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INTRODUCED BY: Councilmember Jarvis
CO-SPONSORED BY: Councilmembers Thomas, Evans, Allen, Mason and Chairman Cropp
The Chairman is referring this legislation to the Committees on Economic Development and
Finance and Revenue
SEPTEMBER 22, 1997 1998
To amend the Washington Convention Center Authority Act of 1994 to
authorize the Washington Convention Center Authority (the "Authority") to enter
into various interest rate hedge agreements; to provide authorize for the
Authority to enter into marketing services arrangements or agreements for the purpose of
promoting conventions and tourism in the District of Columbia; to authorize the Authority
to apply dedicated taxes to the payments of Costs; to increase the permitted maturity of
revenue bonds issued by the Authority from 30 to 40 years; to allow the Authority to use
revenues for redemption or purchase of outstanding indebtedness of the Authority prior to
delivering excess revenues to the District; to enter into various interest rate
agreements to permit the Authority to create additional reserves if it determines that
such additional reserves are required; to provide for the immediate transfer of the
dedicated taxes to the Authority; to amend title 47 of the District of Columbia Code to provide
that 100 percent of the repeal Hotel Occupancy Tax and the transfer of
certain taxes and surtaxes to the Authority, to increase to the separate Sales and
Compensating-Use Taxes on gross receipts for transient lodgings or accommodations and to
provide that 100% of the 4.45% taxes imposed thereunder pursuant
to section 47-2002.2 and section 47-2202.1 shall be transferred to the Authority; and
to amend Section section 305 to D.C. Law 10-188 to specify the
procedures employed by the District of Columbia Auditor in certifying as to the
sufficiency of certain taxes to meet expenses and reserves of the Authority.
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this act
may be cited as the "Washington Convention Center Financing Amendment Act of 1997"
1998.
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Sec. 2. The Washington
Convention Center Authority Act of 1994, effective September 28, 1994 (D.C. Law 10-188;
D.C. Code, Sec. 9 §9-801 et seq.), is amended as
follows:
(a) Section 201 (D.C. Code §9-802) is amended as follows:
(1) Subsection (4) is amended to read as follows:
“(4) “Dedicated taxes” means those taxes imposed
pursuant to sections 2002.2 and 2202.1 of title 47 of the D.C. Code, plus interest and
penalties related thereto.”
(b) Section 203 (D.C. Code, sec. 9-804) is amended as follows:
(1) Subsection (12) is amended by striking the word "and" at
the end thereof;
(2) Subsection (13) is amended by striking the period at the end
thereof and inserting the phrase "; and" in its place; and.
(3) By adding a new subsection (14) to read as follows:
"(14) To enter into interest rate swaps,
interest rate caps, interest rate floors and any other interest rate-related hedge
agreements or arrangements to1imit interest rate risk, to facilitate the
issuance of variable rate obligations or obligations with an effective variable rate
and to better manage assets which agreement may, but need not be, agreements
or arrangements shall only be entered into in conjunction with the issuance of bonds,
notes or other obligations by the Authority.” Authority; provided
that the Authority shall retain the right to discontinue or unwind any such agreement if
in the reasonable opinion of the Chief Financial Officer of the Authority it is in the
best interest of the Authority to do so.”
(b)(c) Section 206 (D.C.Code, sec 9(D.C.
Code §9-807) is amended as follows:
(1) Subsection (a)(5) is amended by striking the word "and"
at the end thereof;
(2) Subsection (a)(6) is amended by striking the period at the end
thereof and inserting the phrase "; and" in its place;
(3) A new subsection (a)(7) is added to read as follows:
"(7)(A) Enter into marketing services service
contracts to promote conventions and, tourism, and leisure
travel in the District of Columbia, which. The contracts shall be
based on and total, as nearly as practical, an amount equal to 17.4 percent of the amount
of tax collected in the prior fiscal year.”
“(B) Where applicable, the contracts shall include information
on general and specific responsibilities, performance standards, pricing, financial
reports and data, associated services, cooperative efforts with the Authority and the
District, duration and termination of agreements, proprietary work product, notices and
remedies. The Authority shall have the right at any time to terminate any such contract
for cause. In the event of termination for cause by the Authority, the services to be
performed under the terms of the terminated contract shall be procured by request for
proposals made pursuant to rules for the procurement of goods and services properly
adopted by the Authority Board of Directors.
