STRATEGIC PRIORITY: Growing
AGENDA DATE: June 25, 2025
COUNCIL DISTRICT(S): 2
DEPARTMENT: Department of Convention and Event Services
EXECUTIVE: Robin Bentley
______________________________________________________________________
SUBJECT
Title
Authorize (1) the City Manager to execute the second three-year renewal options to the services contract with the Dallas Convention & Visitors Bureau (d/b/a VisitDallas), for convention and public event facility promotion, advertising and tourism development services for the period beginning October 1, 2025, through September 30, 2028; and (2) revising the contract to incorporate the 2025 amendment to Chapter 44, Section 44-35 “Levy; Amount; Disposition of Revenue” by ordinance No. 33028 of the Hotel Occupancy Tax allocation of 1.232% - Not to exceed $46,209,045.00 - Financing: Convention and Event Services Fund
Title
BACKGROUND
On September 9, 2015, the City Council, authorized a contract with the Dallas Convention and Visitors Bureau d/b/a VisitDallas (DCVB) for convention facility promotion, advertising and tourism development for the period October 1, 2015 through September 30, 2020, with one five-year renewal option and one three-year renewal option, subject to annual appropriations by Resolution No. 15-1666.
On January 4, 2019, the Office of the City Auditor released the Audit of VisitDallas Report No. A19-006 which evaluated the effectiveness of services provided by the DCVB between FY 2016 and FY 2017, and the Audit provided 18 recommendations that require memorialized contract amendments.
On November 13, 2019, the City Council authorized an Amended and Restated contract with the DCVB to memorialize contract amendments by Resolution No. 19-1802.
The amended and restated contract did not include any extension to the original contract approved by Resolution No. 15-1666 in September 2015. As a result, the amended and restated contract expires September 30, 2020, but allows for a five-year renewal and, thereafter, a three-year renewal option subject to City Council approval.
On May 20, 2020, the Department of Convention and Event Services staff briefed the City Council and provided recommended contract terms for the first five-year renewal option with DCVB. The renewal contract terms called for a five-year pro forma that includes annual budget reductions, implementation of a compensation study findings and recommendations, singular focus on marketing the City of Dallas, governance requirements and continued contract compliance.
On June 10, 2020, the City Council authorized the first renewal option with DCVB to extend the term of the contract from October 1, 2020 through September 30, 2025, by Resolution No. 20-0938.
In considering the exercise of the second three-year renewal option with DCVB in accordance with the Dallas City Code Section 44-35, as amended on March 7, 2025, by CR No. 25-0444, will call for an amended disposition of Hotel Occupancy Tax (HOT) revenues to Visit Dallas of 17.6%. staff are recommending that:
• Given the reduction in HOT, the City of Dallas eliminate Section 3(A) of the existing contract which requires the retaining of 3.0 percent of the monthly Visit Dallas HOT payment as a means to ensure compliance with outlined performance goals, and instead, provide for a mid-year and end-of-year compliance review that would result in the holding of 3.0 percent of the monthly Visit Dallas HOT payment until compliance is met if VisitDallas does not meet its submitted goals;
• Contract provide additional dedicated funds not to exceed $2, 500,000.00 per year to support enhanced marketing efforts for the expanded convention center, with VisitDallas required to submit an annual marketing plan that supports such activities as required to ensure the successful opening of the center;
• Contract offer an additional pro-forma-based incentive allocation from HOT revenues when Visit Dallas exceeds the room night goals as approved by the Board of Directors and accepted by the City of Dallas, provided such room night goal enhancement results in the City of Dallas exceeding its annually forecasted HOT revenue;
• The City formally authorizes VisitDallas to manage ad hoc projects such as Deck the Plaza and other plaza and city-owned venue activations as requested by the City Manager and/or the City Council, with a 10% service fee to cover administrative costs;
• Given that, unlike larger city contractors, VisitDallas has minimal controllable spend, relies on single-source vendors, and often works with small and local businesses who lack certifications, that the organization focus on events that have an inclusive impact, hospitality job creation in minority communities, and community engagement, with small and local spending goals tied to actual opportunities rather than the existing BID policy;
• Contract add an additional two-year renewal option to be exercised in 2028 to accommodate consistency in the opening of the expanded center and one additional post-opening performance year, with the opportunity for amended performance metrics related to the newly opened convention center;
• The City Attorney’s Office to add additional language allowing for the protection of the City; and
• All reporting requirements and stipulations required of VisitDallas in the existing contract remain the same, until such time as the additional two-year renewal option is exercised.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On September 25, 1996, the City Council authorized a ten-year contract, with two five-year renewal option terms with the Dallas Convention and Visitors Bureau (DCVB) for the promotion of tourism and convention sales/marketing promotion by Resolution No. 96-3120.
On May 12, 1999, the City Council authorized Supplemental Agreement No. 1 to the contract to remove the cap on the amount of compensation and decrease the percentage of compensation the DCVB receives from 33.57% to 32.6% of the 7% Hotel Occupancy Tax the City collects by Resolution No. 99-1652.
