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Volusia County Tourist Development Council
Meeting Minutes
July 31, 2003 - 9:00 a.m.
Ocean Center

Others in attendance:
Frank Gummey, Rick Hamilton, Bob Mills, Larry Kelly, Larry Fornari, Gary Brown, Bob Davis, Joe Witkowski, Rick Prioletti, Big John, Michael Porter, Sharon Mock, Chad Smith and Valerie Witney.

Chairman Bruno called the meeting to order at 9:05 a.m.

Frank Bruno: The approval of the minutes. Those are the minutes that were left over from the December meeting that we did not take an action on for one reason or another.

Rick Hamilton: Because it was a workshop.

Frank Bruno: OK, so I’ll entertain a motion to the minutes.

Rick Hamilton: Do you remember them?

Frank Bruno: That was a while back. Do you want to re-send them?

Rick Hamilton: I can re-send them.

Frank Bruno: Why don’t we do that (He asked for a motion to have the minutes re-sent. The motion carried). Moving on to the item number 3, and this is the Expansion Status Report. As you all know we are in a process right now going out for requests for selection of architects and engineers. The request took about one week. It actually went out on the street on 5/28/03. It took 45 days. It came back and the committee met on 7/25 to short -list it. Three really rose to the top but we felt that we needed to have five because we wanted to do back-ground check, Dunn and Bradstreeet, make sure that there are no leans or any law suits against the companies and so on. So, we decided to take five and go through this process so that we were sure that we would have three going in front of the County Council. So, that is the process that we are in right now. The committee is going to meet again on 8/11/03 and then it will go in front of the County Council for approval on 9/4/03.

Jim Bazemore: Who makes up this committee?

Frank Bruno: I share the committee; Cindy Coto, the County Manager; Deputy County Manager, Ray Pennybaker; Rick Hamilton, and by-the-way, I want you to know that everyone that I selected, Rick selected. I had not talked with him. I want you all to know I did my homework. It took me 7.5 hours to go through those proposals; Charlene Weaver, Finance Director; Fred Swank and Bob Mills who were non-voting but were present for questions and so on; and the facilitator was Barry Lilja.

Frank Gummey: I was there too.

Frank Bruno: Yes, non-voting. For attorney purposes. Kept us out of trouble. Why don’t I have you talk about the next phase, because I am not on the committee (to Rick Hamilton).

Rick Hamilton: The next one is the request for qualifications for construction managers. That is currently on the street. The selection committee will meet on September 19th for their first meeting. The second meeting is on October 3rd. We will be doing the same type of process that we are doing for the architects and it goes to the County Council on the 6th of November. And while we are going through this if you all could put those dates down. I will send you a note out too. What is going to occur is the committee is not going to see presentations from the short list of candidates. They are actually going to make their presentations to the County Council and the County Council will make the selection. I will send this group a notice when that is going to occur, what time and please feel free to come.

Jim Bazemore: Mr. Chairman, may I make a comment? Years ago we, TDC were more intimately involved than we are now. My point is; you have a lot of talent here, and I strongly recommend that you consider maybe not the whole Council, but some members to sit on this Committee because we are appointed by the legislature, so to speak, and I do believe that we have the oversight of this Ocean Center by law. And such, if we are doing our jobs, we should see it all the way through. I strongly recommend that you would consider this.

Frank Bruno: I appreciate that. I thought that this is the process that the Council and the County has to go through right now. Once we have the architect and engineer on board, I do plan on having meetings for discussions from this board with the architect and engineers and also the construction company. We will keep everybody onboard, I promise.

Rick Hamilton: My plan, and Frank and I have not discussed this, but we will be involved in the design process like we have gone through with architects. That’s what I had in my mind.

Frank Bruno: Actually, we kind of handled both the Time Line and Status Report at the same time. Are there any questions on these?

Stuart Arp: Once the architect and engineers are selected on September 4th, do you have any idea how long it would take them to be able to come up with a finalized plan, drawing?

Frank Bruno: My answer is that we will break ground in December and we start construction in January. It is going to take a little longer than that. I am really being honest.

Rick Hamilton: We will break ground in December. I have not talked to the architects that are in the process currently, but I have talked to other architects and they are saying that 90 days for schematics and design concepts, six months for working drawings and construction.

Jim Bazemore: Which means next summer.

Frank Bruno: I would say so, by June of next year we should be totally under construction.

Rick Hamilton: The other thing that you need to be aware of is that we have to address the garage issue. Building parking prior to the construction of the actual facility, so that you are aware of that. The building site will take up all our surface parking so we are going to have to make arrangements to handle that prior to the construction of the building taking place.

Lori Campbell-Baker: Is that going to be a part of the overall plan, rolled in to the financing, rolled in to the architect work?

Rick Hamilton: Yes. It is a part of the discovery work for the architects.

Jim Bazemore: What is going to be our relationship with the City of Daytona Beach?

Frank Bruno: They will be a part of it from the get-go.

Darlene Yordon: I think that we are fund one-third of the traffic plan along with the County and the Boardwalk Developers.

Lori Campbell-Baker: What is the timeline on that?

Rick Hamilton: We could do it now.

Frank Bruno: Let’s wait until we get there.

