nobody's enforcing. Oh, I'm with you guys on this. They need to go. I'm getting rid of that. I literally shut up though. You don't want to say anything? LA Kings tonight, man, man. Come on. Go Kings go. Just a bit of a fact, I'm very too much of we have partnered with the city a couple of times to host kind of like a STDR 101 where we've had members of the city come and we kind of match made property owners with members of the city so that they can kind of inform them how to register and do the right way and what's involved and all that and we had we've had good feedback and responses as a result of the two and I know so be right now she's actually I think she's working on another one right now so it's just a way to kind of help with that effort. And this is just a department breakdown. Yeah, so this is an overview of those things that we've talked about the different things that we do as an organization. Um, over our sorr talked a lot about marketing. Michelle, do you want to do a quick sales? Yeah, I think so. So similar to the leisure slide, but different. So when you're booking one room at a time for a leisure group or for a family or for vacation, our team is actually charged at targeting large conventions. So when you're booking a large to room a block, you know, for multiple days. And generally these are corporations that can be anywhere from medical devices, automotive, I mean all different market segments. But what we're targeting is midweek, low season, and we're trying to get to fill the dates that, you know, are regular vacationers and leisure people are coming because most of the time they're working. So these people are coming here to do work, to spend money, to use our, you know, our restaurants and all the services that we have. But that's generally what we do. And similar to Omar's team with all the marketing, we have another whole set of marketing that we do. We have a travel and train show what we do. And similar to Omarq's team with all the marketing, we have another whole set of marketing that we do. We have a travel and train show that we do. There's a lot of components that go into it. Because as you can imagine, it's a very competitive landscape. They can choose anywhere that they want to go and why do they want to cut the honey to beach. So I mean, if you ask somebody in the Northeast we're hunting to beaches, they're probably going to say it's LA or it's an San Francisco. Like it's that education and awareness is of where we are, where we're located, the ease of access to the areas that we have and why they want to be here. I'm going to say you're kind of critical because I have three kids right now working in the restaurant, hook health industry in Huntington Beach and and the winters are brutal for them. They get mainly one day a week, but it's through the corporations that come in that are saving us the whole city, really, and not the whole city, but like downtown hostels to give them business, because the locals don't wanna go out on the call but that and again it's called it's to you know again we're going to build during the summertime during the weekends we don't have a problem with everybody when they come to hunt and meet but nobody wants to come during the midweek and how are you going to sustain that? And again, all of those people who come, they pay that TOT and that goes back to the general of five. So it kind of equals it out. Um, that it is. I appreciate that. It is very critical market. Yeah, it is. And a big chunk of that increase with that 2% additional, we've actually went to group sales. That was a directive from our board. That was really one of us to spend the money. That makes sense. Yeah. Yeah. OK. So we do additionally have programs that we do all talk about the tourism enhancement programs that Chris mentioned. We also visit our partner services. So again, once people do that here, we want to make sure that we fulfill that promise that we've made so they have a good time. We do have visitor services. And then we do do some advocacy. Um, I mentioned, you know, we work closely with the Chamber, with the downtown business improvement district, with the city, with other organizations throughout the city to make sure that we're all in the same page and that we're all helping each other. These are those nine projects that Chris mentioned. This was part of our agreement with the city that 10% of our budget would go towards tourism enhancement programs. There are nine of those programs. The first one is way finding, so this includes that sense of arrival and sense of place that Omar mentioned. This is actually a program that began back in 2016, I believe. It was unfortunately interrupted by COVID and so we are picking it back up again now to reinstate some replacement gateway signs of ones that were very old and hard to read. to read and so you might have noticed on Warner and on Adams. We got first two replaced and we were working on the remaining ones. We're also looking at creating a new HBQ sign so that sense of place right now when you're in downtown there's not really something that keeps green, honey, to each kind of like when you go to Santa Monica and we're looking to create that place to help with the branding and the marketing and for people to really understand where they are. We're also working with the city specifically with Chris in economic development and walkability and connectivity. So this is really how to be get those people from the hotels to Pacific City and to Main Street so that they are spending more money while they're here. So that program right now we're looking at enhancing the lighting along PCH because we know it is kind of dark, especially at night when you're walking through there. And so it will help with security, but it'll also help to lead people down that path towards Main Street. Temporary beach restrooms, we all know the restrooms at the beach are challenging. So for the last couple of years, Last year we paid for the entire beach restroom where they add those additional temporary ones by Zax at the pier. We've also contributed to those beach restrooms for probably the last eight years. So we have helped to pay for those every year for the last eight years and now we are paying for I think almost the entire program. The nighttime ambassador program I already mentioned in downtown. We're also looking at accessibility in our city. It's done an amazing job and trying to make it more accessible for people in physical disabilities. We put some money towards the mobile mats and so we're actually replacing one of the really worn out mobile mats that is at the beach. and then we're adding an additional tea at the end so that people don't just get stuck at the very end to that mat. And they can now go parallel to the waterline and really take more advantage of the beach space. And then bike ballet is something we're also working on with Chris and her department. We're