On June 26, 2002, the City Council authorized Supplemental Agreement No. 2 to the contract to provide $950,000.00 supplemental funding for additional marketing and promotion of the Dallas Convention Center expansion and required DCVB to establish a reserve fund of not less than $1,000,000.00 to address future revenue shortfalls and require DCVB to provide for future improvements at WRR Municipal Radio by Resolution No. 02-1986.
On December 11, 2002, the City Council authorized Supplemental Agreement No. 3 to the contract to provide $30,000.00 in funding for the promotion of the City of Dallas and the Dallas area as a location for the production of motion picture and television films by Resolution No. 02-3527.
On January 8, 2003, the City Council authorized Supplemental Agreement No. 4 to the contract to reduce the supplemental funding for additional marketing services from the DCVB from $950,000.00 to $715,000.00, and to reduce DCVB’s required reserve fund from $1,000,000.00 to $800,000.00 to address future budget deficiencies, and to reduce DCVB’s requirement to pay for capital improvements at WRR Municipal Radio from $1,050,000.00 to $790,280.00 by Resolution No. 03-0213.
On October 22, 2003, the City Council authorized Supplemental Agreement No. 5 to the contract to defer DCVB’s January 1, 2004, repayment in the amount of $197,570.00 until January 1, 2007, allowing DCVB to offer economic incentives to the clients to facilitate future convention center booking by Resolution No. 03-2860.
On April 28, 2004, the City Council authorized Supplemental Agreement No. 6 to the contract to defer DCVB’s requirement to establish a reserve account of $800,000.00 from September 30, 2006 to September 30, 2007, to enable DCVB to support or create special events to attract visitors downtown by Resolution No. 04-1442.
On October 12, 2005, the City Council authorized Supplemental Agreement No. 7 to the contract to provide $200,000.00 supplemental funding for DCVB to promote the City of Dallas and the North Texas area as a location for production of motion pictures and television films by Resolution No. 05-2924.
On September 13, 2006, the City Council authorized Supplemental Agreement No. 8 to the contact with DCVB, exercising the first of two five-year renewal options to extend the contract by Resolution No. 06-2490.
On October 28, 2006, the City Council authorized Supplemental Agreement No. 9 to the contract with DCVB for the City to assume the function of marketing and promoting the City as a desirable location for the entertainment industry (i.e. film, digital image and other) and other actions by Resolution No. 09-2672.
On September 14, 2011, the City Council authorized an Amended and Restated Contract with the DCVB for convention facility promotion, advertising and tourism development services by Resolution No. 11-2452.
On September 9, 2015, the City Council authorized a contract with the DCVB for convention facility promotion and advertising and tourism development by Resolution No. 15-1666.
On December 19, 2016, the City Council authorized Supplemental Agreement No. 1 to remove Downtown Tourist Public Improvement funds as the source of funding for the annual $500,000.00 capital improvement contribution and to update the DCVB contact information by Resolution No. 16-7122.
The Government Performance and Financial Management Committee was briefed on the Audit of VisitDallas Report No. A19-006 Proposed Corrective Actions on February 19, 2019.
The City Council was briefed on the “Audit of VisitDallas Report No. A19-006 Update on Corrective Actions” on May 15, 2019.
The City Council was briefed on the “VisitDallas Amended and Re-stated Contract” on October 16, 2019.
On November 13, 2019, the City Council authorized an amended and restated contract with the Dallas Convention and Visitors Bureau (d/b/a VisitDallas), addressing audit recommendations from the January 4, 2019 released Audit of VisitDallas Report No. A19-006 drafted by the Office of the City Auditor (AUD), by Resolution No. 19-1802.
On June 10, 2020, the City Council authorized the first renewal option with Dallas Convention and Visitors Bureau (d/b/a VisitDallas) to extend the term of the contract from October 1, 2020 through September 30, 2025, by Resolution No. 20-0938
FISCAL INFORMATION
|
Fund |
FY 2025 |
FY 2026 |
Future Years |
|
Convention and Event Services Fund |
$0.00 |
$15,558,275.00 |
$30,650,770.00 |
Convention and Event Services Fund - $46,209,045.00 based on the annual not to exceed disbursement below:
|
October 1, 2025 - September 30, 2026 |
$15,558,275.00 |
|
October 1, 2026 - September 30, 2027 |
$15,059,784.00 |
|
October 1, 2027 - September 30, 2028 |
$15,590,986.00 |
M/WBE INFORMATION
In accordance with the City’s Business Inclusion and Development Plan adopted on October 22, 2008, by Resolution No. 08-2826, as amended, the M/WBE participation on this contract is as follows:
|
Contract Amount |
Procurement Category |
M/WBE Goal |
|
$46,209,045.00 |
Other Services |
N/A |
|
M/WBE Subcontracting % |
M/WBE Overall % |
M/WBE Overall Participation $ |
|
N/A |
N/A |
N/A |
|
• M/WBE goal waived due to no M/WBE availability. |
|
• Dallas Convention and Visitors Bureau dba VisitDallas - Local; Workforce - 0.00% Local |