Darlene Yordon: Do we do the parking garage first or do we have to wait to do it all at one time?

Rick Hamilton: The garage will have to be up or arrangements will have to be made for the parking. Only way that I can see currently to do it is that the garage will have to be first.

Frank Bruno: That will be the first phase of it. It is all going to one phase but that will be the first phase of it.

Darlene Yordon: But that wouldn’t start until next summer. That’s what you are saying.

Rick Hamilton: It is possible that the garage construction could start earlier.

Darlene Yordon: And how many stories and how many spaces?

Rick Hamilton: In our current proposal it is 1250. That’s going to be another thing that the architects are going to have to figure out and that’s a part of the discover work with the city, the traffic and the parking survey.

Jim Bazemore: How many spots do you loose when you start building?

Chad Smith: 816.

Stuart Arp: Is it absolutely critical to have that garage built before we start, because that could really delay this thing? Can we survive without having that surface parking?

Rick Hamilton: We can’t survive with the current bookings in the facility. We would literally have to close down or not have the large events, which we have already contracted, because we anticipate building a garage or surface parking or what have you prior to. The way we are looking at it right now is that this building will be operating as though nothing was happening.

Jim Bazemore: How long will it take to build the garage?

Rick Hamilton: Nine to eleven months.

Frank Gummey: We built this one in nine.

Lori Campbell-Baker: Why would that delay the construction of the expansion?

Frank Bruno: I am not sure that it will.

Lori Campbell-Baker: Stuart, why are you thinking that it would delay?

Stuart Arp: Because they would want that open before they start the construction of the expansion.

Frank Bruno: I don’t think that we would necessarily have to have it open before we start construction.

Rick Hamilton: Yeah, we do.

Darlene Yordon: Hopefully any problems that we have had with this garage, we have learned from our mistakes.

Frank Gummey: I don’t think that it would necessarily be that long of a delay, Stuart, because, I mean, I couldn’t design a parking garage, but I think that a lot of people can pretty quickly. It is not re-inventing the wheel.

Stuart Arp: Is the architect’s engineer doing both the garage and…?

Frank Bruno: Everything. One package. And the timeframe keeps everybody working together.

Rick Hamilton: More than likely they will pick a company to build the garage or sub it out to a construction manager that is in that business and it will be a pre-formed concrete structure that comes in on a truck and they assemble it. That makes the assembly a lot quicker.

Stuart Arp: So all the land has be acquired?

Rick Hamilton: We have one more partial to acquire.

Jim Bazemore: A big one or a little one?

Rick Hamilton: Fairly good size. Apartments.

Jim Bazemore: Got problems?

Rick Hamilton: I don’t know yet.

Frank Gummey: We don’t have an agreement.

Lori Campbell-Baker: Who sets the actual timeline?

Frank Bruno: We don’t have that until we get these folks onboard.

Lori Campbell-Baker: Do we set that, or do they set that?

Frank Bruno: It is going to be a combination, because they are going to be meeting with us, they are going to be looking at the design concept of the whole thing what we want. So we can’t put that in place yet. We are all going to be a part of that.

Frank Gummey: The present intention and of course this could change with market conditions and so forth, once we get the concept design, we’ll go out for the financing, all the financing at that point, so we’ll have all the money in the bank ready to go. But, that may change as the conditions change.

Stuart Arp: On selling point, we can’t start selling this when we break ground, we have to start selling this now, at least to get the word out. What do we feel comfortable saying: I have heard from anywhere 06 to 07. What are we comfortable saying right now? So that we get the word out to people who are thinking about booking their conventions here. We are not ready to go to contract with the people now, but at least we got to get the word out.

Frank Bruno: We have always said that it will be about two years. So, at the very earliest it would be June 05.

Stuart Arp: So, we should feel pretty good saying 06?

Rick Hamilton: I would say middle 06. The reason I am saying this is that by the time we get through the process, get the contract signed and get the people actually working, we are really looking at October, November. Every one of the proposals that I went through, we had 13 proposal, they were looking at a built-out anywhere from eighteen to thirty months, depending on the firm.

Stuart Arp: Can you share with us the five that you selected?

Rick Hamilton: I can’t because I don’t remember them off the top of my head.

Jim Bazemore: Can you send us that information, because we would like to know.

Rick Hamilton: I tell you this, we had every major architectural engineering that build conventions centers in the country bid on the job.

Frank Bruno: I have the five: DJ Design, Daytona Beach; they are affiliated with TMS out of Atlanta; Morse Architects out of Orlando; HOK Sport of Orlando; HKS Architects out of Orlando; and DLR Group out of Orlando. We will get it in writing for you.

Rick Hamilton: Out of all of these, Orlando is the one that bid the most, but most of them have offices throughout the country.

Frank Bruno: Any questions?

Big John: These committee meetings are open to the public?

Frank Bruno: Absolutely.

Big John: So, if we could know when those committee meetings are, perhaps more would attend. Who is the chairman of the committee?

Frank Bruno: It will be Dwight Lewis. People can attend, but it is not open to the public to comment, the way I understand it and I want to declare with the attorney.

Frank Gummey: There is no public comment.

Frank Bruno: They can just witness it. Any other questions?

