MCCVB: Carmel-by-the-Sea's Membership Fee Changed From $241,170 to $108,360!

“For years, Carmel and the bureau have discussed the city joining, but the $200,000 cost was prohibitive, according to City Administrator Rich Guillen.”

(Source: “Tourism bureau decides to charge: Not all cities think services worth fees,” Dania Akkad, The Monterey County Herald, 3 July 2006)


On Monday, 3 July 2006, Dania Akkad, The Monterey County Herald, reported that the City of Carmel-by-the-Sea had for years been discussing the possibility of joining the Monterey County Convention & Visitors Bureau (MCCVB). However, according to City Administrator Rich Guillen, the “$200,000 cost was prohibitive.” Recently, however, it was reported that MCCVB “reformulated” the amount Carmel-by-the-Sea would be required to pay to $108,000. And at that bargain cost, the City Council unanimously voted to join MCCVB at the City Council’s 22 June 2006 Special Meeting.

In an e-mail to Naiomi Skiles, Manager, Membership & Convention Services, MCCVB, a request for an explanation as to how Carmel-by-the-Sea’s membership fee changed from $200,000 to $108,000, was answered as follows:

“...the previous formula was based on a percentage of TOT revenues from FY 1998-99, whereas, the current, or new formula is based on a percentage of TOT revenues from the previous year (in this case, FY 2004/05). The exact formula changed slightly, which explains the variance.”

As a follow-up, when Naiomi Skiles was presented with Carmel-by-the-Sea’s TOT revenues of $3,547,616 (FY 1998/99) and $3,611,990 (FY 2004/05), and her response that the exact formula had “changed only slightly,” she did not respond to a request for an explanation as to the membership fee changing from $200,000 to $108,000, nor did President/CEO John McMahon, but Nat Rojanasathira, Marketing Coordinator did respond, as follows:

“The membership fee for Carmel-by-the-Sea was previously about $200,000, based on 6.8% of TOT from FY 1998/99. Today, it is based on 3% of TOT from the previous year (in this case FY 2004/05), and is $108,000. This is how the membership fee has changed from $200,000 to $108,000.”

A follow-up request for clarification, as follows:
The previous membership fee rate of 6.8% TOT revenues FY 1998/99 of $3,546,616 is $241,170.

The current membership fee is 3% of $3,611,990 or $108,360.

Comparing Carmel-by-the-Sea with the city of Monterey, for example, Monterey’s membership fee is $478,000 on TOT revenues of $13,627,997 (or 3-4%).

Question: At the time Carmel-by-the-Sea was quoted over $200,000 as MCCVB membership fee, were the cities of Marina, Monterey, Sand City and Seaside paying MCCVB membership fees of 6.8% of TOT revenues FY 1998/99?

Nat Rojanasathira’s response: “...the Cities of Marina, Monterey, Sand City, Seaside and the County of Monterey have contributed fees of 6.8% of TOT from 1998/99.”

Today, Marie Vasari, Herald Staff Writer, wrote that John McMahon, President/CEO MCCVB, is currently promoting a tourism business district which would raise an “additional $2.2 million for designation marketing.” Moreover, it was reported that this additional revenue for designation marketing is needed in order to remain competitive with other tourist destinations and because MCCVB’s “operating budget is $2.1 million, compared to $3.1 million in 2001.”

COMMENTS:

Déjà vu: The City of Carmel-by-the-Sea’s MCCVB membership fee morphing from $241,170 into $108,360 is reminiscent of City Administrator Guillen’s Storm Water Drainage Utility Fee Program in 2003. His Program initially cost Carmel-by-the-Sea property owners $$442,600 (with $250,000 diverted to the General Fund), then $270,600, then finally $151,500.