TO:

FROM:

RE:

City of South Lake Tahoe NEW BUSINESS a "making a positive difference now··

STAFF REPORT CITY COUNCIL MEETING OF OCTOBER_ 7h 2014

Nancy Kerry, City Manager

MaryAnne Brand, Financial Services Manager Laura Murray, Accountant

South Lake Tahoe Tourism Improvement District Fiscal Year 2013-2014 Annual Report

RECOMMENDED ACTION:

Approve Fiscal Year 2013-2014 Annual Report

BACKGROUND AND DISCUSSION:

In accordance with the Property and Business Improvement District Law of 1994, Resolution No. 2006-52 was adopted by the City Council on September 5, 2006. The Resolution established the South Lake Tahoe Tourism Improvement District (SL TTID) and authorized levying an assessment on lodging businesses to provide a mechanism for stable funding of community marketing and tourism promotion. On December 8, 2009 Resolution No. 2009-103 was adopted by the City Council which renewed the SL TTID for a period of ten years and increased the nightly assessment amount.

The agreement with the SL TTID states that the City shall be responsible for the collection of assessments. After the monthly collections, accounting, and reconciliation, the funds are passed through to the TIO less a 1 % administrative fee. The agreement also requires the TIO to prepare and submit to the City an annual report of activities; a budget summary, and a financial statement. All required items are enclosed for review and approval by the City Council. The Council may approve the report as submitted or may modify it pursuant to Street and Highways Code Sections 36635 and 36636. The Council may not approve a modification that would change the basis or method of assessment that would impair an authorized or executed contract to be paid from the revenues derived from the levy of assessments.

Annual assessments: Lodging businesses in the City of South Lake Tahoe are included in the District which includes an assessment of $3.00 per paid occupied room night on hotels and motels, and a $4.50 per paid occupied room night on timeshares, condos, triplexes, duplexes, and vacation homes under management contracts. The assessment began on November 1, 2006 and will expire on December 17, 2019 unless renewed. There are

Finance Department • 1901 Airport Road Suite 210 • South Lake Tahoe, CA 96150-7048 • (530) 542-6041 FAX

SL TTID Annucil Report October: '7. 2014

Page 2 of 3

no changes to the boundaries or areas of benefit in the District. The method of assessment remains the same as in previous years.

Revenues: The TIO Board has budgeted $2,127,674 in 2015, which is a 5% increase over the Fiscal Year 2014 budget. TIO revenue collections in fiscal year 2014 are estimated to be $2,125,000; actual collections in fiscal year 2013 totaled $2,111,734. The City of South Lake Tahoe receives a 1 % administrative fee for collection of the monthly assessment, distribution of funds to the TIO, and other financial support services.

Expenses: The largest expense of the TIO includes Marketing Programs and Special Events, which comprise 47.9% of the TIO budget. Administration expenses include payroll, insurance, utilities, and supplies, representing 16. 7% of the budget. The Visitor's Center represents 11.1 % of the budget while Communications and Public Relations represent 8.3% of the budget. The remaining budget includes a 5% contingency fund and a 1 % administrative fee to the City of South Lake Tahoe. There is no expected surplus or deficit.

1.0% 5.0%

TIO Budget 2014/2015

• Marketing and Promotions

•Communications/Public Relations

•Special Events

•Visitor Center

• Admini~tration

•City of SLT Adm in Fee

• Contingency

STRATEGIC PLANNING/FINANCIAL PLAN RELEVANCE:

• Fiscal Sustainability

FISCAL IMPACT:

Included in the TIO Annual Report is the fiscal year 2014/2015 budget, which includes general fund revenue in the amount of $21,277.

MaryAnne E{r nd, Financial Services Manager

Laura Murray,/<ccountah\ ! ~.

I concur with t~.!~ reEort: _,.,,~,.~

M

Attachments:

SL TTID Annual qeport October 7 2014

Page 3 of 3

1. South Lake Tahoe TIO Fiscal Year 2013/2014 Annual Report, including Fiscal Year 2014/2015 Annual Budget

2. Financial Review as of July 31, 2014

SOUTH LAKE TAHOE TOURISM IMPROVEMENT DISTRICT

FISCAL YEAR 2014 ANNUAL REPORT

AND FISCAL YEAR 2015 SLTTID BUDGET

August 18, 2014

Summary of the Management District Plan

The South Lake Tahoe Tourism Improvement District (SL TTID) provides for the provision of tourism promotions and marketing for South Lake Tahoe. The district is composed of lodging businesses located within the incorporated city of South Lake Tahoe and includes hotels/motels and vacation rentals. Services provided by the SL TTID include Marketing and Promotions programs and activities designed to increase tourism and market the South Shore of Lake Tahoe as a unique, world-class year-round reso1t destination for the economic benefit and quality of life of the area.

The South Lake Tahoe Tourism Improvement District was incorporated in November 2006 with a proposed annual budget ofapproximately $1,600,000, and was renewed on November 1, 2009 with an annual budget anticipated of $1,800,000. Annual assessment rates are based upon a flat rate of$3.00 per paid occupied room per night on hotels and motels and $4.50 per paid occupied unit per night on timeshares, condos, triplexes, duplexes and homes under management contracts. See the list of assessed lodging businesses in Attachment section of this plan.

The present SLTflD assessment district began on November 1, 2009 and is in effect for ten years. The SL TTID has created a website with information for all district members. The site address is www.southtahoetourism.com, and includes the below information:

1. District Plan documents 2. District By-Laws 3. Listing of lodging pro petties in the assessment district 4. News and events (upcoming meetings, etc) 5. Agenda and minutes from all meetings 6. SL TTID fund amounts collected and disbursed

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I. Changes in District Boundaries

The South Lake Tahoe Tourism Improvement District had no changes in the district boundaries or benefit zones for the 2015 fiscal year.

II. Improvements and Activities Provided

The South Lake Tahoe Tourism Improvement District (SLTTID) is comprised of all lodging properties in the City of South Lake Tahoe. The SLTTID utilizes the professional marketing services of the Lake Tahoe Visitors Authority (LTVA) to promote the South Shore of Lake Tahoe. LTVA is chartered with promoting South Shore, Lake Tahoe and achieving a measurable impact on tourism numbers in the region. The mission of the LTV A is the increase of overnight accommodations to the South Shore of Lake Tahoe, through marketing the South Shore as a unique, world-class year-round resort destination for the economic benefit and quality of life for the area. The SL TTID and the South Lake Tahoe Lodging Community is represented through two (2) board seats on the Lake Tahoe Visitors Authority Board of Directors. The SLTTID also maintains representation on the LTV A's Marketing Advisory Committee with two additional committee seats.