Big John: Who is on the other committee?

Rick Hamilton: Same group of individuals with the exception of the Chair.

Frank Bruno: I didn’t feel it was right for me to be on both committees. With Dwight being the former chair of the TDC, I felt that it would be more appropriate for him to handle that section of it. Anymore questions on that? (No response) OK, we will move to the financial report, Bob Mills.

Bob Mills: First thing I have to handout is the Tourist Development Tax receipts.
Frank Bruno: While Bob is handing those out, everybody is aware of the fact that we are authorized to charge an administrative charge for the collection of the Tourist Development Tax. It was offered as a major consideration from the Hotel/Motel Association, that we do not charge an administrative fee on the additional one cent. I will tell you right now that there will not be an administrative charge on the additional one cent tax and I have it in writing. It has already been sent out to everybody, so we only have the administrative fee on the original tax and not on the additional one. I hope that makes some of the folks from the Hotel/Motel Association happy.

Bob Mills: The first sheet that I handed out was the gross receipts of the two percent resort tax. The extra one penny did not take effect until July 1 and we don’t have the results of that yet. If you look at the column where it says “Actual FY 2002-03”, our fiscal year starts in October. The numbers that are in dark bold letters are my projections based on a fairly complex formulation that I use and come pretty close each year. We don’t have the June actual receipts yet. I think they are held up in DeLand. There is probably somebody on vacation. Up until just a couple of months ago, we were actually showing an increase over the prior year. Starting in May, we did see a sizeable decrease and that may be weather related. Based on my projections, it looks like we are going to clear over $4.5 million in receipts this year which really is not bad in this economy. To kind of tie that together; if you look at the financial statements that I handed out, the financial statements on the Ocean Center, that’s a really quick snap-shot, it doesn’t have a lot of detail on it, but I wanted you to have that so you could see how the gross receipts actually tie in with the operations of the Ocean Center. It’s actually an intricate part. The Ocean Center does not necessarily make enough money on it’s operations to cover everything. The gross receipts are on the very top and on the second line is the big item that’s taken out of the gross receipts. That is basically paying the mortgage on this building. What you see there is actually 9/12 of what the mortgage would be for the year. The remainder comes down to help fund operations, for maintenance and also helps to fund some of the acquisitions that we have been doing over the years to purchase land, etc. to get ready for the expansion. The very bottom line which is the reserve is really important because the operations of the Ocean Center is not just based on the every day events that happen here, just painting and everything. From time to time we have to do things such as to replace the heating and ventilation system here, which is now 18 years old. These resort taxes don’t go just for paying the mortgage, they go for a lot of other things also. Does anybody have any questions on the receipts?

Jim Bazemore: I am sure you have a budget, right. Are you above or below the budget for getting revenue at this point?

Bob Mills: Operationally?

Jim Bazemore: Yes.

Bob Mills: We are right at budget.

Darlene Yordon: You have shown Garage Bond Payment, do you include the income from the garage?

Bob Mill: That was something special. Everybody knows that the garage has gone through some changes lately. As matter of fact, on October 1, the County Council gave Mr. Hamilton the oversight on the garage. At the same time, the company who was managing the garage was demanding some of the money that had accrued to them. They had not been getting paid every month for their operating expenses. Out of some of the reserve money for the operation of the garage, they were paid that, but there were also certain other expenses, for instance, there was a bond out there that had to be set aside. We paid that out of our reserve funds. That may or may not be returned to us in the future.

Lori Campbell-Baker: How much is that?

Frank Gummey: That is an obligation back to the Ocean Center.

Bob Mills: Once the garage actually starts making money, we will start getting repaid money that we have been putting out. We have been putting out some money for the maintenance of the garage, but we also had that big hit in October to pay off some of the bonds.

Darlene Yordon: What you are saying the income then is not counting in there.

Bob Mills: No it’s not. The income from the garage, there is actually a separate entity Volusia Redevelopment Corporation Inc. They are actually responsible for the garage, but the Ocean Center is basically on the hoop to make any short falls in the garage.

Rick Hamilton: We are the guarantee.

Jim Bazemore: We are you now as far as the garage is concerned? Breaking even or are you still loosing money?

Rick Hamilton: We will break even this year and that to me is remarkable. I think that we need to make like $77,000.

Bob Mills: Yes, and I went through the cash statements that were given to me. I now every month receive information from the garage on their operations and I go through that stuff with a fine-tooth comb because I suspected that in the past we might have paid some charges that we shouldn’t have.
Based on the cash flows that are in the garage right now and what we have in reserve funds, we should be able to break even this year. In the next two months, we need a cash influx after operational expenses of approximately $77,000 to make our bond payment ,which is due in October. That to me is break-even. We are this close. Now of course there is a level of reality that if we missed it by $25,000 it is going to come out of one of the other reserve funds that we have set up there. And that could be paid out of the operating revenues in the next 18 months. We are doing much better that before.

Jim Bazemore: One more final comment: I get more complaints that they can’t find their way around that thing, because there are no signs. Is there anything done on overall plan to improve the signage in the garage, please?

Frank Bruno: Within the garage or outside?

