Las Vegas on a Budget

Balloona Palooza – North Las Vegas Lake Las Vegas - Henderson Fabulous Las Vegas Strip Annual Budget Fiscal Year 2008/2009 Las Vegas, Clark County, Nevada Annual Budget Fiscal Year 2008/2009 Prepared by the Finance Department Under the supervision of Brenda Siddall, Vice President of Finance Las Vegas Convention & Visitors Authority 3150 Paradise Road Las Vegas, Nevada 89109-9096 (702) 892-0711 www.lvcva.com Cover photos provided by Las Vegas News Bureau TABLE OF CONTENTS PAGE BUDGET MESSAGE President's Budget Message BUDGET STRUCTURE AND POLICY Distinguished Budget Presentation Award Organizational Chart Board of Directors and Executive Officers History of the LVCVA Facilities of the LVCVA Reader's Guide Financial Structure Structure of the Budget Document New Policies/Significant Events Financial Management Policies Marketing Policies Facility Policies Community Policies Budget Process Budgetary Controls Budget Calendar Budget Summaries All Funds Comparison to Prior Years – Total All Funds Fund Balance Analysis ANNUAL OPERATING BUDGET General Fund Summary Graphs - General Fund Expenditures Revenue Graphs - Sources of Proposed Revenues & Major Revenue Sources Revenue Summary Room Taxes Gaming Fees Use of Facilities Other Fees and Charges/Interest/Other Financing Sources General Government Organizational Chart Graphs - Expenditures & Comparison of Actual to Budget Budget Analysis Board of Directors & Executive Public Affairs Human Resources Marketing Organizational Chart Graphs - Expenditures & Comparison of Actual to Budget Budget Analysis Marketing and Advertising Sales and Services Operations Organizational Chart Graphs - Expenditures & Comparison of Actual to Budget Budget Analysis Facilities Customer Experience Las Vegas Convention Center Cashman Center Security Project Development 21 24 25 26 27 29 30 31 32 33 34 35 36 37 39 40 41 43 46 51 52 53 55 55 56 59 60 62 1 2 3 5 6 8 8 10 10 13 13 13 15 16 17 18 19 20 i TABLE OF CONTENTS PAGE ANNUAL OPERATING BUDGET (continued) Operations (continued) Finance Purchasing Information Technology Special Events Graphs - Expenditures & Comparison of Actual to Budget Budget Analysis Special Events Grants & Other Graphs - Expenditures & Comparison of Actual to Budget Budget Analysis Grants & Other CAPITAL FUND Capital Projects Funds Summary Capital Improvement and Replacement Fund Capital Building and Land Improvements Listing Capital Furniture and Equipment Listing Master Plan Enhancement Program Fund Extraordinary Maintenance, Repair or Improvement Fund Five-Year Capital Improvement Plan DEBT SERVICE FUND Debt Service Funds Summary Debt Limit and Capacity Bond Coverage Historical Perspective PERSONNEL ALLOCATION Summary of Personnel Requests Summary of Authorized Positions Authorized Positions by Organizational Unit/Section Bargaining and Non-bargaining Unit Classifications STATISTICAL DATA General Fund Revenues by Source- Last Ten Fiscal Years General Fund Expenditures by Source - Last Ten Fiscal Years Use of Facilities - Last Ten Fiscal Years Excerpt of Rental Rates per Facility Demographic Statistics - Clark County, NV – Last Ten Fiscal Years Visitor Analysis - Last Ten Calendar Years Visitor Demographic Statistics – Last Ten Fiscal Years Principal Room Tax Payers - December 31, 2007 Room Tax Rate Distribution by Jurisdiction – June 30, 2008 GLOSSARY 108 110 112 114 115 116 118 119 121 122 100 101 102 105 91 96 97 98 72 73 77 80 83 84 85 63 65 67 68 69 69 70 71 71 May 15, 2008 To the Board of Directors Las Vegas Convention and Visitors Authority I am pleased to present the fiscal year 2009 budget for your review and consideration. This budget is the product of many months of work on the part of all the members of this organization. It represents the expected revenues and planned expenditures for the LVCVA’s fiscal year from July 1, 2008 to June 30, 2009. It has been prepared in conformance with the requirements of state law, Board policies and governmental budgeting “best practices”. The mission of the Las Vegas Convention and Visitors Authority: “To attract visitors by promoting Las Vegas as the world’s most desirable destination for leisure and business travel.” The LVCVA has the sole responsibility to market and brand Las Vegas as a travel destination. Hotels and resorts advertise and market their individual properties, while we market the city as a whole. We fulfill our mission primarily through national and international advertising campaigns, sales efforts and operation of the Las Vegas Convention Center and Cashman Center. In addition, we market Laughlin, Mesquite and outlying areas. The LVCVA underwent a strategic planning process three years ago that resulted in the Vision Plan. The plan was comprehensive and aggressive – with a goal of achieving 43 million visitors by the end of the decade. The three main elements of the vision plan are Grow the Brand, House the Brand and Live the Brand. These elements serve as the foundation for establishing annual goals and are focal points in the FY 2009 budget resource allocation. FY 2009 CHALLENGES Las Vegas is embarking on its most dynamic period of growth in history. Beginning in the current fiscal year, over 45,000 new hotel rooms will be added during the next five years to the current room inventory of 134,000. Las Vegas hotels could house the entire city of Portland, Oregon. During this time of unprecedented growth, the marketing efforts need to be intensified to ensure that Las Vegas remains a top visitor destination. This budget is being brought forward in the midst of a very challenging economic environment. The chairman of the Federal Reserve Board recently indicated the possibility of a recession, citing turmoil in the housing and credit markets. Prior economic downturns have had less of an effect on the Las Vegas tourism industry than the national trends, possibly because while people may cancel or delay vacations, they tend to need a get-away that is shorter and closer to their home. Las Vegas is within a five-hour drive for over 22 million residents of southern California and Arizona. In addition to economic concerns, the LVCVA has been the subject of various proposals to divert a portion of our revenues. In 2007, legislation was passed that requires the LVCVA to issue debt to fund transportation projects in the amount of $300 million, or $20 million per year in debt service, whichever is less. The first transportation project has been approved by the Board of Directors and the financing process is proceeding. Two initiatives have been filed with the Secretary of State proposing to divert current and future room tax money away from the LVCVA to fund education, roads and public safety. Because the initiatives seek to change the Nevada constitution, voters must approve them at both the November 2008 and 2010 elections. The LVCVA filed a legal challenge to the initiatives, asking the court to dismiss both initiatives, which would prevent them from appearing on the election ballot. The court recently ruled that the initiatives may proceed. The LVCVA has filed an appeal with the State Supreme Court. FY 2009 BUDGET HIGHLIGHTS The total FY 2009 budget for the LVCVA is $294 million. That amount reflects no growth over FY 2008. Operating expenditures account for $219 million, while capital, debt and reserves total $75 million. Revenue During the first six months of FY 2008, room taxes had mixed results. Half of the months exceeded budget, while the other half came in below budget. Beginning in January, results for two consecutive months did not meet budget expectations, although they did show gains over the same month in the previous year. The March room tax decline deepened, coming in 9% lower than March 2007 and 15% below budget. FY 2008 revenue expectations have been lowered by $8 million. Since it is so late in the fiscal year, the FY08 "budget cuts" will consist of expenditure controls. One of those expenditure controls is a hiring freeze. Another is the elimination of non-essential travel. The major cost control measure will be capital expenditures. Revenues in the FY 2009 budget total $279 million, an apparent decrease of 2 percent over the current year’s budget. However, compared to our lower expectations for FY 2008, the FY 2009 revenues actually reflect an increase of $2.3 million, or a little under 1%. Room tax is projected to provide $224 million, or 80% of total revenues. Room tax projections are based on the number of lodging rooms available, occupancy rate and the average daily taxable room rental rate. II Room inventory in Clark County currently stands at 148,800 rooms, with over 135,000 rooms in the metropolitan Las Vegas area. A weighted average of 7,000 rooms will be added during FY 2009. For every 1,000 new rooms, Las Vegas needs to attract 200,000 more visitors annually to maintain current hotel occupancy rates. The county-wide projection for FY 09 average occupancy rate is 89%. Occupancy in the greater Las Vegas area consistently exceeds that in other resort destinations. In calendar year 2007, average annual occupancy rates were: Las Vegas 90.4% New York 83.7% Oahu 76.9% Los Angeles 75.2% San Francisco 75.2% The most volatile factor in calculating room taxes is the average daily room rate (ADR). With hotel rooms being booked over the internet, price fluctuations are common with hotels having the ability to respond quickly to occupancy trends. Taxable ADR is on track to increase 2.9% in FY 2008. Based on the first three months of calendar year 2008, ADR is being projected to decrease 1.2% in FY 2009 to $91.69. $ 100 90 80 70 60 50 County-wide Taxable ADR FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 The $224 million projected for LVCVA room tax revenue represents about half of the total $420 million in room taxes that will be collected in Clark County. Other local government jurisdictions will receive about $196 million for schools, roads and other general government needs. In addition to that, the LVCVA will return $26 million to the other government entities in the form of grants and pay approximately $3.9 million in debt service for transportation bonds. The end result is that the LVCVA nets roughly 46% of the total room tax. Revenue from rental of the Las Vegas Convention Center (LVCC) is projected to remain flat in FY 09, primarily due to the start of construction related to the Master Plan Enhancement Project (MPEP). Utility relocation work will be occurring in the parking lots this summer and ground-breaking for the north/south connector and the Desert Inn meeting rooms will take place in December and January. III Other revenues include gaming fees, Cashman Center rental, interest earnings and revenue sharing on sports sponsorships. During FY 08, the LVCVA sponsored the 2007 Federation International de Basketball Americas Championship (FIBA) for men. FIBA was the pre-Olympic qualifier for men’s basketball and featured ten national teams. Both ‘other revenue’ and special event expenditures are showing declines in FY 09 due to that event being hosted in FY 08. FY 08 Expected FY 09 Change Room Tax LVCC Revenue Other Revenue Total $ 219,000,000 44,766,000 13,421,300 $ 277,187,300 $ 224,000,000 44,936,000 10,563,400 $ 279,499,400 2% --21% 1% Note that FY 08 reflects the lowered expectations instead of the budget. Expenditures Operating expenditures in the FY 2009 budget total $219 million, which represents no growth over FY 2008. FY 08 General Government Marketing Advertising Operations Special Events Grants & Other Operating Expenditures $ 9.6 36.1 87.5 45.2 13.7 27.4 $219.5 FY 09 $ 10.1 35.8 88.6 48.7 8.9 26.7 $218.8 Chg 6% -1% 1% 8% -35% -3% 0% (In millions) General Government includes the functions of Board of Directors, Executive, Human Resources and Public Affairs. The major expenditure increase for FY 09 is in legal fees. IV Advertising will continue the ongoing approach that has been so successful in the past few years. The pop culture phenomena of: What happens here, stays here. TM will continue to lead the ad campaign, supplemented by the Your Vegas is Showing campaign. A new campaign currently running is Vegas Right Now, which is intended to drive immediate and spontaneous visitation. A new function added to the Operations budget in FY 09 is administrative support for the MPEP. The LVCVA entered into an agreement in 2005 with MWH Americas to act as program manager and construction manager for the Master Plan Enhancement Project (MPEP). Part of MWH's services are to act as the Owner's (LVCVA) eyes and ears and represent our interests in all aspects of the MPEP. However, additional administrative support is required for permitting, advertising, repographics, plans check fees, and inspections. Almost $7 million in funding will be provided to Las Vegas Events (LVE), a non-profit corporation dedicated to securing and sponsoring events that encourage visitation to the area. In addition to the LVCVA’s funding, LVE will use a portion of the earnings they have built up over several years to fund some events. Operating Transfers Transfers to the capital fund are budgeted at $15 million. The LVCVA maintains capital sub-funds that are used for different purposes. Annual capital is being funded for $4.4 million. Any capital improvement or asset costing $500 or more is budgeted in annual capital. This includes projects at both the Las Vegas Convention Center and at Cashman Center. It also includes items of furniture and equipment. The Capital Improvement Program (CIP) is a multi-year plan that includes major projects that cost over $1 million or that require multi-year planning to fit them into the building schedule. It covers everything from painting the building exterior to providing a redundant power feed to the central plant. The CIP project listing currently totals $78 million over the long-term. In FY 09, funding of $4 million is being added. Capital Reserve is similar to the CIP in that it accumulates money over multiple years. Its purpose is to provide funding for the pay-as-you-go portion of the master plan enhancement program and owner’s contingency. The FY 09 addition to the capital reserve is $5 million. Transfers to the debt service fund are $58 million. Debt service on current outstanding bond issues is $25.7 million. In addition, funding of $12.5 million has been provided for debt service on the commercial paper debt issuance approved by the Board in February 2006 to begin implementing the projects approved in the master plan. Another $15.9 million is being placed in a debt reserve fund. Bonds to fund transportation projects, as approved by the 2007 legislature, are in the process of being issued. Debt service amounting to $3.9 million is provided in the FY 09 budget. Ending fund balance on June 30, 2009 is projected at $14 million. State law provides guidance for an ending fund balance of between 4% and 8.3% of budgeted expenditures. The FY 09 ratio is 6.4%, which meets the target established in the five year forecast. V As we review what has been accomplished in the third year of the Vision Plan, and set forth the goals for year four, we can be pleased with the progress that has been made. This budget incorporates a long-term perspective and establishes linkages to the broad organizational goals outlined in the Vision. We will be keeping an eye on the economy during the upcoming budget year. A driving force in the budget preparation this year was flexibility. We monitor revenues constantly and can adjust expenditures to meet fluctuations in the forecast revenues. Facilitation of the budget process and the development of a budget document is a major undertaking. The team effort reflects the collaborative spirit within our organization. I would like to thank the departments and the Board of Directors for their efforts, support, and feedback during the budget process. Lastly, I would like to thank the budget staff. They did a great job coordinating the organization-wide efforts on budget and capital plan development, forecast updates, and document production. I also congratulate them on receiving the Government Finance Officer’s Distinguished Budget Presentation Award. Sincerely, Rossi Ralenkotter President / CEO VI DISTINGUISHED BUDGET PRESENTATION AWARD The Government Finance Officers Association of the United States and Canada (GFOA) presented an award of Distinguished Budget Presentation to the Las Vegas Convention and Visitors Authority for its annual budget for the fiscal year beginning July 1, 2007. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, an operations guide, a financial plan, and a communications device. The award is valid for a period of one year only. We believe our current budget continues to conform to program requirements, and we are submitting it to GFOA to determine its eligibility for another award. 1 LVCVA ORGANIZATIONAL CHART BOARD OF DIRECTORS LEGAL COUNSEL EXECUTIVE HUMAN RESOURCES PUBLIC AFFAIRS MARKETING OPERATIONS MARKETING & ADVERTISING SALES & SERVICE FACILITIES FINANCE INFORMATION TECHNOLOGY PURCHASING PROJECT DEVELOPMENT SAFETY & SECURITY 2 BOARD OF DIRECTORS AND EXECUTIVE OFFICERS The Las Vegas Convention and Visitors Authority (LVCVA) is governed by a Board of Directors consisting of fourteen members. Eight members are elected officials from either Clark County or one of the incorporated cities therein. The Las Vegas Chamber of Commerce (CC) and the Nevada Resort Association (NRA) nominate three each of the remaining six members. Current members of the Board, along with terms of office, are as follows: Elected Members: Mayor Oscar Goodman, Chair Representing City of Las Vegas Term: July 1999 – June 2011 Mayor James Gibson, Secretary/Treasurer Representing City of Henderson Term: July 1997 – June 2009 Councilman Larry Brown Representing City of Las Vegas Term: July 2003 – June 2009 Commissioner Tom Collins Representing Clark County Term: January 2005 – December 2008 Mayor Michael Montandon Representing City of North Las Vegas Term: July 2003 - June 2009 Mayor Susan Holecheck Representing City of Mesquite Term: August 2007 - June 2011 Councilman Mike Pacini Representing City of Boulder City Term: July 2003 – June 2009 Commissioner Rory Reid Representing Clark County Term: March 2007 – December 2010 Appointed Members: Mr. Keith Smith, Vice-Chair Representing resort hotel business (NRA) Term: April 2005 – June 2008 Mr. Charles Bowling Representing central business district (NRA) Term: July 2005 – June 2009 Mr. Scott M. Nielson Representing resort hotel business (NRA) Term: August 2007 – June 2009 Mr. Tom Jenkin Representing resort hotel business (CC) Term: December 2003 – June 2009 Ms. Kara Kelley Representing other commercial interests (CC) Term: July 2005 – June 2009 Mr. Andrew Pascal Representing tourism (CC) Term: July 2006 – June 2008 The terms of appointment for the eight elected officials are coterminous with their terms of office. The six remaining members serve a 2-year term but can be reappointed to additional 2-year terms. 3 BOARD OF DIRECTORS AND EXECUTIVE OFFICERS The Board serves as a policymaking body and employs a president to serve as chief executive officer. The LVCVA executive committee consists of: Rossi Ralenkotter E. James Gans Terry Jicinsky Vince Alberta John Bischoff Mark Haley Chris Meyer Mark Olson Luke Puschnig Brenda Siddall Cathy Tull President and CEO Senior Vice President, Operations Senior Vice President, Marketing Vice President, Public Affairs Vice President, International Brand Strategy Vice President, Facilities Vice President, Convention Sales Vice President, Human Resources Vice President, Legal Counsel Vice President, Finance Vice President, Strategic Planning 4 HISTORY OF THE LAS VEGAS CONVENTION AND VISITORS AUTHORITY Las Vegas has long been a favorite vacation destination for millions of tourists. In the early 1950s, however, community leaders realized the cyclical nature of tourism caused a significant decline in the number of visitors during the weekdays, throughout the summer months, and over the holiday season. In order to attract more visitors to the area during slow periods, a new market was needed - convention travelers. This idea became the seed that blossomed into the development of the Las Vegas Convention Center, established by the Nevada Legislature in 1955 as the Clark County Fair and Recreation Board. Its function was to operate the Las Vegas Convention Center and promote Southern Nevada as a convention-tourism destination. Original construction of the Las Vegas Convention Center began in 1957. It consisted of a rotunda, 18 meeting rooms and 90,000 square feet of exhibit space. Official opening ceremonies took place in April 1959, when the World Congress of Flight became the first convention to meet at the Las Vegas Convention Center. This fiscal year marks the 50th Anniversary of the opening of the Las Vegas Convention Center. Resolutions passed by the Board of Directors on June 27, 1967 and March 19, 1974 led to the renaming of the Clark County Fair and Recreation Board to the current Las Vegas Convention and Visitors Authority. During FY 2002, the Las Vegas Convention Center completed one of its largest expansions, which included a two-story exhibit hall addition. It now contains more than 3.2 million square feet of exhibit hall and meeting room space. The Convention Center contains 16 exhibit halls, 144 meeting rooms, restaurants, a business center, warehouses and administrative offices. The LVCVA also operates Cashman Center, which opened in 1983. It is a multi-purpose facility built with a 10,000-seat baseball stadium, 1,922-seat theatre, 98,100 square feet of exhibit space and 12 meeting rooms. On August 11, 1998, the Board approved a name change from Cashman Field Center to Cashman Center. During the ensuing years, the function of the LVCVA has evolved into the following mission: To attract visitors by promoting Las Vegas as the world’s most desirable destination for leisure and business travel. The LVCVA’s primary source of revenue is provided by a tax imposed on hotels, motels, and other transient lodging establishments in Clark County. The rate levied varies from 9% to 11% for resort hotels and 7% to 9% for non-resort hotels depending on the establishment’s jurisdiction (see page 121 for room tax rate breakdown by jurisdiction). The division of room tax, as of July 1, 2008, is presented below: Resort Hotels State County Clark County of TransporSchool Nevada tation District 3/8% 1% 1 5/8% Other Hotels / Motels State County Clark County Taxing of TransporSchool Entity Nevada tation District 0-2% 3/8% 1% 1 5/8% LVCVA 4-5% Taxing Entity 0-2% LVCVA 2-4% The LVCVA is empowered by the Nevada state legislature to: Provide for the levy of ad valorem taxes by the Board of County Commissioners, Acquire real property through the exercise of the power of eminent domain by the Board of County Commissioners, and Issue general obligation bonds in the name of and on behalf of the County. 5 FACILITIES OF THE LAS VEGAS CONVENTION AND VISITORS AUTHORITY LAS VEGAS CONVENTION CENTER The Las Vegas Convention Center is one of the most modern and functional facilities in the world a 3.2 million square foot facility located within a short distance of more than 100,000 guest rooms. In addition to more than two million square feet of exhibit space, 144 meeting rooms (more than 241,000 square feet) handle seating capacities ranging from 20 to 2,500. A grand lobby and registration area (more than 225,000 square feet) efficiently link existing exhibit halls with new exhibit and meeting rooms, allowing simultaneous set-up, break-down and exhibiting of multiple events. 