trying to find a place in downtown for the summer for people to ballet. They're very like. So they don't have to worry about it getting stolen and they can come and spend more time in downtown and spend more money while they're there. And then beach event infrastructure, this goes towards what Michelle was saying with trying to bring groups and also events to Huntington. We got feedback from a lot of the events that holding an event in the parking lot was difficult because there were lights in the middle of the parking lot that impeded them being able to build out that space. So if they wanted to erect like a giant tent for their conference, there were those giant light poles in the middle. So we actually worked with public works to have those removed. They did a study that showed that the lighting, the amount of lighting would not be impacted by them removing those kinds of lights. And that allows for more events and more conferences to take you to that space. And then we are working with the ISM because, hopefully, the LA-28 was going to be hosted here, but we know it's still coming to the region, and there will still be a lot of people coming to the area. And so we want to make sure we have a World Class Surfing Museum for people to experience since we are Sir City, USAID. And then as a part of that program, the city also contributed. So this is the city's contribution towards the enhanced requirements in the Chris. I don't know if you want to talk to the more about. So as part of that we're looking at downtown improvements. We're also replacing the elevators and the main streets. How about grab that's kind of the review already about it. It's we've got the funding for circuit. We just completed the pedestrian path at PCH and 6th Street. We're working on park upgrades at Pirate Park down down, lighting up love top park, and then we also fund the maintenance. So it's kind of a matching commitment. And Chris, we'll put a question about circuit. At one point, it was free, right? It was like a grant. And then now are we paying for it? We're not paying for it. It's all through the grant. Oh, it's still through a grant. Yes. And then I think it was some parking and loop fees that especially dedicated, but it's not, and the setting is not general fun. We were able to secure that. That's great. Thank you. Thank you. Again, some of our additional programs. We try to get people to get more involved in the city as well. So we actually run a service to you, say volunteer program. One of our staff members does this to create a way for residents and community members just to feel like they can contribute to organization and to their community. So we we will frequently have visitor information booths at large events and so we invite them to help us and volunteer at those. And then we'll also connect them to other volunteer opportunities in the city. I also mentioned our board meetings earlier. So if we do meet, they are subject to the Brown Act. So anyone is welcome to come and attend. Rebecca, that chart where you had all the low badge things laid out here. You heard from the Washington people. This has been very formidable, not necessarily for me in a good way. If I understood this whole premise, it's basically to get more heads and beds cutting through it all. Is that correct? So that really targets the living bejevers at a who you're going after. Okay? With that said, you're very limited on your budget. I'm telling you this from many years experience living in the business of marketing and in teaching it for 15 years in graduate school. You don't have enough money to do all of this happy stuff over here. You're really dumb. It ought to all be going into marketing and you've got very little, you got very little of it to spend. Okay, so that gets to my not to tell you how to run your business, but I don't understand what you're doing spending $26,000 a month for office space over on fifth, whatever that is. I would think one of the hotels would donate office space to you. I mean really if you're doing what I think you're charged to doing, they out of welcome you. I would I would think if not you could probably get a really good deal of Elon, the most of the entire bottom floor is empty. Didn't mean to step on any toes. The other thing I didn't understand is you're spending over a quarter of a million dollars on travel, which I assume is to go into these travel fairs, trade promotion kind of things. The hotels have people that do that for them. Okay, so why you would want to be doing it in addition to what they're doing, you know, I don't understand the spin. I also don't understand why you got 17 people on your board of directors. Why? Do you need some? I mean, I'd get rid of 10 of them like tomorrow, you know, if not more. I don't know about the executive committee thing. They got to get a representative from every hotel. Is that it? Probably. Actually, so when we were originally created, the founders decided to create a board that didn't with some hotel representatives but we only have currently five hotel representatives and then one person that is an STBR owner. The remainder of the seats are meant to have a more representative group of people from within the community. So we've got somebody from a public on our board, we've got somebody from the Chamber on our board, we've got somebody we have had a representative from Golden West College on our board. We've got the Executive Director of the HB Wetlands on our board so we try to make sure that we're representing the community as a whole. So when we're looking at all the words that we do, we are taking into account that community input. And I realize that has something to do with your 501c3 success. I don't know. I don't really care. All I would care about is focus on the heads in the beds. I'm sure that's what the hotel wants. Us being the greedy city people, we just want the art slice of the 10% and all the rest of the stuff would just be, it's basically it's smoking mirrors. Everything on the right side of that chart, smoke mirrors. And yet, is the city council required you to spend 10% of your budget? What was that chart back there? If you have switched it up. Projects. That's our city council. How's it doing this stuff? What is that got to do with visit? To get people to visit here. Makes it nice to be here if we have. Give it that's not their job. I agree with it. Don't get me wrong. I'm not trying to be critical of that. It's if your job is to get people here, I don't know what any of that does to do that. And yet 10% of your budget's got that's over a million bucks, right? It was. On a 10.6 million dollar budget? Man. Okay. Thank you very much. I appreciate it. Everything you're doing. Thank you. Thanks for coming. And I would like to see the market budget. The only goes I live for that stuff. Yeah, and I promise not to say anything. Oh, no, it's not. Don't make up. Fuck that. He's not like Bill's