Local Option Tourist Development Act Orange County Attorney’s Office Presentation to the 2016...

Local Option TouristLocal Option TouristDevelopment ActDevelopment Act

Orange County Attorney’s OfficeOrange County Attorney’s Office

Presentation to thePresentation to the 2016 Orange County CRC2016 Orange County CRC

TDT Procedures / Priorities Work Group TDT Procedures / Priorities Work Group September 1, 2015September 1, 2015

Presentation Overview

• Tourist Development Tax

• Tourist Development Council

• Tourist Development Plan

• Use of TDT Revenue

• Orange County TDT

• Orange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Presentation Overview

• Tourist Development TaxTourist Development Tax

• Tourist Development Council

• Tourist Development Plan

• Use of TDT Revenue

• Orange County TDT

• Orange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Tourist Development Tax

• Local Option Tourist Development Act • § 125.0104, Fla. Stat. (“The Act”)

• Authorizes any Florida county to levy tourist development tax (“TDT”) within its boundaries

• Tax imposed on rental or lease of living quarters or accommodations in hotels, motels, apartments, RV parks, condominiums, etc. for a term of 6 months or less

• TDT, often referred to as “bed tax,” is levied on total consideration paid for occupancy

Tourist Development Tax (Cont.)

The Act requires:

•TDT levied by ordinance enacted by BCC

•Ordinance to include County’s tourist development plan

•TDT Ordinance be approved in referendum election

•BCC to establish and appoint members of tourist development council (“TDC”)

Presentation Overview

• Tourist Development Tax

• Tourist Development CouncilTourist Development Council

• Tourist Development Plan

• Use of TDT Revenue

• Orange County TDT

• Orange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Tourist Development Council

The Act requires BCC to appoint:

•Nine (9) members:

• One (1) county official

• Two (2) city officials

• Six (6) members of tourist industry, of which, 3-4 are hotel or motel operators

•Members serve staggered, four (4) year terms

Tourist Development Council (Cont.)

• Prepares County’s tourist development plan

• Plan required to set forth:• Net TDT revenue anticipated in first 24

months; • TDT tax district; and • List prioritizing proposed uses of TDT

revenue by specific project or special use

• Plan submitted to BCC for approval

After BCC’s initial adoption of Plan:

•TDC periodically makes recommendations to BCC

• Effective operation of special projects; or

• Uses of TDT revenue

•TDC continually reviews expenditures of TDT revenues and regularly receives expenditure reports from BCC

•Reports unauthorized expenditures to BCC

Tourist Development Council (Cont.)

Presentation Overview

• Tourist Development Tax

• Tourist Development Council

• Tourist Development PlanTourist Development Plan

• Use of TDT Revenue

• Orange County TDT

• Orange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Tourist Development Plan

•BCC required to adopt TDC’s proposed Plan

•Plan included in Ordinance initially levying TDT

•Amendments to Plan require ordinance enacted by BCC

•Affirmative vote of a majority plus one (1) of BCC required to amend Plan

•Amendments to Plan at sole discretion of BCC

•TDC recommendation or approval not required

Presentation Overview

• Tourist Development Tax

• Tourist Development Council

• Tourist Development Plan

• Use of TDT RevenueUse of TDT Revenue

• Orange County TDT

• Orange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Use of TDT Revenue

• The Act strictly governs use of TDT revenue

• Uses not expressly authorized by statute are expressly prohibited

• At the sole discretion of BCC

The Act authorizes use of TDT revenue:

•To acquire, construct, extend, enlarge, remodel, repair, improve, maintain, operate or promote:

• Publicly owned convention centers, sports stadiums/arenas, coliseums, or auditoriums within County

• Aquariums or museums that are publicly owned or owned and operated by not-for-profit organizations and open to the public

•To promote zoological parks that are publicly owned and operated or owned and operated by not-for-profit organizations and open to public

Use of TDT Revenue (Cont.)

