Finance Committee

CITY OF HENDERSONVILLE FINANCE COMMITTEE October 24th, 2023, at 6:00 p.m. 101 Maple Drive North, Hendersonville, TN 37075 I. Call to Order by the Chairman II. Acceptance of agenda III. Minutes A. Approval of September 26th, 2023, meeting minutes 2-4 IV. Public Comments V. Ordinances and Resolutions Collins 1. Reading of Ordinance 2023-25, an ordinance amending Budget Ordinance 5-18 2023-11 by appropriating General Funds in the amount of $86,615 for the arts festival and approving the Mayor to effectuate festival agreements VI. Other Agenda Items 2. Sales Tax Analysis Report (to be provided under separate cover) 3. Hotel-Motel Tax Report (to be provided under separate cover) 4. Investment Earnings Analysis (to be provided under separate cover) 5. Stormwater Report (to be provided under separate cover) 6. Other Business VII. Adjournment Anyone needing accommodations due to disabilities, please contact the ADA Coordinator at 615-822-1016 at least 24 hours prior to the meeting. 1  FINANCE COMMITTEE MEETING MINUTES September 26, 2023 CONFERENCE ROOM 2 @ 6:00 pm Present: Karen Dixon, Mark Burgdorf, Jeffrey Sasse Absent: None Others Present: Mayor Jamie Clary, Jesse Eckenroth, Tamara Ingersoll, Andy Gilley, Sarah Locke, Casey LaMarr, Eddie Roberson, Rachel Collins, Terri Goodwin, Chief Bush, Asst. Chief Edwards, Mike Cook Called to order at 6:00 pm Motion to amend the agenda to change “approval of September 26th, 2023 meeting minutes” to “approval of July 25th, 2023 meeting minutes”. Motion: Jeffery Sasse Second: Mark Burgdorf Approved unanimously Motion to Accept the September 26, 2023, Finance Committee Agenda as Amended Motion: Mark Burgdorf Second: Jeffrey Sasse Vote: Unanimous Approval 3-0 Motion to Approve the July 25, 2023, Finance Committee Meeting Minutes Motion: Jeffrey Sasse Second: Mark Burgdorf Vote: Unanimous Approval 3-0 Citizens’ Comments None Ordinances Reading of Ordinance 2023-20, an ordinance requesting citizens to determine by election whether to adequately fund public safety, infrastructure, parks, and paving in the City of Hendersonville by a small increase in sales tax of ½ penny per dollar for only 10 years Discussion: Eddie Roberson led the discussion. This will allow the citizens to make the decision regarding the future of the City. This will have a significant improvements all across the City. Infrastructure projects such as Stop 30, New Shackle Island Road, Sanders Ferry Road, Exit 8 and others throughout the City. Many 2 other cities in TN have approved the additional sales tax. No other have put a time limit on the increase. It will sunset in 10 years and would require another vote of the citizens to extend it. This would require these funds be delineated in the budget for accountability and can only be spent for paving, infrastructure, public safety and parks. Anticipated annual revenue is $9,000,000. This ordinance has already passed by General Committee. Motion to recommend Ordinance to BOMA: Jeffrey Sasse Second: Mark Burgdorf Vote: Unanimous Approval 3-0 Reading of Ordinance 2023-23, an ordinance amending Ordinance 2023-11 to reflect final-year adjustments to the City’s 2024 Fiscal Year Budget Discussion: Jesse Eckenroth led the discussion. Original FY24 budget was based on estimated project expenditures for FY23. Now that FY23 is closed, we have actuals and are now need to true-up the amounts to align. No change in dollar amount, it is a timing issue between the two fiscal years. Amendment moves funds for the purchase of computers instead of leasing them and adding $40,000. Budget Amendment adds a project for a traffic signal at Drakes Creek Road and Long Hollow Pike, paid with funds paid by the developer. Also adds appropriations for Learn not to Burn, paid from donations. Adds funds for potential grants intended for smaller grants that we may apply for. Motion to recommend Ordinance to BOMA: Mark Burgdorf Second: Jeffrey Sasse Vote: Unanimous Approval 3-0 Resolutions Reading of Resolution 2023-35, a resolution to revise and update the Fund Balance and Reserve Policy for the City of Hendersonville Discussion: Jesse Eckenroth led the discussion. This updated policy adds a new reserve for public safety so we would now have three reserves; public safety, infrastructure and rainy day. This updated policy outlines recommended amounts to build these reserve