doing something. It's not. Okay. and write out to them on it. Thank you. Thank you very much. Thank you very much. Thank you so much. Thank you very much. You're going to buy a ball of dinner. That's what I was talking about. We're just a fighting this commission, you know. How are we going to do with why? I don't know. All we can do is to plan. Are we going to get on your guess list for the Air Show donations? We all we can do is why we can do is come We're gonna get are we gonna get on your guess list for the airshow You're gonna be cleaning up the garbage cans But I am to go as Travis Hopkins. You know what the volunteer number? Yeah. Sign up. Sign up. Email. Email Heather. Yeah. I don't know. How do we get this? 15 in the bathroom. There was saying the volunteer program. Our volunteers actually are invited to go into the path that our lunch breaks. So I'm going for it. There you. Yeah, we're going to say that you're going to be in the one of the best in the dark world. I'll say you guys can see how I've talked about. Appreciate that. Thank you guys. Thanks for spending your Wednesday night with us. Yes. Thank you. Yeah, that's what else to do. Thank you do. All right. So we are ready to move on to D2 popular annual finance report review. That you? Who's doing that? Okay. All right. Go for it. Okay. Hi. One minute Bob towards my first official meeting. I attended the last meeting, but I didn't have any. I'm going to talk about. So I'm going to talk about. That was. Yeah. Yeah. Yeah. Yeah. Yeah. I should volunteer for the. Okay. What I'm going to talk about is. Here and you'll put it. This is the city's plan for the year end you do 30 to 24 to 108 pages. Why is it called popular? And I'm saying the games in the old days and during the last two years that chat. I've been doing other things. It came to the name to the popular. You have to be constant melting for this whole time now. I was just cracking up that I saw that. But those were positive adjectives. I've been doing other things. It's changed the name to the popular. You can be called the mouthful. I was just cracking up that I saw that. We're positive attitudes. Yeah. Well, there's 180 cities. City boilers down to the popular report. Okay. And I'm going to boil the down to a couple of slides here. Oh, can we get it first? I want to I'm to go into the class to the very end. Yeah. I'm going to get a bottle. If you're going to get the full report. You're going to get the you're going to get the high dice. Okay, but we can get a hard copy of. Oh yeah, yeah, yeah, at least. Yeah, what you have in front of you. Yeah, the actual popular report. Okay. This is the whole thing. We don't have a venue, the actual 180 pages. I want to put that. Yeah, I want to give you a minute. I'll give you a copy. Thanks. Okay, so it's very worth the, and this is the popular report. It's sometimes referred to as the fit of entry. So it's supposed to be understandable to the Yeah, first average city. So let's get into the first slides. Entity beach by the numbers. You can see our property tax rate actually. It's 1% in California is the 1% property tax rate. You know, you're probably tax but on top of that, you can look at the property tax value see other assessments. So 100 in beach for fiscal year 24, or the average of that, if you're looking to probably back there, you'll see other assessments. So, I'd encourage and reach for fiscal year 24, the average of whether assessment was 0.1, 0.3. But the property tax rate was pros and pros 13. It can only be 1% of the assessment. The market evaluation. As you know, when you sell your house, the new owners is paying the higher rate than probably you were, right? An employment, you can look at these numbers yourself, but I wanted to talk about the ratings. So the Fitch and S&P, y'all are familiar with S&P standard and PORS, Fitch is another bond rating agency, and the third one is Moody's and they're not listed here because the city didn't go, didn't ask them for a rating. But to be honest, that's pretty dog that I'll get. There's very... bond rating agency and the third one is Moody's and they're not this year because the city didn't go didn't ask them for rating but Tribal Aid, that's pretty dark out there's very few cities in the state of California that have a triple rating that's basically that's called your Geo bond or general obligation bond rating and the Tribal Aid was signed to the pension bonds So the pension bonds, the city, it should them, I believe in 2021, I would say it's a great strategy to reduce your thought. At the time, the city had a pretty significant $300 million and plus unfunded live-goky, live-goky at the old purse, purse was advertising that over 20 years, and they were charging the city 7%. City turned around and issued bonds. If you pay out that live bill fee. So you still have a live bill fee, but not your paying bondholders, instead of paying them 7%, they're paying about 3.5% or 4%. So there are significant savings associated with that. The double A and double A minus, those are revenue bonds primarily. the life of those bonds. We're going to have that rate for how long? So it's typically 20 miles per year, don't you? Assuming that the pension obligation bonds, city issue are probably 25 miles. And with those bonds in the future, there could be an opportunity for another refinancing, but right now, it's a pretty high town on. Now we're saying, let's see how it goes. The next slide. Here's the breakdown. It's pretty debt primary long term debt. You can see that we are the metal, those of it for the pension bonds. And we currently are standing about $300. Revenue bonds total about 22 million tax allocation bonds are what's left over from the old redevelopment agency. So when Governor Brown came in and dissolved redevelopment ages, he came 2012, the state assumed all, or took away all the tax agreement, probably tax agreement. And then, of course, say you got to get away and say, well, wait a minute, what about the debt? Because under federal constitutional law, the state can't take away funds that have been dedicated to bonds. It's called the contract and the law and the federal competition. So every year we submit a budget to the State Department of Finance requesting about 10 million dollars annually of tax documents that we can pay for debt that remains from the days when the redevelopment is existed and most of that then goes to pay out your redevelopment bonds. Get that from the state. We get that revenue from the state. Remember that property tax money is coming from the Huntington Beach. It's our money but But okay, yeah, well, we lost a time away that the state took the balance of budget. Yeah. The investments said, you know, we have a city, like the city treasury, the lease of and she manages the city investments. Under state laws that equal California are not, are can only purchase securities primarily bonds with maturity of five