Title
Dept/ Agency: Administration/Office of Business Administrator
Action: ( ) Ratifying (X) Authorizing ( ) Amending
Type of Service: Grant Agreement
Purpose: To mitigate the negative financial impact due to the Covid-19 public health emergency.
Entity Name: Greater Newark Tourism Improvement District Management Corporation d/b/a The Greater Newark Convention and Visitors Bureau
Entity Address: 58 Park Place, First Floor, Newark, New Jersey 07102
Grant Amount: $500,000.00
Funding Source: American Rescue Plan Act of 2021 - Department of Treasury Coronavirus State and Local Fiscal Recovery Funds/NW051-G21-ARPK0-A-72090-B2021
Grant Period: Upon full execution of the Grant Agreement
Contract Basis: ( ) Bid ( ) State Vendor ( ) Prof. Ser. ( ) EUS
( ) Fair & Open ( ) No Reportable Contributions ( ) RFP ( ) RFQ
( ) Private Sale (X) Grant ( ) Sub-recipient ( ) N/A
Additional Information:
body
WHEREAS, on March 10, 2021, the 117th Congress of the United States and President Joseph R. Biden officially enacted a $1.9 trillion stimulus package, the American Rescue Plan Act of 2021 (“ARPA”), in response to the economic crisis brought on by the ongoing Covid-19 pandemic; and
WHEREAS, on or about May 19, 2021, the City of Newark (“City”) submitted an electronic portal application to the United States Department of Treasury for the American Rescue Plan Act of 2021 - Treasury’s Coronavirus State and Local Fiscal Recovery Funds (“Application”), and was notified that the City was being awarded a total amount of $176,667,606.00 (“Award”); and
WHEREAS, on June 22, 2021, the Newark Municipal Council adopted Resolution 7R1-a(s), authorizing the City’s submission of the Application and the acceptance of the Award; and
WHEREAS, the Award will help the City recover from the economic downturn experienced and mitigate the financial impact over the next four (4) years; and
WHEREAS, Congress’s intent is that funds obtained from ARPA must be spent within the four (4) eligible use categories identified in the Statute: (1) to respond to the public health emergency and its negative economic impacts, (2) to provide premium pay to essential workers, (3) to provide government services to the extent of eligible governments’ revenue losses, and (4) to make necessary water, sewer, and broadband infrastructure investments - and not otherwise; and
WHEREAS, ARPA provides flexibility to the City to determine how best to use the Award to meet the needs of the community and population; and
WHEREAS, on June 19, 2013, the Newark Municipal Council adopted Ordinance 6PSF-h (“Special Improvement District Ordinance”), which created a Special Improvement District to be known as the Greater Newark Tourism Improvement District (“District”), comprised of all hotel properties within the City of Newark, to provide supplemental services and collect a special license fee assessment to be collected by the owners or operators of hotel properties within the City as an additional room charge based upon actual room rentals and paid over to the City of Newark in quarterly installments together with regular real property tax payments for the purpose of promoting the economic and general welfare of the Special Improvement District and the City increasing tourism making the City a year round destination; and
WHEREAS, the Special Improvement District Ordinance designated the Greater Newark Tourism Improvement District Management Corporation (“Greater Newark Convention and Visitors Bureau”) as the management entity to provide services to benefit businesses, employees, residents, visitors and consumers in the Special Improvement District and all the powers necessary to effectuate the purpose of the Special Improvement District Ordinance and the District; and
WHEREAS, on or about June 9, 2021, Greater Newark Convention and Visitors Bureau submitted a request to the City for financial assistance from the Award the City received pursuant to ARPA, in the amount of One Million Five Hundred Thousand Dollars ($1,500,000.00), to offset loss revenue as a result of the Covid-19 Pandemic; and
WHEREAS, Greater Newark Convention and Visitors Bureau’s total income for 2019, 2020, and part of 2021 is as follows:
2019: $2,128,039.67
2020: $773,105.10
2021: $38,590.28, which does not include approximately $400,000.00 in Tourism Improvement District collection for First and Second Quarter.
The income reflects that the Covid-19 public health emergency had a massive financial impact evidenced by a loss in revenue in the amount of $1,354,934.57 in fiscal year 2020. While fiscal year 2021 shows that there is a potential for the total income to be more than fiscal year 2020, Greater Newark Convention and Visitor’s Bureau is still financially suffering from the pandemic as their revenue is not projected to be nearly as much as fiscal year 2019; and
WHEREAS, ARPA describes several types of uses that would be responsive to the impacts of the Covid-19 public health emergency, including assistance to households, small businesses, and nonprofits and aid to impacted industries such as tourism, travel and hospitality; and
WHEREAS, the Covid-19 pandemic caused significant economic and financial hardship for many Americans, which resulted in businesses experiencing decline in revenue or being closed, and decline in travel; and
WHEREAS, Greater Newark Convention and Visitors Bureau is a nonprofit organization, which suffered a loss in revenue caused by the City’s decline in travel and closure of businesses stemming from the Covid-19 pandemic, and as such qualifies as an eligible use under ARPA; and
WHEREAS, the City has determined that an economic harm to Greater Newark Convention and Visitors Bureau exists and that the economic harm was caused or made worse by the Covid-19 public health emergency; and
WHEREAS, the City desires to provide Greater Newark Convention and Visitors Bureau a grant in the amount of Five Hundred Thousand Dollars and Zero Cents ($500,000.00); and
WHEREAS, pursuant to ARPA and the Interim Final Rule, the City has determined that the eligible use in this instance responds to; is reasonably proportional to the decline of revenue; and mitigates the financial hardship experienced by Greater Newark Convention and Visitors Bureau.
NOW, THEREFORE, BE IT RESOLVED BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, NEW JERSEY, THAT:
1. The Mayor, and/or his designee, and the Business Administrator are authorized to execute and enter into a Grant Agreement with Greater Newark Tourism Improvement District Management Corporation d/b/a The Greater Newark Convention and Visitors Bureau, 58 Park Place, First Floor, Newark, New Jersey 07102, in the amount of Five Hundred Thousand Dollars and Zero Cents (“Grant”).
2. The Grant to Greater Newark Convention and Visitors Bureau will be issued from the American Rescue Plan Act of 2021 - Treasury’s Coronavirus State and Local Fiscal Recovery Funds (“ARPA”), accepted and received by the City pursuant to Resolution 7R1-a(s) adopted on June 22, 2021.
3. Pursuant to ARPA, the Grant to Greater Newark Convention and Visitors Bureau, qualifies as an eligible use as it provides financial assistance to a nonprofit organization that suffered a decline in revenue and aids the impacted industry of tourism, travel and hospitality resulting from the Covid-19 public health emergency.
4. Pursuant to ARPA, the Grant to Greater Newark Convention and Visitors Bureau is reasonably proportional to the decline of revenue and mitigates the financial hardship experienced by the Greater Newark Convention and Visitors Bureau.
5. Attached hereto is a certification of funds in the amount of $500,000.00 from Account Line: NW051-G21-ARPK0-A-72090-B2021.
6. The Business Administrator shall file the fully executed Grant Agreement along with this Resolution in the Office of the City Clerk
STATEMENT
Resolution authorizing the Mayor and/or his designee and the Business Administrator to enter into and execute a Grant Agreement with Greater Newark Tourism Improvement District Management Corporation d/b/a The Greater Newark Convention and Visitors Bureau, 58 Park Place, First Floor, Newark, New Jersey 07102, in the amount of Five Hundred Thousand Dollars and Zero Cents ($500,000.00)