“(C) The contracts to promote conventions and,
tourism, and leisure travel in the District of Columbia shall include:
"(i) A contract for an initial term of 10 years, renewable
for additional 10 year terms, with the Washington Convention and Visitors
Association pursuant to which the Washington Convention and Visitors Association shall be
designated the primary contractor to promote conventions and tourism in the District of
Columbia and shall receive compensation in an amount equal to not less than thirty
percent of the amount collected each year from the tax imposed by chapter 32 of title 47
of,
“(ii) A contract with the D.C. Code;
"(ii) A contract for an initial term of 10 years,
renewable for additional 10 year terms, with the DC Committee to Promote
Washington pursuant to which the DC D.C. Committee to Promote
Washington shall be designated the primary contractor to conduct leisure travel
advertising and promotions in the District of Columbia and shall receive
compensation in an amount equal to not less than 22.5 percent of the amount collected each
year from the tax imposed by chapter 32 of title 47 of the D.C. Code;; and,
"(iii) A contract for an initial term of 10 years,
renewable for additional 10 year terms, with the D.C. Chamber of Commerce
pursuant to which the D.C. Chamber of Commerce shall receive compensation in
be designated the primary contractor to promote neighborhood and cultural tourism in
the District of Columbia and promote participation by local small and minority businesses
in the hospitality industry.
“(D) There is established the “Washington Convention
Center Marketing Fund” to be operated by the Authority for the payment of marketing
service contracts. The Authority shall deposit an amount equal to not less than 5.83
17.4% percent of the amount collected each year from the tax imposed by chapter
32 sections 2002.2(a)(1) and 2202(a)(1) of title 47 of the D.C. Code;
and into the Washington Convention Center Marketing Fund,
"(iv) Contracts with such other public or private entities as the
Authority shall deem advisable.
"The “(E) The obligation of the Authority to make any
payment pursuant to any contract and the amount thereof shall be subject and subordinate,
in all respects, to the obligation of the Authority to apply any amount deposited or
required to be deposited in any fund or account established or maintained pursuant to any
resolution, indenture or trust agreement adopted by the Authority relating to any bonds,
notes or other obligations issued by the Authority pursuant to section 210 of the
Washington Convention Center Authority Act of 1994, effective September 28, 1994 (D.C. Law 10-188; D.C. Code, sec. 9-811), in accordance with the provisions of
such resolution, indenture or trust agreement and the Authority shall have the
right at any time to terminate any such . This section 206(a)(7) does not
create and shall not be deemed to create any priority in the payment of any amount
pursuant to a marketing service contract for cause."over any
other operating expense of the Authority.”
(4) Subsection (b)(1) is amended to read as follows:
"(1) For the purposes of this subsection, the term "operating budget"
shall include only funds for personnel, show operations, travel, development, marketing service
contracts entered into pursuant to subsection (a)(7) of this section, and Board
expenses."
(c) Subsection (c) of section (d) Section 208
(D.C. Code, sec. 9-809(c)) §9-809) is amended as follows:
(1) Subsection (b) is amended to read as follows:
“(b) Dedicated taxes collected by the Mayor as agent for the
Authority and the monies in the Fund shall not be a part of, nor lapse into, the General
Fund of the District, except as provided in section 213 (D.C. Code §9-814).
(2) Subsection (c) is amended to read as follows:
"(c) As of September 28, 1994, any and all dedicated taxes
collected by the Mayor as an agent for the Authority shall be transferred upon receipt to
the Fund for the payment of the Costs of the new convention center, expenses necessary for
debt service, reserve funds, repair, maintenance, marketing contracts and all other costs
of operating and managing the Authority."
(d) (e) Subsection (a)(2) of section 211 (D.C. Code, sec. 9 §9-812(a)(2)) is
amended by striking the phrase "30 years" wherever it appears and inserting the
phrase "40 “34 years" in its place.
(e) (f) Section 213 (D.C. Code, sec. 9
§9-814) is amended as follows:
(1) Subsection (a) is amended to read as follows:
"(a) If, at the end of a fiscal year, the balance of cash and
investments of the Authority exceeds the balance of current liabilities, reserves and any
amounts which the Authority expects to apply to purchase or redeem its outstanding
indebtedness during the upcoming fiscal year, the excess shall be transferred, in cash, to
the General Fund of the District."
(2) Subsection (c) is amended to read as follows:
"(c) If the The Authority or the
bond-rating agencies determine (i) that any may increase the level of the
reserves described under in subsection (b)of this section must
be higher than the levels calculated thereunder or (ii) that it is necessary or desirable
to or establish, fund and maintain any other reserve or reserves, if
the Authority must include the justification for the higher levels or additional
reserves and the levels thereof in the inducement resolution or the resolution authorizing
a bond issuance submitted to the Council pursuant to section 204 of this Act."
determines that such action is necessary to satisfy the bond-rating agencies or
otherwise maintain the financial condition of the Authority.”