MARKETING AND PROMOTIONS RE-CAP As the South Lake Tahoe Tourism hnprovement District utilizes the services of the LTVA for its promotional activities, a recap of the past year will provide a basis for activities that will be continued and expanded during the following year. As we realize momentum with an adequately funded tourism campaign, promotional activities and events can be further developed and honed for maximum success.

The LTV A contracts with DuncanChannon for advertising creative and placement. The LTV A also contracts with Noble Studios, a digital agency for ongoing digital integration and Weidinger Public Relations, to manage media relations. Through research and focus groups the target audience for South Lake Tahoe adve1tising is defined as the "Good Lifers". They are above average income consumers, who enjoy life, live it to the fullest and put pleasure first. They are always in search of new experiences and making new discoveries. They are active; enjoy skiing, hiking, biking, and other outdoor pursuits, but also love a good meal, a good show, and a choice of accommodations. The LTV A's 2009 Strategic Plan supported the research and fmther defined the target market by its "passions;" specific activities including those mentioned above, that visitors are very likely to engage in. During FY2014, the LTVA reviewed and updated the Strategic Plan to reflect changes in markets and in marketing. The Strategic Plan aligns the passions under three guiding pillars: Outdoor recreation, Entertainment and Indulgence. Further, the Plan defines the LTV A's guiding principles, the destination's personality, the destination brand offerings, an updated SWOT analysis, industry trends and LTV A objectives. This document informs the board and the marketing committee in regards to efficient, focused and effective marketing efforts.

In FY2014, the media plan included a winter campaign as well as summer. The LTV A leveraged a small budget in the So CA market along with Ski Lake Tahoe's and Nevada Commission on Tourism's messages. Billboard, online and public relations were primary channels of delive1y. The summer campaign included TV, radio, online SEO and SEM and print. The campaign focused on the various passions with high energy, active images. With a conservative budget, the LTVA continued to summer marketing in the N01thern California drive market.

WINTER CAMPAIGN Cooperative ski marketing effo1ts--which leverage the LTV A's advertising funds significantly with a unified ski message--focused on differentiating the region from competitive ski destinations in the countty and raising awareness for South Lake Tahoe as a winter destination and using the website for fulfillment for packages and information. In addition to patticipating in the regional ski product

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consortium, the LTV A invested in a destination specific message, using OOH and digital channels in the L.A. Market and maintained a presence in the No CA market with digital assets. Impressions in both markets included: paid search for 1,243,000; Eblast for 758,000; online banners for 782,000 and OOH for 112,777.

SUMMER CAMPAIGN The objectives were to raise awareness for South Lake Tahoe as a summer destination and to increase traffic to the LTVA website for packages and information on summer activities and events. A regional TV, radio, and digital integrated campaign were utilized to drive traffic to the website for fulfillment.

In May of2013, Lake Tahoe South Shore continued the advertising campaign aimed at increasing awareness of South Shore as a unique vacation destination. The "Wild Side" campaign highlighted a variety of outdoor and nightlife activities capturing the energy and excitement that define Lake Tahoe South Shore and separate it from other destinations. Secondary goals were to suppott South Shore Summers Series events and drive traffic to the website, TahoeSouth.com. The integrated campaign targeted active, young-at-hea1t adults and families in San Francisco and Sacramento drive markets. Multiple media channels (TV, radio, online banners, e-newsletters, paid search) were layered to increase frequency and keep Lake Tahoe South Shore top of mind as a summer vacation option.

The campaign resulted in 167,385, 690 impressions over the summer season. OOH and radio were specific to event promotion, with 51 events receiving exposure. Clicks to TahoeSouth.com were 35% higher than in 2012 (294,000) and 2,000 new likes on Facebook and 1200 additional Twitter followers were added. The advertising agency was able to negotiate an additional $231,000 of added value media exposure to the $1.3m campaign.

PUBLIC RELATIONS The public relations strategy complimented the media plan and its overreaching goal of increasing awareness of the destination and capitalized on the LTV A events calendar. The year end summary shows outstanding success gleaning national and regional recognition through PR efforts.

The LTVA retains Weidinger Public Relations (WPR) to execute a comprehensive national and regional media communications plan to keep the Lake Tahoe brand awareness high in targeted markets through influential media. WPR suppotted a comprehensive social media component utilizing Facebook, Twitter and YouTube to reinforce LTV A's brand and strategic plan.

USA Today-- "Best Ski Destination." The accolade designated by the public earned us print recognition with Friday, Jan. 3 Travel Section and included a photo of the Heavenly Gondola with the lake in the background.

AOL Travel- result of hosting Cani Wilbanks and travel crew to capture videos this winter. CaiTi visited as a result of USA "Best Ski Destination" accolade. The production company is working on getting the videos on USAToday.com and are also planning on coming back this summer on assignment for AOL Travel

• Overview 5 min: http://on.aol.com/video/

• Hungry Bear: http://on.aol.com/video/

• Reno Tahoe Helicopter Tours: http://on.aol.com/

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• Heavenly Ski Resort: http://on.aol.com/video/

• Edgewood Restaurant: http://on.aol.com/video/

• Lake Tahoe Boat Cruise: http://on.aol.com/video

• Boston.com also shared the Heavenly video: http://www.boston.com/

San Francisco Chronicle - feature story (print and online) on South Shore ran in print and online which was a result of hosting Jill Robinson last year. Unique Monthly Visitors are 3,135,092 in our No.l market and the adve11ising value is $14,447 - what the same space would have cost if purchased as advertising. http://www.sfgate.com/travel/article/Lake-Tahoe-far-from­the-crowded-shore-5515018 .php

Expedia's, Spencer Spellman, visited late March. His at1icle, which includes Heavenly Mountain Resort, Lake Tahoe Resort Hotel, The Landing, and Lake Tahoe Adventures hit on Expedia Viewfinder: http://viewfinder.expedia.com with 250-350k visit per month. Spencer also posted this on his personal blog: http://thetravelingphilosopher.com, which averages 10 -15k unique visitors per month. He has a huge twitter influence/following and his posts of the destination ranged from 18 - 44k impressions.

Sunset Magazine- Last minute summer escape tips (print version) but also has some content online:http://www.sunset.com/travel/last-minute-trip/summer-lake-tahoe-lodging-fix

We Blog the World (luxury travel blog) visited last month and has provided the following stories - planning another visit this summer/fall:

• Destination Overview

• Ridge Tahoe cooking class

• Landing Resoti & Spa

• Spring Skiing at Heavenly

• Jimmy's Restaurant

• Ridge Tahoe

• Ciera Steak + Chophouse

• Epic Mix

Bike Magazine (lead generated via T AMBA and is a co-op effort to host) visited mid-June to produce a feature story on mountain biking in South Lake Tahoe.