6 FACILITIES OF THE LAS VEGAS CONVENTION AND VISITORS AUTHORITY CASHMAN CENTER Cashman Center is a multi-use facility encompassing 483,000 square feet on a 55-acre site near downtown Las Vegas. The facility includes approximately 98,100 square feet of exhibit space, 12 meeting rooms, a 1,922 seat state-of-the-art theatre, 2,700 spaces for parking, and a 10,000 seat baseball stadium which is the home of the Las Vegas 51s, the AAA affiliate of the Los Angeles Dodgers. Each segment of the facility is capable of functioning independently or in any combination for conventions and trade shows, business/group meetings, theatrical presentations, and sporting events. 7 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT FINANCIAL STRUCTURE Nevada Revised Statutes govern most of the LVCVA’s activities, including financial structure, purchasing procedures, budgeting, debt, and investments. Accounting and budgeting for a governmental organization is somewhat different from profit-making businesses in that governmental organizations use funds. A fund is a separate accounting entity with its own assets, liabilities, revenues and expenditures. The LVCVA has three major funds, the General Fund, Capital Funds and Debt Service Funds. The LVCVA budgets its governmental funds, which include the general fund, capital projects funds, and the debt service funds, based on the modified accrual basis of accounting. Under this method, revenues (income) are recognized, and any related receivable is recorded, when they become both measurable and available to finance expenditures. Room tax, the primary source of LVCVA revenue, is recognized at the time it is received and held for disbursement by the collecting governmental entity. Interest and facilities rental revenues are recognized when earned. Expenditures (expenses) are recognized when the liability is incurred, except for unmatured principal and interest on long-term debt which is recognized when due. Definitions for each fund group are provided in the glossary. All LVCVA funds are presented in the comprehensive annual financial report (CAFR) on the basis of generally accepted accounting principles (GAAP) and conform to the manner that the LVCVA prepares its budget (i.e. modified accrual basis). Encumbrances are sometimes viewed as an extension of the formal budget integration even though those amounts were adopted in the previous year’s budget. They consist of purchase orders, contracts and other commitments for expenditures of monies that are recorded in the accounting system in order to reserve the portion of the applicable appropriation. At fiscal year end, outstanding encumbrances are reported as reservations of fund balance and are reappropiated in the next fiscal year, since they are not considered expenditures or liabilities. STRUCTURE OF THE BUDGET DOCUMENT The goal of this budget document is to provide not only comprehensive information about estimated revenues and expenditures but also the policies, goals, financial structure, operations, and an organizational framework that show how the LVCVA will work towards its mission for fiscal year 2009. A main objective is to communicate to the readers (i.e. the Board of Directors, management, other organizational units and the public) in a manner that is clear, concise and understandable. The LVCVA budget is comprised of seven main sections: Budget Message, Budget Structure and Policy, General Fund, Capital Fund, Debt Service Fund, Personnel Allocation, and Statistical Data. BUDGET MESSAGE and BUDGET STRUCTURE and POLICY These sections provide a general overview of the LVCVA. It includes the president’s budget message, this reader’s guide, and condensed summaries of the budget. The budget structure and policy section contains a brief historical view of the LVCVA, along with its financial structure, various policies, budget procedures and fund balance analysis. GENERAL FUND The operating budget (i.e. general fund), beginning on page 21 presents budgetary information for revenues, followed by the functions of general government, marketing, operations, special events and grants. The emphasis is on the nature of the tasks to be undertaken by the organization. This section identifies the purpose of each organizational unit, its responsibilities, and goals for the ensuing fiscal year, selected activity measures, and prior year achievements. Appropriations are summarized in major categories of salaries, employee benefits, and services and supplies. Also included is the number of fulltime employees and capital outlay related to the division. 8 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT STRUCTURE OF THE BUDGET DOCUMENT (continued) GENERAL FUND (continued) For financial reporting and budgeting purposes, the LVCVA has classified its expenditures by functions, activities, and organizational units. The function classification arranges related activities, providing information on the overall purposes or objectives of expenditures. Activities are similar endeavors or groupings of organizational units performing a specific and distinguishable type of work. FUNCTIONS General Government ACTIVITIES Board of Directors Executive Human Resources Public Affairs Marketing & Advertising Sales and Services ORGANIZATIONAL UNITS Board of Directors Executive, Internal Audit, Legal, Board Office, Human Resources Media Relations, News Bureau Advertising, Internet Marketing & Research, Sports Marketing Convention Center Sales, Convention Sales Diversity Marketing, Destination Services Convention Services, International Sales Leisure Sales Customer Experience, Client Services, Engineering Security, Physical Security, Traffic Financial Services, Accounting, Payroll, Travel, Records Purchasing, Materials Management Information Technology Project Development Marketing Operations Facilities Security Finance Purchasing Information Technology Project Development The organizational chart shown on page 2 is closely related to each unit’s financial classification. In general, divisions relate to functions, departments relate to activities, and sections relate to organizational units. Special events and grants are unrelated to the organizational structure. Functions are the basic unit of the operating budget. Within each function, activities and organizational units are discussed in a narrative format. Also included within this discussion is a more detailed organization chart. CAPITAL FUND The capital fund budget, starting on page 72 includes a capital project and purchases listing and the fiveyear capital plan, which is reviewed and updated annually. This section explains the capital projects review and selection process, and includes a description of major projects and estimated impacts on the operating budget. There are three separate capital project funds being used: Capital Improvement and Replacement Fund, Extraordinary Repair, Maintenance, and Improvement Fund, and the Master Plan Enhancement Program Fund. DEBT SERVICE FUND The debt service fund budget on page 91 provides not only a historical perspective concerning the LVCVA’s past bond issues, but also a review of current and proposed bond obligations, the bond issuance process and debt limit and capacity. 9 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT STRUCTURE OF THE BUDGET DOCUMENT (continued) PERSONNEL ALLOCATION Information on personnel requests, including justifications, authorized positions by organizational unit, and wage schedules is located in the personnel allocation section, beginning on page 100. STATISTICAL DATA Statistical data starts on page 108. It contains information on demographics for Clark County, visitor analyses, principal room taxpayers, and a room tax schedule, along with ten-year schedules of facility usage for the Convention Center and Cashman Center and general fund revenues and expenditures. NEW POLICIES/SIGNIFICANT EVENTS The Board of Directors acted upon the following items during fiscal year 2008: Selected a “Master Architect” to complete the Master Plan Enhancement Program design effort. The Master Architect will retain Las Vegas based architectural/engineering firms along with other consultants to form a project team working from a single office in Las Vegas. (July 2007) Authorized the sale of revenue bonds in the amount of $50 million and purchased 8.44 acres of property. The land will be used for outdoor exhibits, parking, freight staging and construction lay down and staging. (Sept 2007) Approved a new inter-local collection allocation agreement. The agreement, first entered into in 1964, provided that collection allocation be allocated by way of population. The newly adopted agreement maintained the reimbursement allocation up to the level as paid in FY 2007 (“Baseline”). Reimbursement over the baseline will be paid to the entity that collected the increase. The reimbursement formula will be phased in over the next five years. (Sept 2007) Updated the investment policy. New changes include replacing a member of the investment committee with a member outside of the Operations Division and allow investments with maturity dates up to five years instead of two years. (Mar 2008) FINANCIAL MANAGEMENT POLICIES During each stage of the budget preparation process, consideration is given to the policies and goals established by the Board and Executive Management that directly relate to the budget and financial planning. The financial policies are divided into the following categories: Operating Management, Capital Management, Debt Management, Reserve/Fund Balance, and Financial Reporting. OPERATING MANAGEMENT Projections used to balance revenues to expenditures will be prepared for a five-year period and updated annually. Conservative but realistic revenue projections will be prepared to assess the limits of budget appropriations. If projections are too high, under-realized revenues could cause budget cuts mid-fiscal year. Operating expenditures will be funded with current revenues. For FY 09, current budgeted revenues of $277.3 million fund operating expenditures of $218.8 million. 10 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT FINANCIAL MANAGEMENT POLICIES (continued) The LVCVA is required by law to submit a balanced budget each year to the State of Nevada for approval. This is defined as a budget in which proposed revenues and other financing sources are equal to or exceed proposed expenditures. Investments of cash funds will be maintained in accordance with the Board-approved investment policy and state statute. The primary objectives of this policy are to minimize risk, ensure that cash is available when it is needed, and ensure a competitive rate of return while complying with the laws of the State of Nevada – in that order. Interest earnings on investments in the capital and debt service funds will be transferred into the general fund, except for earnings on the proceeds from construction financing (i.e. bonds, commercial paper). The Board authorizes adjustments to the full-time position roster, currently at 574 positions. All requests for new positions must contain a justification and evaluate total costs including benefits and capital outlay. Temporary employees are used only to augment regular staffing on a temporary or intermittent basis. Staffing is discussed in the personnel allocation section, page 100. There are no new position requests in FY 2009. The current collective bargaining agreement with Service Employees International Union Local 1107, along with additional LVCVA personnel policies, direct such items as annual pay increases, personal time off (PTO) accruals, and pension plan contributions. All are taken into account in the preparation of the budget. This agreement expires June 30, 2008 and at the time of budget preparation, negotiations are taking place. CAPITAL MANAGEMENT A five-year capital improvement plan will be updated annually. It is presented to the Board of Directors with the annual budget and is adopted at the same time. The capital improvement plan must include a list of proposed capital improvements or purchases with cost estimates, methods of financing (i.e. room taxes, use of facilities revenue or debt issue), and any estimated income or cost associated with the constructed facilities. Only projects or purchases costing over $20,000 in one fiscal year or included in a multi-year equipment replacement program appear in the plan. A listing of the five-year capital plan projects is included in this budget book. The detailed five-year capital plan is a separate document published along with the annual budget. The LVCVA is required by state law (NRS 350.013) to submit its capital improvement plan to the Nevada State Department of Taxation and the County Clerk with our Debt Management Policy and Indebtedness Report on August 1. A balance of pay-as-you-go capital improvements versus financing will be evaluated taking into account the various economic factors. Nevada Administrative Code 354.750 requires that local governments perform a physical inventory, every two years. Each item subject to the inventory must be assigned an identifying number and be labeled as belonging to the LVCVA. This same code sets the guidelines for the establishment of capitalization thresholds by resolution. 11 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT FINANCIAL MANAGEMENT POLICIES (continued) DEBT MANAGEMENT The LVCVA will actively seek to maintain, and if possible, improve our current bond ratings in order to minimize borrowing costs resulting in lower interest rates. Debt issuance is governed by Nevada state law. The LVCVA’s Board of Directors is empowered to issue general obligation bonds; however, state statute requires that these bonds be issued in the name of the County. Although state statute allows the LVCVA to use property taxes for debt service, only net pledged revenues derived from room taxes and use of facilities revenue have ever been used. No ad valorem property tax revenues are allocated to the LVCVA for any purpose and this practice will continue. The LVCVA is required to file several reports with the Debt Management Commission prior to August 1, regardless if new debt is being contemplated or not. The specifics of the reports can be found on page 91. RESERVE/FUND BALANCE A minimum unreserved fund balance of between 4.0% and 8.3% of budgeted general fund operating expenditures will be maintained. Our proposed FY 2009 unreserved fund balance is 6.4%. Reserves will be sufficient to pay principal and interest on the outstanding bond issues due on July 1. A contingency reserve of $1,000,000 will be funded for the discretionary use of the Board of Directors. However, use of these funds should be utilized only after the availability of all other budget sources are examined. The LVCVA is required by an inter-local agreement with Clark County to provide funding for a 13th month premium to the Clark County Self-Funded insurance program, in case of more claims being paid-out versus premiums collected. FINANCIAL REPORTING The LVCVA’s accounting and financial reporting systems will be maintained in conformance with generally accepted accounting principles (GAAP) and standards of the Governmental Accounting Standards Board (GASB) and the Government Finance Officers Association (GFOA). An annual audit will be performed by an independent public accounting firm, with an audit opinion to be included in the LVCVA’s published Comprehensive Annual Financial Report (CAFR). Financial systems will be maintained to monitor revenues, expenditures and program performance (i.e. special events and grants) on an on-going basis. 12 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT MARKETING POLICIES Filling the available hotel and motel rooms becomes more challenging each year. Nationally, the spread of gaming across the nation has lessened Las Vegas’ monopoly on the industry. We used to be the “only game in town”; now we have to be the “best game in town.” The past 15 years has seen tremendous expansion and growth of resort properties in the Las Vegas metropolitan area. This has driven the number of hotel rooms from 76,000 in 1993 to the current estimated 148,800. Some of the marketing policies that have been tailored to meet these challenges include: Stay abreast of current market conditions and travel trends in order to tailor marketing strategy to achieve maximum impact. Use national advertising to stimulate interest in Las Vegas for tourism and as a convention destination. Target market segments, such as international and diversity, to attract visitors with varied demographic profiles. Conduct market research to measure the local economic impact of tourism, monitor tourist characteristics and test new messages for key target audiences. Identify and promote special events that will attract previously untapped market segments. FACILITY POLICIES The Las Vegas Convention Center is one of the largest meeting facilities in the nation, with more than 3.2 million square feet. In FY 07, the Center hosted 78 conventions, 15 public events, and 3 meetings. Over 6.2 million delegates attended trade shows and conventions in Clark County. “Have a show in the building, another one moving in and one moving out.” This goal is closer to being realized than ever. Reasonable rates and the finest facilities in the country are the secret of our success. Policies that guide us toward this goal include: Maintain a competitive edge in the facility rate structure. Even with the newly adopted rate changes going into effect in FY 2010 and FY 2013, the Las Vegas Convention Center moves only from 17th to 13th in a comparison of national convention center rental rates. This ranking presumes that no other convention centers raise their rates in the interim. Create an outstanding experience for every visitor via the appearance and the amenities found in the facilities and provide excellent customer service. Prevent deterioration of maintenance programs. buildings and equipment through scheduled preventive Pursue aggressive energy and water conservation programs; thereby reducing operating costs. COMMUNITY POLICIES Since the first general obligation bonds were issued in 1957, the LVCVA has maintained a history of supporting the community through grants. The Board has established several grant programs including the following: Apportion annual recreation grants to Clark County and the incorporated cities within (Las Vegas, North Las Vegas, Henderson, Boulder City and Mesquite) for capital improvements to recreational facilities (i.e. parks, pools, community centers). 13 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT COMMUNITY POLICIES (continued) Award grants to local non-profit chamber of commerce, Clark County and its incorporated cities, for the development, promotion and increase of tourism within Clark County. Return a collection fee (up to 10% of total room tax and gaming fees received by the LVCVA) to the collecting entities (i.e. Clark County and its incorporated cities). The amount of fees paid to the collecting entities that exceed the reasonable costs incurred in collecting the room taxes and gaming fees must be used for the operations and maintenance of recreation programs or facilities. 14 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT BUDGET PROCESS An annual budget is developed to meet the needs and the goals of the organization based on the Board’s priorities and long-range plans and to comply with Nevada Revised Statutes. It should also serve as a management and control tool by measuring actual performance against budget standards, focus attention on future operations and plans, and improve communication of goals, objectives and plans. Below are the summarized highlights in preparing the annual budget. The budgetary controls and budget calendar follow, indicating the deadlines to meet the legal mandates of the State of Nevada. 1. Revenue Estimates and Projection Updates - The process begins with the Finance Department updating the five year forecast and preparing preliminary revenue projections taking into consideration national, state and local economic indicators and analyses of the LVCVA’s major revenue sources. Executive management meets to review the information, update strategic plans and determine preliminary budget guidelines. 2. Budget Training Sessions - Budget preparation manuals are distributed by Finance to all departmental budget preparers at budget training sessions. The manual contains instructions for accessing and using the computerized budget system (OLB), preparing narratives, goals and activity measures, requesting new personnel and justifying capital requests. 3. Zero Based Budgeting – Beginning in FY 2009 the LVCVA began a zero based budget process. Departments build their budgets from the ground up, justifying groups of related expenditures. Consideration is given to any additional budget guidance as given by executive management. 4. Goals, Objectives and Performance Measurements - Departments are required to develop goals, objectives and activity measures to show what services are going to be provided. The goals must complement the organization and divisions’ mission statements and goals. 5. Tentative Budget Adoption - The tentative budget document is presented to the Board of Directors at a public hearing. It is then filed with the Nevada Department of Taxation and the County Clerk as required by Nevada Revised Statues, usually on or before April 15th. 6. Budget Book Development - Since the financial and narrative information is completed by this point, the Finance Department prepares the budget book which is compromised of the operating, capital and debt service budgets. 7. Public Hearing and Final Budget Adoption - Between April 15 and the third Thursday in May, the public has the opportunity to review the tentative budget document and submit any comments for inclusion on the agenda of the public hearing. The hearing provides the public an opportunity to comment on the proposed budget to the Board of Directors. 15 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT BUDGETARY CONTROLS Some of the significant controls pertaining to the budget are as follows: The budget process for the operating (general fund) and capital funds is decentralized; all departments participate in the process and input budget amounts and justifications into the computerized on-line budget system. Annual budgets for the upcoming fiscal year (July 1 through June 30) are adopted for all funds. These final budgets are integrated on July 1 with the LVCVA’s accounting system. Each fund in the budget must be in balance; total revenues including other financing sources plus beginning fund balance must equal total expenditures including other financing uses plus proposed ending fund balance. The statutory level of budgetary control is at the function level; however, in reality, control is maintained at the line item level through the use of a purchase order and encumbrance system. An encumbrance is recorded in the accounting system when a purchase order is issued. At fiscal year end, outstanding encumbrances are reported as reservations of fund balance and are reappropiated in the next fiscal year via the budget augmentation process, since they are not considered expenditures or liabilities. The LVCVA is currently using a “zero-based” budget method. Each department must build their budget from the ground up justifying each group of related expenditures. Departments can request additional funding for new positions, equipment or operating expenses to expand existing or for new programs or initiatives. Budgetary performance is measured by line item budget variance reports. Departments have the ability to run the report themselves at anytime. Budget variance reports are linked to the accounting system and when run provide real time data. Budget variance reports are distributed to the Board on a monthly basis. A capital expenditure versus budget report by project number is issued monthly as well. BUDGET TRANSFERS There are three types of transfers of budget appropriations that are permitted by state law. 1) Transfers within the same function (i.e. General Government, Marketing, Operations, Special Events and Grants) and same fund (i.e. general fund, capital fund). Only the President needs to approve them. 2) Transfers between different functions but within the same fund. The President can approve and the Board is advised of the action at the next regular meeting where it is recorded in the official minutes. 