Rick Hamilton: Both. We have both in place right now. I am meeting next week to finalize that, and hopefully they will be up within 30-45 days after that.

Frank Bruno: And we have been working closely with the city on that as well.

Lori Campbell-Baker: I am glad to hear that because I get lost. The collections: is this the month that they are collected in or are they…

Bob Mills: That actually reflects the month of collections.

Lori Campbell-Baker: I am just looking at this, the resort tax gross, and this is just nine months so it is not going line up to here, but once you take out the debt service, why is that still considered net?

Bob Mills: I consider that net. That is the amount of the resort tax collections after I make my mortgage payment that we can use for the operation of the Ocean Center and put in the funds for repair and replacement.

Lori Campbell-Baker: OK, but the amount of the tax is still the same? You could have taken out any number of expenses and just called it net, but you just chose to take out the mortgage payment first.

Bob Mills: Right.

Lori Campbell-Baker: I thought that I understood the whole parking garage income thing until I just heard this and now I am really confused. I know that there is a separate entity. I was listening carefully to Darlene’s question to see: there is income that comes from the garage and it doesn’t come to the Ocean Center, correct? It comes to the separate entity.

Frank Gummey: Right. Under the bond document, it goes to a trustee who is Wacovia and so they part out the money to various entities and we are on the bottom of the food chain, that is any excess after all necessary expenses are paid, would come to us. It is going to be several years before that happens. When we say we are breaking even, I don’t think that that is the goal. I don’t think that you can run that garage on a long term basis not break even because you are going to have capital expenses and so forth. We are not were we want to be yet.

Bob Mils: And breaking even, I would say that’s admirable for right now because the last two years of the operation was a wash in red ink, so the rates have been changed. Some people are happy with that, some people are not, but also the trend is in our favor, because it has been only in the last couple months that the Ocean Walk has come on line and several other factors have helped to increase the use of the garage.

Darlene Yordon: I thought that I heard somebody saying in one of the presentations that we might, just might make money. That we were trending that way.

Frank Bruno: We are heading that way.

Rick Hamilton: When you go back and look since we have taken over the management, the over-sight of the management, unless the sky falls in, which it could, we might possibly make a little bit of money. Based on the averages of income over the month and we needing $77,000 to break even, if the averages will hold up, we will make a little bit.

Frank Gummey: It could turn on the weather.

Bob Mills: You saw it in bike week. We should have actually brought in a lot more that we did.

Stuart Arp: I read in the paper the other day about businesses that have not paid the tourist development tax and the interest and I guess my question is: we are paying this two percent to collect the money, what has been done to collect the money instead of sending out a news release saying “we know that you haven’t paid, so we are going to give you a break”. Someone showed up in my hotel a few months ago to start -----, they were there a couple of days and we never heard from them again.
That bothers me a little bit, that there are businesses out there apparently that have not paid this tax, but we are paying to manage the collection process.

Frank Bruno: Why don’t I get the report to this committee as to exactly the county is doing to collect this tax. Is that better? Rather just me telling you off the top of my head.

Darlene Yordon: And you can’t tell us who is not paying.

Frank Bruno: No.

Stuart Arp: Do they know?

Lori Campbell-Baker: Do they do that amnesty period every year?

John Masiarczyk: I just had this conversation, state does the amnesty thing, but it does not affect the Volusia County, because Volusia County does their own enforcement on collections. So, in other parts of the state, the State Rev Department is doing this. I don’t what other counties, but Volusia County is out of it.

Darlene Yordon: So what you are saying John, is that Volusia County, people that are not paying the tax don’t get amnesty.

John Masiarczyk: No, what I am saying is that we should get somebody here who really knows because Volusia County is different that the state plan. So what you read in the paper about what the state is doing does not necessarily reflect what we are doing.

Frank Bruno: We are doing a lot of speculations here, so let’s wait to find out. Any other questions?

Larry Fornari: Before the garage came over to the management of the Ocean Center, how were the bonds paid for?

Frank Gummey: They were paid out of the revenues of the parking garage.
Bob Mills: There is a pecking order. All the cash receipts go directly to the trustee which is the Wacovia Bank, then whoever is giving them instructions on payment, and currently that is Rick and myself. The very first thing that has to be done, is that the money first goes into two buckets, one bucket for the interest on the bonds, and the other bucket: one bucket for interest on the bonds and the second bucket for the actual principal on the bonds and the payment have to made twice a year. Once those buckets are filled and there is enough money to make the next bond payment, then it flows down to the next bucket which goes to the operator of the garage to pay his every day operating expenses. There has been enough money historically to cover the bonds but not drop down to pay the person who is operating the garage. That’s why on October 1 we had to actually put up enough money the get them some of their rearranges.

Frank Gummey: But that changed with refinancing and now the first $650,000 goes to operations. So, it went from a gross pledge to a net pledge.

Larry Fornari: Right, but I guess my question is: prior to the Ocean Center taking over the garage, if there was a short fall who was on the hook for the bonds?

Frank Gummey: For the bonds? No one.

Rick Hamilton: They were carrying the operational losses.

Frank Gummey: But the bonds, if the revenues were insufficient, the bonds would not have been paid. But, the revenues were really not that short. They were running $300,000 a year short of debt and O & M, we were getting one-third revenue, something like that. That wasn’t missing by all that much, unless you are the guy who is stuck with the $300,000 shortfall.