years or less. So we can't go out beyond five years. In addition, city does not allow to invest in stocks and equities. So we have bonds, you see the list on the left here, US treasuries, US agencies, trade securities securities, or FGINI-MAY, any May. Mutual funds, again, are bond mutual funds. Money market funds, those are overnighters. We don't earn a lot of interest on that. Corporate bonds, California FED management programs called Camp. That's a program that state of California introduced about 20 years ago, I guess. It's a way for time-run smaller cities to invest their money and propose to invest in their money with late. Late is the local area investment funds. It's also a pool. It's where the state invests their money and they allow cities, and other field of extension, never agencies to invest their money in a late pool. It's a very short term pool. You can get your money within 24 hours. So you're not gonna earn a lot of money. The average maternity is about six months, I guess, I'm knows. And then the PERS pension and rate stabilization program, when the city issued pension bonds, the city council adopted policies that require savings as a result of the lower payments from the pension bonds to go into a reserve. We call that the section 115 trust. Section 115 is just a section of the IRS code and applies to pension systems and the pension fund that we use is called part of publication to determine a system. A lot of cities in California use them. I use them in other cities as well. They operate just like CalPERS, not the CalPERS and cities. And they can invest in real estate, stocks, other instruments, investments, and cities that are not allowed to by law. So they're making a pretty good return. Last year, Pars had a return of about 12%. And the last three months, so of course, the returns have been down to the last two big frames and days. So So you can see that the treasure keeps the portfolios fairly short. We're going to make pay low, we've got the stretching contracts, etc. We also do what everybody does and we survey our departments, especially public works, and come up with a schedule of when they're going to need the money. So if public works tells us that they got a major project, come in the breaking ground in September, they're going to need the money. So if public worst tells us that they've got a major project, come in a breaking ground in September, and they're going to need money in September, then we'll schedule our investment. The Treasury will later it so that the investments mature when we need the money. So it's pretty interesting program. And if you're involved, it's actually a lot of fun. You're investments. This is Major Property Taxes. By source, you can see that our property taxes are the largest source of revenue in the city. That's stinking true in just about every city in California. There are some cities however, that are pretty small, and they don't generate a lot of property taxes. Cerritos is one city that I know they don't have a local property tax. A long ago when Prop 13 was first enacted, cities were allowed to make a choice of whether they wanted to continue to charge the local property tax as well as the state rate or not. And Cerritos, what from back in the 1990s they decided not to enact the local tax so they're considered a no property tax city. Lakewood is considered a low property tax city so they do have a local property tax return but it's lower than most cities. I can be to the traditional city, so I can be selected to take the full amount. But the recent serritos did what they did is they created the entire city was the redevelopment of the private area. I think I got 100% of the tax increment of it. Of course that money is kind of restricted and that's how they made have a way to make their descent. Next chart, if you have any questions, slow me down. I've talked kind of fast. I'm your trend of revenues and expenditures. So in 2021, it's one of the issues of the pension bonds and I'm assuming that reflects the payment. I don't think that's very slight. Okay, slide seven. Yeah, you got a question with this. I'm talking about that. Slide seven. We're over just four. All right, wait, it's like six actually. Yeah, I got page numbers and slide numbers. Well, let's come back to four in case you have questions. Hey. I was just curious, why did other taxes go down so much between 23 and 24? I'm hoping someone would ask that. And there's some research. Great, man. Okay, according to my research, that was the year when natural gas prices and electricity prices spiked and a lot of cities made a lot of money on their franchise fees. So PGE is your provider here, they provide both gas and electricity. They pay the rent by speed and during that year they had their sales fee. and because they're sales, went up the city's franchise heat payments also increased. I got a windfall. Yeah, that went far. And that didn't carry forward. But the good thing is I mean in in 2023 we have consumers we were all paying the higher rates. Right. Another they've stabilized a little bit. And the other one is licenses and permits. It's also tick a dive a little bit there. And not really obvious why that would be. Yeah, that's like there's this licensees. This is licensed taxes and permit fees and all that. It's kind of it's kind of fluctuate here here. I'm looking, actually a lot has gone down. I wonder if that's just a reflection of our economy. I mean, the third reflection of the economy. So, you know, as you know, there's been a couple of workshops here where Travis talked about the city budget. And so for next fiscal year, we're projecting a deficit in the general fund. That's primarily because revenues are either down or flat. The revenues are going up. Yeah. Well, it's our retirement that is bankrupting. Yeah, I've gone down, but they're relatively flat. I think historically, they've increased almost every year. We have an economic slump. Of course sales tax revenue goes down because consumers stop buying. But the other thing that's happening is that a lot of consumers are buying online now. But when they buy directly in the 19-beach, we get a 1%. So the sales tax rate in 19-beach is 7.3-4%. Most of that goes to the state of California of that seven and three quarter percent. One percentage point is Huntington Beach's share. We get that, let's call the local share or the Bradley Burns, it's two legislators that created that. So that's that 56 million is that one percent. It's the one percent. So wait, if we shop online, I me, obviously it doesn't get any of that right. You get some of that. What happens when we shop online is that the tax, the state law that was passed by five, six years ago, when online sales started rising. So now if you buy something online, or that was example, they're required to collect the tax. But instead of the 1% coming directly back to the 19 weeks, it goes into the state pool. And then