3) Transfers between different funds require prior approval of the Board. The Department of Taxation is notified of these transfers by means of filing the tentative budget, which contains current year budget revisions. BUDGET AUGMENTATION Adjustments to the budget are accomplished through an augmentation process. It requires adoption by a majority vote of the Board of Directors at a regular meeting to increase appropriations above levels originally approved and the filing of designated forms with the Nevada Department of Taxation. This formal resolution procedure adheres to the process prescribed by Nevada Revised Statutes. 16 READER`S GUIDE TO THE LVCVA BUDGET DOCUMENT BUDGET CALENDAR Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept Oct 11/1- Finance prepares preliminary revenue estimates and debt service requirements. President 11/30 approves budgetary guidelines to disseminate to budget teams. Pro-forma statements prepared. 1/2-2/8 Budget training and information and goal setting sessions held. Open OLB (OnLine Budget), the computerized budget system to budget preparers. Budget teams prepare tentative budget requests and meet with senior vice presidents to review. Finance prepares salary and benefits budget. 2/11- Senior vice presidents review final budget submissions. All 2/22 budget submissions must be completed. 2/25- Tentative budget document is prepared for executive review 3/14 process. President, senior vice presidents and others review budget requests. 3/17- Final draft of proposed budget prepared by Finance. 3/21 3/24 Final draft of proposed budget distributed to executive management. All goals, activity measures, prior year achievements and any changes to text in budget document due to Finance. Last day to make changes to tentative budget. 4/8 Tentative budget and budget augmentation presented to the Board of Directors at a public hearing. 3/28 4/15 Tentative FY 2009 budget submitted to Department of Taxation for compliance review. 4/285/2 Budget to Print Shop for printing and binding. 5/5 5/15 Public notice published. Public hearing and adoption of the final FY 2009 budget. 6/2 Final FY 2009 budget submitted to Department of Taxation. 7/18/14 Submission of FY 2009 budget to GFOA for budget award. Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul 17 SUMMARY OF ALL FUNDS FY 2009 BUDGET ALL FUNDS CAPITAL GENERAL FUND REVENUES: Room Taxes and Gaming Fees Use of Facilities Interest Miscellaneous Total Revenues EXPENDITURES: General Government Marketing Advertising Operations Community Support Special Events Other Capital Outlay Debt Service: Principal Interest Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES): Operating Transfers In Operating Transfers Out Proceeds from Sale of Debt Proceeds from Sale of Fixed Assets Total Other Financing Source (Uses) EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES RESERVE FOR CONTINGENCY FUND BALANCE, BEGINNING FUND BALANCE, ENDING (11,992,610) 2,700,000 28,750,262 14,057,652 (774,936) 11,824,647 11,049,711 17,662,839 28,261,936 45,924,775 4,895,293 2,700,000 68,836,845 71,032,138 2,189,000 (72,671,375) 15,000 (70,467,375) 14,650,000 (1,500,000) 255,000,000 268,150,000 58,021,375 (689,000) 57,332,375 74,860,375 (74,860,375) 255,000,000 15,000 255,015,000 58,474,765 (268,924,936) (39,669,536) (250,119,707) 218,820,635 271,450,936 13,340,000 27,018,536 40,358,536 13,340,000 27,018,536 530,630,107 10,080,200 35,771,500 88,626,000 48,740,200 26,665,000 8,897,735 40,000 271,450,936 10,080,200 35,771,500 88,626,000 48,740,200 26,665,000 8,897,735 40,000 271,450,936 225,950,000 49,390,400 1,950,000 5,000 277,295,400 2,525,000 1,000 2,526,000 689,000 689,000 225,950,000 49,390,400 5,164,000 6,000 280,510,400 PROJECTS FUNDS DEBT SERVICE FUNDS TOTAL ALL FUNDS 18 SUMMARY OF ALL FUNDS COMPARISON TO PRIOR YEARS TOTAL - ALL FUNDS REVISED ACTUAL FY 05 REVENUES: Room Taxes and Gaming Fees Use of Facilities Interest Miscellaneous Total Revenues EXPENDITURES: General Government Marketing Advertising Operations Community Support Special Events Other Capital Outlay Debt Service: Principal Interest Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES) Operating Transfers In Operating Transfers Out Refunding Escrow Proceeds of Sale of Debt Debt Premium Debt Issuance Costs Proceeds from Sale of Fixed Assets Total Other Financing Source (Uses) EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES RESERVE FOR CONTINGENCY FUND BALANCE, BEGINNING FUND BALANCE, ENDING 16,987,295 91,622,256 108,609,551 (10,124,959) 108,609,551 98,484,592 41,394,490 98,484,592 139,879,082 (68,906,337) 2,135,900 139,879,082 68,836,845 4,895,293 2,700,000 68,836,845 71,032,138 46,852,379 (46,852,379) (128,952,550) 118,745,000 10,359,037 (1,815,620) 33,046 (1,631,087) 79,275,085 (79,275,085) (2,242) 29,843 27,601 62,393,370 (62,393,370) (40,796,517) 69,200,000 2,051,229 (323,813) 70,374 30,201,273 65,320,964 (65,320,964) 119,000,000 25,000 119,025,000 74,860,375 (74,860,375) 255,000,000 15,000 255,015,000 18,618,382 (10,152,560) 11,193,216 (187,931,337) (250,119,707) 9,950,000 14,527,555 206,699,635 11,725,000 11,498,269 264,421,852 11,050,000 13,341,084 260,860,199 11,605,000 14,668,351 468,124,637 13,340,000 27,018,536 530,630,107 4,060,570 30,226,420 78,211,817 34,824,213 21,804,748 6,948,345 141 6,145,826 7,429,631 31,990,838 82,923,473 36,890,096 24,431,488 9,816,705 3,774 47,712,578 7,799,028 33,079,359 84,713,300 41,269,630 24,872,455 13,543,716 746 31,190,881 9,553,880 36,099,434 87,559,000 45,307,771 27,372,500 13,733,132 40,000 222,185,569 10,080,200 35,771,500 88,626,000 48,740,200 26,665,000 8,897,735 40,000 271,450,936 178,201,006 45,056,355 2,048,441 12,215 225,318,017 202,050,435 48,359,639 3,800,709 58,509 254,269,292 215,205,408 50,916,320 5,776,566 155,122 272,053,416 220,925,000 52,284,800 6,975,000 8,500 280,193,300 225,950,000 49,390,400 5,164,000 6,000 280,510,400 ACTUAL FY 06 ACTUAL FY 07 BUDGET FY 08 PROPOSED BUDGET FY 09 19 SUMMARY OF ALL FUNDS FUND BALANCE ANALYSIS Nevada Revised Statutes 354.433 defines Fund Balance as the excess of assets over liabilities in a governmental fund. Put another way, fund balance represents the net difference between total financial resources and total appropriated uses. Fund balances provide a financial cushion against anticipated changes. While changes may occur from year to year, maintaining proper fund balances over the long term are an important component of sound financial management and a significant factor in bond ratings. Fund balances will vary by fund. Total FY 2009 ending fund balance for all funds is projected to be $71,032,138. This is comprised of: $14 million in the General Fund, $11 million in the Capital Funds, and $45.9 million in the Debt Service Funds. General Fund – Beginning fund balance for FY09 is projected to be $28,750,262. Fund balance is the amount of unencumbered cash that ensures services could be provided for a short time if commitments exceeded revenues. Because all room tax received in July is accrued back to June 30, 2007, it is already part of ending fund balance. Most facility rental revenue received in July is earned in June and therefore it, too, is a part of ending fund balance. The first "new" money we receive is in the middle of August. Therefore, the LVCVA operates for four to six weeks off of beginning fund balance. This is used to cover expenditures (i.e. payroll, grants and supplies and services) for at least two to four weeks. Capital Fund – Fund balance in the capital fund is used as a supplement to capital projects if necessary. The Master Plan Enhancement Program was approved for a total of $737 million in February 2006, with an additional $153 million approved in May 2007. The board passed a resolution allowing for the sale of revenue bonds, commercial paper or other short-term floating rate securities or any combination thereof in the maximum amount of $822 million with the remainder ($68 million) of the funding from capital reserves. Capital reserves, unless spent, roll each fiscal year through fund balance, which accounts for fluctuations. Debt Service – Fund balance in the debt service funds is used as a cushion for timely debt payments. As part of the long-term financial plan, fund balance in the debt service funds is being increased from FY 2007 through FY 2009, by transferring funds adequate to amortize both principal and interest on the commercial paper draws. Since only interest payments are being made, the funds transferred for principal will accumulate to use for retiring debt or as a contingency for the enhancement program. 20 GENERAL FUND SUMMARY The general fund is the general operating fund of the LVCVA, accounting for most financial resources not specifically accounted for in another fund. General fund revenues include room taxes and gaming fees, use of facilities, other fees and charges, and interest earnings. The LVCVA has classified its expenditures by functions, activities, and organization units (see table on page 9). General fund expenditures are those that are made in the normal operations of the LVCVA. REVISED ACTUAL FY 05 REVENUES: Room Taxes and Gaming Fees Use of Facilities Other Fees and Charges Interest and Other Total Revenues EXPENDITURES: General Government Marketing Advertising Operations Special Events Grants Other Total Expenditures Excess of Revenues over Expenditures OTHER FINANCING SOURCES (USES): Operating Transfers In: Capital Projects Funds Debt Service Funds Operating Transfers Out: Capital Projects Funds Debt Service Funds Proceeds from Sale of Fixed Assets Total Other Financing Sources (Uses) Reserve for Contingency FUND BALANCE, BEGINNING FUND BALANCE, ENDING Total Capital Outlay Total Full-Time Personnel (44,061,077) 42,394,778 47,028,001 6,145,825 503 (77,124,210) 47,028,001 29,590,307 47,712,578 513 (56,290,139) 29,590,307 37,140,543 31,190,881 537 (62,205,964) 2,135,900 37,140,543 28,750,262 222,185,569 574 (70,467,375) 2,700,000 28,750,262 14,057,652 271,450,936 574 13.3% 26.4% (22.6%) (51.1%) 22.2% 0.0% 33,046 29,843 70,374 25,000 15,000 (40.0%) (18,932,302) (25,677,020) (54,258,700) (23,955,869) (33,000,000) (25,829,289) (27,374,200) (36,401,764) (14,650,000) (58,021,375) (46.5%) 59.4% 245,367 269,832 548,112 512,404 1,803,873 664,903 750,000 795,000 1,500,000 689,000 100.0% (13.3%) 48,694,300 59,686,516 63,840,375 55,951,583 58,474,765 4.5% 4,060,570 30,226,420 78,211,816 34,824,213 6,948,345 21,804,747 141 176,076,252 7,429,631 31,990,838 82,923,473 36,890,096 9,816,705 24,431,488 3,774 193,486,005 7,799,028 33,079,359 84,713,300 41,269,630 13,543,716 24,872,455 746 205,278,234 9,553,880 36,099,434 87,559,000 45,307,771 13,733,132 27,372,500 40,000 219,665,717 10,080,200 35,771,500 88,626,000 48,740,200 8,897,735 26,665,000 40,000 218,820,635 5.5% (0.9%) 1.2% 7.6% (35.2%) (2.6%) 0.0% (0.4%) 178,201,007 42,360,710 2,695,645 1,513,190 224,770,552 202,050,435 44,698,675 3,660,964 2,762,447 253,172,521 215,205,408 45,504,500 5,411,821 2,996,881 269,118,610 220,925,000 47,130,500 5,154,300 2,407,500 275,617,300 225,950,000 46,414,700 2,975,700 1,955,000 277,295,400 2.3% (1.5%) (42.3%) (18.8%) 0.6% ACTUAL FY 06 ACTUAL FY 07 BUDGET FY 08 PROPOSED BUDGET FY 09 % CHANGE 21 GENERAL FUND SUMMARY REVENUES Revenues for FY 09 total $277.3 million, an increase of $1.7 million over FY 08. The major source of this increase is attributed to room taxes, which are projected to increase 2%, or $5 million. Gaming fees are expected to increase slightly at $1,950,000. Use of facilities revenue represents approximately 17.1% of total revenues. Building usage, which is based on actual leases confirmed and signed, as well as parking lot rental, is projected to remain flat, primarily due to the start of construction related to the Master Plan Enhancement Program. Other fees and charges is expected to decrease 42%. The projected decrease is due to the reduction of inkind revenue from special events such as the NBA All-Star weekend in FY 2007 and the Federation International de Basketball Americas (FIBA) tournament in FY 2008. Interest is expected to decrease due to lower interest rates on investments. FY 2009 GENERAL FUND REVENUES Other* 2% Use of Facilities LVCC 17% Room Taxes 81% *Other includes Gaming Fees, Interest/Other and Other Fees and Charges as alone these represent less than 1% of the revenue budget EXPENDITURES General fund expenditures are divided into three main categories: salaries and wages, employee benefits, and services and supplies. Salaries and wages represent 17.4% of total general fund expenditures. Included in this amount, however, are temporary salaries and overtime of $3,792,700. Employee benefits are 34.5% of regular salaries budget of $38,087,200. On a division level, salaries and wages make up 41.6% of the General Government budget and 47% of the Operations budget. In the Marketing Division, salaries and wages account for only 8.9%, whereas, sales, advertising, and promotion represent 88.6% of their budget. Total expenditures are $218,820,635 approximately $800,000 less than the FY 08 budget. The General Government Division increase is due to an increase in legal fees. The $1 million increase in advertising is related to enhancing programs in the various market segments. The “What Happens Here, Stays Here” will continue to lead the ad campaign, supplemented by Your Vegas is Showing. Operations Division expenditures will increase approximately $3 million due to an increase in utilities costs, insurance premiums, and fully staffing new positions created in FY 2008. The decrease of $4.8 million in special events is due to not sponsoring the FIBA tournament and NBA All-Star weekend in FY 2009. 22 GENERAL FUND SUMMARY FY 2009 GENERAL FUND EXPENDITURES Operations 22% Advertising 41% Special Events 4% Grants & Other 12% General Government 5% Marketing 16% OTHER FINANCING SOURCES (USES) These are usually comprised of operating transfers in (i.e. interest earned in other funds) and transfers out (i.e. funding for other funds), along with sale of fixed assets. An operating transfer is a legally authorized transfer from a fund receiving revenue to the fund through which the resources are to be expended. FUND BALANCE It is the policy of the LVCVA to maintain an ending fund balance between 4.0% and 8.3% of budgeted expenditures. The projected ending fund balance of $14,057,652, which is 6.4%, meets this requirement. CAPITAL OUTLAY Capital outlay includes all projects accounted for in the capital projects and replacement fund (see pages 7290) for additional details). The total amount shown includes capital expenditures for furnishings, equipment, improvements or additions to land and buildings financed by general fund revenues. In each division’s budget analysis, the amount includes only furnishings and equipment. Two exceptions are: (1) all computer-related items are accounted for in the Information Technology Department’s (Operations Division) capital budget; and (2) all building, land and leasehold improvements are coordinated by the Engineering departments (Operations Division). The FY 2009 transfer is $14,650,000 a 56% decrease from FY 2008. Funding is down due to capital reserve and building improvements not being funded as heavily as in previous years. Also, due to Master Plan Enhancement Program activity, other projects are not being completed because of time and space constraints. TOTAL FULL-TIME PERSONNEL No new full positions were requested this fiscal year. This results in the total number of authorized positions to remain at 574. For additional information concerning personnel allocation, see pages 100-107. 23 GENERAL FUND SUMMARY FY 2009 EXPENDITURES BY DIVISION Salaries & Wages 40% Employee Benefits 13% GENERAL GOVERNMENT Services & Supplies 47% Salaries & Wages 47% Employee Benefits 17% OPERATIONS Services & Supplies 36% Advertising 71% Salaries & Wages 8% MARKETING Employee Benefits 3% Services & Supplies 18% 24 REVENUE GENERAL FUND SOURCES OF PROPOSED REVENUES Room Taxes 81% Use of Facilities LVCC 16% Other* 2% Other Fees and Charges 1% *Other includes gaming fees, interest and use of facilities – Cashman Center. MAJOR REVENUE SOURCES 1998 - 2007 ACTUAL 2008 - 2009 PROJECTED Millions 240 220 200 180 160 140 120 100 80 60 40 20 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Charges for Services Room Taxes Charges for Services include use of facilities revenue for both facilities and other fees and charges. 25 REVENUE REVENUE SUMMARY Total general fund revenues for FY 2009 are $277.3 million, a 1% increase. Revenue components are room taxes and gaming fees, use of facilities, other fees and charges, and interest and other. ACTUAL FY 05 178,201,006 42,360,711 2,695,646 1,513,190 224,770,553 548,245 225,318,798 ACTUAL FY 06 202,050,435 44,698,675 3,660,964 2,762,447 253,172,521 1,090,359 254,262,880 ACTUAL FY 07 215,205,408 45,504,500 5,411,820 2,996,881 269,118,609 2,539,150 271,657,759 REVENUES AND OTHER FINANCING SOURCES Room Taxes & Gaming Fees Use of Facilities Other Fees and Charges Interest and Other Total Revenues Other Financing Sources REVISED BUDGET FY 08 220,925,000 47,130,500 5,154,300 2,407,500 275,617,300 1,570,000 277,187,300 PROPOSED BUDGET % FY 09 CHANGE 225,950,000 2.3% 46,414,700 (1.5%) 2,975,700 (42.3%) 1,955,000 (18.8%) 277,295,400 0.6% 2,204,000 40.4% 279,499,400 0.8% Primary Revenue Trends Millions 250 200 150 100 50 Actual FY 05 Actual FY 06 Use of Facilities Actual FY 07 Revised Budget Proposed FY 08 Budget FY 09 Room Taxes & Gaming Fees Room tax revenue is projected to increase slightly 2.3% in anticipation of continued increases in room inventory and room occupancy rate. Approximately 4,500 hotel rooms are expected to be available next fiscal year, with the anticipated completion of the Encore at Wynn property accounting for approximately 2,000 of those rooms. Room occupancy rate is projected to remain relatively stable at 89.0%. The most volatile factor in calculating room taxes is average daily rate (ADR). The taxable ADR is budgeted to decrease 1.2% from $92.80 to $91.69. Use of facilities revenue projections are based on actual leases confirmed and signed. The rental income related to the Las Vegas Convention Center is flat, due to decrease in paid parking and parking lot rental. An excerpt of rental rates per facility is included in the statistical data section, page 114. Under other fees and charges, the 42% decrease is due to the loss of in-kind revenue from hosting such events as Society of Travel Writers in 2006, NBA All-Star Weekend in 2007 and Federation International de Basketball in 2008. A ten-year historical revenue schedule is located in the statistical data section (pages 108-109). 26 REVENUE ROOM TAXES The LVCVA’s primary source of revenues, approximately 81%, is from a tax levied on hotels, motels, and other lodging establishments throughout Clark County and the incorporated cities therein. The incorporated cities are Las Vegas, North Las Vegas, Henderson, Boulder City, and Mesquite. The rate of tax levied varies from 9% to 11% for resort hotels and 7% to 9% for non-resort hotels depending on the establishment’s jurisdiction (see page 122 for room tax rate breakdown by jurisdiction). The rate of taxes can only be increased by action of the Nevada State Legislature. In general, the tax for resort hotel room rentals will be distributed as follows, beginning July 1, 2007: 4% - 5% 1 5/8% 0% - 2% 1% 3/8% LVCVA - General Fund Clark County School District - Capital Projects City/County (collecting entities jurisdiction) - General Fund Clark County - County transportation tax State of Nevada - Promotion of tourism The LVCVA’s portion of room tax is generally 1% less on non-resort room rentals. The total tax on rooms averages approximately 9%. It is projected that the total tax on rooms collected county-wide will be approximately $420,000,000. The LVCVA retains only 46% of the total room tax collected in Clark County ($224,000,000 less $29,835,000 which is returned to the entities in the form of grants and collection allocation). Currently, 10% of the total room and gaming taxes collected for the LVCVA are returned to the county and the cities. The division of this collection allocation is set forth in an agreement between the various entities and may be designated by the individual entities for any purpose. The distribution to the county and its incorporated cities is based upon the governor-certified population figures as prepared by the state demographer. Collection allocation is discussed further on page 71. Projected County-Wide Room Tax The remaining 54.4% is split as follows: $55,000,000 to collecting jurisdictions $47,000,000 to Clark County for transportation projects LVCVA 46.2% Other Entities 53.8% $17,625,000 to the State of Nevada for the promotion of tourism $76,375,000 to the Clark County School District for capital project construction $25,935,000 to other entities from LVCVA grants and collection allocation $3,900,000 for Nevada Department of Transportation funding 27 REVENUE ROOM TAXES (continued) The table below presents a breakdown of the unrestricted room taxes received from the County and the incorporated cities. Projected growth in room taxes is 2.3% over the current estimates. ROOM TAX BY JURISDICTION ACTUAL FY 05 159,319,174 11,094,369 696,130 4,080,814 160,384 988,388 176,339,259 ACTUAL FY 06 181,759,541 11,754,615 653,373 4,704,029 164,099 1,051,170 200,086,827 13.5% ACTUAL 2004 37,388,781 1.3% 144,917 2.7% 88.6% ACTUAL 2005 38,566,717 3.2% 146,605 1.2% 89.2% ACTUAL FY 07 194,442,571 11,913,846 707,710 5,024,084 161,231 1,006,634 213,256,076 6.6% ACTUAL 2006 38,914,889 0.9% 145,948 (0.4%) 89.7% REVISED BUDGET FY 08 199,693,700 12,242,800 727,400 5,161,000 165,000 1,010,100 219,000,000 2.7% ACTUAL 2007 39,196,761 0.7% 146,372 0.3% 90.4% PROPOSED BUDGET FY 09 205,226,000 11,733,800 704,000 5,245,700 147,200 943,300 224,000,000 2.3% PROJECTED 2008 39,800,000 1.5% 155,000 5.9% Clark County Las Vegas North Las Vegas Henderson Boulder City Mesquite % Change Calendar Year Visitor Volume % Growth Hotel Rooms % Growth Occupancy Rate Source: Las Vegas Convention and Visitors Authority - Internet Marketing/Research and Finance Departments Note: Number of hotel rooms is for all of Clark County. Most visitors to Las Vegas are unaware that the fabled “Las Vegas Strip” is not within the boundaries of the incorporated city of Las Vegas. That fact accounts for the disparity in room taxes with 92% of the budgeted room taxes from Clark County. The average rate of growth in room tax revenue has been 10% over the past decade. Factors considered in projecting room taxes are: Number of available hotel rooms (see statistical data section page 119) There are approximately 148,800 hotel and motel rooms in the county from 317 properties; 69% of the properties are non-gaming in nature. Not included in the 148,800 rooms, is the 6,809 timeshare-unit inventory. During FY 2009, an estimated 6,000 additional rooms are expected to become available. Blended occupancy rates (see statistical data section page 120) It is a combined rate from the Las Vegas, Mesquite and Laughlin properties, which participate in our monthly survey. Blended average daily room rate is based upon rates from revenue generating rooms at Las Vegas, Mesquite and Laughlin hotel, motel and timeshare properties. National and international economic conditions and events. Monitor such domestic economic indicators as: consumer and business capital spending, unemployment and interest rates, the airline transportation market, crude oil prices. 