Orange County's Great Taste Magazine (co-op effo11 with NRLTA) visited mid-June to explore dining, activities and lodging in Lake Tahoe.

• In pat1nership with Visit CA a media tour "Beyond the Slopes" was organized for early March. The first of several lake-wide destination stories

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include: TheManual.com http://www.themanual.com, a men's lifestyle site that covers travel, fashion, dining, spirits and other topics that are of interest to men between 25-35. The site has 800,000 unique monthly visitors and the article has an ad equivalency of $7,400.

• AAA, Encompass, Contra Costa Times, etc. freelancer Will McGough visited mid­March and has already produced the following articles on HotelChatter.com: South Lake Tahoe Hotels (includes the Landing Resort/Jimmy's, 968 Park Hotel, Lake Tahoe Resort Hotel and Beach Retreat/The Boathouse) and Newest Hotel Sports the Manliest Bathroom Amenity Ever.Hotel Chatter has 45,000+ page views and is part of the Conde Nast Travel Network.

Winter Snow Messaging

• SFGate.com - reinforces "no snow" messaging/strategy: http://blog.sfgate.com. Following Tom Stienstra's column in SF Chronicle dissing conditions, we convinced Jules Older, the Chronicle's "Slope Dope" columnist of the importance to the destination and his Bay Area readers for him to take a first-person look and write it - and he was good enough to change his weekend plans to visit. His article was spot on: resorts are open, will remain open, providing fun and quality skiing for families, beginners and intermediate skiers/riders.

• Associated Press - utilized Carol Chaplin's quote from the snow alert release about the late-Jan./early-Feb. snowfall and has been included in Washington Times, Sacramento Bee, San Jose Mercury News, Tahoe Daily Tribune, Nevada Appeal, etc.

Community Outreach

• Welcome Home Olympic Celebration - crafted release on behalf of LTV A, City of South Lake Tahoe and Sierra-at-Tahoe Resort to announce Olympic Athletes Celebration. Coordinating with Sie1Ta media attendees requests.

SPECIAL EVENTS

• Operation Sierra Storm o Resulted in 32 live hits during the two-day conference. o Attendance consisted of 17 TV meteorologists including in The Weather Channel, San

Diego, Chicago, Dallas, Boston, Las Vegas and Northern California markets. o Advertising equivalency of $1.49 million in broadcast and $387 ,00 in broadcast o Circulation of 78 million/listenership o Build reputation and brand in key drive and direct flight markets o Reinforced snowmaking, grooming technology

• American Century Championship 2013 o 6.5 million TV viewers nationwide o Coverage in 168 media organizations: 2,800 print articles with circulation of 100+ million o Record attendance 41,165 - a 10% increase from the previous year

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o South Lake Tahoe area non-profits to receive $156,000 o Build reputation and brand

• Tahoe Reno Golf Media Tour

o In 2013, exposure reached a potential of 16.2 million and advertising equivalency $440,155 (39 print and online stories and 31 on-air radio programs)

o Regional/ national outlets, including Baltimore Sun, Texas Golfer, Las Vegas Review Journal, Golf Chicago, Golf & Lifestyle Magazine, ArizonaFairways.com, Cybergolf.com, ESPN Sacramento, etc.

o Of the 23 attendees, 14 represented media outlets in California, Nevada, Arizona and \V'ashington; the other nine included national outlets with reach in California, Arizona and Washington.

• Washington Post: Nathan Borchelt's story (visited last spring in conjunction with CTTC) ran online Nov. 29 and in printSunday, Dec. 1 highlighting Tahoe as a premier winter destination reinforcing our brand and key messages. The article has a circulation of9.7 million and an ad value of $84,300 (what the same space generated as editorial coverage would have cost if paid as advertising): http://www.washingtonpost.com/lifestyle/travel/. "The Details: Lake Tahoe/Getting Here" link within the story includes various hotels, restaurants, and attractions with website links.

• Thrillist: Jill Robinson visited summer 2013 for an article in the San Francisco Chronicle that hit May 2014. As a result of that relationship, she reached out for a winter focused story that included skiing, non-ski activities, dining and lodging, producing a major South Shore feature: http://www.thrillist.com (148,000 MDV plus 80,000+ subscribers to the SF area).

International PR Black Diamond/UK PR

• Michael Allen's story "Snow Shore" was published through the Daily Mirror UK in two print and

one on-line channel with total circulation of 6.1 million readers and a PR value of $103,500.

• Cooler, a magazine for hip young professional women, published Susan Greenwood's story,

"Lake Tahoe Resorts for Fresh Tracks" with a circulation of 80,000 and a PR value of $68,400.

• Ben Rankin's story, "Go Big or Go Home" was published in the Sunday Mirror with a circulation

of950,000 readers and a PR value of $150,000.

• Total PR Value of Tahoe South hosted Black Diamond visits was $654,500 on a circulation of

20,300,000.

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Gate 7/AUS PR • Australian Financial Review published Craig Tansley's story, "White Gold Rush" in their

upscale magazine and "Ski Trip on Lake of the Sky" on-line with total circulation of 166,200 and value of $121,000.

• "Heavenly Skiing" was featured on the Crowd Goes Wild TV program with 50,000 viewers and a PR value of $160,000

• The partnership of Heavenly Mountain Res01t, Lake Tahoe Resort Hotel and Powder House

provided prizes for Women's Health Magazine with a total PR value of $217,360 attached to print, on-line and TV.

• Total PR value of Tahoe South media elements through Gate 7 was $618,000.

Other Noteworthy • Hosted eight German writers through Visit California - Germany, twelve stories were published

with a circulation of 3,500,000 and a PR value of $405,000

• Hur and Lee came to Tahoe South through Visit California-Korea. They published "Lake Tahoe"

in the Lonely Planet with a circulation of 100,000 and a PR value of $84,000.

• Telehit, Mexico's M-TV visited through Travel Nevada. They produced to Tahoe

South/Heavenly segments with a viewership of 18,000,000 and a value of $466,500.

• NBC/CNN affiliate TV program visited through Visit California-India. They produced four short

segments featuring Tahoe South and their story was published in Overdrive Magazine with a total viewership/circulation of 1,365,000.