every city in California shares from it gets an allocation from that state. The same amount, like percentage, like everybody gets one percent or two percent or whatever. Based on population. Based on population. Based on self-footed. We get a lesser amount. So what I'm saying happening is that the sales activity in the region beach is still going up, but the online sales activity is also starting to go up. And it was kind of flat for a few years and about five years ago, all of a sudden, you started going like that. So if you look at the two graphs, you'll see sales taxes have been gradually climbing and that's because of prices going up. And you see online sale kind of flat, all of a sudden, you started going, now that's taken away from I had to believe that that sales tax was predominantly driven by cars and cars were down in 2024 so that that's probably the biggest reason why that's going down. Yeah well and and in terms of each I can talk about categories I can't talk specifics but we have seen in the category of auto sales, there's a lot of auto dealers and they're all lumped together. In general, that category is flat and would normally be normal to that kind of. So it's for sure. And I guess, and I, we have sales tax consultant, HDL, it's the call to be and I just got a brief from last week from them. So they're telling me that, adding notably, people maybe going to leases. Instead of leases. So I'll be thinking it's the leases. Everybody's leasing their cars and say, I'm blinding them, but I didn't know how that affected the sales tax. Well, I think the interest rate's not for bar sales if you're on the average with regard to your credit scores, you're going to pay about 70% something like that. And sale prices are up for a while over the last 12 months. And in the United States, there was only one car that you could purchase for less than $30,000. Okay, and I've seen a reason you know there's a few more cars in the $20,000 range. But you know, you have to take up second more if you want to buy a luxury car now. You're going to a regular car. I think one more comment too. Property tax is interesting to me because I assume that that to me is not a big jump. And that would be like the turnover of houses, right? Because if you don't sell your house, your property tax stays the same. But then if you sell a house, then on that house, the property tax goes at, which we're not selling, you're not moving. This transfer of wealth is going on as we're passing to see how many Beneficiaries of trust you're not too. Yeah, are not but they're they're not taking it probably they're only at one of them's moving in or But they're not letting it go. Well, and sometimes because it's happened to me I grandfathered into a property tax rate Sorry, okay,. Okay. He's required. But yeah, and then if Sacramento ever eliminates that, it's gonna create people inheriting, especially coming to Harbor. Yeah. Yeah. So you're gonna use that one time I found out that you use. Yeah, you can use it one time. Okay, that's interesting If you move know if you inherit a homie grandfather into the property tax Like I grandfathered maybe a 19 Property to is it gone? Yeah, that was that new So you know when you inherit it you don't get to keep it. Yes, that happened a couple of years. Put it in trust, but the pit has to be a trust. It has to be a trust. That's it. And that was long ago, you just didn't trust. It's still in place. Oh, okay. Yeah, so what I'm talking about is 55. So I, like, oh, my life right now, my property tax rate was based on the prior home. I thought you could use it more than once, but I still have it. You can lie at one time. Okay. rate was based on the prior home. Yeah. Yeah. And I thought you could use it more than once, but I thought you wanted to. But I think you can write one time. OK. Interesting. Yeah. You know, they have certain time periods and all that. Yeah. So so so revenues are down in the general. I would wear a kind of scrambling. Put that strategy together. and we finally prepared for it. It's got the general. I would for kind of scrambling to put that track budget together. And we finally discuss the budget in the late 20 year. Pretty comfortable. But yeah, session. Well, do you say anything about raising sales tax? We're going to chop your head off in there. So just be prepared. It's the only answer. You can chop the head off, but it's the only answer. I'm getting scared. Thanks for anything. I'm looking at you saying that. Don't be a little lazy. OK, so no, no, no, no. Permanent to everybody else is kind of stable. But yeah, there are some annual fluctuations that occur. And basically, a revenue is flat. And expenditures are growing. And like most cities, large part of our sector budget is labor. And like most cities, who's chunk is public safety. Is it a real quick question? Does anybody in the city council looking into kind of doing like some cuts or anything for the staff in ours is too too hot at the topic of arrest. No, so we're reviewing about the budget. We will bring to council and they, and June, they have to do it by then. And so we're working diligently on efficiencies, revenues, budget reductions, so that we can hit that $8 billion deficit projection. And we have major focus right now. All right. In this pie chart, just simply breaks down funds by, by category general government. The primary, everything except public safety and public works and recreation debt services included in there as well. Who are the next? service it's dead service. Dead service is just. What is that being? The bond that's the that's the residual payments on all the bonds that we're having to make. Patient bond. Okay. There's some other other dead. Okay. Smaller nature primary death that city has a pension on the end. And the reason that went up. So much was more bonds or what's the reason for the increase between 2034. 24. 21. The city issued pension bonds. I would I would think that I would think it would be pretty constant. I don't know the answer to that small amount coming to a million. Yeah. No, to the small amount of the survey bonds. Okay. The version during that time. Okay. Thank you. Okay. Five year trend. There is an expenditures. Again, the city issued pension bonds in 21 2021. So assuming that reflects the payment, the pay increase, the payment, the CalPERS pay off the unbutted liability, the recorders and expenditure in the city's books. And next slide. The residents, enterprise fund, their, enterprise similar to a private entity. and we have water sewer and refuse that it has been. You can see that's pretty, pretty bad. But if you know water sewer, like revenues, and that's how they pay for their operations. What's purple and what's blue? What does that mean? Like one is the budget. Revenue in the expenditures. Oh, okay. Oh, there it is. I see that. So where you see in water expenditures exceed revenues, because they have reserves. And