28 REVENUE GAMING FEES Gaming fees are quarterly license fees imposed on operators of games based on the number of table games and slot machines in operation (see table below). These fees were originally established in 1957 and have remained unchanged. Boulder City does not allow gaming; therefore, no gaming fees. QUARTERLY FEE PER GAME OR SLOT MACHINE Casinos having 6 or more games Casinos having 2 to 5 games Casinos having fewer than 2 games Slot machines, more than 12 within one establishment Slot machines, fewer than 12 in one establishment Clark County, Cities of North Las Vegas, Henderson, and Mesquite $40.00 25.00 10.00 2.50 1.00 City of Las Vegas $12.00 7.50 3.00 0.75 0.25 Historically, gaming fees provide only 1.0% of the total revenue for the LVCVA. Gaming fees are difficult to predict because of the following factors: Constant layout reconfigurations by existing casinos. (Example: removal of gaming tables to place slot machines and vice-versa). Construction or closure of gaming establishments (includes not only hotel casino properties but also neighborhood bars, convenience stores, and other licensed gaming establishments). Gaming fees are anticipated to remain stable from FY2008 to FY2009. GAMING FEE BY JURISDICTION ACTUAL FY 05 1,409,560 114,580 130,610 152,032 54,966 1,861,748 ACTUAL FY 06 1,516,002 111,388 133,690 166,362 36,166 1,963,608 5.5% ACTUAL FY 07 1,482,601 103,509 119,151 183,599 60,472 1,949,332 (0.7%) REVISED PROPOSED BUDGET BUDGET FY 08 FY 09 1,475,000 1,483,000 125,000 104,000 100,000 119,000 175,000 184,000 50,000 60,000 1,925,000 1,950,000 (1.2%) 1.3% Clark County Las Vegas North Las Vegas Henderson Mesquite % Change 29 REVENUE USE OF FACILITIES The LVCVA owns and operates two facilities, the Las Vegas Convention Center and Cashman Center. These facilities are not intended to be self-supporting, but rather to generate visitors to the Las Vegas area. These visitors, in turn, generate room tax revenues while contributing to the overall economy. Facility operations are anticipated to generate 15.6% of total revenues. The average rate of growth has been 13% for the Convention Center and 5.7% for Cashman Center over the past decade. This is attributable to a heightened emphasis on selling the facilities, raising rental rates, and an increase in the available space at the Las Vegas Convention Center at various intervals. Use of Facilities revenues are generated through a variety of CONVENTION CENTER CASHMAN CENTER rental charges (i.e. halls, meeting USE OF % USE OF % rooms, equipment, and parking FACILITIES INCREASE FACILITIES INCREASE lots, along with concessions and contractor services’ commissions). 1998 13,415,492 1.4% 1,439,034 3.9% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008* 2009* 18,190,420 18,981,696 22,968,460 28,068,973 30,076,198 32,469,177 40,305,355 42,583,037 43,197,430 44,766,000 44,936,000 35.6% 4.3% 21.0% 22.2% 7.2% 8.0% 24.1% 5.7% 1.4% 3.6% 0.4% 1,701,391 1,961,242 2,044,647 1,712,856 2,063,847 2,158,587 2,055,355 2,115,638 2,307,070 2,364,500 1,478,700 18.2% 15.3% 4.3% (16.2%) 20.5% 4.6% (4.8%) 2.9% 9.0% 2.5% (37.5%) When the North Hall expansion came on-line, the first full rental year, FY 1999, experienced considerable growth. The revenue spikes in Use of Facilities in FY 1999, FY 2002 and FY 2005 are due to holding the world’s largest construction show, CONAGG/CON-Expo, in those years. Use of Facilities revenues are projected to be $44,936,000 for the Las Vegas Convention Center and $1,478,700 for Cashman Center. These projections are based on the following: Below are rental rates for the Las Vegas Convention Center (for excerpt, see page 114). As new clients are obtained and older clients renew agreements, these lease agreements will come under the new rates. There are still a few multi-year agreements outstanding, which are being honored at the older rates. HISTORY OF RENTAL RATES – LAS VEGAS CONVENTION CENTER 5 cents per net square foot 15 cents per net square foot 20 cents per net square foot 25 cents per net square foot 29 cents per net square foot 34 cents per net square foot 1959-1988 1988-1998 1998-2001 2002 - June 2009 Starting July 1, 2009 Starting July 1, 2012 Analysis of actual bookings, signed lease agreements and prior experience, such as cyclical shows, that hold their meetings and tradeshows every number of predetermined years, or for three to five years consecutively. 30 REVENUE OTHER FEES AND CHARGES Other Fees and Charges are comprised of a variety of revenue sources. The majority is derived from the independent services that are not directly related to the rental of facilities, but rather services that can be supplied separately. Examples of such independent services are: conventions using LVCVA registration personnel or housing services; individuals or companies requesting a photograph or video from the News Bureau’s extensive library. Also included are revenues from rental and commission agreements, reimbursements from participating properties in tradeshows, and revenue sharing arrangements. ACTUAL FY 05 2,695,646 ACTUAL FY 06 3,660,964 35.8% ACTUAL FY 07 5,411,821 47.8% REVISED PROPOSED BUDGET BUDGET FY 08 FY 09 5,154,300 2,975,700 (4.8%) (42.3%) Other Fees and Charges % Change Historically, Other Fees and Charges account for approximately 1.2% of total revenues. Revenue is anticipated to decrease due to the lack of in-kind revenue from special events and a decline in business center rental rates. INTEREST AND OTHER Interest and Other is comprised of interest earnings and discounts earned on investments and represents less than 1% of total revenues. Interest earnings are generated not only from cash balances invested in government guaranteed securities but are also earned on the room taxes which are collected and distributed by Clark County. All cash balances are invested daily. ACTUAL FY 05 1,503,055 ACTUAL FY 06 2,757,487 83.5% 4,960 (51.1%) ACTUAL FY 07 2,992,187 8.5% 4,695 (5.3%) REVISED PROPOSED BUDGET BUDGET FY 08 FY 09 2,400,000 1,950,000 (19.8%) (18.8%) 7,500 59.7% 5,000 (33.3%) Interest % Change Other % Change 10,135 It is difficult to project interest earnings because of their dependency on the size of the portfolio, fluctuations in interest rates, and availability of policy-approved securities. For the FY 2009 budget, total Interest and Other are estimated to be $1,950,000 and $5,000 respectively. OTHER FINANCING SOURCES Typically, Other Financing Sources accounts for operating transfers in from other funds (i.e. interest earnings from the capital replacement and improvement and debt service funds) and sale of fixed assets, but it can also include proceeds of sale of bonds. For FY 2009, interest earnings from other funds are estimated to be $2,189,000 and proceeds from the sale of fixed assets are anticipated to be $15,000. 31 GENERAL GOVERNMENT The general government function includes the Board of Directors along with the Executive, Human Resources, and Public Affairs departments. The Executive Department is responsible for the general administration of the LVCVA and is not only comprised of the offices of the President, Senior Vice Presidents, but also Internal Audit, Legal Counsel and Board-related activities. BOARD OF DIRECTORS 14 members LEGAL COUNSEL FTE 2 EXECUTIVE FTE 15 HUMAN RESOURCES FTE 10 PUBLIC AFFAIRS FTE 18 32 GENERAL GOVERNMENT FY 2009 EXPENDITURES Executive 48% Public Affairs 23% Human Resources 20% Board of Directors 9% * Executive includes the offices of the President, Senior Vice Presidents, Legal, and Internal Audit. COMPARISON OF ACTUAL TO BUDGET FY 05 - FY 06 - FY 07 - FY 08 - FY 09 Millions 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 Salaries Actual FY 05 Revised FY 08 Benefits Actual FY 06 Proposed FY 09 Services & Supplies Actual FY 07 33 GENERAL GOVERNMENT BUDGET ANALYSIS No new positions have been requested in FY 2009. Capital item requests (i.e. furniture and equipment) of $53,450 have been made. These requests are accounted for in the capital improvement and replacement fund (see page 80). Computer-related items (i.e. computers, printers, software, scanners) are accounted for in Information Technology’s budget (Operations Division). These requests total $25,000. REVISED BUDGET FY 08 3,834,800 1,212,300 4,506,780 9,553,880 35,200 45 PROPOSED BUDGET % FY 09 CHANGE 4,193,600 9.4% 1,388,200 14.5% 4,498,400 (0.2%) 10,080,200 5.5% 53,450 51.8% 45 0.0% ACTUAL FY 05 2,615,061 804,596 2,094,892 5,514,549 7,945 34 ACTUAL FY 06 2,748,635 884,078 3,796,918 7,429,631 63,354 37 ACTUAL FY 07 3,214,096 1,000,423 3,584,509 7,799,028 38,957 41 EXPENDITURES BY CATEGORY Salaries & Wages Employee Benefits Services & Supplies Capital Outlay Full-time Personnel The Salaries and Benefits sections show a large increase. This is due to two new positions created during FY 2008 being funded for the full year of FY 2009, as well as two positions being transferred from the Marketing Division during FY 2008. Due to lower than anticipated increase in room tax revenue, services and supplies expenditures are being budgeted conservatively in order to maintain current service levels. In FY 2006, the Public Relations department was transferred from the Marketing Division and renamed Public Affairs. FY 2005 totals include Public Affairs for comparative purposes. 34 GENERAL GOVERNMENT BOARD OF DIRECTORS The general government function includes the Board of Directors along with the Executive, Human Resources, and Public Affairs departments. The Board of Directors is comprised of 14 members representing Clark County, the incorporated cities within, and various segments of industry. The Board’s primary function is to formulate policies to guide the LVCVA in fulfilling its mission to attract visitors by promoting Las Vegas as the world's most desirable destination for leisure and business travel. For additional information regarding the Board of Directors, such as members and terms of office, see page 3. EXECUTIVE The Executive Department is responsible for the general administration of the LVCVA and is not only comprised of the offices of the President, Senior Vice Presidents and Board-related activities, but also Internal Audit and Legal Counsel. Executive management meets daily with employees, hotel CEOs, community leaders, and convention association presidents to discuss any potential problems, as well as changes in the trends of the travel and convention industries. Internal Audit is responsible for determining whether organizational units are performing their planning, accounting, custodial or control activities in compliance with management instructions, applicable policies and procedures and in a manner consistent with both LVCVA objectives and high standards of administrative practice. Legal Counsel meets with other divisions to ensure compliance with local government, state and federal laws, assists in preparation of proposed legislation, and conducts lobbying activities, acts as general counsel to the LVCVA Board of Directors, and drafts and approves legal documents (i.e. contracts, bid proposals). GOALS Partner with the resort industry to increase visitor volume and room nights while maintaining an effective average daily rate. (Executive Management) Implement the fourth-year of the of the five-year vision plan. (Executive Management) Coordinate all elements of marketing and operations to brand the destination for increased exposure and visitor volume. (Executive Management) 35 GENERAL GOVERNMENT PUBLIC AFFAIRS Public Affairs is responsible for a broad spectrum of communication activities with a variety of stakeholders. The primary goal of the department is to generate positive news coverage of the Las Vegas destination. The News Bureau operates as part of the department and lends support by providing video and photography of current and historical events. The Public Affairs department is also responsible for educating the public about the benefits the LVCVA provides the community, both directly and indirectly. This department also develops communication programs designed to keep employees informed of LVCVA activities. The Public Affairs department continually implements communication plans and strategies to promote leisure and business travel to the destination. GOALS Develop new public relations opportunities that increase awareness of the destination in key domestic markets. Increase the number of public relations placements in the three major international markets: United Kingdom, Canada and Mexico. Increase international distribution of News Bureau photos by developing relationships with wire services overseas and through increased communication with contracted International Offices. Develop and implement a strategic community awareness campaign highlighting the 50-year anniversary of the Las Vegas Convention Center. Launch a password accessible online photo gallery. Develop and implement a communication strategy highlighting the enhancement program of the Las Vegas Convention Center. ACTIVITY MEASURES Media inquiries coordinated News releases generated Online Press kits page views News Bureau photos distributed/distributed via wire Community displays Speaking Engagements Actual FY 07 1,000 60 n/a 20,000/60 4 121 Est. FY 08 1,100 77 28,000 26,000/75 8 180 Est. FY 09 1,220 85 30,800 28,000/85 10 200 PRIOR YEAR ACHIEVEMENTS Developed News Bureau photo exhibits in conjunction with local libraries, museums and organizations. Organized and integrated a National Tourism Week public relations campaign to generate local awareness of the benefits of tourism and earn press coverage for Las Vegas in key markets. Created a successful PowWow media program for more than 200 international travel press. Implemented a public relations campaign for LVCVA's culinary event ‘Vegas Uncork'd’. Created and standardized a formal speakers bureau for community relations highlighting the benefits of the tourism industry. 36 GENERAL GOVERNMENT PUBLIC AFFAIRS (continued) PRIOR YEAR ACHIEVEMENTS (continued) Developed and implemented a community awareness campaign recognizing the 25th anniversary of Cashman Center. Formalized and standardized process and evaluation for international familiarization media tours. Created and produced a weekly e-newsletter on local and national economic indicators as well as tourism industry trends. E-newsletter is distributed to resort stakeholders throughout the destination. HUMAN RESOURCES Human Resources is responsible for development, promotion and implementation of Authority–wide policies and procedures, along with development of various employee and service-oriented programs. This department provides advice, guidance and support to Authority-wide initiatives, issues, priorities, and goals, and is not limited to employee services, cultural diversity, and health and wellness. Services provided include: recruitment, staffing, and employment; learning and professional development; affirmative action; employee/labor relations, collective bargaining negotiation, contract interpretation; compensation program administration, including evaluation and classification; administration of salary and benefit programs; the administration of employment terms and conditions and employee health, wellness and morale programs. GOALS Expand the Authority Academy, the LVCVA’s in-house learning and development program, by offering on-going professional development opportunities to all LVCVA employees. Enhance employee morale with recognition programs, such as the new Brand Vegas Champion, World of Thanks and Service Award programs, and the Customer Service Excellence (CSE) program managed in cooperation with the Las Vegas Chamber of Commerce. Coordinate employee appreciation events such as baseball games, football games, parades, and Corporate Challenge support. (Corporate Challenge is patterned after the Olympics and is a healthy way for employees to stay active in the community while adding a social component to those who want to sit on the sidelines and cheer on their colleagues. It enables teamwork, company pride, corporate wellness and unity). Improve communication and cooperation with the Service Employees International Union (SEIU) by continuing monthly meetings with the Employee Management Relations Committee, comprised of union stewards and members of management. Enhance the LVCVA’s image by becoming a presence in the Las Vegas community through participation in community activities, such as Bring Your Child to Work Day, LV Marathon, and Santa Run. 37 GENERAL GOVERNMENT HUMAN RESOURCES (continued) ACTIVITY MEASURES Authority Academy class attendance “Coffee with the President” participants Employees processed (promotions, transfers, hiring & separations) Applicants processed Employees participating in Corporate Challenge Community activity participation (number of events) Town Hall Attendees PRIOR YEAR ACHIEVEMENTS • • • • Actual FY 07 952 157 406 1912 165 7 n/a Est. FY 08 800 120 450 1900 180 12 500 Est. FY 09 1600 150 450 1700 190 12 500 Received the Southern Nevada Human Resources Association’s Best Places to Work (1st Place Government) award. Designed and facilitated the LVCVA Authority Academy Essential Program that consisted of Interviewing Techniques, Coaching and Mentoring, and Conflict Management workshops. Recognized 82 employees at the Authority Academy Graduation honoring their completion of the Foundation and\or Essentials Program. Continued participation in Corporate Challenge through a steering committee of coaches and event coordinators, the Corporate Challenge Extravaganza Event, the Corporate Challenge KickOff Barbeque, and the Corporate Challenge Celebration. Sponsored 10 health and fitness fairs and financial seminars. Published the Center Focus, a weekly Authority-wide employee newsletter, and maintained the “Head’s Up!” postings for immediate communication updates. Introduced the new Only Vegas…Because of Us quarterly professional employee newsletter publication. Implemented an online company store for employees to purchase LVCVA logo items. Held periodic Town Halls to enhance property-wide communication. Executed an enculturation program to showcase the different disciplines it takes to create the Las Vegas brand experience, to demonstrate how “Living the Brand” looks, and to answer questions about how the organization functions, creating professional appreciation and staff networks in conjunction with the i.d.e.a.s. team. Launched new employee recognition program created by employees: Brand Vegas Champions. Enacted voluntary long term care insurance, and pet insurance discounts • • • • • • • 38 MARKETING The Marketing Division encompasses two main functions responsible for increasing leisure travel visitors and convention and meetings attendance. These functions are Marketing and Advertising, and Sales and Services. MARKETING MARKETING and ADVERTISING SALES and SERVICES ADVERTISING FTE 2 INTERNATIONAL SALES FTE 8 CONVENTION CENTER SALES FTE 12 DESTINATION SERVICES FTE 10 LEISURE SALES FTE 15 INTERNET MKTG & RESEARCH FTE 7 INTERNATIONAL OFFICES (contracted) CONVENTION SERVICES FTE 16 REGISTRATION SERVICES FTE 4 DIVERSITY MARKETING FTE 4 SPORTS MARKETING FTE 4 CONVENTION SALES FTE 28 CALL CENTER FTE 24 VISITOR INFORMATION FTE 18 39 MARKETING FY 2009 EXPENDITURES Sales & Services 25% Marketing & Advertising 75% COMPARISON OF ACTUAL TO BUDGET FY 05 - FY 06 - FY 07 - FY 08 - FY 09 Millions 100 90 80 70 60 50 40 30 20 10 0 Salaries Benefits Actual FY 05 Revised FY 08 Services & Supplies Actual FY 07 Advertising Actual FY 06 Proposed FY 09 40 MARKETING BUDGET ANALYSIS No positions have been requested for fiscal year 2009. The increase in Salaries and Benefits is due to new positions created during FY 2008 that are being funded for a full year in FY 2009. Advertising is budgeted at a conservative 1.2% increase. Historically, Advertising is budgeted with a minimal increase, and then the budget is augmented when excess funds are available. Augmentation is an increase in appropriations during a fiscal year. Due to lower than anticipated increase in room tax revenue, services and supplies expenditures are being budgeted conservatively and deferring some market development related initiatives until the next fiscal year. ACTUAL FY 05 8,568,573 2,588,727 17,615,150 78,211,815 106,984,265 52,474 145 ACTUAL FY 06 9,276,044 2,728,114 19,986,680 82,923,473 114,914,311 49,986 146 ACTUAL FY 07 9,695,994 2,946,690 20,436,675 84,713,300 117,792,659 188,252 150 EXPENDITURES BY CATEGORY Salaries & Wages Employee Benefits Services & Supplies Advertising Capital Outlay Full-time Personnel REVISED BUDGET FY 08 10,281,800 3,265,000 22,552,634 87,559,000 123,658,434 24,825 152 PROPOSED BUDGET % FY 09 CHANGE 10,823,400 5.3% 3,464,000 6.1% 21,484,100 (4.7%) 88,626,000 1.2% 124,397,500 0.6% 7,750 (68.8%) 152 0.0% The Marketing Division’s budget includes $7,750 in capital item requests (i.e. office and visitor information center furniture, and equipment), which is accounted for in the capital improvement and replacement fund (see page 80). Computer-related items (i.e. computers, printers, software, scanners) are accounted for in Information Technology’s budget (Operations Division). These requests total $10,700. 41 MARKETING The Marketing Division encompasses two functions responsible for increasing leisure travel visitors and convention and meetings attendance. These functions are as follows: Marketing and Advertising Sales and Services The Marketing Division has developed the following goals: Market the destination by utilizing advertising, sales and special events, supported by research, internet programs and marketing/convention services, toward the goal of attracting visitors by promoting Las Vegas as the world's most desirable destination for leisure and business travel. Continue to serve Las Vegas’ traditional market segments while increasing emphasis on target markets such as Canada and Mexico, trade show and convention, domestic Hispanic, African American and Asian segments, contemporary lifestyle and the gay and lesbian markets. 