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Council approves three-year funding agreement with Convention & Visitors Bureau using 5/7s model
Summary
After extensive debate about reserves and CEO recruitment, council approved a multiyear (three-year) funding agreement with the Fredericksburg Convention & Visitors Bureau using a 5/7s percentage funding model and directed staff to finalize contract language and audit requirements.
Representatives of the Fredericksburg Convention & Visitors Bureau (CVB) asked council to approve a multiyear funding agreement to provide operational stability and to support recruitment of a new CEO. Dr. Shields and other CVB representatives said a multiyear guarantee and a plan to buy down reserves to an industry-standard six months would help the organization recruit leadership and plan multi-year marketing and sales efforts.
Councilors debated whether to wait for a new CEO to be onboarded before locking in a multi-year commitment, whether to guarantee a percentage ("five-sevenths") of collected HOT revenues or a fixed dollar amount, and how to treat CVB reserves and existing operational budget gaps. Staff counsel explained that a percentage model is commonly used and that any agreement remains subject to annual appropriation and legal review.
After extended discussion and edits on contract language, council voted to approve a three-year funding agreement using the 5/7s funding mechanism and agreed the CVB should work with staff on audit and reporting requirements. The motion carried by voice vote. Council directed staff to prepare final agreement text for execution consistent with the council's direction.