ELECTRONIC MARKETING Electronic Marketing is an integral component of the marketing, advertising, public relations and sales programs of the LTV A. The LTV A e-newsletter is emailed each month to 47,000+ opt-in subscribers. Included are special offers, events, entertainment and featured properties. On average we see a 10% increase in visits to the website on the day that the newsletter goes out. Social Media The LTVA social media strategy is to drive and maintain traffic interested in "Tahoe" to the website and ultimately to our destination. During our fiscal year 2014, July 1, 2013 through June 30, 2014 Facebook referred 13,896 people to TahoeSouth.com. This is up 43% from last year's fiscal of 9,671 referrals. Facebook

D The number of Tahoe South Facebook fans has increased 337% from 36k to 121k since 2009. These fans receive regular posts on events, real-time weather related information, road conditions, new developments in South Shore, photos, videos, trivia, promotions, etc. The goal is to create a buzz, keeping the destination top-of-mind while exponentially growing the network of Fans. D In FY2014, the page averaged 47k engaged users per month, which is a 147% increase over the FY2013 average of 3 2k. D Facebook fan counts, compared to our lodging competitive set (as of July 2014):

o visitmammoth- 30,236 o SeeMonterey- 53,237

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o The Napa Valley- 50,574 o LakeTahoeNorth- 71,269 o VisitPalmSprings - 12,943 o Reno Tahoe USA- 38,223 o Visit San Diego - 336,060 o VisitSanLuisObispoCounty- 11,319 o visitsantabarbara - 156,507 o sonomacountyca - 97,5 87 o VisitSaltLake - 246,971

Twitter Tahoe South's Twitter following continues to grow, 586% from 900 in 2010 to 5,271 at the end ofFY2014. Followers include media outlets (NPR News, RGJ.com, KOLO, ABC News 10 Sacramento) and travel websites as well as travelers who enjoy getting up-to-the minute alerts, weather conditions, and news aiticles about Tahoe South.

TAHOESOUTH.COM In 2013/14 the TahoeSouth.com website branding continued to position Tahoe South to stand apart from other like destinations by engaging visitors with our active, young at heart, non-stop vacation experiences.

0 Total Visits 1,144,477 up 14% 0 Unique visitors 874,299 up 13%

In FY2013/14 LTV A continued its investment in Trip Advisor adve1tising. Referral Traffic to TahoeSouth.com from Trip Advisor is up 9% over FY2012/132. In September 2012 TahoeSouth.com went live with a mobile optimized website. Through June 30, 2014 the mobile version of the site saw 336,291 visits up 134% LTVA.org

LTV A.org continues to be a valuable business-to-business resource for our partners. The site includes:

D LTV A Meetings

0 Resources

0 Oppmtunities

D Press Releases

D Industty News

In fiscal 13/14 LTV A.org saw a 5% increase in visits to the site. The most visited pages were Contact Us, About, Resources/Statistics & Research, News, Meetings and Resources.

Our goal going forward is to make LTV A.org even more of a valuable resource for those looking for LTV A opportunities, industry news, research and statistics.

VISITOR CENTERS/OPERATIONS The LTV A's Visitor Infmmation Centers are a source of excellent information and free collateral for the traveling public. Visitor Centers are located at:

• 3066 Lake Tahoe Blvd., South Lake Tahoe, CA • 169 Hwy 50, Stateline, NV • 3180 Hwy 50, Meyers, CA The Meyers' location performance was evaluated as a result of an

expired contract with the USFS to operate it and the agency's inability to continue maintenance

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expenses. Staff determined that restroom facilities and hiking information were the primary services offered through the site and that this was not in mission alignment with the LTV A.

The CA visitor center receives the majority of the visitors, many of whom are from other countries. Informal research indicates that many international visitors do not activate their mobile devices while in the USA. They are therefore more dependent on the information and maps obtained at a visitor center, plus they seek the local knowledge and insights provided by staff. Approximately 28,000 visitors were assisted by a VC specialist in the CA and NV locations in FY 13.

SPECIAL EVENTS The LTV A was able to financially invest in special events such as Lights on The Lake Fireworks, American Century Golf Championship, Hot August Nights, Labor Day Fireworks most of which took place within the City limits. The LTV A also supported many other events with adve11ising and promotion, as well as with staff expertise and execution. With each event, the LTV A strives to involve as many local businesses as possible, providing opportunities to promote their individual business and products/services. Events supported through the community grant funding program in FY 2013 included Tallac Association, Wooden Boat Show, Race the Lake of the Sky, Heavenly Mountain Run and The SL TWA Wedding Faire

The Fireworks display litigation in the fall produced a series of events leading to the LTVA board's consideration to cancel due to overwhelming risk. Financial and staff resources have been considerable in effo11s to maintain the two displays that are proven economic drivers.

SALES - Domestic and International There are numerous lodging properties within the City limits that provide corporate meeting, incentive and social event services. However, many of these properties do not have the staff resources and/or the funds necessary to reach the regional markets from which this type of group business typically originates from. The LTV A is able to provide support to these prope11ies in the form of an inquiry and lead resource, a destination liaison for industry related events and activities, and a catalyst for other cooperative programs on an ad hoc basis. The LTV A also assists through staff support and attendance at trade shows and includes a small media plan specifically targeting group business within the larger media buy.

LTV A retains the services of two international representative firms, covering the UK and Australia, and representing Tahoe South in the sales and public relations arenas. Through its membership in the High Sierra Visitors Council, the LTV A received representation in France. In addition, the LTV A maintains strong working relationships with Visit California and Nevada Commission on Tourism, both of whom have representative firms or offices in many other countries.

October 2013 - NCOT Mexico Sales Mission November 2013 - Black Diamond UK Sales Mission December 2013 - Gate 7 Australia Sales Mission May 2014 - Visit California Mexico Sales Mission June 2014 - Visit California European (France & UK) Sales Mission

Shows December 2013 - Nevada Governor's Conference January 2014 -ABA Convention February 2014 - Visit California 2014 Outlook Forum February 2014 - Go West Summit April 2014- Pow Wow

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Hosted FAM Trips August 2013 - Geoffrey Duval, JETSET Voyages, France FAM September 2013 - Comptoir des Voyages, France FAM September 2013 -NCOT Chinese Breakfast FAM October 2013 - UK Super FAM October 2013 - MSI (Visit California Germany) FAM December 2013 - lglu UK FAM December 2013 - Visit California Mexico FAM December 2013 - Fiona Clark, Audley Travel, UK FAM December 2013 - Rafael Hernandez, Chairman of the World Meetings Forum FAM January 2014 - Jens Vestergaard, KLM/Air France Country Manager FAM January 2014 - Visit California Receptive FAM January 2014 - SkiMax, Australia FAM February 2014 - United Airlines, Australia FAM March 2014 - Brendon Croft, Skiworld, UK FAM March 2014 - Visit California Global Ski FAM March 2014 - Gate 7/Qantas, Australia FAM March 2014 - Ski Safari, UK FAM May 2014 - Bon Voyage, UK FAM May 2014 - Visit California French FAM

MEETINGS AND CONVENTIONS The LTVA works to promote Lake Tahoe's South Shore as a destination for meetings, conventions and trade shows. Services are designed to assist potential clients in identifying appropriate venues and reaching the appropriate contacts. LTV A Staff responded to 30 leads with Tahoe South prope1ties winning 13 meetings with approximately 4,395 room nights. Weddings/reunions/social leads (SMERF), numbered 24, with an estimated 1000 room nights to referred properties.