42 MARKETING MARKETING and ADVERTISING The Marketing functions: Advertising, Sports Marketing, and Internet Marketing and Research implement programs that focus on understanding and reaching new and existing markets while supporting the functions of Sales and Services. ADVERTISING The Advertising Department is charged with promoting Las Vegas and Southern Nevada through a variety of mediums to the leisure and business traveler. The LVCVA continues to promote Las Vegas as the premier meeting convention and trade show destination through print and online campaigns. The sixth series of “Vegas Stories” (What Happens Here, Stays Here) campaign will continue in FY 2009. New markets and niche segments will receive additional attention. International markets such as Canada, Mexico and the United Kingdom, will focus consumer advertising efforts using print, television and radio. SPORTS MARKETING Las Vegas has become one of the most recognizable brands in the U.S. and arguably the most desirable destination in the world. The city is now positioned to attract some of the world’s most exciting events. Las Vegas has played host to events crossing all segments of the sports and entertainment landscape, including NASCAR and NHRA racing, the National Finals Rodeo and the NBA All-Star Game. In addition, major artists representing stage, screen and music continue to make Las Vegas a must stop on their annual tours. The outlying areas of Mesquite, Primm and Laughlin also continue to host events such as Viva Laughlin, Primm 300 Off-Road Race, and the Mesquite Long Drive competition. These events continue to draw firsttime visitors to these locations. Working with Las Vegas Events (LVE), the LVCVA’s positioning of Las Vegas as the event and entertainment capital of the world, continues to enhance the brand and drive occupancies during traditionally slower periods of the year. INTERNET MARKETING & RESEARCH The Internet Marketing and Research department oversees a broad range of functions that, while diverse in scope, share the common focus on understanding and exploiting information and technology to develop and support the LVCVA’s overall marketing strategy. The department’s wide range of research projects and programs tracks the dynamics of Las Vegas and Southern Nevada, as well as the nationwide competitive gaming and tourism industries. Among the research programs administered by the department are monthly executive summaries of tourism and convention indicators, annual visitor profile studies that track visitor demographics and behaviors, quarterly marketing bulletins, and a variety of programs to monitor local, national and global travel trends. The Internet Marketing function includes devising processes and procedures to ensure relevant and timely web content, responding to web site-related inquiries from the general public, reviewing the performance of the web sites, and acting as the liaison with the LVCVA’s advertising agency to incorporate appropriate content into branding and promotional campaigns on the LVCVA’s destination marketing web sites: VisitLasVegas.com, LVCVA.com, VisitLaughlin.com, VisitMesquite.com and VisitBoulderCity.com. 43 MARKETING MARKETING and ADVERTISING (continued) GOALS Advertising Continue Las Vegas brand and content integration (product placement) program that incorporates the Las Vegas brand into popular television programming. Continue to build brand presence in international markets – particularly Canada, Mexico, and the United Kingdom. Continue promotions to support the product and “What Happens Here, Stays Here” campaign. Develop new meetings/conventions campaign. Develop and produce “What Happens Here, Stays Here” brand campaign for the United Kingdom. Launch a Laughlin brand campaign. Develop strategic partnerships and sponsorships to support vertical marketing initiatives, including: sports, music, dining, entertainment and fashion. Sports Marketing Identify a major entertainment network award program and develop a comprehensive sales and marketing plan to attract it to Las Vegas Work closely with R&R Partners to develop a comprehensive information package outlining all major facilities and their capacities as they relate to made-for-TV programming. Continue to expand LVCVA/NBA Europe Live partners particularly in the United Kingdom and during the 2008 Olympics. Facilitate at least one familiarization trip each to Primm and Mesquite for out of market meeting planners/association executives. Conduct one luncheon presentation each for Primm and Mesquite to Las Vegas based meeting planners/association executives. Internet Marketing and Research Implement new survey software application to improve timeliness of data collection for online survey programs. Support LVCVA “green” efforts by replacing hard copies of core research publication with electronic distribution. Develop and launch LGBT section within VisitLasVegas.com to support Diversity Marketing efforts. Devise new program to consolidate content management for all LVCVA international web sites. ACTIVITY MEASURES Actual FY 07 Sports Marketing Event Leads/Bookings Leads Generated - Mesquite Hospitality programs held Number of TV/radio events Internet Marketing and Research Statistical Reports and Publications produced Web site visits-combined LVCVA Sites– in millions Web site page views–combined LVCVA Sites– in millions Web site referrals-combined LVCVA sites – in millions 44 Est. FY 08 50/65 60 30 23 25 7.4 77 6.7 Est. FY 09 55/65 70 32 23 26 7.8 80.9 7.1 37/102 50 30 20 26 7 65.2 4.6 MARKETING MARKETING and ADVERTISING (continued) PRIOR YEAR ACHIEVEMENTS Advertising Maintained status as the number two brand name in the country according to an independent national study. Developed mini-campaign to compliment WHHSH (i.e. ‘What Happens Here, Stays Here’) – “Free Will”. Launched first major ‘WHHSH’ brand campaign in Mexico. Launched new brand campaign for Mesquite – “Escape Momentarily”. Launched music and sport initiatives with the following key programs: o o o o o Rolling Stone Magazine program - “Tickets” Madison Square Garden (Year 2) – “Play Louder” Academy of Country Music Awards sponsorship ESPN cross-platform strategic partnership Sports Illustrated program – “Overtime Guaranteed” Entered into a strategic partnership with Sony Pictures for the movie “21”. Received 4 Las Vegas Advertising Federation ADDY Awards – Fortune Teller, Free Will, Lipstick, Tickets and Exhausted (PBR). Sports Marketing Managed the Las Vegas elements of the Federation International de Basketball Americas (FIBA) Olympic qualifiers and NBA Europe Live 2007 mission. Provided exposure of the Mesquite area to international receptive operators via three major industry trade shows. Conducted three familiarization tours of Mesquite for motor coach operators, meeting planners, and international receptive operators. Conducted a three-day dial-a-thon contacting nearly 700 small meeting planners and mailed Mesquite information to over 500 of them. Internet Marketing and Research Developed and implemented the Visitor Experience Monitor program. Participated in a pilot study group to devise new timely international tourism metrics based on credit card data. Launched ‘My Vegas’, a social networking web feature and RSVP (Really Simple Vegas Planner),a trip planning and itinerary tool. Developed and launched promotional micro sites to support “Free Will” and “Your Vegas is Showing” campaigns. 45 MARKETING SALES and SERVICES The Marketing functions: Leisure Sales, Diversity Sales, Destination Services, Convention Sales and Services, and International Sales play an integral role in securing new and maintaining existing business visitors for the destination. These teams are strategic as well as targeted. They continue to position the Las Vegas brand to remain “top of mind” with industry professionals and competitive within the international and domestic leisure, meetings and trade show industries. The distinct yet equally important disciplines support the LVCVA’s mission to promote Las Vegas as the leading destination for business and leisure travel. LEISURE and DIVERSITY SALES – DESTINATION SERVICES The LVCVA’s Sales Teams dedicated to Leisure Sales, Diversity Sales and Destination Services promote Las Vegas to facilitators of leisure and business travel. Utilizing both traditional and new creative to stimulate booking of travel to Las Vegas, these teams primary responsibilities are to maintain existing business and create demand for new business for the destination. The Leisure Sales team’s main objective is to develop creative and targeted programs designed to motivate domestic and international purchase of travel packages to Las Vegas through wholesalers, consortiums, airlines, tour operators, online travel agencies and retail travel agencies. Additionally, the leisure sales staff continues to develop educational programs targeted to sellers of domestic and international travel for the purpose of keeping them informed on the ever-changing destination’s amenities and keeping Las Vegas top of mind for sales opportunities. Diversity Sales aggressively pursues leisure and convention business from the African American, Hispanic American, Asian American and Lesbian, Gay, Bisexual and Transgender (LGBT) markets. These lucrative markets represent a full 30% of the total visitor volume to Las Vegas and strategies and tactics that mirror the LVCVA’s overall marketing programs are in place to command Las Vegas’ share of these segments. Destination Services staff focus on the logistics of bringing visitors to Las Vegas and Clark County and ensuring that their experiences are pleasant and memorable. Employees in Marketing Services, Call Center Operations, Registration Services, and Visitor Information Centers deliver the Las Vegas brand by assisting with room reservations, providing convention staffing assistance, and offering a myriad of information about Southern Nevada to more than one million customers while giving administrative support to the varied sales and marketing activities. GOALS Develop at least two booking incentive campaigns with Las Vegas’ top producing wholesale companies. These campaigns will be designed to motivate travel agents to book vacation packages to Las Vegas during need periods. Credit card companies will be solicited to add valued components to enhance our marketing efforts. (Leisure Sales) Enhance the Vegas Certified travel agency education program by fully automating the process and by adding new benefits such as complimentary show tickets, travel agent preferred room rates and access to additional commissionable selling opportunities. (Leisure Sales) Parnter with various wholesale companies to produce at least 20 product launch events throughout the country. These events will provide a selling platform for Las Vegas hotel partners and at each product launch we will have a stand-alone Las Vegas seminar room, trade show area and provide a destination update. (Leisure Sales) Identify untapped business opportunities for the destination and educate meeting planners on doing business in Las Vegas through a series of educational events. Joint client outreach programs will be created to enhance traditional sales efforts and tap into the rich networks of our diversity marketing partners. Special events and marketing opportunities are created to tap into both leisure and business opportunities throughout the country as well as with our traditional travel partners and program. (Diversity Sales) 46 MARKETING SALES and SERVICES (continued) GOALS (continued) Implement the Digital Marketing Center to enable quicker, more timely communications with our hotel partners and to provide an electronic system for invitations with a response mechanism for sales events. (Destination Services) Establish a local Passkey Users Group to develop best practices to more completely integrate LVCVA housing service support to the hotel partners. (Call Center) Increase the pool of Registration Ambassadors by 8% to meet the increasing demand for convention services. (Registration) In conjunction with the City of Las Vegas, open a downtown visitor information center on Fremont Street. (Vistor Information Centers) ACTIVITY MEASURES LVCVA networking events produced (Leisure Sales) Industry specific fams (Leisure Sales) Vegas Certified Travel Agents (Leisure Sales) Leads Processed (Marketing Services) MINT (DMAI’s Marketing Information Network Tool) records added (Marketing Services) Meetings and conventions supported – (Registration Services) Total calls managed – (Call Center) Total visitor volume – (Visitor Information Centers) New diversity initiatives (Diversity Sales) PRIOR YEAR ACHIEVEMENTS Actual FY 07 41 25 5,497 3,626 1,015 316 224,778 414,241 42 Est. FY 08 44 28 7,500 3,516 1,312 347 200,130 348,981 40 Est. FY 09 46 30 8,000 3,700 1,500 360 180,117 425,000 47 Conducted various travel agent booking incentive programs that resulted in incremental room nights sold for the destination. Most noteworthy are the Southwest Vacations Seen and Be Seen BMW SUV giveaway that was awarded to an agency in Texas. The US Airways Vacations Scavenger Hunt resulting in one agency winning $25,000 worth of air travel and the Continental Airlines Million Mile promotion. (Leisure Sales) Participated in the 9th Annual Luxury Travel Expo, with over 10,000 attendees, the largest nationwide travel agent show in the United States. (Leisure Sales) Booked the National Tour Association annual conference that will bring 4,000 tour operators, media and suppliers to Las Vegas in 2011. (Leisure Sales) Booked and/or is in current negotiations with the nation’s largest emerging market conferences, many of which have never met in Las Vegas. These outreach efforts have served to position Las Vegas as a destination of choice for the minority and gay and lesbian traveler, with national statistics demonstrating that Las Vegas ranks #1 or #2 among these groups. (Diversity Sales) Implemented a new database management system providing a greater level of support of the sales, research, public affairs and executive team functions. (Marketing Services) Increased reservations processed through Laughlin Online service by 6%. (Call Center) Scheduled to open a new VIC in Primm re-establishing the LVCVA’s presence at the Nevada/California border, assisting the traveling public with information and reservations for the area. (Visitor Information Centers) 47 MARKETING SALES and SERVICES (continued) CONVENTION SALES and SERVICES The Convention Sales, Convention Center Sales and Convention Services teams are directly aligned to provide the users of the Cashman Center and the Las Vegas Convention Center a superior customer experience. Convention Sales teams promote Las Vegas to meeting planners and associations. This is done by creating an environment of trust, care, and communication during all aspects of the trade show/event sales and services cycle. The Las Vegas Convention and Visitors Authority has established itself as the world’s leading trade show/event experience provider. Convention Center Sales brings the art of sales to a new level. Even when looking at a full calendar they consistently deliver new business to the Las Vegas market place. Through the use of six vertical markets and a keen eye toward maximizing the use of convention space, this team delivers a diversified base of business for all of Las Vegas to enjoy. The Convention Services team at the Las Vegas Convention Center and at Cashman Center continues to provide the industries bench mark for service standards. Superior customer care leads to years of repeat business. Committed convention service managers quickly adapt to all challenges that the world’s leading convention center presents while relishing the fact that our clients are extremely satisfied at the end of their event. Convention Sales executives aggressively solicit association, corporate and incentive business for the Las Vegas hotel community. They secure business through a strategic account management system that targets vertical markets such as pharmaceutical, insurance & financial services, automotive, union industries, food & beverage organizations, medical, association management organizations, incentive houses and technology companies. GOALS Execute hard-leases for all business at the LVCC through 2011 allowing the LVCC enhancement program to conduct construction activities. (Convention Center Sales) Deploy formalized attendance promotion programs to grow visitation to future tradeshow events through the use of “trade show trade missions”, direct mail, and press events utilizing the magic of the Las Vegas brand. (Convention Center Sales) Engage clients in timely updates and advocacy programs with one-on-one communication during the duration of the Master Plan Enhancement Program. (Convention Center Sales) Work with the Clark County Fire and Building Department inspectors to ensure that all clients are aware and compliant with policies. (Convention Services) Revise the leasing and insurance process to assist the client with compliance of insurance and the timely execution of building leases. (Convention Services) Increase the number of lead bulletins generated for the Las Vegas hotel community and enhance relationships with resort industry partners. (Convention Sales) Increase market penetration in targeted vertical markets and integrate a new business marketing campaign. (Convention Sales) Implement new marketing programs designed to generate business during mid-week and need periods. (Convention Sales) Enhance electronic marketing efforts. (Convention Sales) 48 MARKETING SALES and SERVICES (continued) ACTIVITY MEASURES Actual FY 07 Convention Center Sales International press events/promotions Convention industry events hosted Domestic press events/promotions Attendance promotion campaigns conducted Client Solicitation Events Attended Convention Services Space blocks processed (LVCC/Cashman) New leases generated (LVCC/Cashman) Revised leases processed (LVCC/Cashman) Booking orders processed (LVCC/Cashman) Conventions/events (LVCC/Cashman) Convention Sales LVCVA networking events produced Travel industry conventions hosted Industry events attended Industry trade shows exhibited Leads/bookings generated Est. FY 08 4 1 4 15 11 450/400 160/325 300/135 750/300 85/260 85 3 225 30 3,100/2,80 0 Est. FY 09 3 0 5 15 20 500/425 165/350 325/140 750/100 90/66 90 3 225 30 3,200/2,875 4 1 4 6 10 318/338 156/323 280/132 726/361 96/257 83 2 219 28 3,158/2,812 PRIOR YEAR ACHIEVEMENTS Formalized and deployed an attendance promotion program across a wide range of Las Vegas trade show clients. (Convention Center Sales) Created long term leasing metrics to identify trade show business qualified to receive a long term lease at the LVCC, thus protecting the revenue stream for years to come. (Convention Center Sales) Communicated to all LVCC building clients on the Master Plan Enhancement Project and how it impacts their shows and provided information for review and discussion. (Convention Services) Coordinated 96 conventions and tradeshows at the LVCC and 257 public events, tradeshows, and meetings at Cashman Center. Survey results demonstrated a superior level of customer satisfaction. (Convention Services) Played an active role in numerous MPEP subcommittees, assisting in the overall design and functionality of the project. (Convention Services) Expanded the Brand through programs designed to increase business travel and increase efficiency in sales operations with new policies and procedures. (Convention Sales) Developed and deployed a strategic account management program increasing penetration in targeted markets. (Convention Sales) Aligned regional offices efforts into the strategic account program. (Convention Sales) Enhanced sales efforts through the integration of ELVIS - Essential Las Vegas Information System. (Convention Sales) Increased brand awareness in the electronic community through participation in a series of electronic media opportunities such as webinars and virtual tradeshows. (Convention Sales) 49 MARKETING SALES and SERVICES (continued) INTERNATIONAL SALES The International Brand Strategy and International Sales department were created to develop and implement a consistent and coherent international brand strategy for Las Vegas. The key strategic elements of that strategy include: • • • • • Expanding the global reach of the Las Vegas brand Achieving a mix of a regionalization strategy with a country-specific strategy throughout the world Implement regionalization brand strategy across the European Union, Australia/New Zealand/Southeast Asia, South America and Russia/Eastern Europe. Enhance our country-specific strategy in the major markets of Canada, Mexico and the United Kingdom, and the primary markets of Japan and South Korea. Establish the Las Vegas brand in the emerging markets of China, Russia, India and Brazil. GOALS Establish measurable sales programs with key performance indicators reported by our international offices and managed by our International Sales Department. Prioritize budget dollars across regions and in countries based on realistic projections of increased visitation to Las Vegas. Reallocate budget dollars both in preparation for new global opportunities (proactive), and in response to the changing global dynamics impacting tourism (re-active). Partner with McCarran Airport to align projected visitor volumes from around the world to airport and international airline lift capacity. As International Brand Strategy did not exist in prior years there are no prior year achievements to list at this time, except the establishment of the department itself. Performance measures are being transformed to future measures of productivity. 50 OPERATIONS The Operations Division has the overall responsibility for the operation, maintenance and security of the Las Vegas Convention Center and Cashman Center. Additional activities are Finance, Purchasing, Information Technology, Project Development, and Customer Experience. OPERATIONS FACILITIES SECURITY FTE 39 CLIENT SERVICES FTE 126 CUSTOMER EXPERIENCE FTE 2 ENGINEERING FTE 111 TRAFFIC FTE 17 PHYSICAL SECURITY FTE 17 FINANCE FTE 22 INFORMATION TECHNOLOGY FTE 15 PURCHASING PROJECT DEVELOPMENT FTE 7 PURCHASING FTE 11 MATERIALS MANAGEMENT FTE 10 51 OPERATIONS FY 2009 EXPENDITURES Client Services 20% Project Development 6% Other* 9% Engineering 43% Security 14% Finance 8% *Other includes ITD, Purchasing, and Customer Experience as those departments, when taken separately, account for less the 5% of the expenditures. COMPARISON OF ACTUAL TO BUDGET FY 05 - FY 06 - FY 07 - FY 08 - FY 09 25 20 15 10 5 0 Salaries Actual FY 05 Revised FY 08 Benefits Actual FY 06 Proposed FY 09 Services & Supplies Actual FY 07 Millions 52 OPERATIONS BUDGET ANALYSIS No new budget positions have been requested for FY 2009. Capital item requests (i.e. furniture and equipment) totaled $1,119,000, which is accounted for in the capital improvement and replacement fund (see page 80-82). All computer-related budget requests (i.e. computers, printers, software, scanners, and network servers) are accounted for in Information Technology’s capital budget. Operation’s requests total $269,400; other divisions’ requests total $35,700. REVISED BUDGET FY 08 20,977,400 7,573,300 16,757,071 45,307,771 2,280,640 377 PROPOSED BUDGET % FY 09 CHANGE 22,896,100 9.1% 8,221,800 8.6% 17,622,300 5.2% 48,740,200 7.6% 1,119,000 (50.9%) 377 0.0% ACTUAL FY 05 17,435,987 5,791,620 11,596,602 34,824,209 2,176,395 324 ACTUAL FY 06 18,115,761 6,242,792 12,531,543 36,890,096 1,962,742 330 ACTUAL FY 07 20,183,998 6,897,932 14,187,700 41,269,630 2,536,075 346 EXPENDITURES BY CATEGORY Salaries & Wages Employee Benefits Services & Supplies Capital Outlay Full-time Personnel Of the services and supplies budget, approximately $8.8 million is devoted to utilities (50%), $1.7 (9.7%) million is for repair and maintenance and an additional $1.8 million for insurance of the buildings and equipment. Salaries and Benefits are increasing due to the filling of new positions in FY 2008 which will be funded for the entire fiscal year 2009. Due to lower than anticipated increase in room tax revenue, the remaining balance of the services and supplies budget is up slightly from the previous year due to Master Plan Enhancement Program support. 53 OPERATIONS The Operations Division has the overall responsibility for the operation, maintenance and security of the Las Vegas Convention Center and Cashman Center. Additional activities are Customer Experience, Finance, Materials Management, Information Technology and Project Development. To fulfill the LVCVA mission, the following goals have been created: Raise the division’s customer service excellence to new levels through the introduction of new service initiatives enhancing our visitors’ destination experience. Introduce initiatives to promote and implement “Living the Brand” through employee development, partner education and stakeholder outreach to ensure a consistent understanding and delivery of the LVCVA brand promise. Continue to implement processes that enhance our “Housing the Brand” experience including Master Plan Enhancement Program communication to event managers and attendees, capital projects and implementation of a comprehensive preventative maintenance program. Work collaboratively with other LVCVA Divisions to support their mission critical objectives and to develop shared goals to improve the overall customer experience. Fully develop the LVCVA’s commitment to sustainability including the establishment of green operating procedures, increased energy measurement & efficiencies and staff education in LEED (Leadership in Energy & Environmental Design) certification. Establish a platform of key performance measures to be used to measure the division’s overall success at year end. The Operations Division received the following recognition in FY 2008: Government Finance Officers Association – Distinguished Budget Presentation Award - In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, an operations guide, a financial plan and a communications device. This is the nineteenth consecutive receipt of this award. Government Finance Officers Association – Certificate of Achievement for Excellence in Financial Reporting – This prestigious national award recognizes conformance with the highest standards for the preparation of state and local government financial reports. This is the twenty-fifth consecutive receipt of this award. National Purchasing Institute – Achievement of Excellence in Public Procurement Award – This award recognizes achievement of organizational excellence in public procurement by demonstrating excellence in innovation, professionalism, productivity and leadership attributes. This is the thirteenth consecutive receipt of this award. 