that's very typical of water enterprises that sewer enterprise. I mean, you have on reserve land or reserves that, you know, capital. Well, I could visit one side, but it's a couple projects and a rainy day. But in the last slide. Well, this one here, the purpose of this really, I'm just like we were talking about sales taxes and tax increment. Every property tax dollars that the resident or business and Unit and Beach, a state of California, Unit and Beach only gets back 16 cents. The rest of it goes to the state, our primary pay for education and the county for special districts. So let's go back and this chart would have been a little different. It's almost different because the state is not taking the biggest chunk of the property taxes. But in 1993 or 1994, the state took the property taxing away from cities in order to finance schools because they needed the state money from the general fund to balance the general fund budget. That was back in the days when even though the state required to balance their budget to adopt the budget by June 30th, they would adopt it in September and then cities would travel like crazy, trying to come up with ways to to offset the loss of money because every year, it's a big way. So the situation has become more stable, but still for every dollar that we pay, in poverty taxes, it has to be to get taxed 16 cents in the dollar. That's pretty similar in most cities. And I'm close with it. If you any questions, I'll be happy to have you. Galaxy, we're talking about mouth sheet. We'll just then in the, one of these things. On the town of Peter, the guy who was the statement of death, the love, yes. I keep asking this question. If we have revenue coming from Elon's regular water in 15 years, assuming we sell, isn't that treated as an upcruel? And if it is, where is this shown up on the balance sheet? Conversely, the debt that has been incurred as a result of bonds, where is that showing up on the balance sheet? It's not. You know it's not, right? I can't do for it to be. I can't find it. Just saying, it's not on balance sheet. Both of those are not on the balance sheet. That's just a degree that we do agree with that or not. Oh, I would agree with it. Okay. So you're asking why not? You want it to be on balance sheet. Okay. I just wanted to cut to the chase. If this were a business, you couldn't just say, well, it's a complete, it's a complete, And lock the way from that bad boy for whatever reason. And we're going to bury the number. In fact, we're just not going to put the number anywhere. I'm just saying through from the people that live here. We owe it from the same Florida account building and transparency. Okay. Both sides of it. Okay. But in the actual full blog, 180 page, that's where it points all there. It's a long term debt. He's asking, you know, on brick water is that. I don't believe it's in there. So at least that's what I understood. And that's what I understood. Okay. So I don't believe it's in there. It's part of that JPA. I guess I need to get more information or better answer for. The way I just understood it last month, where we just talk about it, because it's really not a city-owned entity. It's this partnership out there that's got that. How do you put it on the city's books? I understand that. I said the same thing. But the problem is we should be an actress at least. or something. Oh yeah. A note for you. Some offer you did with a wooden somewhere. Stick a footnote in there and I'd be happy. The other issue is you've got property tax revenue. It just evaporated. I don't understand how that. That doesn't make any sense, right? Is it, we don't even get the problem taxes. Let me know. It's not already in the point. I'm just saying, come on, let's stick to some basic accounting here. Okay? You were getting it. Before this deal happened, you were getting it and then just went away. Yeah. So it's kind of like, well, it's not being short. Right. I'll answer the question. The county gets 16% of that. Yeah. The state gets 16% of that. Yeah. And the state gets 71% of that if they don't care. So they don't get any of it. Well, I know what they don't care. Nobody asked him. This is the bad way. We're getting rid of the 70, which is 500% of the problem.. So I'm not going to say this is the same, but I believe it could be purchased by a nonprofit. They don't want to buy a church. Yeah. And they don't pay for any of the pain property. When it wasn't a nonprofit or not a church or something like that, then they were playing property tax. And then when it becomes a nonprofit or a a church. Like the movie theater charter center. It was a movie theater and now it's a church. And so there's no property charter found on that movie theater where yeah. Yeah, that's the same kind of thing. The state that did. I'm not saying it's a good idea. I'm not defending that. Yeah, you're just saying what it is. That's what same kind of thing happens. And I'm not trying to beat the dead horse because God knows we have kicked that bad boy up down the street. I'm just saying, get the accounting right. Get right with the Lord if you will. Where is this money? Where are this money just floating around, disappearing? Nobody knows. Because by the way, there's a $10 million bond in there that we owe to who's a castle rock. That was fabulous. I was the other round. $10 million dollar bond, how do we, is that debt noted anywhere? And I know the answer is, oh no, it's not because it's a joint, it's a JP, so it's like all off the books. Yeah, it's in the JP. But there's, but we're going to be the ones on the roof. It's like we're going to do the ones on the roof on the property tax when it's accumulated and and and orange County comes after their their pound of flesh or the whole thing well Whenever this deal finishes In 15 years or whatever it is then the debt and the asset will Top on to the balance sheet in one big fell swoop Yeah Yeah. You just what you mean? You should have one. So the balance is that's why that's what they're going to do. This is because they're going to turn it over. They're going to turn it over from the the joint thing to the city. And I'll just pop on there. It'll become then city and instead and the city debt left. Well, yes yes, if you paid off that time. How do you know what's going to happen that's going to pay that off? So they're paying it off? No, if you listen last month, all they're doing is paying the interest. So on the 10 billion, that is the last debt that gets paid. So you pay everything else first and then you do that. Well, what our fellow commissioners told us last week is so far, everything all they're paying is interest. Not they're not paying the principal down. On that piece, the piece of the whole. So what he said? Yeah, so they're paying the desk down on purchasing and all the capital projects they have to do to get the debt for that they're paying it down on that. What it is is this