Larry Fornari: The payment that you are showing here though…

Bob Mills: That was not for the shortfall operation expenditures. That was to pay off one of the small bond issues that was still out there but never really funded and paid. And some legal and administrative expenses.

Frank Gummey: It was essentially a restructuring.

Larry Fornari: I was just curious. I have not read the law for a quite a while, but I know that there is something there about borrowing for the tourist development taxes for a payment on things like this. I just want to make sure that what we are doing is whit in the realm of the tourist development tax laws.

Frank Gummey: Absolutely.

Frank Bruno: Any other questions?

Bob Davis: There is an association of bed tax collectors, whether you all know this or not, which the Volusia County is a member off. They just had their meeting in Fort Lauderdale. They are looking at the South Carolina law and they are going to try to go the legislature next session and get time-shares involved. So, there may be more dollars involved and Sharon could probably tell you better how that would work. I have been working with President Claudette from Orlando on regarding how they tend to go changing the law to get more of the timeshares to pay their bed tax and put them on equal plane field with the hotel industry. So, they is money out there that is not been collected, you are absolutely right. We collect our own so we don’t come under the state. There is a group of bed tax collectors that is trying to propose a new rule and have been working on for about nine months. Sharon if you want to chip in on that and tell them how that will work.

Sharon Mock: It is actually a law that is in place in other states. The timeshare industry has changed over the years and when you buy a timeshare now, you no longer buy real estate, you buy a certificate that is good for vacation time. When they stopped selling real estate and started selling blocks of time, IRS and other officials content that that is taxable even if you barter it from state to state. It is a taxable transfer. So, that’s how they are going to approach it. They are going to try get the law amended as it is in at least two other states already. And it would apply to anyone using a vacation certificate, but would not apply if you were still actually on the deed. They do collect the tax on overnight rentals. People that just check in to a timeshare and just pay a nightly rate, they are collecting a tax on that. But the issue is, whether or not that certificate or bartering is taxable.

Lori Campbell-Baker: When you are pulling all that information together about the tax collection, am I understanding that the Volusia County is unique and that we do our own and that the state does other counties bed tax collections.

Frank Gummey: I don’t think that we are unique.

Lori Campbell-Baker: Who does it in the other areas?

Frank Gummey: In some instances counties and in some instances the state.

Lori Campbell-Baker: Do they get a higher percentage of income in than we do? So my question is it cheaper to do it a different way and do they somehow get a higher percentage?

Sharon Mock: You do not want the state to collect you money. We went down that route. We do not want to do that. That is the main reason that all the counties around the state collect their own because the state takes forever to process anything. It is just much cleaner process.

Darlene Yordon: I am curious if it may be something that we could investigate, is on the tourist tax maybe going to the legislature possibly to do some changing because I have heard of a lot of crumbling over a couple of years of people not paying and they can’t reveal who it is until they actually file for a judgment on it, Frank, when try to collect it and it’s in public records. If there would be some way that we could go in there and modify it so that they can’t hide behind the structure that has been set up.

Frank Gummey: There is no way. It is the state policy on taxes. I mean, you could say the same thing about sales taxes. All sales tax returns are confidential.

Darlene Yordon: I’m sorry that I asked.

Big John: The answer to Stuart’s question which you are going to get a report on, and I am anxious to see what the report says, the administration shows to disband the tourist development tax portion of the finance department at which point Nuno (?) was sold on the product and retired. I don’t know if this is too early but I think it’s about time that we should know those returns. You know the whole department will not operate like it has in the past because it is not there anymore.

Bob Mills: I typically get those about three weeks after the collection period has ended.

Big John: We used to get them sooner. The second thing is, Mr. Gummey you are not a part of the administration, so you don’t have to apologize, but I understand that they gross-trained everybody therefore it’s not a problem. We have never in the past, Mrs. Weaver made the decision years ago, not to audit. So we do one or two audits a year and that whole department over at 250 N. Beach Street is totally dismantled at this time with retirement transfers and people fleeing the boat, so, there are problems in that area and I suspect that if there were any audits done, they were minimum.

Frank Bruno: There will be a report.

Frank Gummey: There was a report made by Mrs. Weaver and her staff to this body within the last year and what the report was is not supported by his staff.

Frank Bruno: OK, any other questions on financial? Ok, then we will move into old business. Thank you, Bob.

Lori Campbell-Baker: When the architect comes forward with the plan, the Convention and Visitors Bureau offices, are they still a part of the whole thing? They are still in there, OK. Just making sure.

Rick Hamilton: Yeah, Sharon has already given me the square footage, needs and everything else. When the architect is selected, we will forward that information.

Frank Bruno: Any other old business?

Larry Fornari: I was just curious, we did far back the voting on the tax, the Hotel Association made some recommendations to the TDC which in turn were past onto the County Council, one of those recommendations you already touch on, the other once that were past on as far as operational philosophies, strategic plan, marketing plan, those things have not been addressed. As well as over quarter million dollars a year in charges from the county to the Center that we talked about and vividly remember Rick mentioning that he probably could do it cheaper if it was privatized. In looking at privatizing those services and saving some money, those were all recommendations that were just kind of setting on the table and not being pushed any further. I think that it would be appropriate for the Council to look at those things and see if there is any validity to move forward on them. I certainly think there is on the strategic plan, the business plan and the marketing plan. That all should be done now before that place is opened.