• To promote and advertise tourism in Florida, nationally, and internationally

• To fund convention bureaus, tourist bureaus, tourist information centers and news bureaus

• To finance beach park facilities or beach improvement, maintenance, renourishment, restoration, and erosion control

• To be pledged to secure and liquidate revenue bonds issued by County to fund certain TDT priorities authorized by statute

Use of TDT Revenue (Cont.)

Presentation Overview

• Tourist Development Tax

• Tourist Development Council

• Tourist Development Plan

• Use of TDT Revenue

• Orange County TDTOrange County TDT

• Orange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Orange County TDT

• Orange County citizens approved initial 2% TDT in 1978

• Increased in 1986, 1989, 1995 and 2006

• Currently, TDT is at 6%

• Certain percentages of TDT revenue dedicated to specific uses:

• Payment of debt service• Professional sports franchise facilities• Promotion of tourism

Presentation Overview

• Tourist Development Tax

• Tourist Development Council

• Tourist Development Plan

• Use of TDT Revenue

• Orange County TDT

• Orange County Tourist Development PlanOrange County Tourist Development Plan

• Concerns and Legal Issues with Proposed Charter Amendment

Orange County Tourist Development Plan

• Tourist Development Plan, § 25-140 Orange County Code

• Plan currently contains 23 priorities:• Convention Center operations, maintenance and promotion• Convention Center construction and phased expansion

projects• Construction of Orlando Arena• Orlando/Orange County Convention and Visitor's Bureau,

Inc. (d/b/a “Visit Orlando”)• Expansion of Citrus Bowl• Promotion and advertisement of tourism in Florida,

nationally and internationally• Central Florida Sports Commission

• United Arts of Central Florida

• Florida Classic football game

• Auditoriums or museums used primarily for arts and culture

• Association to Preserve the Eatonville Community, Inc.

• Tangerine Sports Association, Inc.

• Performing arts center

• NCAA championship competitions or college conference athletic championships

Orange County Tourist Development Plan

(Cont.)

Presentation Overview

• Tourist Development Tax

• Tourist Development Council

• Tourist Development Plan

• Use of TDT Revenue

• Orange County TDT

• Orange County Tourist Development Plan

• Orange County Tourist Development Plan Priorities

• Concerns and Legal Issues with Proposed Concerns and Legal Issues with Proposed Charter AmendmentCharter Amendment

Concerns & Legal Issues With Proposed Charter

Amendment• 67 counties in Florida; 20 charter counties

• No Florida charter county regulates use of TDT revenue or provides for TDT procedures through its charter

• Flagler County – resolutions set forth TDT policies• Tourist Development Special Event Grant Policy Resolution• Public Tourism Infrastructure Project Grant Policy Resolution

• Hamilton County – 10-page grant application

• Effect of TDT charter amendment would be logistically impractical given complex charter amendment process

Concerns & Legal Issues WithProposed Charter Amendment

(Cont.)• Flagler and Hamilton Counties are significantly

dissimilar to Orange County

• Flagler County TDT annual revenue estimated at $1.7 Million

• Hamilton County TDT annual revenue estimated at $27,000

• Both Flagler and Hamilton County act as own visitor’s bureau (cf. Visit Orlando)

• Neither county has an established convention center requiring continuous maintenance and improvements

• Proposed Charter amendment requires the approval of the TDC in order for a project or event to be funded with TDT revenue

• Conflicts with the Act:• Tourist Development Plan only amended by supermajority

vote of BCC (§ 125.0104(4)(d), Fla. Stat.)• No recommendation or approval of TDC required to amend

Plan (AGO 92-34)

• When statute provides method to do something, it is a prohibition against its being done in any other way

• Amendment would undermine the statutory authority granted to the County’s elected officials to amend Plan

Concerns & Legal Issues WithProposed Charter Amendment

(Cont.)

Local Option TouristLocal Option TouristDevelopment ActDevelopment Act

Orange County Attorney’s OfficeOrange County Attorney’s Office

Presentation to thePresentation to the 2016 Orange County CRC2016 Orange County CRC

TDT Procedures / Priorities Work Group TDT Procedures / Priorities Work Group September 1, 2015September 1, 2015