catalyst money for doing the deal they got they got a basically gave the city a loan right we pay 8% interest to them over the life of the life of and that's the last 10 million old. That's one that gets paid. So you pay the purchase price, the capital project price over the 30 years, I think it is. And that gets paid down. And then those last two get paid last. But what I understood what I took away from last month was the bond, the debt currently was around 200 and for one of the properties, I think it was the break water one, was around 240. The value, the market value is around 180 right now. So somebody's making a major assumption that that that that property is going to decrease in value by another 60 million by the time we have to pay that. Well, they're well, we should win uh uh in Dave. Really? Yeah. Thank you. Well, they come back. They are making payments every year on that. The big bond at 200 and something. They're not paying interest only. Yes. But in the upcoming years, the payments accelerate greatly to catch up and to pay it off in 35 years. So that payout number, the amount that gets paid of those those can't shut and to pay it off in 35 years. So that pay off number, the amount that gets paid on those those those bonds increases quite a bit as you get to the next thing they broke down into five year quadrants. Those five year quadrants as you go to the next one and pay off gets bigger, which means they're going to have to increase risk. They're going to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to have to legally be able to increase the rent to meet the application. Yeah, that's part of the problem. Yeah, that rent and the cap rate are never going to meet. Yeah, they're never going to meet. They're never going to meet. Oh, is that the problem? I see. So they're legally only 10% of the market cap rates for that kind of property are going to be wherever they are and that rent will be anywhere. No, that's the problem. So my point is how are you not accounting for this little supply? It's going to pop enough. And that's why. And then in 30 years there are like you owe $96 million. I'm going to guess, Robert. It's a note to the financial statements. And it's got to be a note. It's a note to the financial statements because it's not to be a note, right? It's a note to the financial statements because it's not an ask on the books. I can't read. I can't put it on the books because it's on my ability somewhere in the future, so you don't know what's back. You don't know what it is. So you can only say that someday it's going to be there. Yes. If I saw a note to the five beat on behalf, okay. I mean, you know, we can't sit here and argue about something that decisions already been made. That book's already sailed. So we got to now deal with, okay, we at least are being prudent in our future planning to know that this is coming. Somebody should be a surprise to that. And publicly, we owe it to the public to make note of, I think it was a four-hundred who was in there for two or three years. Nobody knows this. I don't think they're... I don't think. Thank you for your presentation, sir. That was not you didn't do it. That you better give me the whole. They were all. I want to heart. They don't want to be the big for the. the bad for the people housing and all that. I know, that's the problem. Do I have your shelf on the box by 6.2? It's more valid if you know how to avoid it. If I see straight. Okay, Travis is not a buggy. I'm sorry. Yes, thank you, Perf. We can, we can, we can, we can, we can, close this out officially. How would it just tack it? Let's name Ramoulon. All right. Commissioner Comet. Oh yeah, we do have that. But you can skip. I mean, you can just like, I'm out. No comment. No comment. Next meeting agenda, the one thing we want to put, the automated platform that Frank uncovered. Yeah, there. get that email? The link to that Norfolk. The Norfolk Virginia. Yeah, the Northfolk Virginia. They've got a web page that it's interactive for the budget. So that citizens can get on and they have the current budget and you can go and do what I think. I have a phone, did I share that with commission? You've done that to me to share that. That was supposed to be on the agenda this month. We'll put it next month this fight because I'm sure Billy wants to talk about it too. But if we could put it just so we could get it on the screen there, we could show it to our people here until this is what we're thinking of when we're asking for stuff on the website. Well, yeah, specifically the financial dashboard because it lose you in that direction and if you could buy something like that, turn key or license it without a huge infrastructure investment in IT stuff. Then maybe something that we wanna do. It's an article for GBA. I hope you had the link, right? I'll send it. Yeah, it was, I think, a Billy sent it to you in an email probably, what, two, three weeks ago? On a Friday. For it. We're gonna do the least God. Yeah, I was thinking about that. Yeah, I have the least God coming up next and we'll. Yeah, they weren't able to make it this week and they're paying to come next month. Okay. And as soon as Kelly gets over his hip replacement, we want him back. I'm just kidding. Fresh meat. No, Kelly, Kelly missed all the fun, right? Yeah, it was fortuitous planning on his part. Yeah. He's probably perfectly fine. He just didn't want to come. We told him we were mean. Actually, I think you probably know that. Austin, I hope you return. Yeah, I did a fine job, especially that. In church group talking. Yeah. Like that's an exactly where the body is. Yeah. I just problem with that group. It's not the people that said they started with two. They now have 19 10 years from now. They'll have 38 Well, they'll have twice the office space. I mean, it's my president a lot of people Yeah, wow, they're their latest tax returns. So they had 22 people So maybe they lost a couple maybe yeah, maybe they have some part time, but I don know. Yeah, it's one of those one of those organizations that will Continue it's the up it'll continue to grow and all over things and This city the city council has to prove all this stuff Like the increase in the equipment They really need to keep it. They bring that report annually. Yes, they go to their meetings. Are you satisfied with the ROI, the way they're describing it? Because given it upmarking research, you could prove anything. Yeah, there really was a lot of assumptions going on. Yeah, it's not. It's all assumptions. It's not easy to follow. No, to actually follow that and things could happen. We we have, you do have a reason to check on the send, you don't have as many people coming. I made the point, I made the point that I teach this stuff in graduate school. And the best way for me to describe what we just sat and listened to was gas B comes to marketing. That's what this is. So, gas B, it's just kind of like, it's