Frank Bruno: I don’t want you to think that we just took your recommendations and didn’t do anything.

Larry Fornari: I didn’t say that.

Frank Bruno: I mentioned the first item right-away because I think that we needed implement that right-away so that we are not taking those administration funds out of the additional tax and that the full amount of the tax is going back into the expansion of the Ocean Center. But as far as a written statement, as far as the operational philosophy and all those other ones, I think that you need to give the staff… I have really been pushing to get the qualifications for the architects and engineers and doing all these things.

Rich Hamilton: You will be getting the operational and marketing…Sharon Mock and myself are meeting tomorrow with the advertising firms. As soon as that evolves, Larry, we will be getting that information to you.

Frank Bruno: And Larry, also, I have had ongoing meetings with Fran Gummey as far as retaining the TDC as an oversight. You know it’s my feeling that we need to do that. It should have never been disbanded to start with, but that was the suggestion from the original TDC. But I think that that has changed and with the operational philosophy of the Ocean Center changing and everything else changing, it is imperative to have the TDC in operation continually. We are going to work on that. I think that the best thing to do is make sure that you keep me in the office to make sure that happens.
(Laughter from around the room).

Frank Gummey: You know, the TDC is in the county code of ordinances, so can’t be anything more permanent than that.

Jim Bazemore: Mr. Chairman, the former TDC was never recommended to be disbanded, the County Manager, dissolved it, that is the fact.

Frank Bruno: I don’t know, I just heard that they made a recommendation to dissolve it at one point. I am sorry I wasn’t here. That was during the time that I had left the County Council for those ten years. Big John was the culprit in that one. John, you want to make a comment? You know I am just kidding.

Big John: I don’t want to upset Gummey any more.

Bob Davis: Big John put the TDC back together. Of course Gary, Ron and I visited him, but I don’t think it is and if or, the TDC has to be. That is the state legislature law. What Larry is talking about is really not a County Council, we are talking to you, the TDC board. The people who are on this board that we like a marketing plan, we would like to know where we are going and is it feasible to put out a bid for the collection of $300,000 which someone mentioned might be able to do better. The $250,000 that they collect now, that’s over half-million dollars that is in an accounting firm out there. These are the issues that you are charged with not the County Council. I think that these are the issues that you have to ask for before you talk about the big building, the big parking garaged, what happens to the lot outside. Were are we going with it? Is it going to dye? Is it going to sell? Stuart is right on top of it. I mean he had a greatest convention in the State of Florida two weeks ago at his property, the FSAE, which is every association in the State of Florida. Rick went over and made a presentation. These are the people, the crème de la crème. They came to Daytona Beach that had never been here. Every association executive who runs an association in the State of Florida were over at Stuart’s property, over 400 people. They need to make a presentation, you need to know where you are going, and the marketing plan has to be there. And you have to say to them when they meet at the Adam’s Mark or the Plaza or wherever they meet, this is were we are going and bring that forth. Don’t let that business that is coming to the beach side escape you. Stuart is right on top of it. He knows. Next week he will be at the Governor’s Conference up in Jacksonville. Again, that has to be nurtured. We want them here. Why not? You are the board that is charged with what we have put through and we gave it to you first. As important as the building is, as important as the financing is, you need to be right there in the middle and you need to know everything that is going on. This board must meet regularly. Last meeting was in December. There is no excuse for not meeting more than that. You are everything that we do. We okayed it. We went to our membership and they went for the one penny and you have got to uphold that very strongly. Thank you.

Frank Bruno: By-the-way, I was going to make a comment about future meetings. I totally agree that we need to have meetings, I think that until we get everything sorted out, at least once a month if we can handle it.

Stuart Arp: I want to take it back to what Bob said. We need to start selling it now. We collected the money for it. The big conventions that we are going after book in 3,4,5,6,7 years out and if we don’t start now, the first couple of years that this thing is open it is going to be empty. We can’t wait. We have got to start now and get the word out and put the staff in place in selling this and book in the business.

Sharon Hughes: On what Rick had said, you and Sharon are getting together tomorrow for a meeting. The CVB and the Ocean Center will be working very closely from this point on, I don’t know exactly how, but it seems like a wonderful combination. Maybe they will get us were we are going. So, this will be a very tight niche relationship.

Rick Hamilton: Sharon and I have been working on advertising and media buys. We have been looking at a sales representations in major cities across the United States where most of the associations are located and there will be more things. We have co-op our meeting schedules as far as people going to various associations meetings across the country. And there will be more as we get along. And we are gearing everything to answer your question, Stuart, to October 1.

Darlene Yordon: If I understand correctly, this county charge is an administration fee for collectiong.

Frank Gummey: That’s correct.

Darlene Yordon: And it is about how much?

Frank Bruno: It is a maximum of two percent.

Darlene Yordon: Is there the possibility that we could deal with an issue of asking for privatization or just putting out bids to see if somebody out there…

Frank Gummey: No.

