PRESENTER: Presenter
Jared Werner, Assistant City Manager
Tanya Pence, Chief Marketing Officer and President of the Convention and Visitor’s Bureau
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SUBJECT: Title
Approval of the format and content of the proposed petition and service plan for the potential creation of a Tourism Public Improvement District as authorized by Chapter 372 of the Texas Local Government Code.
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DEPARTMENT: N/A
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COUNCIL DISTRICTS IMPACTED: N/A
BACKGROUND INFORMATION:
A Tourism Public Improvement District (TPID) is a state-authorized tool designed to enhance and promote tourism, hotel activity, and year-round visitation within a defined geographic area. Its primary purpose is to generate dedicated funding for expanded marketing and promotional initiatives that support a stronger and more resilient tourism economy. Ten Texas cities, including Waco, Corpus Christi, Frisco, Denton, and Addison currently operate TPIDs.
For New Braunfels, creation of a TPID directly aligns with the City’s Strategic Plan, particularly the Economic Mobility and Organizational Excellence strategic priorities. Several local factors further support consideration of a TPID:
• Stagnant or declining hotel occupancy tax revenues.
• Major redevelopment and mixed-use projects expected to increase year-round tourism demand.
• A strong relationship between tourism performance and sales tax growth, which indirectly reduces property tax revenue growth.
• Significant increases in advertising costs, which currently limit the CVB to marketing in only eight Texas markets for roughly half the year.
A TPID would provide the resources needed to expand marketing into additional regions and
during more months of the year. The proposed assessment is 2% of the room rate, with an expected average annual revenue of $1.2 million. Eligible lodging properties include those within the city limits with five or more rooms unless they derive a majority of revenue from admission tickets.
Under the proposed service plan:
• 85% of funding must support marketing, attracting groups, and sales activities.
• 10% is allocated to research and administration.
• 5% is reserved for contingencies.
Council Consideration This Evening
The only action requested is approval of the petition and service plan. This does not create the TPID; it simply authorizes the Chamber of Commerce working with the Texas Hotel & Lodging Association to begin gathering signatures from eligible lodging partners.
To advance, the petition must be signed by hotel owners representing:
• 60%+ of total appraised hotel value, and either
o 60%+ of total hotel surface area, or
o 60%+ of the total number of hotels in the proposed district.
If these thresholds are met, the process continues with public hearings and final Council consideration.
Proposed TPID Timeline
• November: Council considers format and content of the proposed petition and service plan.
• Dec-Jan: Chamber gathers petition signatures.
• March: Petition validated; Council orders and holds public hearings.
• April: Council considers final approval to create the TPID.
• July: TPID assessments begin.
Administration
The TPID assessment would be collected using the same process currently in place for local hotel tax collections. A TPID board, comprised of lodging representatives would oversee expenditures, with non-voting representatives from the City and the Chamber/CVB. City Council must review and approve the service plan annually throughout the 10-year authorization period.
Note: This topic was previously presented to City Council for discussion at the June 30 workshop and again during the November 17 presentation meeting.
ISSUE:
N/A
STRATEGIC PLAN REFERENCE:
☒Economic Mobility ☐Enhanced Connectivity ☐Community Identity
☒Organizational Excellence ☐Community Well-Being ☐N/A
Objective - Support Confluence, the New Braunfels Chamber of Commerce Economic Development Strategic Plan, by helping to ensure a community that supports targeted industries and increases the diversity of job opportunities in the community
Objective - Considering statutory and market-based factors, continue to diversify revenue streams to support long-term fiscal sustainability of the organization
FISCAL IMPACT:
There is no fiscal impact associated with this item.
Recommendation
RECOMMENDATION:
Approval of the petition and service plan for collection of signatures