Okaloosa County BOCC — May 6, 2016 — I. a. Budget Discussion — reading text

TOURIST DEVELOPMENT DEPARTMENT MEMORANDUM DATE: May 8, 2015 TO: Tourist Development Council FROM: Ed Schroeder, Tourist Development Department Director Charlotte Dunworth, Finance, Administration, and Compliance Manager SUBJECT: FY17 Budget Overview STATEMENT OF ISSUE: Request Council guidance regarding outside agency operational & capital funding requests and FY17 budget development. DISCUSSION: Tourist development tax revenues are preliminarily estimated at $3.92M per penny, for a total of $19.6M total. F.S. 125.0104 was recently amended to authorize that the County may use up to 10 percent of the tax revenue received to reimburse expenses incurred in providing public safety services needed to address impacts related to increased tourism for the budget year commencing October 1, 2016. FY 2016 FY 2017 Total TDT Collections $15,000,000 $19,600,000 Per Penny TDT Collections $3,000,000 $3,920,000 10% Max to Public Safety n/a $1,176,000 (capped at 10% of 1st - 3rd pennies) The following funding requests have been received for Council consideration: FY16 Budget FY17 Request Penny Okaloosa Lifeguards $562,304 $592,604 2nd Destin Lifeguards $562,304 $824,787 2nd Okaloosa Sheriff n/a $716,657 TBD 10% to Public Safety $1,124,608 $2,134,048 (must be capped at $1,176,000) Emerald Coast Science Center n/a $37,345 3rd Destin History & Fishing Museum $42,000 $27,900 3rd Heritage Park & Cultural Center $12,600 $7,500 3rd City of Fort Walton Beach $100,000 $100,000 1st City of Destin $402,507 $376,885 1st Tax revenue allocation may be summarized as follows in accordance with the Tourist Development Plan (Ordinance 14-08). If the Council desires to expand the authorized uses (e.g. law enforcement), the Tourist Development Plan will have to be amended before any funding could be budgeted for that purpose. (1) First Percentage  Provide and improve beach park facilities or beach improvements including access   Maintenance, renourishment, restoration and erosion control, including shoreline protection, enhancement, access, cleanup, or restoration of beaches, other waterways  Provide and improve tourist destination facilities… for which there is public access  Any other purpose authorized in F.S. 125.0104(5) (2) Second Percentage  Tourism services, including visitor services, brochure distribution, communication and research  Tourist bureau administration  Lifeguard services and protection  Any other purpose authorized in F.S. 125.0104(5) (3) Third Percentage  Provide and improve visitor welcome or information centers  Operations and maintenance of the convention center, visitor welcome or information centers, and other tourist destination facilities, including aquariums and museums  Promotion of the use of the convention center and other tourist destination facilities  Any other purpose authorized in F.S. 125.0104(5) (4) Fourth Percentage  Any future expansion, renovation or reconstruction of the convention center  Any other purpose authorized in F.S. 125.0104(3) (l) 2,3,4 (5) Fifth Percentage  Tourism promotion  Film Commission RESERVE POLICIES: Council affirmation of reserve policies adopted in 2014 is requested: Operations 35% of budgeted personnel & operating expenses, plus any debt service, for each percentage point. Beach Restoration $14M total, funded in whole or part by the first, second, and/or third percentage point(s). To the extent beach restoration reserves do not total $14M, a minimum of $500K will be budgeted annually, in whole or part by the first, second, and/or third percentage point(s), to build reserves until $14M is reached. East Pass Dredging $2M total, funded in whole or part by the first, second, and/or third percentage point(s). Convention Center Insured Loss Deductible $1.5M total, for the fourth percentage point. Promotional Activities 25% of budgeted promotional activities (expense accounts classified as 548xxx), funded in whole or part by the third and/or fifth percentage point(s). CONTINGENCIES: On several occasions the topic of contingencies within each penny has been discussed. Contingency-type funds are budgeted as “promotional reserves” within the Strategic Marketing Plan; available for new, unfunded events within the Local Event Marketing Funding line item; and available if needed under 35% operations reserve. Council direction on whether additional contingency funds should be budgeted within each penny is requested. RECOMMENDATION TO BCC: N/A, for staff budgetary direction purposes only.