54 OPERATIONS FACILITIES The Vice President of Facilities has direct responsibility for the operation and maintenance of the Las Vegas Convention Center and Cashman Center. This function oversees the Customer Experience, Client Services, and Engineering sections. CUSTOMER EXPERIENCE The Customer Experience Department was established in 2006 to head-up the LVCVA’s efforts to address the specific needs of our attendee and exhibitor customer base. Globally, Customer Experience is responsible for developing programs that deliver the LVCVA’s brand promise for both the Las Vegas Convention Center and Cashman Center. The brand promise is delivered to our attendees, exhibitors and show managers when they arrive on site for their event. Examples of brand promise delivery are clean facilities, reasonably priced food and beverage options, availability of appropriate business services, availability of up-to-date technology, ease of transportation to and from the facility, and helpful employees and stakeholders in the facility. Key functions include being a liaison among various departments in the Operations and Marketing divisions and to establish campus wide programs and initiatives that will improve our customers’ experience. In particular, direct responsibilities include delivery of our facility partners’ (i.e. ARAMARK, Smart City Networks, and FedEx Kinko’s) operational performance and quality of services. Additionally, the department reviews services delivered by our facility stakeholders such as general service contractors, exhibitor approved contractors, taxi and transportation companies, etc. Relative to the Master Plan Enhancement Program, Customer Experience’s role will focus on ensuring that physical improvements in the Las Vegas Convention Center (LVCC) are reflective of the key services the attendees and exhibitors need for a successful event. This includes those services and products currently offered at the LVCC and those that could be offered in the future enhanced facility. GOALS Improve results of the Customer Experience survey by 5-10% for internal partners, based on year-toyear comparisons. Formulate a “Brand Promise” presentation and deliver presentation to key stakeholders such as internal partners, contractors, union members, and hotels. Coordinate the inclusion of specific programs, features, or physical attributes into the planning process for the LVCC Master Plan Enhancement that supports a purposeful Customer Experience mindset. ACTIVITY MEASURES Signage and wayfinding improvements completed Customer Experience Survey results (Overall Satisfaction Ratings from 1-5) Building partner goals to support the LVCVA Expansion of Bags to Go/Digital Departure Information locations Community/partner outreach presentations Actual FY 07 25% 4.3 3 1 10 Est. FY 08 50% 4.4 5 2 20 Est. FY 09 75% 4.5 6 3 20 55 OPERATIONS FACILITIES (continued) CUSTOMER EXPERIENCE (continued) PRIOR YEAR ACHIEVEMENTS Implemented a lobby organization plan to provide standards of operation and improved way finding. Established specific logo’s and brand icons to be used at Cashman Center and the Las Vegas Convention Center, in concert with the LVCVA’s advertising agency. Monitored and expanded participation for the Attendee Intercept Survey to establish attendees’ needs and desires for services offered in a convention center setting both today and into the future. Information will be used for Master Plan Enhancement purposes and bench marking for future improvements. Partnered with area resorts to open a Concierge Counter in the Grand Lobby of the LVCC. The hotel partners have the ability to sell show tickets and book restaurant reservations for guests. The nationally recognized brand of FedEx Kinko’s entered into a five year agreement at the LVCC. The number of exclusive services was reduced resulting in a focused business services operation. Customer Experience made numerous presentations to exhibitor appointed contractors, labor and hotel partners discussing customer experience initiatives and enhancement updates. Established a “Green” Team to increase awareness of ongoing initiatives and to identify new ideas for conserving resources and encouraging sustainability. LAS VEGAS CONVENTION CENTER The Las Vegas Convention Center, located adjacent to the Las Vegas Strip, currently encompasses approximately 3.2 million square feet with exhibit space of more than 2 million square feet and meeting space of more than 241,000 square feet. It includes 16 exhibit halls and 170 meeting rooms with seating capacities from 20 to 7,500. Parking for 5,200 cars is available on-site. See the diagram on page 6. CLIENT SERVICES Client Services is responsible for a myriad of daily show and building-related requirements as well as the overall cleanliness of the facility. These responsibilities include room set-up, production and sporting event set-up, equipment logistics, response to show manager requirements, restroom cleanliness, and tracking over $6 million dollars of equipment and supplies. In order to accomplish these activities, Client Services works closely with other internal departments, building partners, and contractors to assure our customers’ desired outcome is achieved. This teamwork and constant communication allows the department to schedule, plan, and allocate the necessary resources in a timely and efficient manner. 56 OPERATIONS FACILITIES (continued) CLIENT SERIVCES (continued) GOALS Develop and initiate a departmental certification program, “Service Certified” focused on building knowledge to provide customer service and answer frequently asked questions. Create and/or update all department policies and procedures to incorporate new initiatives, additional accountability, define measurements where applicable and establish training needs. Expand the current recycle program in order to capture more commodities, as well as research vendors that are capable of receiving food waste. This includes cooperation from our building partners. ACTIVITY MEASURES Recycle Rate Building Maintenance(% of labor hours used) Scheduled Room Changes Restroom Support (% of labor-hours used) Work Orders Complete Actual FY 07 13% 23% 869 32% 748 Est. FY 08 50% 27% 1,200 33% 1,200 Est. FY 09 55% 28% 950 32% 1,400 PRIOR YEAR ACHIEVEMENTS Initiated a graveyard shift focused on cleaning and maintaining areas throughout the facility which are difficult to service during regular hours. This allowed preparation of the facility for the next customer in a more thorough and efficient manner, as well as accomplishing additional off hour requirements. A permanent recycle solution put in place allowing the LVCVA to maintain an average 50% recycle rate for all shows. This program’s primary focus is geared towards dry waste removal for the entire building. All waste is sorted off property by our local trash hauler. Centralized and structures supply distribution to support both internal and offsite supply requests to maximize efficiency. Supply ordering has become automated; thereby making tracking and historic usage per event more accurate. By working with the LVCVA’s mailroom the amount of labor dedicated to deliveries was decreased Increased advertising efforts of recycling initiatives by branding trash compactors and various receptacles throughout the facility. “Green” progress information sheets were also created in order to keep our customers informed. Enhanced entrances and service supplies by replacing all external trash receptacles with more modern non-industrial appearing units and converting an additional 5,000 gallons of chemicals to environment friendly products. ENGINEERING The Engineering section encompasses the activities of heating, ventilation, and air conditioning (HVAC), plumbing, electrical, carpentry, painting, welding/fleet/folding walls, communications, voice systems, computerized maintenance management system (1CALL), grounds, and graphics. The section’s primary objective and responsibility is to maintain and operate all building operating systems and building components to a level that minimizes customer disruption and supports customers’ needs. Engineering continuously pursues new technology that improves building efficiencies without compromising the comfort or quality that today’s customer expects of the Las Vegas Convention Center. 57 OPERATIONS FACILITIES (continued) Engineering staff handles preventative maintenance in all areas, from maintaining 5,800 doors, including freight doors, and fleet vehicles to resolving HVAC and lighting issues, not only at the Las Vegas Convention Center, but also in the five outlying visitor information centers. ENGINEERING (continued) GOALS By April 1, 2009, implement Maximo 6 upgrade to 1CALL work order system and complete related staff training. Measure sustainability improvements at LVCC through power monitoring system and building system changes identified by the LEED-EB (existing buildings) Certification process. Develop and train additional Quality Control staff in building damage assessments. Staff will also work with LVCVA Safety Department to insure OSHA standards are met throughout LVCVA buildings. ACTIVITY MEASURES 1CALL work orders processed Doors maintained/repaired/PM Program (5,200 total) Fleet vehicle and carts repaired/maintained Bulbs and lamps maintained (275,000 total) Cable drops and podium sets Air Handlers checked and serviced (138 total) Stand-alone AC Units checked and serviced (60 total) Electrical power panels and disconnects maintained (over 1,500 total) Walls and ceilings painted (over 1.5 million square feet) 900 plumbing fixtures maintained 892,000 square feet of ceiling components maintained 1,088 restroom partition doors and door hooks maintained 113 bathrooms maintained 92 freight doors maintained 1,373 phone lines maintained/monitored PRIOR YEAR ACHIEVEMENTS Actual FY 07 20,641 1,800 141 35,000 1,496 110 48 750 750,000 351 446,000 816 73 46 1,373 Est. FY 08 28,300 2,000 145 65,000 1,523 110 48 750 825,000 450 535,200 979 79 60 1,373 Est. FY 09 32,000 2,100 149 50,000 1,550 110 48 1,050 900,000 540 713,600 1,088 79 73 1,373 Implemented graveyard shift to handle preventive maintenance by electricians and carpenters. Created Director of Facility Projects position to coordinate all requirements of the Capital Improvement Plan and capital projects generated by the Master Plan Enhancement Program. Installed and activated electrical power monitoring system. Installed new voter board and audio system software in the Board Room. Improved and standardized signage at LVCC and Cashman Center, including: o o o o Refurbishment of directional kiosks, Placement of evacuation and Visitor Center signage, Installation of directional wraps in the Front Plaza/Sawtooth area for North, Central and South Halls, Placement of decorative “Only Vegas” 3-D signage at LVCC 2nd Floor Pre-function and Cashman Center Meeting Rooms. 58 OPERATIONS FACILITIES (continued) ENGINEERING (continued) PRIOR YEAR ACHIEVEMENTS (continued) Installed Concierge Desk in LVCC Grand Concourse for use by major hotel properties to provide show and dining options to attendees of full-facility user shows. CASHMAN CENTER Cashman Center is located on 51 acres near downtown Las Vegas just off the 515 interstate and Las Vegas Boulevard. This facility provides an outdoor sports stadium that seats 10,000 fans and is home to a Triple A baseball franchise, the Las Vegas 51s. There is a state-of-the-art theater that will accommodate 1,922 patrons, with seating on the main floor and balcony areas. The campus contains twelve meeting rooms with approximately 13,000 square feet of space and two exhibit halls with 98,100 square feet of space for small conventions, seminars, receptions and other events. See the schematic on page 7. Due to the size of Cashman Center compared to the Las Vegas Convention Center, the Client Services and Engineering departments have been combined in this narrative. The goals, activity measures and achievements listed below encompass both of these areas. GOALS Improve “Housing the Brand” in celebration of Cashman Center’s 25th anniversary. Develop and implement a strategic business plan for Cashman Center in support of the budget process and five year Capital Improvement Plan. Establish two new means of improving and increasing employee communication. ACTIVITY MEASURES Work orders completed/work orders per skilled craftsman Number of energy efficient lighting fixtures converted Landscape converted to desert landscaping (square feet) Restroom support (labor hours) Show/Event support (labor hours) PRIOR YEAR ACHIEVEMENTS Actual FY 07 2,721/272. 1 150 3,000 12,151 10,858 Est. FY 08 3,000/30 0 115 5,000 14,000 10,400 Est. FY 09 3,400/34 0 85 5,000 14,000 11,000 Installed new energy efficient P-TAC heating/cooling units in box offices, theater and ticket office. Renovated the scoreboard, including new video display, recording and replay systems, reducing energy consumption and improving the baseball fan’s experience. Replaced cooling towers, improving energy efficiency and reducing repair costs. 59 OPERATIONS SECURITY The LVCVA Security Department consists of three sections and over 200 full and part-time staff. The sections include Security, Traffic and Physical Security. The Security section is responsible for calls for service within the LVCC and is the only section with a 24/7 presence at Cashman. In addition, the Security section is responsible for administration of the nursing/first aid program, K9 unit, and executive protection. The Traffic section consists of bike officers, perimeter security and traffic control. Perimeter Security is a relatively new component that monitors freight areas and assists in ensuring all vehicular traffic coming on property is authorized. Traffic control includes parking and generates revenue for the organization. The bike officers respond to calls for service all around the exterior of both the LVCC and Cashman. The Physical Security section consists of the control center staff, the safety office, investigators and life systems. The section is responsible for monitoring and maintaining all technologies utilized by the department to ensure the facility and all occupants are safe. Technologies include surveillance, fire systems and access control. Over the past several years, Security has added additional bike officers, a K9 unit, initiated the perimeter program, and restructured to combine safety and the control center under a single section. Over the next several years the department intends to expand the perimeter program and utilize additional technologies gained in the Master Plan Enhancement Program to help in the early detection of potential hazards and/or threats. GOALS Introduce new initiatives focusing on elevating customer experience as it relates to security, traffic and physical security. Establish a platform of key performance measures to determine the departments overall success at year end. Provide leadership training to Security’s front line supervisors and contracted security companies. ACTIVITY MEASURES Floor plans reviewed (LVCC & CC) Traffic violation notices Fire/Safety violations given (LVCC & CC) Incident reports taken Special event hours worked Actual FY 07 1,612 3,959 3,020 970 2,517 Est. FY 08 960 2,900 3,600 800 1,964 Est. FY 09 1,200 3,000 2,800 800 1,500 60 OPERATIONS SECURITY (continued) PRIOR YEAR ACHIEVEMENTS Developed and rolled out of the Perimeter Security Program with forty-five part time employees. This new component monitors freight areas and assists in ensuring all vehicular traffic coming on property is authorized. Redesigned Cashman Center parking lot “C,” by relocating Executive parking, LVCVA vehicle parking area, taxi/limousine drop/pickup area, by designating employee parking area and LV 51’s season ticket and sponsor parking. Introduced a pilot program that reduced contract security guards at selected freight doors. Rolled out of the LVCVA Health, Environmental and Safety Risk Management Guide (HES) to all employees. Also developed monthly safety/risk assessments per department, monthly safety “Tips” and monthly safety executive reports. Increased camera surveillance by over 100% at Cashman Center. New areas added were the parking lots, stadium plaza and vehicle entry points to the facility. Produced the 16th Annual Tourism Safety Conference. The Traffic Section instituted a selective traffic enforcement program throughout the LVCC campus. This initiative increased focus on reducing traffic violations and improving overall safety as our other strategies had not been successful in curbing the problem. Initiated a campus-wide post-show inspection, a comprehensive visual inspection of the facility immediately following the move-out of a show. 61 OPERATIONS PROJECT DEVELOPMENT Project Development is responsible for overseeing all construction projects from conceptual design through the permitting, construction, commissioning and final acceptance process. This department coordinates the work of the architects, engineers and construction firms for projects ranging from minor renovations and demolition projects to implementing the Master Plan Enhancement Program (MPEP). The Project Development department is dedicated to making the Las Vegas Convention Center the best convention center in the world. To achieve this, Project Development personnel work with other LVCVA departments in order to identify strategic capital improvement projects for both facilities. GOALS Complete the Convention Center Area Command (Metro) by November 1, 2008. Place steel order for the North-South Connector and Desert Inn Building by August 1, 2008 to stop escalation on steel pricing and to facilitate early delivery of structural steel to the project sites by April 1, 2009. Start construction of North-South Connector and Desert Inn Building by January 1, 2009. Relocate administrative offices beginning January 1, 2009. ACTIVITY MEASURES Actual FY 07 MPEP Design and Construction plan packages reviewed and approved Construction pay applications reviewed and submitted Involvement, support, and management of projects at LVCC and/or Cashman Center PRIOR YEAR ACHIEVEMENTS n/a n/a 29 Est. FY 08 15 121 35 Est. FY 09 25 175 29 Installed web cam on the South Hall to view the on-going construction of the Convention Center Area Command (Metro). Web access was provided with support from Security and ITD. Proposed and designed building utilization and prepared drawings and layouts to be utilized in relocating administrative office moves related to the Master Plan Enhancement Program. In conjunction with the Contracts department, negotiated terms and formed a group of local architects from various firms to facilitate the design of individual Master Plan Enhancement Program projects, as well as, the construction documents related to their field of expertise. Facilitated and developed, with input from customers, the utilization design of recently acquired buildings and vacant land. Contracted and began ongoing construction audit services. Prepared and tracked responses and implemented recommendations made by the auditors. Created and maintained a Master Plan Enhancement Program Progress Report, tracking individual projects and detailed dollars spent on over 42 projects within the MPEP and related capital projects. 62 OPERATIONS FINANCE The mission of the Finance Department is to allocate the LVCVA’s financial resources in accordance with applicable policies and laws, to safeguard the LVCVA’s assets, and to provide accurate and timely financial information and assistance. The Finance Department maintains a general accounting system for the LVCVA to ensure accountability in compliance with legal provisions and in accordance with generally accepted accounting principles. Finance is comprised of Financial Resources, Financial Systems, Accounting, Payroll, Transportation and Record Management activities. Financial Resources is responsible for cash management, debt management, capital assets and investment of the LVCVA’s funds within the guidelines of Nevada Revised Statutes and the LVCVA’s investment policy. Additional responsibilities include preparation of the LVCVA’s comprehensive annual financial report (CAFR). The travel function oversees all travel arrangements for LVCVA staff, FAMs, and contest winners. Financial Systems section oversees the preparation of the annual budget, the grant program, the LVCVA records management program and supports all computerized financial systems (accounting, payroll, time & attendance, and imaging). Payroll is primarily responsible for processing the LVCVA’s bi-weekly payroll for over 500 full-time employees and over 400 intermittent and temporary employees. Additional duties include payment of voluntary and involuntary deductions, bonus programs, federal/state taxes, and retirement contributions. The Accounting section is responsible for the general ledger, accounts payable, accounts receivable, monthly budget, encumbrances, and project accounting posting. Over 2,200 line items are monitored to ensure proper posting of journal entries, cash receipts, revenue, client invoices, budget transfers, purchase orders, and invoices. The Accounting section processes regularly submitted expense reports for local, national and international charges from over 60 employees. With the ever-expanding international market, familiarity with various world currencies is required. The comprehensive accounting software system is a major responsibility for this section. Additional duties include preparing and posting of the month-end financial information on the intranet for use by the executive and management staff. GOALS Develop and introduce a new pro-active means of communication by June 30, 2009. Execute at least two initiatives to improve current services or new service levels that provide effectiveness, timeliness or efficiency of service. Develop a new initiative that will contribute to the improved quality of financial decision-making. Develop and introduce at least two additional guidance aids and/or assistance programs that support other departments in meeting their goals. 