(f) (g) Section 305 is amended to read as follows:
"Sec. 305. (a) On or before July 1 of each year, the District of
Columbia Auditor, pursuant to the Auditor's duties under section 455(b) of the District of
Columbia Self-Government and Governmental Reorganization Act, approved December 24, 1973
(87 Stat. 803; D.C. Code §47-117(b)), shall audit the accounts and operations of the
Authority.
"(b) On or before July 15 of each year in which there is
outstanding any indebtedness issued by the Authority pursuant to article 9, chapter 8 of
the District of Columbia Code, the District of Columbia Auditor shall prepare and deliver
to the Mayor, the Council and the Chief Financial Officer of the District and the Chairman
of the Authority a certification relating to the upcoming fiscal year of the District as
to the sufficiency of the sum of the projected revenues from (i) the taxes imposed
pursuant to sections 301, 302, 303 and 304 of this act 2002.2 and
2202.1 of title 47 of the D.C. Code and transferred to the Authority by the Mayor pursuant
to sections 2202.3 and 2202.2 of title 47 of the D.C. Code, as such tax revenues are
estimated by the Office of Tax and Revenue for such upcoming fiscal year, which estimates
shall be delivered by the Office of Tax and Revenue to the Authority on or prior to July l
of such year, excluding from such estimate any amounts relating to any surtax imposed
pursuant to subsection (c) of this section, (ii) the projected operating revenues of the
Authority for such upcoming fiscal year contained in the most recent multiyear financial
plan of the Board submitted pursuant to section 206(g) of this Article (D.C.
Code §9-807(g) and (iii) any amounts on deposit in any reserve fund or account (other
than any debt service reserve fund or account for indebtedness of the Authority), which
are in excess of the required minimum balance for such fund or account, as certified by
the Authority, to meet the sum of (l) projected operating and debt service
expenditures and reserve requirements (other than amounts include in clause (2) below) of
the Authority for the upcoming fiscal year contained in the most recent multiyear
financial plan of the Board submitted pursuant to section 206(g) and (2) any amounts
required, as certified by the Authority, to restore any reserves relating to indebtedness
of the Authority to their required minimum balance.
"(c) If the certification delivered pursuant to subsection (b)of
this section indicates that such projected revenues for the upcoming fiscal year are
insufficient to meet such projected expenditures and reserve requirements (other than
amounts included in clause (2) of subsection (b) of this section) and payments required to
restore reserves to their minimum required balance for the upcoming fiscal year, the Mayor
shall impose a surtax, to become effective on or before the first day of the upcoming
fiscal year, on each of those taxes dedicated to the Authority, except the tax on
sales of restaurant meals and alcoholic beverages, the tax imposed pursuant to
section 2002.2(1) and 2202.1(1) of title 47 of the D.C. Code in an amount equal to the
pro rata share of the difference between (i) the sum of the projected operating
and debt service expenditures and reserve requirements (other than amounts included in
clause (2) of subsection (b) of this section) and payments required to restore reserves to
their minimum required balance and (ii) the projected revenues. The pro rata share
shall be determined based on the pro rata estimated tax revenue for the particular year as
contained in estimate of tax revenues for such year provided by the Office of Tax and
Revenue. Such surtax shall be effective only for such upcoming fiscal year."
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Sec. 3. Title 47 of the D.C. Code is amended as
follows:
(a) Section 47-1807.2a is repealed.
(b) Section 47-71808.3a is repealed.
(c) Subsection (2) of section 2002 is amended by striking the phrase
“10.5%” and replacing it with the phrase “10.05%” in its place.
(d) Subsection (1) of section 2002.2 is amended by striking the phrase
“2.5%” and replacing it with the phrase “4.45%” in its place.
(e) (1) Section 47-1807.2a 2002.3 is
amended to read as follows:
"(a) The Mayor shall collect the surtax levied tax
imposed pursuant to section 47-1807.2(a)(4), acting 2002.2 as
agent on behalf of the Washington Convention Center Authority, and shall transfer the
revenue from the surtax, upon receipt, to the Washington Convention
Center Authority Fund, established pursuant to section 211 of the Washington Convention
Center Authority Act of 1994, effective September 28, 1994 (D.C. Law 10-188; D.C.
Code, sec. 9-809)."§9-809).