LTVA WEDDING CO-OP Recognizing the importance of the wedding industry to the South Shore community, the LTVA Wedding Co-op program consists of an aggressive advertising/marketing campaign using a ratio of 90% online adve1tising to 10% print. Patticipation in this co-op increased in 2012 and again in 2013, which allowed for an expanded budget and increased reach.

STRATEGIC ALLIANCES The LTV A leverages funds through strategic alliances that broaden reach outside the regional adve1tising efforts.

Lake Tahoe South Shore Chamber of Commerce - In June 08, the LTV A joined the LTSSCC in the implementation of The Blue Ribbon Awards, which strives to annually celebrate and recognize our business community's efforts towards sustainability. The program's goal is to recognize and reward businesses in five key areas: Experience, Service, Entrepreneur, Tourism and Green. Nominees and winners are showcased at an event in November. Winners receive community recognition. The intention is to inspire our business community members to provide an exemplary experience for our visitors and local community.

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The Reno-Tahoe Regional Marketing Committee-RMC was formed in June 2001 with the goal to assist the Reno-Tahoe International Airp01i in providing additional incentives to maintain and grow air service and to promote the Reno-Tahoe area as a viable year-round travel destination. The participants agree that the intent and mission of the Cooperative Marketing Plan is to bring together public and private organizations and businesses to contribute marketing dollars and expertise to position the Reno-Sparks­Lake Tahoe- Notihern Nevada region as one destination, to increase quality air service to and from the Renoff ahoe International Airport and to target common tourism and business industry concerns for cooperative action.

Sierra Ski Marketing Council - With the primary goal to promote and strengthen the awareness of winter recreation available in the greater Lake Tahoe-Reno area, complementary marketing programs implemented by SSMC and Ski Lake Tahoe have continued to create a comprehensive national marketing program which include print and online adve1iising, email marketing activities, public relations, sales and promotions. Membership in this organization leverages the LTVA winter budget to reach markets far beyond what the allocation could reach individually.

Visit California - Similar to the SSMC, this alliance allows us to present South Lake Tahoe to national and international markets unreachable without the leverage of the cooperative effort and funds.

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III. Budget Summary

Fiscal Year 2015 Service Plan Budget Summary

The summary of the FY 2015 service plan budget for the South Lake Tahoe Tourism Improvement District is provided on the following pages (Attachment A). The fiscal year for the SLTTID is October 1 through September 30. Based upon previous years' performance and trending occupancy, the total improvement and service plan budget for 2014 is projected at $2,127,674 which is a 5% increase over budget for FY2014, and a 2% increase over the actuals/forecast for FY 2014. Lodging businesses will contribute the entire amount through annual assessments. Budgeted expenditures will be made in the following areas:

• Marketing and Promotions The budget for the Marketing and Promotions program is estimated at $1,018,943, which represents 47.9% of the total District budget. Marketing and promotions will include media adve1tising and promotional programs designed to attract visitors to visit and stay at the South Shore lodging establishments as well as promote the area as a lodging and conference destination.

• Communications and Public Relations The budget for the Communications and Public Relations program is $177,235, which represents 8.3% of the total district budget.

• Special Events The budget for Special Events is $212,767, which represents 10.0% of the total district budget.

• Visitor Center Operations The budget for Visitor Center Operations program is $236,385, which represents 11.1 % of the total district budget.

• Administration/Operations The budget for Administration/Operations including office rent, insurance, utilities and supplies is $354,683, which represents 16.7% of the total district budget.

• Administrative Fee to the City of South Lake Tahoe The City of South Lake Tahoe charges an administrative fee to collect assessments and distribute the funds to the SLTTID Corporation. The budget for this administrative fee is 1 % of the total annual assessment, or $21,277 in FY 2015.

• Annual Service Plan -Contingency/TID Renewal (5%) The budget also includes a portion for contingencies and renewal of the District. This amount equals 5% of the total district plan budget, or $106,384.

(See Attachment B for Reviewed Financial Statements as of July 31, 2014)

The Method of Assessment

No changes in assessments are proposed in the current assessment methodology, as they are not allowed under the district management plan.

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..._--~---~--~. , _________ _

APPENDIX 2 - LODGING BUSINESSES TO BE ASSESSED WITHIN THE SOUTH LAKE TAHOE TIO:

3 Peaks Resort & Beach Club Big Pines Mountain House 4083 El Dorado Motel4139 Lake Tahoe 931 Park Ave Cedar AveSouth Lake Tahoe, CA BlvdSouth Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 96150

7 Seas Inn Black Bear Inn B&B El Nido Motel 4145 Manzanita Ave 1202 Ski Run Blvd 2215 Lake Tahoe Blvd 2 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

968 Park Spa & Resort Black Jack Motel Elizabeth Lodge 968 Park Ave 985 Park Ave 3918 Pioneer Trail South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

A&A Lake Tahoe Inn Block Hotel, The Embassy Suites Lake Tahoe Hotel

3520 Lake Tahoe Blvd 4143 Cedar Ave & Ski Resort #69496

South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 4130 Lake Tahoe Blvd South Lake Tahoe, CA 96150