63 OPERATIONS FINANCE (continued) ACTIVITY MEASURES Years received budget/CAFR receipt of GFOA Awards Full time/part time employees participating in direct deposit Percent of vendors receiving payment by EFT Maintain the LVCVA’s uninsured bond rating at Aa3 (Moody’s) ad A+ (S&P) Conduct at least 8 vulnerability assessments each quarter Maintain a rate of return on investments at no more than 50 basis points below the 6-month T-bill Forecast annual room taxes within a 5% accuracy Number of calendar days to close year-end (not to exceed 45) Number of calendar days to complete audit and produce CAFR (not to exceed 65) Number of months that G/L was closed within 8 business days Staff turnover rate (not to exceed 10%) Maintain a minimum debt service coverage ratio of 3.0 Actual FY 07 18/24 n/a n/a Aa3/A+ N/A -3 bp .06% 41 62 n/a 14% 7.84 Est. FY 08 19/25 90%/56% 11% Aa3/A+ 20 +25 bp .5% 45 65 10 18% 6.0 Est. FY 09 20/26 91%/60 % 15% Aa3/A+ 32 +25 bp 5% 45 65 11 10% 5.0 PRIOR YEAR ACHIEVEMENTS Received the Certificate of Achievement for Excellence in Financial Reporting award from the Government Finance Officers Association for the 25th consecutive year. Received the Distinguished Budget Presentation award from the Government Finance Officers Association for the 19th consecutive year. Obtained an unqualified opinion on the annual audit. Created a five-year strategic business plan for the Finance department, complete with performance measures. Developed improved financial reporting tools, including My Revenue, Popular Annual Financial Report, quarterly investment report and Room Tax Update. Built a staff development plan, including defined career paths and plans of actions, for every member of Finance. 64 OPERATIONS PURCHASING Purchasing and Materials Management are the main components making up the Purchasing Department under the Operations Division. It is with great pride that this team fosters the requirements of all procurement within the Authority, under local, county and state regulations. Our goal is to cultivate knowledge and necessity while promoting internal and external customer service to meet interdepartment goals and objectives. Purchasing works closely with all areas of the LVCVA in determining the proper quantities and quality of materials and supplies necessary to perform all functions. Following legal requirements, purchases which exceed an annual cost of $25,000 are put out to bid, promoting fair and open competition. Purchases between $10,000 and $25,000 are solicited to a minimum of two suppliers in accordance with state law. Bids are routinely sought on purchases below this amount in order to conserve public funds, as well as obtain the best product for the lowest possible price. Purchasing is also responsible for the administration of contracts. Our commitment includes negotiating, managing, and presiding over all contracts while monitoring deliverables, mediating, and assisting in dispute resolution, and conducting performance evaluations. Additionally, this area maintains insurance documentation to ensure proper requirements are satisfied and generates weekly and monthly status reports to review expiring contracts, audits pro-card transactions, and provides status updates on professional service agreements. Materials Management is made up of three support areas: mailroom, copy center and distribution center. The mailroom is responsible for processing all outbound domestic and international mail and packages. Multiple times each day, mail is distributed throughout the Las Vegas Convention Center and twice daily to Cashman Center. Package and mail processing functions include U.S. mail processing, package and document shipping and daily deliveries internally and to local Las Vegas valley customers. On an “asneeded” basis, the mailroom will hand deliver Board of Director directives and post public records in designated areas throughout Las Vegas. Notorious for setting the standard in customer service, the copy center provides a variety of services, including large volume print jobs, duplication, color copies, binding, lamination, folding, drilling, stapling, and typesetting. Output production includes items such as the Annual Budget, the Comprehensive Annual Financial Report, the News Bureau Linage/Entertainment Report and other documentation supporting the LVCVA’s mission. The distribution center is responsible for managing all brochures, promotional items and selected support materials. The principal objective is to act as a distribution center while processing package and bulk shipments worldwide. Responsibilities include receipt, storage, order filling, inventory management, surplus property management, and international and domestic shipping. The brochure room which operates as a fulfillment center for brochure requests worldwide is also part of the distribution centers operations. GOALS Raise the awareness of the importance of a diverse supplier base by raising the participation levels of discretionary dollars from last year’s levels by 2%. Raise the department’s customer service levels by introducing at least two new customer service initiatives. Establish at least one program to instill and reinforce the LVCVA Core Values (loyalty, integrity, trust, excellence, and respect) to our employees throughout the department. 65 OPERATIONS PURCHASING (continued) ACTIVITY MEASURES Actual FY 07 Manage services & supplies budget so that actual annual expenditures are within 95% of original appropriations. Yes / 91% Annual temporary and overtime expenditures are within 95% of original budget. Yes / 83% Years received Achievement of Excellence in Public Procurement 12 Diversity participation (% of dollars spent) 17% Annual contract percentage of total spent 41% Number of contract action items completed per Full Time n/a Equivalent 3.6 Dollar amount of purchase orders per FTE (in millions) Outbound packages per FTE Copy Center copies produced per FTE (in thousands) Distribution Center requisitions filled per FTE Distribution Center brochure requests filled per FTE (in thousands) 1,731 764 1,829 110 Est. FY 08 Yes Yes 13 20% 42% 392 3.9 1,800 800 1,900 115 Est. FY 09 Yes Yes 14 22% 42% 410 4.1 1,800 800 1,900 115 PRIOR YEAR ACHIEVEMENTS Conducted first ever CMAR (Contract Management At Risk) delivery method for three Master Plan Enhancement Projects. Increased minority/woman-owned participation by at least 3%. Reviewed processes and completed desk manuals for approximately 50% of Purchasing staff. Established an inventory system for Client Services complete with inventory controls, reporting and distribution accountability. Set-up property control system with Engineering at Cashman Center to support accountability of materials used by the department. 66 OPERATIONS INFORMATION TECHNOLOGY The Information Technology Department (ITD) functions as the LVCVA’s technology support element. ITD has committed to advancing the LVCVA’s goals and objectives in a fiscally responsible manner through continuous innovation, leadership and guidance while improving service quality and applying necessary technical skills. Our mission will be accomplished through the focused and dedicated efforts of our Administrative, Support Services, Systems Maintenance and Software Development teams. Responsibilities include: maintaining all LVCVA hardware, software, networks and systems; developing new support tools, automation systems, databases and applications; establishing automation policies and procedures; Help Desk operations; and identifying cost-effective technology applications. GOALS Develop Employee News Network (ENN) system, available on touch screen plasmas in break rooms. Develop and implement infrastructure to support off-site administration facilities. Convert existing security programs to a new fully integrated system. Support MPEP technology. ACTIVITY MEASURES In-House Training Cost Savings (dollars) Server availability (%) Call completion time (avg. hours) Call resolution time (avg. hours) Call testing/delay time (avg. hours) Actual FY 07 240,00 0 99.75% 13.2 3.5 3.9 Est. FY 08 183,000 99.80% 25.3 7.9 7.8 Est. FY 09 200,00 0 99.90% 15.0 4.0 4.2 PRIOR YEAR ACHIEVEMENTS Completed company-wide migration from Novell to Microsoft platform. Implemented Customer Relationship Management (ELVIS) system for Marketing Division. Implemented new mobile applications; room setup and facility work order processing Leased and installed 400 new PCs and 40 laptops configured with Microsoft’s new Vista Operating System, updating LVCVA technology. Completed MPEP construction team-site utilizing SharePoint software. 67 SPECIAL EVENTS FY 2009 EXPENDITURES Special Events LVE 68% Special Events LVCVA 22% Salaries & Benefits 10% COMPARISON OF ACTUAL TO BUDGET FY 05 - FY 06 - FY 07 - FY 08 - FY 09 Millions 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Salaries & Benefits Actual FY 05 Revised FY 08 Special Events - LVE Actual FY 06 Proposed FY 09 Special Events - LVCVA Actual FY 07 68 SPECIAL EVENTS BUDGET ANALYSIS In FY 2009, the decrease of $1.1 million in Special Events–LVE, is due to Las Vegas Events sponsoring some events from a portion of the earnings they have built up over the years. The decrease in Special Events– LVCVA is due to not sponsoring a large scale event such as the NBA All-Star Weekend (FY07) and ACTUAL FY 05 718,445 6,229,901 6,948,346 ACTUAL FY 06 793,823 7,547,882 1,475,000 9,816,705 ACTUAL EXPENDITURES FY 07 BY CATEGORY 837,561 Salaries & Benefits - LVE 6,937,584 Special Events - LVE 5,768,571 Special Events - LVCVA 13,543,716 REVISED PROPOSED BUDGET BUDGET % FY 08 FY 09 CHANGE 871,381 921,755 5.8% 7,319,751 6,117,980 (16.4%) 5,542,000 1,858,000 (66.5%) 13,733,132 8,897,735 (35.2%) Federation International de Basketball Americas (FY08). SPECIAL EVENTS Throughout the years, the LVCVA has sponsored and promoted special events by grants and sponsorships. The LVCVA has been instrumental in bringing many inaugural events and securing repeat performances to Las Vegas and Clark County. Prior to fiscal year 2000, special events were funded by a 5/8 of one percent portion of the restricted room tax. It was redirected to the school district for school construction by the legislature. Room taxes and use of facilities revenues now provide funding for these grants. These developments have resulted in guidelines regarding special event funding with items such as media exposure, visitor volume, and incremental room nights generated being more heavily reviewed. Also, special events that promote the brand of Las Vegas as well as targeting key visitor demographics are critical when determining event levels of funding. In 1983, the LVCVA began partnering with Las Vegas Events Inc. (LVE) to promote and encourage special events that will in turn stimulate tourism, and provide media exposure for Southern Nevada. Events sponsored range from rodeo (i.e. National Finals Rodeo) to golf (i.e. Mesquite Long Drive Championship) and from auto races (i.e. Laughlin Desert Challenge Off Road Race, NHRA Drag Races) to music events (i.e. Las Vegas City of Lights Jazz Festival). In FY07, special events sponsored directly by the LVCVA were transferred into this section from the community support/grants section. 69 GRANTS & OTHER FY 2009 EXPENDITURES Collection Allocation 85% Grants & Other 15% COMPARISON OF ACTUAL TO BUDGET FY 05 - FY 06 - FY 07 - FY 08 - FY 09 Millions 25 20 15 10 5 0 Collection Allocation Actual FY 05 Revised FY 08 Actual FY 06 Proposed FY 09 Grants Actual FY 07 70 GRANTS & OTHER BUDGET ANALYSIS There have never been any positions or capital outlay budgeted for this section. Collection allocation increases proportionally with room taxes, as it is based on a percentage of the amount of room taxes and gaming fees collected. The FY 2009 “Grants” category funding level decrease is due to Destination Capital Improvement Funding program. Reserve for contingency contains funding not only for contingencies but also to fund payroll related items: new positions, authorized but unfilled positions, retirements, education benefits and self-funded insurance premiums. In FY 2009, a large number of retirements are expected due employees taking advantage of Public Employees Benefits Program (PEBP), a health insurance program for retirees. During the 2007 Legislative Session, Senate Bill 544 was introduced limiting participation in PEBP for non-state employees to those who retire prior to September 1, 2008. No new positions were requested during the budget process. ACTUAL FY 05 17,820,101 3,984,646 141 21,804,888 44,609,321 66,414,209 ACTUAL FY 06 20,205,044 4,226,444 3,774 24,435,262 78,214,569 102,649,831 ACTUAL FY 07 21,520,541 3,351,915 746 24,873,202 58,829,289 83,702,491 EXPENDITURES BY CATEGORY AND OTHER FINANCING SOURCES Collection Allocation Grants Other Other Financing Uses Reserve for Contingency REVISED BUDGET FY 08 22,892,500 4,480,000 40,000 27,412,500 63,775,964 2,135,900 93,324,364 PROPOSED BUDGET FY 09 22,595,000 4,070,000 40,000 26,705,000 72,671,375 2,700,000 102,076,375 % CHANGE (1.3%) (9.2%) 0.0% (2.6%) 13.9% 26.4% 9.4% GRANTS & OTHER Historically, the LVCVA has always supported the community through recreational and promotional grants. Presently, 10% of the total room taxes and gaming fees collected are returned to the county and the cities. The division of this collection allocation is set forth in an agreement between the various entities and may be designated by the individual entities for any purpose. The distribution to the county and its incorporated cities is mainly based upon the governor-certified population figures as prepared by the state demographer. The newly adopted agreement maintained the reimbursement allocation up to the level as paid in FY 2007 (“Baseline”). Reimbursement above the baseline will be paid to the entity that collected the increase. The reimbursement formula will be phased in over the next five years. Recreation grants are granted to Clark County and the incorporated cities within. These funds are intended exclusively to develop, improve and enhance the recreational facilities within Clark County. Funds awarded under the Tourism Destination and Event Grant Program are to be used to develop, promote and increase tourism to and within Clark County, Nevada. Eligible entities include Clark County, the incorporated cities within and the non-profit chambers of commerce, including those that represent nationalities, ethnicities and cultures in Clark County. Projects eligible for funding include special event staging and promotional materials. Reserve for contingency contains funding for payroll suspense, retirements, education benefits, self insurance premiums and contingency. Payroll suspense is used to fund new positions and unfilled authorized positions. If any new positions are requested, they are discussed in the personnel allocation section and included in the full-time personnel count in each division’s proposed budget. If approved, funds are transferred to the divisions’ salary and benefits accounts through the regular budget transfer process as the new employees are hired. “Other Financing Uses” is comprised of operating transfers out which represents appropriations for capital outlay and debt service as discussed in the following capital fund and debt service fund sections. 71 CAPITAL PROJECTS FUNDS SUMMARY The capital projects funds are used to account for the acquisition of capital assets and the construction of new facilities or improvements. For FY 09, the LVCVA will have three capital project funds: Capital Improvement and Replacement Fund, Extraordinary Repair, Maintenance, and Improvement Fund, and the Master Plan Enhancement Program Fund. Each of these funds is discussed on the following pages. The schedule below includes all capital project funds. REVISED ACTUAL FY 06 REVENUES: Interest M iscellaneous Proceeds from Debt Issuance Total Revenues EXPENDITURES: Leasehold Improvements Land & Improvements Buildings Capital Improvement Program Construction in Progress Furniture & Equipment Executive M arketing Operations Debt Issuance Costs Total Expenditures 63,354 49,985 1,962,742 47,712,578 38,957 188,252 2,536,075 397,941 31,190,881 22,500 37,525 2,280,640 222,185,569 53,450 7,750 1,119,000 500,000 271,450,936 138% (79%) (51%) 100% 22% 8,278,549 20,710,412 206,617,233 261,631,036 27% 16,370 7,526,630 4,250,000 (44%) 35,916,487 1,441,461 1,468 6,203,419 1,097,986 2,099,743 3,601,298 18,000 2,453,500 1,418,200 100% 17% (61%) $ 530,818 53,549 584,367 $ 2,119,476 150,427 31,000,000 33,269,903 $ 3,780,000 1,000 119,000,000 122,781,000 $ 2,525,000 1,000 255,000,000 257,526,000 (33%) 0% 114% 110% ACTUAL FY 07 BUDGET FY 08 PROPOSED BUDGET FY 09 % CHANGE Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES): Operating Transfers In Operating Transfers Out Total Other Financing Source (Uses) 53,710,588 31,196,127 26,624,200 13,150,000 (51%) 54,258,700 (548,112) 33,000,000 (1,803,873) 27,374,200 (750,000) 14,650,000 (1,500,000) (46%) 100% (47,128,211) 2,079,023 (99,404,569) (13,924,936) (86%) EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES FUND BALANCE, BEGINNING FUND BALANCE, ENDING $ 51,329,867 $ 84,605,016 $ 11,824,647 $ 11,049,711 (7%) 44,747,490 51,329,867 84,605,016 11,824,647 (86%) 6,582,377 33,275,149 (72,780,369) (774,936) (99%) 72 CAPITAL IMPROVEMENT AND REPLACEMENT FUND The Capital Improvement and Replacement Fund is used to account for capital expenditures for furniture, equipment, construction work-in-progress, land, buildings, and improvements to land, buildings and leaseholds. In FY 2002, capital assets became depreciable per GASB Statement 34’s “Basic Financial Statements and Management’s Discussion and Analysis for State and Local Governments.” This means that the LVCVA allocates the cost of tangible property over a period of time, rather than expensing the entire cost in one year. Generally, at the end of an asset’s useful life, the net value of the asset (original cost less accumulated depreciation) will equal the salvage value of the asset. The requirement for maintaining controls over fixed assets is found in the Nevada Revised Statutes and Nevada Administrative Code. The latter spells out the following inventory guidelines: (1) The governing body of every local government shall take an inventory at least once every two years of all its equipment and other personal property that constitute fixed assets. (2) Each item of property subject to the inventory must be assigned an identifying number and be labeled as belonging to the local government. CAPITALIZATION THRESHOLD Nevada Administrative Code 354.750 sets guidelines for the establishment of capitalization thresholds by resolution. This same code requires that every local government perform an inventory every two years. The LVCVA established a three-level system for determining the cost at which items should be classified as a capital asset. Each of these categories assumes the following: the item is generally tangible in nature (computer software is the major exception); the item has a useful life greater than one year; the item is not a repair part or supply item; and the original cost is greater than the capitalization threshold. High Risk: $500 – An item meeting two or more of the following criteria: easily convertible to personal use or cash; easily removed from LVCVA property without detection; or not assigned to any individual. Examples: computers, tools, cameras, vacuums. Low Risk: $3,000 - An item meeting two or more of the following criteria: specialized equipment not easily convertible to personal use or cash; not easily removed from LVCVA property without detection; or under departmental inventory control. Examples: trucks, carts, permanent sound equipment. No Risk: $20,000 – Defined as those assets that are not moveable. No risk assets would include land and buildings. Bulk Inventory Assets: Exceptions to the capitalization threshold are made for bulk inventory purchases. Typical bulk purchases include tables and chairs, podiums, barricades, trash receptacles and amplifiers. While individually costing less than $500, these items will be combined and capitalized as a group of assets. BUDGET PROCESS Planning for capital acquisitions is a continuous process throughout the year. Individual employees originate proposals for acquiring new and replacement equipment and furniture. If the supervisor agrees with the proposal, it is added to the section’s capital requests. During the budget process, each organizational unit submits its requests to acquire equipment and furniture. These requests must be justified as replacements for existing items that have failed or become obsolete or as new acquisitions that will enhance and improve the efficiency and/or effectiveness of the LVCVA’s operations. All requests are reviewed and discussed during the executive budget review process. The acquisitions that survive this process are consolidated into the final budget. Some are moved to subsequent years for future consideration. 73 CAPITAL IMPROVEMENT AND REPLACEMENT FUND BUDGET PROCESS (continued) Factors that can influence an increase or decrease in the land and building improvement accounts are: As the Las Vegas Convention Center is expanded, the older parts of the facility are updated and modernized. Due to the number of shows and events using the exhibit halls and meeting rooms, projects must wait for an open time frame before proceeding. Implementation of segments of the long-term master plan. National and international events, such as economic downturns, can determine if capital improvement projects will be deferred until future years. The LVCVA uses the construction work–in-progress account to fund various on-site improvements that have been on the drawing board, in some cases for years. Capital land and building improvement project requests have a similar, although more involved, budget process. The capital improvement program is described on page 77. These expenditures are funded from current operations. IMPACT ON GENERAL FUND Capital projects can have an impact on the LVCVA’s operating budget in several ways. Costs impacted by acquiring or replacing equipment and constructing additional exhibit space include required personnel levels, maintenance expenses and utility charges. Some of the capital projects are multi-year programs, and the fiscal impact can be spread across many fiscal years. Building and land improvements are listed on pages 77-79. Included is a description of the project and any quantifiable impacts on the general fund. The majority of the furniture/fixtures and equipment purchases are for replacement due to damage, obsolescence or theft. When repairing damaged equipment is no longer cost-effective, it is replaced. However, depending on the type of equipment, many departments cannibalize damaged equipment for parts, thereby reducing repair costs. BUDGET ANALYSIS Capital projects and purchases are funded with a transfer to the Capital Improvement and Replacement Fund from the operating budget. The FY 2009 transfer is $14,650,000, a 46% decrease from the FY 2008 revised budget. The decrease capital fund is due to fewer capital reserves being funded. As we begin construction of the MPEP, other projects are not being completed because of time and space constraints. The construction in progress account is the LVCVA’s pay-as-you–go capital plan for funding expansion and land acquisition, for FY 2009 it will receive additional funding of $4.3 million. A summarized capital building and land improvement listing is included. It is followed by a description of major projects and impacts on the general fund. A capital furniture and equipment listing by organizational unit is also featured. 