all over, it's like the multi-headed beast, but you really can't track it down. You know, it was one of the more bizarre things I've ever sat through in my life. So, the clarity, the lack of clarity there, it's just shocking. It's difficult to argue with because it is not a drug connection. The hotels are paying for it, but they're not. They're dipping into what the city can charge. That's not true. I don't know. It kind of is. So, one is that let me say So, let me say how they look at it. So, they look at the TOT that if the city wasn't doing the TOT, which they feel it's on the back of their industry, I'm not saying it is, I'm just saying this is their perspective. So, the TOT, the city gets the 10%. If they do, what do they call it, the pricey is dynamic pricey, right? And so if the city wasn't doing that 10% guess who would be getting it? They would I got a bit lower the price Well, they wouldn't do that. No, they wouldn't yeah, so they try to get the best price they get for every room So they did their dynamic pricing and there and whatever pressures put their pricing up and so So their perspective is this and that's a little bit of what they didn't tell you in that, but they take that 10, we'd sit and take that 10% and then we go pay for police services or all these other things which don't actually, which not directly in their mind, increases sales to them. So that's why they've agreed, they voted this. The large hotels must have wanted that 60%. That's 60% right? Yeah, so they're willing to do that. I don't know all the benefits of doing that, but they chose to do it. They voted because it's a pretty elastic number. Well, the people that go and stay there are willing to, they're pretty elastic with that five, six, 10% number. Because they do it every time. Well, you don't see it to you check out. And it's well, but I mean, but people are just not on their feet. They do that. It's all on. People just use to it. So it's pretty elastic. They won't stop going because, oh, I had to pay 6%. a basic percent. That will affect the price they get for it because yes, because if we if they didn't collect that and if the city didn't collect it, I bet the price will still be the same. Sure. Of course, it did. It may be. Yeah. So this could be for one scenario, a potential scenario. So the hotel they got from marketing budget and then instead of increasing the marketing budget, the city puts in the T-ride. Okay, so now when you check out and you look at your bill, you're going to see it's not higher prices or all that sort of say city tax. They can blame the city, but now they got these guys doing marketing and the hotel don't to spend as much on marketing. The slide for me that I think it really talks about whether I'd like to know before this group came into being what were the occupancy rates which were basically at 69-70% at their lowest for nine months of the year, at least for sure seven months of the year, with the exception of winter on both ends, fall and winter, right? So at the end of the day, what's the incremental value for that budget, getting them over that 70% and what are they gonna do? Well, they're at 90%. Well, you can go over that stuff. That's why we kept pushing on it. You have to go back to 98, or whatever to be able to see what the occupant, we didn't even have hotels back then. I was saying it's not even a fair. So the only good data point is gonna be this increase in Tibet that they just got and how did occupancy change next year? Now you have a direct correlation to more marketing. It's not just marketing. It's not a wonder. Like, for instance, I have a home in Abline and we actually do better when the economy is bad. Because people are like, I can't afford to go to Florida. I can't afford to go to Europe. I'm going to go to Abline. And so right now, my house is booked through all this summer. summer. Last year when the economy was better, I could barely get it, but I get it in there in August, which is unheard of. So marketing is a huge thing, but there's so many other factors. That's why it's frustrating. It's almost impossible to really nail down like how effective are they? I said to Frank, I whispered in my said, this is like when I say dead, don't like I'm not trending and says it. said if all these people just died and there was no visit hb What what happened to our hotels and and I'm not saying we should get rid of it I'm just saying I think they'd be fine It's called first mention unated awareness goes down. That's what it is Yeah, but like do you think in the summer weeks would so we still would we wouldn't be like I need to there are other several places to go and if you're not out there promoting your brand so that you are constantly in front of someone you're not going to think of them first to go. So you're you you are like yeah we need the fact that mayor is on board with this tells you that they're doing something right. The mayor's? Yeah he wouldn't he would not put money in this. Yeah. It's he wouldn't agree. He probably has with power if he wouldn't ask for two more percent. Yeah, I was gonna You know that's right because if that he gets it. It's kind of like spending money on you know Google to get your your ad Clicked at the or at the first on at the top right the same kind of money is spent on Expedia and all the, you know, it's boom. Now, I need to beach can get. Well, I was actually very sure that we actually had a little bit of say in this, but after ice-red and Mayors really set this whole thing in motion years ago, I was like, it is what it is people. I mean, we're not touching this thing. Like it is what it is. Did the beach boulevard of cars have a similar organization? For what? A five or one, so five or one six. That's the same thing. To do what? You got the same boulevard by you. So they have that one organization, but they pretty much do it themselves. Yeah, so that's what I mean. They've got fun. If this work was the other ones, it didn't themselves. So I've been doing it a lot more TV or time though. It sounds to me like the four big hotels are sucking money from the 18 little ones to help pay for their marketing. Yeah, I don't agree because their price points so much higher. It other, those other 18, you know, tells her full. I think they're paying for, they're over 80% of the air. They're paying for health. Just 80% of the, of their, I just thought I, I guess it's, it's working but who knows? Yeah. It's, it's been fun. Yeah, I have no, I don't have any comments. I don't know. I move that we end this meeting. That's a second. All right. Everyone. I don't have any comments. I don't want to move in seconds in the city. I move that we get this meeting. Second. All right. Everyone in favor. I do. Do you guys? So we have Senate confidence bills are so good. I don't think we've solved. One. I love. I mean, thank you. I'm talking about how do you get to know is from out here and to the walk up