Hospitality Tax Projects Oversight in Wake County

Wake County and City of Raleigh oversee the utilization of hospitality tax revenues for arts, cultural, sports, and convention projects. The funds have increased significantly over the years, supporting various projects like Marbles Museum, Historic Yates Mill Park, and more. A staff review team and interlocal agreements ensure transparent and effective management of these revenues.

• Wake County
• Raleigh
• Hospitality Tax
• Arts Projects
• Revenue Management

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1. RFI#19-001 Request for Information for Hospitality Tax Projects Pre-Submittal Meeting October 25, 2018

2. Wake County Hospitality Taxes State legislation approved in 1991 and amended in 1995 levies 6% on occupancy stays and 1% on prepared food and beverage countywide Wake County and City of Raleigh are responsible for oversight and approval for uses of revenues Revenues must be used for projects supporting arts, cultural, sports or convention Revenues in FY1995 = ~ $12 million Revenues in FY2018 = ~ $55 million 2

3. FY 2018 ACTUAL MAJOR FACILITIES FUND Occupancy Tax Revenue Prepared Food & Beverage Tax Revenue Major Facilities Fund $55,734,000 Section 1: Administration and Holdbacks 1,400,000 $ 1,267,000 $ 680,000 $ 6,584,000 $ 3,212,000 $ 2,500,000 $ 5,209,000 $ 1,000,000 $ 1,000,000 $ 22,852,000 $ Administration and Collection Cary Hold Harmless Raleigh Hold Back Greater Raleigh Convention & Visitors Bureau Centennial Authority PNC Maintenance PNC Arena Debt Service Raleigh $1.0 million Wake County $1.0 million Administration & Holdbacks $32,780,000 Uncomitted Funds Section 3: 15% Projects Section 2: 85% Projects ~85% ~15% ConventionCenter $ 27,863,000 Other Projects $ 4,600,000 Cary Sports Facilities Competitive Projects

4. Marbles Museum Historic Yates Mill Park Raleigh Convention Center PNC Arena 5 County Stadium Cary Soccer Park Art Museum Performing Arts

5. Staff Review Team Operating Principles established a staff review team to assist City and County managers to help plan, review model scenarios and advise on the distribution of tax revenues Staff review team developed proposed review process Review Team: Centennial Authority City of Raleigh Greater Raleigh Convention and Visitors Bureau Town of Cary Town of Knightdale Town of Morrisville Wake County Wake County Hospitality Alliance 5

6. Interlocal Review An interlocal agreement between the City of Raleigh and Wake County along with 20 amendments articulate the oversight and uses of the revenues 20th Amendment calls for a public review Review Financial Models Current Projections and Forecast Review PNC Capital Plan Review Convention Center Capital Plan Inclusive of stakeholders Complete by January 1, 2020 6

7. 2019 Interlocal Review Schedule September 4, 2018 Briefed Wake County Commissioners September 11, 2018 Briefed Raleigh City Council October 1, 2018 Briefed stakeholders October 10, 2018 Released Request for Information (RFI) Goal of RFI: Seek to learn about capital projects that are being planned or proposed in Wake County related to arts, culture, sports or convention from period 2019 2024 with a minimum project cost of $20 million that may request interlocal funds at a future date October 25, 2018 RFI Pre-submittal meeting January 10, 2019 Receive RFI responses 7

8. RFI This RFI is issued solely for information and planning purposes It does not constitute a Request for Proposal (RFP), a promise to issue an RFP in the future or that any projects will receive or be guaranteed any funding.

9. Minimum Criteria Project fully located within Wake County Project must meet statutorily defined purpose of funding Project must be capital in nature with a minimum value of $20 million Project anticipates requesting use of interlocal funds for some portion of the project cost at a future date

10. Information to be Submitted Maximum length 5 pages Project purpose and design concept User, primary tenant, local and out of town users Regional benefit and return on investment Lead organization and known partners Project costs - capital and operating and how operating will be met Timeline

11. Next Steps Q & A Today Written questions due November 9, 2018 Responses distributed to attendees and posted at wakegov.com/Finance and wakegov.com/roomfoodtax Responses Due January10, 2019 Deliver to Tom West Wake County Finance by 3:00 pm One hard copy and USB drive

12. 2019 Interlocal Review Schedule January/February 2019 Stakeholders meet to review financial models, results of capital maintenance plans for Raleigh Convention Center Complex, PNC Arena and Cary Sports Facilities March 2019 Develop recommended modifications to financial models to address findings of facility studies and develop process for consideration of new investments March/April/May 2019 If funding available, conduct process for consideration of new investments 12

13. Questions?

14. This presentation will be posted to: www.wakegov.com/roomfoodtax For more information, contact: Denise Foreman Assistant County Manager 919-856-5578 denise.foreman@wakegov.com