Alder Inn Motel Blue Jay Lodge Emerald Bay Inn 1072 Ski Run Blvd 4133 Cedar Ave 1313 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Alpenrose Inn Blue Lake Inn Fantasy Inn 4074 Pine Blvd 944 Friday Ave 3696 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Alpine Inn And Spa Budget Inn Fireside Lodge 920 State Line Ave 3496 Lake Tahoe Blvd 515 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Ambassador Motor Lodge C &M Rooms Forest Suites Resort 4130 Manzanita Ave 1209 Bonanza Ave One Lake Parkway South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Apex Inn Cal Va Rado Motel Green Lantern Motel 1171 Emerald Bay Rd 988 State Line Ave 4097 Manzanita Ave South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Avalon Lodge Capri Motel Hansen's Resort 4075 Manzanita Ave 932 State Line Ave 1360 Ski Run Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Beach Walk Cottages Carriage House Inn/Motel Heavenly Inn Lake Tahoe 971 Merced Ave 4135 Laurel Ave 930 Park Ave South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Bears Den Inn Cedar Inn & Suites High Country Lodge 2250 Lake Tahoe Blvd 890 State Line Ave 1227 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Best Choice Inn Cedar Lodge Highland Inn 954 Park Ave 4069 Cedar Ave 3979 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Best Tahoe West Inn Chateau Inn & Suites Holiday Inn Express 4107 Pine Blvd 965 Park Ave 3961 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Best Western Station House Inn Crystal Range Motel Holiday Lodge 901 Park Ave 941 Emerald Bay Rd 4095 Laurel Ave South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Best Western Timber Cove Lodge Days Inn Howard Johnson Express Inn 3411 Lake Tahoe Blvd 3530 Lake Tahoe Blvd 3489 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Beverly Lodge Deerfield Lodge At Heavenly Inn At Heavenly 3480 Lake Tahoe Blvd 1200 Ski Run Blvd 1261 Ski Run Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

South Lake Tahoe TIO Management District Plan Page 24

FY2015 SLTTID Budget October 1, 2014 through September 30, 2015

Revenue Genera1ed in TIO Assessment

SOUTH LAKE TAHOE TOURISM IMPROVEMENT DISTRICT FY 2015 BUDGET

2014 2014 2014 2015 2015 2015 2015 2015 2015 2015 2015 2015 OCTOBER NOVEMBER DECEMBER JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY ___ A\LQUST~MBER TOTAL

HoteUMotel Assessment@ $3/occ nt 73,469 62,250 126,387 127,764 128,991 112,362

62,282

66,618

36,926

85,426 138,085 161,676

69,616

163,750

90,766

122,122 1,366,900 64.30%

Vacation Rental/Timeshare Assessment @ $4.50/occ nt 40,723 34,505 70,056 70,819 71,499 47,351 76,540 67,692 ise,ri4 35.70%

114,192 96,755 196,443 - 198 583 200,489 174,644 -- 103,S# - 132 778 214,625 251,292 254,516 189.814 2.127.674

EXPENDITURES

Marketing Programs: Advertising, Fam Trips, Marketing Programs 54,667 46,336 94,076 95,101 96,014 83,637 49,587 63,587 102,764 120,344 121,888 90,902 1,018,943- 47.9%

Communications & Public Relations 9,512 8,060 16,364 16,542 16,701 14,548 8,625 11,060 17,878 20,933 21,201 15,811 177,235 6.3%

Special Events Funding 11,419 9,675 19,644 19,658 20,049 17,464 10,354 13,278 21,463 25,129 25,452 16,961 212;767 10.0%

Visitor Center I Operations Visitor Center Payroll, Benefrts, Opera1ing Costs 12,667 10,749 21,825 22,063 22,274 19,403 11,504 14,752 23,845 27,919 26,277 21,088 236,385 11.1%

Administrative I Opera1ions Administration Payroll, Benefits, Operating Costs 19,036 16,129 32,747 33,104 33,422 29,113 17,261 22,134 35,778 41,690 42,426 31,642 _354,683 16.7%

Administration to the City of SLT (1%) 1,142 966 1,964 1,986 2,005 1,746 1,035 1,326 2,146 2,513 2,545 1,898 21,277 1.0%

ContingencymD Renewal (5%) 5,710 4,638 9,822 9,929 10,024 8,732 5,177 6,639 10,731 12,565 12,726 9,491 106,384 5.0%

Total P!:Q!lrams & ExDenses 114192 96,755 196,443 196,583 200,469 174,644 103,544 132,776 214,625 251,292 254,516 189,814 2,127,674 100.00%

Net lncome/(LossJ 0 0 0 0 0 0 o _____ o _ _ ____ !> _______ 0 0 0 0

Inn At Ski Run1180 Ski Run Park Tahoe Inn South Lake Tahoe Lodge, LLC BlvdSouth Lake Tahoe, CA 96150 4011 Lake Tahoe Blvd 1341 Emerald Bay Rd

South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 Inn By The Lake Parkside Lone Pine Lodge South Shore Inn 3300 Lake Tahoe Blvd 864 State Line Ave 3900 Pioneer Trail South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

La Baer Inn Patrick Ronan Rental Management South Y Lodge 4133 Lake Tahoe Blvd 930 Bal Bijou Rd 1120 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

La Bella Motel Pine Cone Acre Motel Stateline Economy Inn & Suites 3994 Pine Blvd. 735 Emerald Bay Rd 966 La Salle St South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Lazy S Lodge Pine Frost Inn Stateline Lodge 609 Emerald Bay Rd 4113 Manzanita Ave 913 Friday Ave South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Lodge, The Pinewood Inn Sunshine Inn Motel 3840 Pioneer Tr 3818 Lake Tahoe Blvd 1184 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Manzanita Lodge Pioneer 1.nn Super 8 Motel 532 Emerald Bay Rd 3863 Pioneer Trail 3600 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Mark Twain Lodge Pistante's Coyote Den Tahoe Adventure Lodge 947 Park Ave 1211 Emerald Bay Rd 942 Pop,ar st South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Matterhorn Motel Quality Inn & Suites Tahoe Budget Inn 2187 Lake Tahoe Blvd 3838 Lake Tahoe Blvd 1259 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Midway Inn Rainbow Lodge Tahoe Chalet Inn 3876 Lake Tahoe Blvd 970 Poplar St 3860 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Monaco Friendship Inn Roadside Inn Tahoe Colony Inn 4140 Pine Blvd 952 State Line Ave 3794 Montreal Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 961~0 South Lake Tahoe, CA 96150

Motel 6, #250 Rodeway Inn Tahoe Cottage Inn 2375 Lake Tahoe Blvd 4127 Pine Blvd 1220 Emerald Bay Rd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Mountain Home Royal Valhalla Motor Lodge Tahoe Country Inn 608 Emerald Bay Rd 4104 Lakeshore Blvd 4085 Pine Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Mountaineer Sail In Motel Tahoe Driftwood Lodge 580 Emerald Bay Rd 861 Lakeview Ave· 4115 Laurel Ave South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

National91nn Secrets Inn Lake Tahoe Tahoe Hacienda Motel 3901 Pioneer Tr 924 Park Ave 3820 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Nickelodeon Motel Shamrock Inn Tahoe Lakeshore Lodge & Spa930 2440 Lake Tahoe Blvd 4116 Pine Blvd Bal Bijou RdSouth Lake Tahoe, CA South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 96150