to. Funds would be added to these reserves after the Comptroller’s recommendation for the General Fund balance is met. Finance will provide unaudited estimate for ending FY23 soon and final audited fund balance will be available one the audit is complete at the end of December. Motion to recommend resolution to BOMA: Jeffrey Sasse Second: Mark Burgdorf Vote: Unanimous Approval 3-0 3 Other Business Sales Tax Analysis State Sales Tax Analysis – Sales tax for the month of August 2023 totaled $524,659. This represents a $5,062 decrease compared to August 2022, and a $12,985 increase compared to this point in FY2023. Local Sales Tax Analysis – Sales tax for the month of August 2023 totaled $1,699,877. This represents a $11,982 increase compared to August 2022, and a $19,437 increase compared to this point in FY 2023. Hotel-Motel Tax Analysis Hotel Motel Tax Analysis – Tax collections for the month of August 2023 totaled $41,101.48. This represents a $ 12,287.70 increase compared to August 2022, and a $14,652.81 increase compared to this point in FY 2023. The Hotel-Motel Occupancy tax rate increased from 2.75% to 4.00% effective August 2023. Investment Activity Discussion: The City of Hendersonville’s interest earnings for the month of August 2023 was $135,095. The total investment earnings year-to-date for FY24 is $288,237. Stormwater Fund Report The current balance in the Stormwater Fund is $1,332,925. Limited revenues come in the first four months of the fiscal year as Stormwater fees are billed and paid with property taxes. Motion to Adjourn Motion: Jeffrey Sasse Second: Mark Burgdorf Vote: Unanimous Adjourned 6:29 pm ______________________________ Karen Dixon, Chairwoman 4  ORDINANCE 2023-25 Sponsor: Collins AN ORDINANCE AMENDING BUDGET ORDINANCE 2023-11 BY APPROPRIATING GENERAL FUNDS IN THE AMOUNT OF $86,615 FOR THE ARTS FESTIVAL AND APPROVING THE MAYOR TO EFFECTUATE FESTIVAL AGREEMENTS WHEREAS, on June 27, 2023, the City’s governing body passed Ordinance 2023-11 (the “Budget Ordinance”) adopting the City’s operating budget for Fiscal Year 2024; WHEREAS, the Budget Ordinance was based on projected revenues and anticipated expenditures for Fiscal Year 2023; and WHEREAS, the City desires to appropriate the requisite funds for the Arts Festival, as more specified in the attached Exhibit A, and the City therefore desires to amend the Budget Ordinance to reflect this appropriation: NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF MAYOR AND ALDERMEN OF THE CITY OF HENDERSONVILLE, TENNESSEE, that the City’s Fiscal Year 2024 Budget Ordinance, Ordinance 2023-11, is hereby amended by appropriating $86,615 for the Arts Festival as set forth in the attached Exhibit A, and approving the mayor to effectuate festival agreements This ordinance shall take effect on the earliest date allowed by law. First Reading: ______________________ Second Reading: APPROVED: JAMIE CLARY, Mayor ATTEST: ___________________________________ TAMARA INGERSOLL, City Recorder APPROVED AS TO FORM: ____________________________________ LANCE A. WRAY, City Attorney 5  LEGISLATIVE HISTORY Ordinance 2023-25 Sponsor: Collins Committee: Finance Date of Committee Meeting: October 24th, 2023 Committee Recommendation: 6  EXHIBIT A BUDGET AMENDMENT WORKSHEET Requested Requested Expenditure Revenue Account Code Account Name Current Budget Amendment Amendment Adjusted Budget Justification 110-000-41620-0013-0000-532900-ARTCN Arts Council Supplies $ 19,500.00 $ 86,615.00 $ 106,115.00 For Good Neighbor Festivals 110-000-00000-0000-0000-436700-ARTCN Contributions & Donations $ - $ 15,000.00 $ 15,000.00 Sponsorships received and pledged $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 19,500.00 $ 86,615.00 $ 15,000.00 $ 121,115.00 7 DATE: October 24th, 2023 ORDINANCE/RESOLUTION # Ordinance 2023 - 25 For BOMA to amend budget ordinance 2023-11 by SPECIFIC REQUEST/ appropriating general funds in the amount of $86,615 for RECOMMENDATION: the arts festival and approving the mayor to effectuate STAFF festival agreements REPORT Tamara Ingersoll, Finance Director REPORT PREPARED BY: Andy Gilley, Parks Director Jesse Eckenroth, Chief of Operations BACKGROUND: 1 The Arts Council is one of city committees with multiple members represented from wards throughout the city. The Municipal Code lists the duties of the committee as follows: 2-503. Duties and objectives