(2) Section 47-1808.3a is amended to read as follows:
"(a) (b) The Mayor shall collect
the surtax levied may develop and apply a fixed formula to the taxes imposed
pursuant to section 47-2002 and 47-2002.2 to determine the amount that shall be
transferred to the Authority.”
(f) Subsection (2) of section 2202 is amended by striking the phrase
“10.5%” and replacing it with the phrase “10.05%” in its place.
(g) Subsection (1) of section 2202.1 is amended by striking the
phrase “2.5%” and replacing it with the phrase “4.45%” in its place.
(h) Subsection (a) of section 47-2202.2 1808.3(a)(4),
acting as agent on behalf of the Washington Convention Center Authority, and shall
transfer the revenue from the surtax, upon receipt, to the Washington Convention Center
Authority Fund established, established pursuant to section 211 of the Washington
Convention Center Authority Act of 1994, effective September 28, 1994 (D.C. Law 10-188;
D.C. Code, sec. 9-809)."
(3) Section 47-2002.3 is amended to read as follows:
"(a) The Mayor shall collect the tax imposed pursuant to section
47-2002.1 2202.1 as agent on behalf of the Washington Convention
Center Authority, and shall transfer the revenue from the tax, upon
receipt, to the Washington Convention Center Authority Fund established,
established pursuant to section 211 of the Washington Convention Center Authority Act of
1994, effective September 28, 1994 (D.C. Law 10-188; D.C. Code, sec.
9-809)."
(4) Section 47-2202.2 is amended to read as follows:
"(a) The Mayor shall collect the tax imposed pursuant to
section 47-2202.1 on behalf of the Washington Convention Center Authority, and shall
transfer the revenue from the tax, upon receipt, to the Washington Convention Center
Authority Fund established, established pursuant to section 211 of the Washington
Convention Center Authority Act of 1994, effective September 28, 1994 (D.C. Law 10-188;
D.C. Code, sec. 9-809)."
(5) Section 47-3206 of the D.C. Code is amended to read as follows:
"(a) The tax imposed by this subchapter shall be collected
by the Mayor on behalf of the Washington Convention Center Authority and immediately set
aside and transferred to the Washington Convention Center Authority Fund, established
pursuant to section 211 of the Washington Convention Center Authority Act of 1994,
effective September 28, 1994 (D.C. Law 10-188; D.C. Code, sec. 9-809).
"(b) For purposes of calculating the contract amount
liabilities of the Authority pursuant to section 206 (a)(7) of the Washington Convention
Center Authority Act of 1994, effective September 28, 1994 (D.C. Law 10-188; D.C. Code,
sec. 9-807(a)(7)), on or before the 25th day of each month, the Office of Tax and Revenue
shall certify to the Authority the amount of tax imposed by this subchapter collected in
the immediately preceding month."
(i) Chapter 32 is repealed.
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Sec. 4. Applicability
(a) The following sections shall apply as of the effective date of this act:
(1) Section 2(b), (c), (e), (f), and (g); and
(2) Section 4.
(b) The following sections shall apply as of October 1, 1998:
(1) Section 2(a), (d) and (h); and
(2) Section 3.
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Sec. 5. Delegation of Council authority to
issue bonds.
The Council delegates to the Authority the power of the Council under
section 490 of the District of Columbia Self-Government and Government Reorganization Act,
approved December 24, 1973 (87 Stat. 809; D.C. Code, see 47-334), as amended by section
11508 of the National Capital Revitalization and Self-Government Improvement Act of 1997,
approved August 5, 1997 (Pub. L. 105-33), to issue revenue bonds, notes, and other
obligations to finance, refinance, or assist in the financing or refinancing of any
undertakings of the new convention center pursuant to the Washington Convention Center
Authority Act of 1994 (D.C. Law 10-188).
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Sec. 5. 6. Effective
Date.
This act shall take effect following approval by the Mayor (or in the
event of veto by the Mayor, action by the Council to override the veto), approval by the
Financial Responsibility and Management Assistance Authority as provided in section 203(a)
of the District of Columbia Financial Responsibility and Management Assistance Authority
Act of 1995, approved April 17, 1995 (109 Stat. 116; D.C. Code, sec. 47§47-392.3(c)),
and a 30-day period of Congressional review as provided in section 602(c)(1) of the
District of Columbia Self-Government and Governmental Reorganization Act, approved
December 24, 1973 (87 Stat. 813; D.C. Code, sec.1§1-233 (c)(1)),
and publication in the District of Columbia Register. |