Paradice Motel Sliver Shadows Lodge1251 Emerald Tahoe Mountain Lodge 953 Park Ave Bay RdSouth Lake Tahoe, CA 3868 Lake Tahoe Blvd South Lake Tahoe, CA 96150 96150 South Lake Tahoe, CA 96150

Park Tahoe Inn 4011 Lake Tahoe Sky Lake Lodge Tahoe Pines Lodge 2644 Lake Tahoe Blvd 966 Modesto Ave BlvdSouth Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

South Lake Tahoe TIO Management District Plan Page 25

r

Tahoe Queen Motel At Tahoe, Inc Premier Resorts International 932 Poplar St 601Hwy50 3535 Lake Tahoe Blvd #124 South Lake Tahoe, CA 96150 Zephyr Cove, NV 89448 South Lake Tahoe, CA 96150

Tahoe Retreat & Spa Bavarian Village Vacation Rentals Reservation Bureau/Tahoe Keys 2446 Lake Tahoe Blvd 1140-B Herbert Ave

South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 599 Tahoe Keys Blvd Suite B2 South Lake Tahoe, CA 96150

Tahoe Thunderbird Motel Beachcomber Inn Resort Properties lnt'I

4123 Laurel Ave Vacation Membership Assoc 3816 Pioneer Trall #6

South Lake Tahoe, CA 96150 999 Lakeview Ave South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Tahoe Troplcana Motel Buckingham Properties Selective Properties, Inc. Lake Tahoe LLC 4132 Cedar Ave ·

4000 lake Tahoe Blvd, Suite 28 188 Hwy 50 South Lake Tahoe, CA 96150

South Lake Tahoe, CA 96150 Zephyr Cove, NV 89448

Tahoe Valley Lodge Coldwell Banker/McKinney & Assoc South Lake Tahoe Realtors 2241 Lake Tahoe Blvd 2196 Lake Tahoe Blvd, Suite 1 1235 Ski Run Blvd Suite 1 South lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Tahoe Villa North Lodge First Resorts Mgmt Group LLC Spruce Grove Cabins & Suites 4123 Manzanita Ave 1261 Ski Run Blvd 3599 Spruce Ave South Lake Tahoe, CA 96150 South lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Tahoe Villa Frost Vacation Rentals Stardust Vacation Club, Inc. 933 Poplar St 1377 Matheson Dr 4061 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Thunderchlef Motel Great Vacation Retreats Stonehenge Vacation Rentals 1008 Echo Rd 589 Tahoe Keys Blvd, Suite E-2 1082 Mountain Canary Dr South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Travel Inn Holly's Place Tahoe Beach & Ski Club Owners 3536 Lake Tahoe Blvd 1201 Rufus Allen Blvd 3601 Lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Travel Inn/Knights Inn Interval International Tahoe Keys Resort

964 State Line Ave 6262 Sunset Dr (aka Reserv. Bureau, TKeys)

South Lake Tahoe, CA 96150 South Miami, FL 33143 599 Tahoe Keys Blvd Suite 82 South Lake Tahoe, CA 96150

Traveler Inn Suites Lake Tahoe Accommodations Tahoe Rental Connection 3930 Pioneer Trail 2048 Dunlap Dr #4 2241 James Suite 3 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Trout Creek Motel lake Tahoe Lodging Tahoe Seasons Resort 2650 lake Tahoe Blvd 212 Elks Point Rd Suite 554 3901 Saddle Rd South Lake Tahoe, CA 96150 Zephyr Cove, NV 89448 South Lake Tahoe, CA 96150

Vagabond Inn lake Tahoe Vacation Resort Tahoe Sierra Vacatlons2288 3892 lake Tahoe Blvd 901 Ski Run Blvd Washington AveSouth Lake Tahoe, South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150 CA 96150

Value Inn Motel Lake Valley Properties1151 Emerald Ponderosa House C/O S Broche 2659 Lake Tahoe Blvd Bay RdSouth Lake Tahoe, CA 717 Wentworth Ln South Lake Tahoe, CA 96150 96150 South Lake Tahoe, CA 96150

Washoe Motel, LLC751 Emerald Marriott's Grand Residence Club Americana Vacation Club, Inc Bay RdSouth Lake Tahoe, CA 1001 Heavenly Village Way 3845 Pioneer Trail 96150 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

Accommodation Station, Inc Marriott's Timber Lodge 2516 Lake Tahoe Blvd 4100 lake Tahoe Blvd South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

All Around The Lake, Inc Network Tahoe Vacation Rentals 384 Crystal Court 2520 Lake Tahoe Blvd Suite D-4 South Lake Tahoe, CA 96150 South Lake Tahoe, CA 96150

South Lake Tahoe TIO Management District Plan Page 26

August 18, 2014

To the Board of Directors South Lake Tahoe Tourism District 3535 Lake Tahoe Boulevard South Lake Tahoe, CA 96150

DREW AGUILAR. CPA LINDA R. TURRIA, CPA

1663 Hwy. 395, #201 Minden, NV 89423 ('775) 782· 7874 FAX 782"8374 WWW.CARSONVALLEYACCOUNTING.COM

This letter is to confirm our understanding of the terms and objectives of our engagement and the nature and limitations of the services we will provide.

We will perform the following services:

We will compile, from information you provide, the statement of assets, liabilities and fund balance of the South Lake Tahoe Tourism District as of July 31, 2014, and the related statement of income and expenses for both the nine months ended July 31, 2014, and the one month ended July 31, 2014. We will issue an accountant's report on such financial statements in accordance with the "compilation .standards" as set forth in the Statements on Standards for Accounting and Review Services issued by the American Institute of Ce1iified Public Accountants. The objective of a compilation is to assist you with presenting, in the form of financial statements, information that is representation of management without undertaking to obtain any assurance that there are no material modifications that should be made to the financials statements in order for the statements to be in accordance with accounting principles generally accepted in the United States of America. We will not audit or review such financial statements.

A compilation differs significantly from a review or an audit of financial statements. A compilation does not contemplate performing inquiry, analytical review procedures, or other procedures performed in a review. Consequently, the information provided by management will not be verified, con-oborated, reviewed, or audited. Additionally, a compilation does not contemplate obtaining an understanding of the entity's internal control; assessing fraud risk; tests of accounting records by obtaining sufficient appropriate audit evidence through inspection, observation, confirmation, the examination of source documents (for example, cancelled checks or bank images); and other procedures ordinarily performed in an audit. Therefore, a compilation does not provide a basis for expressing any level of assurance on the financial statements being compiled. Accordingly, no fom1 of assurance will be given on the financial statements. Because we are performing our compilation work as accountants rather than auditors, the South Lake Tahoe Tourism District should not

. record or describe our services as an audit or "auditing" in its minutes or books of record.

