Anaheim will create a new public board that will monitor the more than $30 million a year that flows through the city’s tourism district, a move that was recommend by state auditors that took issue with the city’s oversight of the money.
The city is forming the board after the California State Auditor in a January report said it should have kept a closer eye on the money raised from a fee on room rentals, some of which ended up being used for political purposes.
The City Council created the board in a 6-1 vote at its Tuesday, June 18, meeting.
The Anaheim Tourism Improvement District was formed by the city in 2010 to generate funding to market Anaheim to travelers. It’s funded by a 2% extra assessment on hotel room rates at 94 participating hotels – it is separate from the 15% hotel tax the city collects. Three-quarters of the money goes to Visit Anaheim, a nonprofit with a contract to market the city and book the convention center. The rest goes toward transportation improvements for the Platinum Triangle and the resort area.
The new board will be comprised of four city employees, two hoteliers and Visit Anaheim CEO Mike Waterman. Its role will be to make recommendations to the City Council and Visit Anaheim for how the tourism district dollars are spent.
“This board is just yet another layer of oversight to review those budgets and annual plans and to make recommendations to this body on an annual basis,” Assistant City Manager Greg Garcia told councilmembers.
Waterman in a statement said, “Visit Anaheim collaborated with the city to establish this new advisory board and will continue to support its efforts moving forward.”
The City Council will appoint the two hotel representatives who will serve four-year terms. The hotel representatives will not be allowed on the new board if they are a part of Visit Anaheim’s boards.
Councilmember Jose Diaz was the lone vote against creating the board, saying the government is sticking its fingers into something that’s worked well for years and would just add more bureaucracy.
“This made me very uncomfortable,” Diaz said. “This is mind-blowing.”
When the city created the tourism improvement district in 2010 it had the power to create an advisory board but it never did. Other cities in Southern California with similar setups, such as Huntington Beach, Newport Beach and San Diego, already have public meetings to help monitor those millions of tourism dollars.
The state auditors in their review said that Visit Anaheim improperly contracted with the Anaheim Chamber of Commerce to use some of the funds for political advocacy and influence, including supporting resort-friendly candidates.
The board will be subject to the state’s open meeting law, Garcia said. Its members will not be compensated.