Darlene Yordon: I was just asking, Frank. It is a government tax but if we could do it cheaper and save money, the money could go to more advertising.

Larry Fornari: Darlene, the money that I was talking about wasn’t the two percent that is being charged for the collections. On top of that there is another $250,000-300,000 that the county charges the Ocean Center for overhead charges. Those are the services that I was talking about that could be privatized because they are getting those whether or not the services….Based upon a formula that is spread and charged to different departments of the county including the airport, the Ocean Center and all that. Those are the charges that I was saying that if we are going to do this thing and we ought to try to be as efficient as we can and maybe in doing that it means privatizing some of those services at a cheaper cost.

Darlene Yordon: That is what I misunderstood. Is that a possibility? I know we have got that in Daytona, a given amount that is charged to each department.

Frank Gummey: It would be contrary to the present philosophy, but I can tell you one thing, last year if that were the case, I would suspect the Ocean Center would have spent at least half a million dollars in those expenses.

John Masiarczyk: That’s the fee that they charge the MSD’s and everything else. It is just an overall sharing of the cost of administration. We have paid it with our MSD in Deltona for years and years. It could be looked at, but you are talking about changing a philosophy, entire County Council, entire budget process of Volusia County. It is a system that is in place. Without a system to back it up, to change it, I don’t think that they are going to entertain it. Someone is going to have to really look into a different way to finance all these options.

Darlene Yordon: It doesn’t hurt to have this dialogue and put it on the table and discuss.

Frank Bruno: I think that we are doing a good job with the dialogue.

Lori Campbell-Baker: I agree with Stuart that we need to start selling it now. Back to the timeline thing, a solid timeline from the architect who’ll put that together is going to be critical. We want to be talking everywhere and we want to be accurate with what days it can be sold. I think we should go back and review all the suggestions from the Hotel/Motel Association. There were some things that moved pretty quickly right after they made their recommendations. There was something about the actual tax itself, and I don’t remember how it went Larry. It was looking into this area of funding and if that didn’t work to go ahead and increase it to the full amount. The next thing I read in the paper, it was already being increased.

Frank Bruno: You are talking about the guaranteed entitlement funds.

Lori Campbell-Baker: Yeah, and we didn’t , at least I didn’t here anything about how that was decided one way or the other.

Frank Bruno: The County Council decided that.

Lori Campbell-Baker: We probably need to go back to all of those suggestions. Who actually is putting together the marketing plan? Is it Sharon and Rick?

Rick Hamilton: It will be Sharon, myself, and the advertising firm.

Lori Campbell-Baker: And there is probably a lot of research going into it? And we probably need a timeline on that too.

Frank Bruno: All five of those recommendations will be re-addressed at the next meeting.

Lori Campbell-Baker: That will be great.

Frank Bruno: New business.

John Masiarczyk: I just had one thing. I think that you brought up a couple of questions. I think that we need a clear understanding because we are being charged by folks out there that we should be making these decisions. The County Council arbitrarily just makes decisions, you know we could talk, but the County Council then goes ahead and makes them which totally may not be in the flavor or this board. They have the right to do it. I am not complaining about it, but I would like a definitive answer on this parking garage issue. We have been talking about this for a long time. The parking garage had nothing to do with the Ocean Center. All of sudden by the actions of the county manager it became, and I think we should really know who that fits in the future because if there was a problem in the county or whatever and those bonds were being paid. Are we going to shove out the money from TDC funds to support the garage again?

Frank Gummey: Yes.

Jim Masiarczyk: To the tune of half a million?

Frank Gummey: Yes.

Jim Masiarczyk: We would by the virtue. Is that owned by the same corporation? In other words, the Ocean Center itself is a property that is paid for by TDC money. That building is owned and operated by whom?

Frank Gummey: Volusia Redevelopment Parking Corporation. It is on land leased by the county to it.

Jim Masiarczyk: OK, so we leased county land to a corporation to build a building on. Who ultimately will own that building at the end of time?

Frank Gummey: The county.

Jim Masiarczyk: The county gets the building after so many years. So, the County of Volusia owns it.
So, should not the County of Volusia then pay this vs. the TDC money?

Frank Gummey: The DTD is the revenue of the county.
Bob Davis: This is not a thread or anything like that, but the Florida Hotel/Motel Association has seen 324 violations of the tourist development bed tax of which they forked 301. Recently in St. Johns County the association spent $17,000 and beat the county council down. They are watch dogs of the bed tax. Primary, primary deal that the Florida Hotel/Motel Association is to insure that the bed tax is spent the way it was mandated by the State Legislature. So some of the conversations I hear here, and Frank you are the attorney, but some of it is not correct. There is specification that the bed tax can only be sped for. Anything aside from that is a gray area. If it deemed possible and you got into some problems you have people out there who would come in and fight this county council tooth and nail and go to the legislature because it would be illegal as it is written. There are two sides to that issue, what is right and what is wrong. But they have through the state and beaten 300 county councils where they were going to use it for a various, they say it’s tourism but it’s not. Basically it is convention centers and advertising, end of story. And so, that is something I’ll bring to the table. I have been there. I was down at St. Lucie County and Hudsenson Island were they want to build a museum. I told them they couldn’t do it. They tried to and they failed. We go throughout the state, going to county councils telling them: you are breaking the law. Be careful and really understand it.