Management is responsible for making all financial records and related information available to us and for the accuracy and completeness of that information.

Management has elected to omit disclosures and the statement of cash flows required by accounting principles generally accepted in the United States of America. If the omitted disclosures and statement of cash flows were included in the financial statements, they might influence the user's conclusions about the South Lake Tahoe Tourism District's financial position, results of operations, and cash flow. Accordingly, the financial statements are not designed for those who are not informed about such matters.

We will be responsible for performing our services as outlined above in accordance with the "compilation standards" as set forth in the Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. If, for any reason, we are unable to complete the

NEVADA SOCIETY OF CWTIFIED PUBLIC ACCOUNTANTS I CALIFORNIA SOCIETY Of CFRTIFIED PUBLIC ACCOUNTANTS I AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

·-------------------------

The above list of assessees was provided by the City of South Lake Tahoe at the time of publication of this Management District Plan. As new lodging businesses begin operations or as existing lodging businesses close, the list of assessees will change.

South Lake Tahoe TIO Management District Plan Page 27

Page 2

compilation of your financial statements, we will not issue a report on such statements as a result of this engagement.

Drew Aguilar, CPA, is the engagement partner for the compilation services specified in this letter. His responsibilities include supervising Carson Valley Accounting, LLC's services performed as part of this engagement and signing or authorizing another qualified firm representative to sign the compilation report.

As outlined in this letter, we will assist in the preparation of your financial statements and we may advise you about appropriate accounting principles and their application, but the final responsibility for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America remains with you. Also, as part of our engagement, we may propose standard, adjusting, or correcting journal entries to your financial statements. Management, however, has final responsibility for reviewing the proposed entries and understanding the nature and impact of the proposed entries to the financial statements. It is our understanding that management has designated qualified individuals with the necessary expe11ise, preferably within senior management, to be responsible and accountable for overseeing all the services performed as part of this engagement. By your signature below, you acknowledge that management agrees to evaluate the adequacy of, and accept responsibility for, the results of all the services performed as pat1 of this agreement. In addition, you are responsible for establishing and maintaining internal controls, including monitoring ongoing activities. This includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements; as well as identifying and ensuring that the organization complies with the laws and regulations applicable to its activities. We will have no responsibility to identify and communicate deficiencies in your internal control as part of this engagement.

Our engagement cannot be relied upon to disclose errors, fraudulent financial reporting, misappropriation of assets, or illegal acts that may have occuITed. However, we will inform the appropriate level of management of any material eITors and of any evidence or information that comes to our attention during the performance of our engagement that fraud may have occurred. We will also report to the appropriate level of management any evidence or information that comes to our attention regarding illegal acts that my have occurred, unless they are clearly inconsequential. By your signature below, you understand and agree that you are responsible for preventing and detecting fraud.

We appreciate the opportunity to be of service to you and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return it to us.

Siilb ~~' C(Jp/_ Carson Valley Accounting, LLC

Acknowledged:

DREW AGUILAR. CPA LINDA R. TURRIA. CPA

1663 Hwy. 395, #201 Minden, NV 89423 (775) 782· 7874 FAX 782-8374 WWW.CARSONVALLEYACCOUNTING.COM

INDEPENDENT ACCOUNTANT'S COMPILATION REPORT

Board of Directors South Lake Tahoe Tourism District South Lake Tahoe, California

We have compiled the accompanying Statement of Assets, Liabilties and Fund Balance for the South Lake Tahoe Tourism District as of July 31, 2014, and the Statement of Income and Expenses for the one month and nine months ended July 31, 2014. We have not audited or reviewed the accompanying financials statements and, accordingly, do not express an opinion or provide any assurance about whether the financials statements are in accordance with accounting principles generally accepted by the United States of America.

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of the financial statements.

Our responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements.

Management has elected to omit all of the disclosures and the statement of cash flows ordinarily included in financial statements prepared in accordance with accounting principles generally accepted by the United States of America. If the omitted disclosures and statement of cash flows were included in the financial statements, they might influence the user's conclusions about the Company's assets, liabilities, equity, income and expenses. Accordingly, the financial statements are not designed for those who are not informed about such matters.

be~~g~LLC-Minden, Nevada August 18, 2014

NEVADA SOCIETY OF CrnTJrlED PUULIC ACCOUNTANTS I CALIFORNIA SOCIETY OF CERTIFIED PUBl.IC ACCOUNTANTS I AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNli\NTS

SOUTH LAKE TAHOE TOURISM DISTRICT

Financial Statements

For the Nine Months Ended July 31, 2014

South Lake Tahoe Tourism District Statement of Assets, Liabilities and Fund Balance

as of July 31, 2014

ASSETS

CURRENT ASSETS Cash and Equivalents

Checking $ 43,351

Prepaymentto LTVA 2,401

Due from City Total Current Assets 45,752

TOT AL ASSETS $ 45,752

LIABILITIES AND FUND BALANCE

CURRENT LIABILITIES Due to LTVA $

Total Current Liabilities

TOT AL LIABILITIES $

FUND BALANCE Fund Balance 179,102

Current Earnings (133,350)

TOT AL EQUITY $ 45,752

TOT AL LIABILITIES AND FUND BALANCE $ 45,752

See independent accountant's compilation report -2-

South Lake Tahoe Tourism District INCOME STATEMENT

For the 1 Month and 9 Months Ended July 31, 2014

SALES

TIDREVENUE

BANK INTEREST INCOME

Total Sales

Gross Profit

OPERATING EXPENSES

LTV A MARKETING FUND

SPECIAL EVENTS

MARKETING & PROMOTIONS

WEBSITE & ELECTRONIC NEWSLETTER

ADMINISTRATIVE/OPERATIONS

ACCOUNTING FEES

ADVERTISING/MEETING ANNOUNCEMENTS

BANK CHARGES

POSTAGE

ADMIN FEE TO CITY OF SOUTH LAKE TAHOE

Total Operating Expenses

Operating Income (Loss)

Net Income (Loss) Before Taxes

Net Income (Loss)

See independent accountant's compilation report -3-

1 Month Ended July 31, 2014

132,622

1

132,623

132,623

124,731

13

1,326

126,070

6,553

6,553

$ 6,553

9 Months Ended July 31, 2014

1,306,895

10

1,306,905

1,306,905

1,229,135

184,508

12,500

72 600

259

113

13,068

1,440,254

(133,350)

(133,350)

$ (133,350)