of the council. The duties and objectives of the council shall be: (1) To stimulate and encourage throughout the city the study and presentation of the performing, visual, and literary arts and public interest and participation therein. In fulfilling these objectives, the council must strive for excellence in all areas in the Arts and shall endeavor to: (a) Encourage participation in, appreciation of, and education in the arts to meet the legitimate needs and aspirations of persons in all parts of the city; (b) Take such steps as may be necessary and appropriate, to encourage public interest in the cultural heritage of our city, to expand he city's cultural resources, and to promote the use of art in the city government's activities and facilities; and (c) Encourage excellence and assist freedom of artistic expression for the well-being of the arts. DISCUSSION: 2 The Arts Council has been advocating for an Arts Festival to support the duties and objectives of the council. The City issued a Request for Qualifications in June 2023 for festival management groups. The city received one proposal in July and selected the consultant, Good Neighbor Festivals, in August. Good Neighbor’s proposal was separated into Phase 1 and 2. Phase 1 was for $19,500 and includes development, fundraising and planning. A contract for Phase 1 was authorized by the city, from the original FY24 Budget. Phase 2 is primarily for the physical production of the event, $86,615. The total cost for phases 1 and 2 is $106,115, the proposal is attached to this report. Anticipated revenue from the festival is $113,400, for a total net positive impact of $7,285. The city broke the project into two phases so BOMA could evaluate the feasibility of a festival before committing to the full project budget of $106,115. Good Neighbor and the Arts Council, among other things, have been developing the project and seeking sponsorship. Good Neighbor will present data to BOMA at the November 14th to give a more definite sense of interest and sponsorship levels. 8  2 The festival goal is to command an attendance of 5,000 or more. The Parks Board approved Sanders Ferry Park as the festival location for May 2024. FISCAL IMPACT: 3 A budget amendment is needed for $86,615. The city has a sunk cost of $19,500 for the engagement of Phase 1 which was paid through the FY24 budget for the Arts Council; the additional $86,615 for Phase 2 will total $106,115. Revenue is estimated at $113,400, for a net positive impact of $7,285. However, actual revenue is estimated and unknown. The budget amendment would authorize the city to enter into a contract for $86,615. ATTACHMENTS: 4 1. Good Neighbor Festivals proposal 9 City of Hendersonville Arts Festival 10 About Good Neighbor Festivals Good Neighbor Festivals has been creating and managing large scale events for over 14 years. We strive to create and grow festivals that support the communities we love. We develop and manage all facets of special events specifically, marketing, promotion, production, strategic planning, logistics, budgeting, permitting and sponsorship sales. Our events bring people together, inspire, and stimulate minds. Good Neighbor Festivals currently manages an average of 16 festivals per year in the middle Tennessee and Kentucky area. In 2021 more than 400,000 people attend a festival we managed. Festival and Event Management Experience Below are a few examples of festivals we manage by the numbers. Event Name Month Number of Vendors Attendance Budget Sevier Park Fest May 120 14,000 $90,000 Nashville Pride June 280 125,000 $1,400,000.00 Festival Tomato Art Fest August 225 75,000 $380,000 All Hallows East October 40 8,000 $100,000 Good Neighbor Festivals Team Jack Davis Founder Partnerships/Sponsorship Kelsey Morris Festival Director Overall Management of Festival Katie Hollingsworth Festival Manager Vendors/Logistics/Subcontractors Kat Hendrick Festival Coordinator Entertainment/Production Shelby Huggins Sponsorship Manager Partnerships/Sponsorships Tracie Hitz Marketing Marketing/Social Media Kristyn Corder Design and Web Branding/Graphics/Website Ellice Evans Social Media Social Media Management 11 Festival Management Good Neighbor Festivals will work with the Hendersonville Arts Council to develop and execute a success Artisan Festival in May of 2024. We have successfully built ideas into large