Frank Gummey: Let there be no doubt that the parking garage is authorized use of the tourist development tax.

Big John: Frank, this time I will support Mr. Gummey because he is more correct that he was last time, but the parking garage is absolutely essential to the operation of the Ocean Center and was tearing up this building big time a year and half ago and now it ain’t anymore. Now it is adding to the ambiance of the building and it is making people to want to come here.

Frank Bruno: New business.

Darlene Yordon: Frank and I are meeting tomorrow. I have been appointed by the City Commission of Daytona to negotiate with Frank and the county to work out some type of arrangement for the county to take over the Peabody Auditorium. We are meeting tomorrow at 11 o’clock and hopefully we are going to keep it simple and the attorneys won’t gummey it up. Hopefully we can work out something. I think that it is essential. We are also considering putting the Bandshell in with these facilities. That it is crucial to the success of this area and conventions for Rick to have as many facilities as possible available.

Frank Bruno: It just makes sense that we have ticket sales, we have promotional opportunities, we have so much going to kind of combine all those interests and make them all profitable. We have also discussed over the last six or eight months at least that I have been onboard with this, that we can tie in the Peabody Auditorium with the expansion of the Ocean Center and do the improvements over there also tie it into the year-around convention business. I think that it is a plus for the county and it is a plus for the city too. We are going to be discussing that tomorrow. Rick has done a fantastic job in making the Ocean Center profitable. I believe that he can use the bookings and make the Peabody profitable at the same time and do the improvements that are really necessary there and also relief the city of major drain on their budget.

Darlene Yordon: Plus the communication, because, Rick, I know that there were a lot of problems with the communication between the two facilities on events Peabody not notifying you and so, having it under one umbrella, we are not having those glitches, I hope.

Lori Campbell-Baker: Darlene, are you saying that the Bandshell might fall under the Ocean Center umbrella?

Darlene Yordon: We are putting it up for discussion.

Frank Bruno: What we are trying to do is kind of work together for the management end of if. I know that you are on their board as well and when I am able to attend, I am on their board. I really do believe that just working together would make it work better for everybody. And also we are trying to put together friends of Peabody and the friends of Bandshell and then they can apply for more eco grants and so on. Because you know we need to do some improvements out there. It is just a perfect opportunity for the city and the county to work together.

Big John: The National Reptile Breeders which will be here on the 16 & 17, is the second largest show at the Ocean Center, they have also mentioned the Peabody for the venomists’ display. So, it is necessary to put these two buildings together.

Frank Bruno: Absolutely. And also, I just want to mention that the Chamber of Commerce in their meeting recently supported the county taking over that facility.

Sharon Hughes: Peabody is definitely going to stay in place and be improved in the future?

Frank Bruno: Absolutely. It needs a new roof. It needs air-conditioning. It has some mold problems in there. The whole interior needs to be re-worked. We probably should work it with what we are going to be doing with the expansion of the Ocean Center. I am not saying that we are using any bond money or the TDC money to do that. I am just saying that we need to make the improvements as soon as possible to get that place operating.

Darlene Yordon: And more bathrooms.

Frank Bruno: Yeah. Any other new items?

John Masiarczyk: It is going to be looked at, it has nothing to do with the TDC, so I don’t know why you brought it up here. Are you going to look for the county and Daytona to be jointly funding these renovations? Is that building worth saving? When you are talking about expansion here, would you not just encompass that and use the area for the parking garage.

Frank Bruno: I don’t want to take anything away right now without an analyses from what we are trying to accomplish here with the expansion of the Ocean Center.

Darlene Yordon: I think what the important thing is with Rick bringing in conventions that he has as many facilities to use and rent out as possible, because it does help in your marketing. Having the Peabody is just an added plus helping him market and bring in different types of conventions. And the Bandshell would be just one more venue that would be out there.

Frank Bruno: Not unlike what they have in Orlando with Bob Car and the Winter House and the different garages and so on. Any other new business?

Rick Hamilton: Rick Prioletti is here from the city. We have been working for four months or more, combining efforts to do an overall parking and traffic study which we would have to do for the expansion of the Ocean Center anyway. We are real close. We have the scuffle work done. We have agreed with Richmond and Associates on that. There will be an agenda item going before the County Council to get our proportion approved. We have asked the Council for the maximum expenditure of $50,000. The city will be putting in a maximum expenditure of $50,000 also. The third party is the Board Walk Developer, Mr. Gary, who will also be putting in a maximum of $50,000. So, we split it three ways because it is in everyone’s interest that we look at the entire development area. Your comments, Rick, on that.

Rick Prioletti: We have been working on that. We hope to get that started. One of the things about the county’s parking garage is, how do we load that garage and unload it. We need to design the garage. That planning exercise needs to be done prior to the design of the garage, where to put the entrances and how you design the street system to make it work so that we would not have the problems that we have had.

Frank Bruno: Anything else that needs to be put on the table at this time?

Meeting was adjourned at 10:10 a.m.

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