Memorandum

City of Lawrence

City Manager’s Office

TO:	City Commissioners Thomas Markus, City Manager Diane Stoddard, Assistant City Manager Casey Toomay, Assistant City Manager
FROM:	Megan Gilliland, Communications Manager
DATE:	March 24, 2016 – revised 03/28/16
RE:	TGT Grant Program Approvals

In the 2016 budget deliberations, the City Commission set aside $150,000 in Transient Guest Tax funds for the purpose of creating a grant program that would allow the city to draw on budgeted funds for requests for support. The use of a budgeted grant program allows the city to limit opportunities for out-of-cycle requests for event support. Historically, these types of requests were handled on a case-by-case basis and there were no funding limit guidelines the city used to fund these types of event requests. This first cycle was a challenge because there are many variables at play including timing of grant process, historical funding of organizations and events, the city’s desire to streamline requests into a process with funding guidelines. This grant process is certainly a pilot program with room for improvement and the advisory board is very interested in creating a consistent and equitable program that adheres to Commission goals.

The TGT Grant Program is designed to fund events and programs that benefit the Lawrence community and/or enhance the visitor experience in Lawrence. The Transient Guest Tax Fund (TGT) is supported by a 6% tax collected on all overnight hotel stays in Lawrence. The TGT is used to promote tourism and convention promotion in Lawrence. Charter Ordinance 30 states that the TGT fund should be expended for the purposes as the City Commission determines promotes, enhances, maintains, or improves the tourism, visitor, or convention business of the city.

The following goals and guidelines were used in considering requests for funds from the Transient Guest Tax Grant Program (TGT).

GOALS

These funds should support events that:

· demonstrate a measurable community or economic benefit,

· enhance Lawrence’s character and reputation for tourist activities;

· attract additional new events or strength existing events;

· generate additional transient guest tax and sales tax for the community.

An advisory board was appointed by the Mayor in February 2016 to review and make recommendations for the use of the 2016 program funding. The advisory board has seven members. The advisory board met on March 11 to deliberate and make funding decisions for the applications received. A matrix of funding requests is attached (revised 03/28/16). The City Commission has final funding approval for the program. Grant applications are available online.

The advisory board and staff would like to take time over the next few months to refine the grant application and scoring process. With this program being a pilot program for this first cycle, there were several areas the committee, and community stakeholders, identified for consideration as the city considers another round of funding for the Transient Guest Tax Grant Program.

The following items were identified as policy or process considerations for future funding cycles:

The advisory board and staff would like to increase time for deliberations and include a brief time for presentations before funding decisions are made.

Does the City Commission wish to include in-kind city services as part of the total amounts granted to organizations through the application process?

For example, the city previously donated in-kind public safety services for certain events. Should those costs be included in the grant application as part of the city’s contribution? If those costs are to be included, can staff create a general cost analysis for event organizers to use to estimate the amount of city services that would be provided as in-kind services for events? Or, would the city rather continue to provide these in-kind services to events and transfer funds from the TGT at the end of the fiscal year (as has been done previously once a yearly total was determined for services provided).

The funding formula for budgeting needs clarification. In their deliberations, the advisory board used a cap of 25% of the event budget (which was determined as the TGT grant request, the requestor’s contribution and third party cash match). A policy decision on the in-kind city services question above will allow for clarification of this calculation.

The advisory board would like to provide a way to consider funding grant applications with more lead time for organizers to secure funding. Many events need approval for funding several months or more in advance; the advisory board can help with scheduling the grant program timeline to alleviate rushed decisions based on timing in future grant applications.

Once the program has completed the initial grant funding, the city and eXplore Lawrence (CVB) staff should work with grant recipients to determine the economic impact of events and gather good estimates for attendance. The hotel properties should be engaged to work with events to help promote specials that encourage overnight stays in Lawrence as part of the event.

The advisory board originally intended to leave a 10% reserve for funding events that may not have been captured in this first cycle, however after deliberations, the advisory board chose to use the full $150,000 in funding for FY2016. The city received $225,671 in requests for support through this first TGT Grant Program cycle (24 events). The amount of support requested is indicative to the many great events that are occurring, through the work of our community members and organizations. As a community, we should take the opportunity to understand the direct and indirect economic impact of these efforts.

As part of the grant application, any event receiving Transient Guest Tax Grant Program funds will be required to sign an agreement with the city and provide post-event reporting including a summary of the event, data captured from the event including participant projections and use of city funding in the overall budget. Post-event reporting is due to the City of Lawrence within one month of the event/program. Staff will work with the City Attorney’s Office to develop an agreement that provides recourse for the city to reclaim funding if the event is cancelled.

The timeline for the next grant cycle, as long as the Commission provides support for the program in the 2017 budget, would generally follow this schedule:

June/July 2016 Advisory Board meets to refine grant application and scoring process

August 2016 Advisory Board recommendations for grant program return to City Commission for review and approval

September 2016 Applications accepted for grant program for FY2017 funding

October 2016 Advisory Board meets to determine funding for FY2017 program funding

RECOMMENDATION:

Approve TGT Advisory Board recommendations for FY2016 funding. The advisory board will meet this summer and provide program considerations to the City Commission for review before the next cycle, if funding is approved for FY2017.