scale festivals that draw thousands of people and are profitable. In 2010 we began managing the annual Tomato Art Fest in East Nashville. At the time this event was drawing an average of 3,000 people and breaking even. Today the event draws more than 75,000 people and has a budget of more than $380,000. Working with the Nations Business Association we developed the annual Light the Nations Festival that takes place each October on Nashville’s westside. The event draws an average of 7,500 people each year. Hendersonville Art Festival Good Neighbor Festivals will work with the arts council to create a nationally recognized artisan festival. Using our existing knowledge of artisan festivals and overall successful festival operations Good Neighbor Festivals will develop and implement a project timeline to ensure overall event goals are realized. Festival Management Proposal Phase 1 – Development, Fundraising and planning August – December 2023 In Phase 1 of the agreement, Good Neighbor Festivals would work with the Arts Council to provide the following in an effort to set the event up for success and begin fundraising. Marketing and Branding • Good Neighbor Festivals will design all graphics needs for the event including logo, design colors, wordmarks, social media templates and website design outline. • Build and manage phase one of the website site. o Landing page, Artisan Page, Sponsorship/Support page. • Set up formal Hendersonville Art Festival email addresses and online file storage. • Build and manage phase one of social media marketing. o Set up social media accounts o Set up call for Artists Sponsorship • Develop formal sponsorship deck and levels to engage local community to support event. • Develop list of potential sponsors/supporters. • Reach out and engage with potential sponsors/supports to confirm any commitments. • Develop agreements and ensure they are executed. Event logistics 12  • Build and manage event action plan o Develop timelines and milestones • Create a draft event layout Vendors/Artisans • Manage the event vendor program • Develop a list of potential vendors, crafters, and artisans to join the event • Launch vendor and artisan application in November 2023 • Develop all vendor agreements Budget Development • Assist in the development of the event budget • Track budget and ensure invoices are processed on time Phase 2 – Planning and Operating January – May 2024 Event logistics • Manage event action plan. o Follow through on developed timelines and milestones. • Finalize event layout and manage all load in, day of, and load out logistics. • Hire and manage all aspects of the event including o Production (AV/sound/lights) o Tents, tables, chairs, staging o Security/Police o EMTs o Trash/Recycling/Composting o Power o Portable restrooms • Manage all special event permits as required by city and state laws. • Coordinate all ADA and other access needs for the event. • Track and confirm all COIs. Ticketing • Manage ticketing platform and guest services throughout the event (If needed). Travel • Handle all travel/shuttle arrangements onsite as needed. • Curate and manage host hotels for visiting artists. Vendors/Artisans • Manage the event vendor program. • Handle all communication, once recruited to participate in the event. • Track and confirm all COIs 13 Entertainment • Negotiate all entertainment offers and contracts within budget. • Manage all entertainment related hospitality. • Hire and manage a production team. • Track and confirm all COIs. Community Engagement • Connect with community (bars, restaurants, etc) to activate at or during the event. • Work with local groups to increase volunteers at the event. • Manage all volunteer sign ups and communication. Sponsorship • Reach out and engage with potential sponsors/supports to confirm any commitments. • Oversee sponsorship activation and event execution as required. Budget Management • Track budget and ensure invoices are processed on time. Marketing • Manage website domain and page throughout the event. • Amplification management - build schedule of content generators, posting, tagging. • Handle all traditional media buys. • Schedule photographers/videographers. • Provide a post show wrap up. Social media • Manage all aspects of social media. City of Hendersonville to provide police and EMTs for the event weekend. 14 15 16 17 18