74 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CAPITAL IMPROVEMENT AND REPLACEMENT FUND REVISED ACTUAL FY 06 REVENUES: Interest Miscellaneous Total Revenues EXPENDITURES: Leasehold Improvements Land & Improvements Buildings Capital Improvement Program Construction in Progress Furniture & Equipment General Government Marketing Operations Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES): Operating Transfers In Operating Transfers Out Total Other Financing Source (Uses) 53,710,588 31,196,127 26,624,200 13,150,000 (51%) 54,258,700 (548,112) 33,000,000 (1,803,873) 27,374,200 (750,000) 14,650,000 (1,500,000) (46%) 100% (47,189,259) (9,690,536) (95,934,569) (12,818,900) (87%) 63,354 49,985 1,962,742 47,712,578 38,957 188,252 2,536,075 11,497,080 22,500 37,525 2,280,640 96,685,569 53,450 7,750 1,119,000 14,319,900 138% (79%) (51%) (85%) 8,278,549 1,414,552 81,117,233 5,000,000 (94%) 16,370 7,526,630 4,250,000 (44%) 35,916,487 1,441,461 1,468 6,203,419 1,097,986 2,099,743 3,601,298 18,000 2,453,500 1,418,200 100% 17% (61%) $ 469,770 53,549 523,319 $ 1,803,873 2,671 1,806,544 $ 750,000 1,000 751,000 $ 1,500,000 1,000 1,501,000 100% 0% 100% ACTUAL FY 07 BUDGET FY 08 PROPOSED BUDGET FY 09 % CHANGE EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES FUND BALANCE, BEGINNING FUND BALANCE, ENDING $ 49,834,173 $ 71,339,764 $ 2,029,395 $ 2,360,495 16% 43,312,844 49,834,173 71,339,764 2,029,395 (97%) 6,521,329 21,505,591 (69,310,369) 331,100 (100%) 75 CAPITAL IMPROVEMENT AND REPLACEMENT FUND The summary below represents capital projects and purchases by organizational unit. A more detailed listing follows it. EXPENDITURE SUMMARY IMPROVEMENTS Building Improvements Land and Land Improvements Capital Improvement Program Leasehold Improvements FURNITURE /FIXTURES & EQUIPMENT General Government Executive Public Affairs Human Resources Marketing Visitor Information Centers Operations Facilities Client Services – LVCC Client Services – CC Communications Engineering – LVCC Engineering – CC Grounds – LVCC Security Security – LVCC Physical Security Traffic Information Technology Computer Requests from other departments* Engineering Executive Finance Physical Security Public Affairs Purchasing Research Security Traffic Visitor Information Center $1,418,200 1,453,500 4,250,000 18,000 750 15,300 37,400 7,750 140,300 13,000 31,000 119,900 5,000 17,400 18,100 86,700 33,600 547,500 4,500 20,000 51,000 1,000 5,000 10,600 10,000 2,500 1,200 700 $8,319,900 76 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CONVENTION CENTER BUILDING IMPROVEMENTS Building improvements include such projects as additions, expansions or renovations to current buildings, and upgrades or replacements of equipment attached to the buildings. Projects numbers flow from year to year which allows us better tracking of the entire cost of a project. BUDGET FY 2009 00000.09.001 00000.09.002 00000.09.003 00000.09.004 00000.09.005 00000.09.006 00000.09.007 Access Control (Cambridge Warehouse) Air Conditioning Unit (Carpenter Shop) Awnings & Power Receptacles Capital Building Enhancements Concourse Door Replacement (C-5 Hall) Emergency Generator Replacement (Central Hall) Service Hallway Door Replacement (Communications) 12,000 10,000 3,200 500,000 56,000 75,000 10,500 $ 666,700 $ LAND IMPROVEMENTS Land improvements are defined as land attachments of a permanent nature, other than buildings and include such items as roads, bridges, tunnels, walks, parking lots, etc. 00000.09.008 00000.09.009 Blue Lot Fencing Protective Bollards (S-2) $ $ 50,000 15,000 65,000 MAJOR PROJECTS FOR FY 2009 EMERGENCY GENERATOR REPLACEMENT (CENTRAL HALL) – Current generator is worn out and inadequate for future needs. It is over 35 years old and repairs are more costly than replacement. DOOR REPLACEMENT (CENTRAL HALL) – Bank of doors are being replaced to increase energy efficiency. These doors have exceeded life expectancy due to high traffic through the area. PARKING LOT FENCING – Fencing will keep unauthorized persons from walking thru parking lot and looking into vehicles, it will also guide people to crosswalks. BUILDING ENHANCEMENTS – Given the small window of opportunity to begin projects between major shows, this project line item is used to fund the beginning of projects that may be completed in subsequent years. IMPACT ON OPERATING BUDGET The various building improvements are anticipated to reduce repair and maintenance costs and increase energy efficiency. Not all improvements have a direct and quantifiable effect on the budget. Replace Doors – Replacement will assist in reducing the heating and cooling costs in the building. Replace Generator – The new generator will reduce repair costs. 77 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CASHMAN CENTER BUILDING IMPROVEMENTS Building improvements include such projects as additions, expansions or renovations to current buildings, and upgrades or replacements of equipment attached to the buildings. BUDGET FY 2009 00000.09.011 00000.08.039 00000.08.066 00000.09.012 00000.09.013 00000.09.014 00000.08.041 00000.09.015 Call Center Carpet Replacement Central Plant Chillers Diamond Plate (Exhibit Halls) Exhibit Hall Corridor Carpet Replacement Re-Lamp Exhibit Hall A&B Roofing Repairs (Exhibit Halls/Meeting Rooms) Concrete Repair (Stadium) Water Main Line Replacement 50,000 150,000 15,000 75,000 6,500 200,000 180,000 75,000 $ 751,500 $ LAND IMPROVEMENTS Land improvements are defined as land attachments of a permanent nature, other than buildings and include such items as roads, bridges, tunnels, walks, parking lots, etc. 00000.09.016 00000.06.093 00000.09.017 00000.08.046 00000.09.018 00000.08.047 00000.09.019 Aluminum Parking Lots Signs Baseball Field Renovation Landscape Conversion (East Plaza) Landscape Conversion (Parking Lot B) Ballards (Parking Lot C) Reseal (Parking Lot C) Lighting Re-Lamp (Stadium) $ 3,500 1,200,000 35,000 35,000 50,000 30,000 35,000 $1,388,500 MAJOR PROJECTS FOR FY 2009 CENTRAL PLANT CHILLERS – New chillers are environmentally friendly, more reliable, and more energy efficient. ROOFING REPAIR – Repair roof to support a large event, United States Bowling Congress, which will be in the building for over six months. Full roof replacement not scheduled until FY2014. BASEBALL FIELD RENOVATION – The playing surface is over 15 years old with poor soil and drainage conditions. A new field will provide the Las Vegas 51's with major league-like playing conditions. CONCRETE REPAIR - STADIUM – The existing concrete is cracked and spaulding has occurred. To ensure the safety of guests and further damage, concrete needs to be repaired. SPEAKER REPLACEMENT – The current system is original to the facility, over 25 years old. New technology will greatly increase quality and coverage thus enhancing the customer’s experience. 78 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CASHMAN CENTER - continued IMPACT ON OPERATING BUDGET The various building improvements are anticipated to reduce repair and maintenance costs and increase energy efficiency. The various land improvements are anticipated to reduce repair and maintenance costs. Not all improvements have a direct and quantifiable effect on the budget. Replace Central Plant Chillers – Energy efficiency and saving on utility cost is an obvious reward in replacing this dated system. Landscape Conversion – Conversion in both the East Plaza and Parking Lot B with new drought tolerant landscape will result in reductions in water usage and cost. Additionally, it will reduce damage to concrete areas due to water run-off. LEASEHOLD IMPROVEMENTS A lease is a contractual understanding between a lessor and a lessee that grants the lessee the right to use specific property, owned by the lessor for a specific period of time in return for stipulated, and generally periodic, cash payments. Long-term leases such as those that involve office space ordinarily provide that any improvements made to the leased property revert to the lessor at the end of the life of the lease. BUDGET FY 2009 00000.09.020 00000.09.021 Canopy Replacement (Laughlin Vic) Counter Installation (Primm Vic) $ $ 8,000 10,000 18,000 Projects numbers listed the previous three pages encompass a range of projects from FY 2006 to FY 2009. This includes projects that have expenses in prior years but also funding in the new budget year as well as projects which have been canceled in prior years and received funding in the new budget year. This flow from year to year which allows us better tracking of the entire cost of a project. 79 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CAPITAL FURNITURE AND EQUIPMENT LISTING FURNITURE/ FIXTURE GENERAL GOVERNMENT EXECUTIVE 10200.09.001 PUBLIC AFFAIRS 10300.09.001 10300.09.002 10300.09.003 10300.09.004 HUMAN RESOURCES 10500.09.001 10500.09.002 10500.09.003 10500.09.004 10500.09.005 10500.09.006 10500.09.007 10500.09.008 10500.09.009 10500.09.010 MARKETING TOURISM LAUGHLIN REGIONAL SALES OFFICE 33950.09.01 Electric Typewriter 750 750 MARKETING SERVICES PRIMM VISITORS INFORMATION CENTER 34230.09.001 34230.09.002 OPERATIONS INFORMATION TECHNOLOGY 21000.08.001 21000.09.001 21000.09.002 21000.09.003 21000.09.004 21000.09.005 21000.09.006 21000.09.007 21000.09.008 21000.09.009 21000.07.004 21000.09.010 21000.09.011 Chairs (Training Room) Modular Furniture (Telecommunications) Audit Automation Software Back-up Solutions Barcode Scanner/Printers (Carpenter) Contact Management Software Customization Directional Signage Content Documentum Software (Finance) High Volume OCR Scanner (Purchasing) HP Laser Printer (Primm VIC) Kiosk and Enclosures Laptop Computers (Public Affairs) Minority Supplier Searchable Database (Purchasing) 4,000 5,000 20,000 50,000 4,500 80,000 25,000 25,000 7,000 700 60,000 5,000 3,600 Meeting Table & Chairs Shelving & Brochure Rack 2,000 5,000 7,000 Application Carrels Award Display Case Conference Room Table & Chairs VP Office Conference Table & Chairs Lateral File Cabinets (2) Mobile Training Tables (14) Training Room Chairs (50) Ceiling-mount Electric Screen Event Staging LCD Projector 29,700 4,000 1,700 3,900 3,900 1,600 5,400 9,200 1,200 3,500 3,000 7,700 Conference Table & Chairs Storage Lockers Nikon Camera Bodies Roller Cutting Board 10,600 $ 10,000 600 4,000 700 4,700 Digital Transcription Machine (Legal) $ 750 750 EQUIPMENT 80 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CAPITAL FURNITURE AND EQUIPMENT LISTING (continued) FURNITURE/ FIXTURE OPERATIONS (continued) INFORMATION TECHNOLOGY 21000.09.012 21000.09.013 21000.09.014 21000.09.015 21000.09.016 21000.09.017 21000.09.018 21000.07.040 21000.09.019 21000.05.021 21000.09.020 21000.09.021 PC/Laptop Leasing Printer/Copier (Traffic) Qualtrics Survey Software (Research) Security Surveillance System (Primm VIC) Server Hardware Upgrades Sharepoint Portal Software Licenses/Upgrades Software Modifications (Finance) Spare Components Time & Attendance Software Customization Touch Screen Plasmas Wide Screen Flat Panel Monitors (2) (Physical Security) 9,000 CLIENT SERVICES - LVCC 55020.07.010 55020.09.001 55020.09.002 55020.09.003 55020.09.004 55020.09.005 55020.09.006 55020.09.007 55020.09.008 55020.09.009 55020.09.010 55020.09.011 ENGINEERING 55041.09.001 55041.09.002 55041.09.003 55041.09.004 55041.09.005 55041.09.006 55041.09.007 55041.09.008 55041.09.009 55041.09.010 55041.09.011 55041.09.012 55041.09.013 55041.09.014 Chevrolet Truck Electric Cart (ITD) Electric Cart (Public Affairs) Electric Carts Electric Chain Hoist Gas-Powered Carts Generators (2) Oil Filter Crusher Panel Saw Pressure Washer (HVAC) Robinair Cooltech (Fleet) Robinair ID Plus Cooltech (Fleet) Tools (Carpenter) Tools (Fleet) 36,600 10,000 10,000 20,000 1,200 20,000 4,500 1,100 2,500 1,200 3,000 1,300 3,500 5,000 119,900 Air Movers (10) Barricades (150) Carpet Extraction Tools (2) Easels (200) Handheld Blowers (6) High-speed Burnisher (2) Ride On Carpet Cleaner Rotary Scrubber/Buffer Stair Sets & Skirting Trailer Mount Pressure Washer Upright Vacuums (15) Wet/Dry Vacuum 1,700 30,000 10,800 16,900 1,200 2,200 12,600 4,200 36,000 14,300 7,200 3,200 140,300 156,000 1,200 10,000 2,500 15,000 60,000 22,500 20,000 20,000 6,000 50,000 1,000 645,000 EQUIPMENT 81 CAPITAL IMPROVEMENT AND REPLACEMENT FUND CAPITAL FURNITURE AND EQUIPMENT LISTING (continued) FURNITURE/ FIXTURE OPERATIONS (continued) COMMUNICATIONS 55043.09.001 Handheld Radios (51) 31,000 31,000 GROUNDS MAINTENANCE 55046.09.001 55046.09.002 55046.09.003 55046.09.004 SECURITY 55057.08.004 55057.09.001 PHYSICAL SECURITY 55058.09.001 55058.09.002 55058.09.003 55058.09.004 55058.09.005 55058.09.006 55058.09.007 55058.09.008 TRAFFIC 55059.09.001 55059.09.002 55059.09.003 55059.09.004 55059.09.005 55059.09.006 Office Furniture - Traffic Field Supervisor Wardrobe Cabinets (12) Bicycle Racks (9) Bicycles (3) Parking Lot Emergency Cellular Telephones (3) Portable Propane Heaters (3) 6,700 CLIENT SERVICES - CC 55220.09.001 ENGINEERING CC 55241.09.001 Tools 5,000 5,000 Ride On Carpet Cleaner 13,000 13,000 4,000 2,700 2,600 3,000 18,000 3,300 26,900 Security Information Stations (5) Security Information Station Chairs (8) Carbon Monoxide Tester Duct Detectors Fire Extinguishers (100) Fire Rack Hose (100) Heat Stress Monitors (2) Saflok MT Key Cards 6,600 5,000 1,600 2,100 35,000 5,000 8,500 2,500 27,000 80,100 Canine Transport (Modifications) Wall Mounted Defibrillators (12) 3,700 14,400 18,100 Backpack Blower Equipment Trailer Maxicom Site Controller (Blue Lot) Trailer Mounted 150-Gallon Sprayer 700 1,700 8,000 7,000 17,400 EQUIPMENT 82 MASTER PLAN ENHANCEMENT PROGRAM FUND In February 2006, the LVCVA was given board approval in the amount of $737 million for the enhancement of the Las Vegas Convention Center. In May 2007 the board approved an increase of $153 million. The enhancement includes construction of a Las Vegas Metropolitan Police (LVMPD) substation, fire station and connecting the existing buildings, adding meeting rooms, and upgrading building and technology systems at the LVCC. The Master Plan Enhancement Program (MPEP) fund is used to account for the proceeds of the commercial paper issue and all construction related costs. The funding of the plan includes the usage of $68 million in cash reserves and the debt issuance of $822 million via the issuance of commercial paper. Construction began in late 2007 with the Metropolitan Police Station. The North/South Connector and the South Hall Meeting Rooms are in the design phase and construction should begin in the latter part of 2008. In 2011 the renovation project is expected to be completed; thus ending the Master Plan Enhancement Program. The construction budget for FY 2009 is as follows: REVISED ACTUAL FY 07 REVENUES: Interest Other Proceeds from Debt Total Revenues EXPENDITURES: Debt Issuance Construction in Progress Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures FUND BALANCE, BEGINNING FUND BALANCE, ENDING $ 11,689,216 $ 8,189,216 $ 11,689,216 11,689,216 (3,500,000) 397,941 19,295,860 19,693,801 125,500,000 125,500,000 $ 235,261 147,757 31,000,000 31,383,017 $ 3,000,000 119,000,000 122,000,000 $ BUDGET FY 08 PROPOSED BUDGET FY 09 1,000,000 255,000,000 256,000,000 500,000 255,000,000 255,500,000 % CHANGE (67%) 0% 114% 110% 100% 103% 104% 500,000 8,189,216 8,689,216 (114%) (30%) 0% 83 EXTRAORDINARY MAINTENANCE, REPAIR OR IMPROVEMENT FUND Originally, Nevada Revised Statute 354.6105 required that local governments establish a fund for the extraordinary maintenance, repair or improvement of capital projects. The statute has since been amended and the fund is now a recommendation. Such expenditures are defined as expenses ordinarily incurred not more than once every five years to maintain a local governmental facility or capital project in a fit operating condition. Funding is to be 1/2 of 1% of the total amount of the bonds sold for each capital project. In FY 97, the LVCVA transferred the required funds relating to the 8/96 bond issue from the general fund in order to establish this fund. Additional funding was transferred for the 11/99 bond issue in FY 2000. All funds are anticipated to be spent on building improvements during FY 2009. REVISED ACTUAL FY 06 REVENUES: Interest OTHER FINANCING SOURCES (USES): Operating Transfer In Total Other Financing Sources (Uses) EXPENDITURES Construction in Progress OTHER FINANCING SOURCES (USES): Operating Transfer Out Total Other Financing Sources (Uses) $ $ $ $ 61,048 $ 80,342 $ 30,000 ACTUAL FY 07 BUDGET FY 08 PROPOSED BUDGET FY 09 $ 25,000 % CHANGE -17% - 0% 0% $ 1,631,036 100% - 0% 0% EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES FUND BALANCE, BEGINNING FUND BALANCE, ENDING $ 1,495,694 $ 1,576,036 $ 1,606,036 $ (0) -100% 1,434,646 1,495,694 1,576,036 1,606,036 2% 61,048 80,342 30,000 (1,606,036) -5453% 84 FIVE-YEAR CAPITAL IMPROVEMENT PLAN A capital improvement plan (CIP) is a financial planning and management tool that lists proposed capital projects and capital acquisitions for a rolling five-year period. This multi-year document identifies and prioritizes the need for the improvements and acquisitions and coordinates their funding and optimal time frames for completion. It is also a process that provides order and continuity to the repair, replacement, construction or expansion of the LVCVA’s facilities. The LVCVA prepared a five-year capital improvement plan for fiscal years 2009 – 2013. It includes not only all planned capital acquisitions or projects expected to cost $20,000 or more in one fiscal year, but also multi-year equipment replacements and additions regardless of estimated individual cost. Projects and equipment estimated to be less than $20,000 are included in the capital project and equipment listing on pages 77-82. The first year projects (FY 2009) operating impacts have already been discussed on pages 77-79. If there are any impacts on the operating budgets for FY 2010 – 2013, they will be noted below the project name. Nevada Revised Statute 350.013 requires that capital improvement plans be submitted to the Nevada State Department of Taxation and the County Clerk with the entity’s Debt Management Policy and Indebtedness Report on August 1. BUDGET PROCESS In conjunction with the review and update of departmental objectives and preparation of the departmental annual budget, each department is required to identify and submit individual capital project requests to their respective senior vice president. Departments are urged to carefully assess their equipment necessities and planned improvement programs to determine the full five-year needs in an effort to encourage long-range planning instead of short-term, stop-gap, or “emergency” repairs or rehabilitation work. For each project/acquisition, the submitter must provide a description, justification, documentation, and amount of funding that is expected to be needed. In addition, any effects that the project will have on future annual operating budgets must be identified and quantified if possible. Based on the individual project details, summaries of capital funding needs over the next five years can be prepared and sources of funding identified. The Finance Department then compiles a preliminary listing of capital projects and acquisitions for the executive review process. It is during this review process that project recommendations are accepted, deferred to later years, or changed either in time frame or funding. Year one of the plan (budget year) is submitted to the Board of Directors for their acceptance and approval in the operating budget. Any projects or purchases that may have an impact on the operating budget will be footnoted and quantified if possible. A more detailed five-year capital improvement plan is published as a separate document. 85 FIVE-YEAR CAPITAL IMPROVEMENT PLAN FY 09 CONVENTION CENTER Land Improvements Blue Lot Fencing Protective Bollards (S-2) Joe W. Brown Landscaping/Fencing Wash Rack Relocation Gold Lot Seal Coat Replace Concrete Walkways Capital Improvement Program Capital Improvement Program Holding FF&E - Public Areas C-3 Tunnel Renovation Renovate C-3 Tunnel Restrooms Folding Wall Replacement - Central Halls Off-site Way finding Lithonia Lighting (North/Central Halls) Fire Booster Pump (Paradise) Northeast Meeting Rooms Outer Stairs Data Telecom Cabling (North Halls) Temporary General Session at North Hall Gold Lot Enhancements Art Allowance Electric Signage Paint Building Exterior Exhibit Hall Concrete Replacement (C-2) Engineering/Warehouse Relocation Restroom Renovation - South Hall Building Improvements Master Plan Enhancement (PM/CM, Architect, Insurance, Permits, Regulatory Allowances) (A) Desert Inn Meeting Rooms (A) Central Hall Restrooms, Data Center and Freight Door (A) Grand Concourse\Silver Lots (A) North Lobby & Meeting Room Renovation (A) 44,300,854 42,290,269 14,619,742 51,746,141 5,011,946 211,864,057 74,477,092 31,260,834 13,970,476 33,368,140 143,842,117 22,810,481 75,752,456 9,440,636 4,250,000 2,500,000 500,000 214,000 3,200,000 1,000,000 500,000 303,000 50,000 5,000,000 334,000 400,000 1,000,000 1,000,000 1,400,000 2,225,000 4,200,000 10,000,000 5,000,000 2,225,000 1,000,000 5,000,000 2,535,000 500,000 500,000 $500,000 3,000,000 500,000 $214,000 $50,000 15,000 $40,000 10,000 160,000 100,000 $400,000 FY 10 FY 11 FY 12 FY 13 86 FIVE-YEAR CAPITAL IMPROVEMENT PLAN FY 09 CONVENTION CENTER Building Improvements (continued) Electrical Distribution (A) Sewer, Water, Telephone Relocation (A) Gas & Power Relocation (A) Campus Wide Technology Packages (A) Campus Wide Fire Alarm Systems (A) Campus Wide Signs & Graphics (A) Metropolitan Police Department Substation (A) North Hall/Central Hall Building Enhancement (B) Access Control - Cambridge Warehouse Air Conditioning Unit (Carpenter Shop) Awnings & Power Receptacles Building Enhancements Concourse Door Replacement (C-5) Emergency Generator Replacement - Central Hall Service Hallway Door Replacement (Communications) Column Retrofit (Sprinkler Connection) Meeting Room Door Replacement - North Hall Grand Concourse Canopy (East Entrance) Grand Concourse Lighting (East Entrance) Grand Concourse Signage (East Entrance) Construct Wall in Halls C3 to C4.1 Overhead Door Replacement (C-2) Albany 3000 Rapid Roll Doors Vertical Metal Gray Siding Repair Rebuild Columns in C-1 Hall Emergency Operations Center (EOC) 3333 Cambridge Furniture & Equipment Capital Computer Miscellaneous Equipment ( C ) Barricades (150) 654,000 270,600 30,000 $1,275,461 9,138,740 5,376,217 2,448,804 199,342 133,951 5,210,526 1,631,036 12,000 10,000 3,200 500,000 56,000 75,000 10,500 FY 10 FY 11 FY 12 FY 13 $11,049,747 554,744 1,531,751 $6,156,276 412,875 1,690,031 $436,384 21,395 104,005 83,000 57,600 50,000 10,000 8,000 75,000 175,000 150,000 150,000 30,000 $80,000 700,000 500,000 700,000 500,000 1,200,000 500,000 28,200 1,200,000 500,000 87 FIVE-YEAR CAPITAL IMPROVEMENT PLAN FY 09 CONVENTION CENTER Furniture & Equipment (continued) Forklift Carpet Extractor Stair Sets & Skirting Chevrolet Truck Handheld Radios (51) Duct Detectors Saflok MT Key Cards Electric Carts Gas Carts Chairs Tables Scrubber CASHMAN CENTER Land Improvements Aluminum Parking Lot Signs Baseball Field Renovation East Plaza Landscape Conversion Parking Lot B Landscape Conversion Parking Lot C Bollards Parking Lot C Reseal Stadium Lighting Re-Lamp Block Wall Repair Fire Suppression System for Berm Replace Reader boards Remodel Theatre Plaza Building Improvements Call Center Carpet Replacement Central Plant Chillers Diamond Plate Exhibit Halls Exhibit Hall Corridor Carpet Replacement Re-lamp Exhibit Hall A&B 50,000 150,000 15,000 75,000 6,500 425,000 3,500 1,200,000 35,000 35,000 50,000 30,000 35,000 71,400 20,000 500,000 50,000 225,000 $36,000 36,600 31,000 35,000 27,000 40,000 20,000 220,000 72,800 89,000 54,900 39,000 35,100 71,000 198,000 138,000 $14,000 $27,000 14,000 16,500 28,000 $58,000 30,000 $75,000 FY 10 FY 11 FY 12 FY 13 88 FIVE-YEAR CAPITAL IMPROVEMENT PLAN FY 09 CASHMAN CENTER Building Improvements (continued) Roofing Repairs - Exhibit Halls/Meeting Rooms Stadium Concrete Repair Water Main Line Replacement Boiler Replacement Replace stadium speakers Install Way finding Signage Remodel Stadium Ticket Office Automated Logic Installation Repair Freight Doors Cashman Kitchen Remodel Replace Floor Tile Tunnel Hallway Wash Rack Covers Replace Meeting Room Folding Walls Installation of new Lithonia Lighting System Replace perimeter doors Hydraulic Stage Lift Install 2nd Water Supply Roof Replacement Purchase Transformer Exhibit/Meeting Room Restroom Remodel Furniture & Equipment Miscellaneous Equipment ( C ) Barricades (150) Forklift Carpet Extractor Chevrolet Truck Electric Carts Gas Carts Light Towers (2) Sweeper 20,000 35,000 75,000 16,000 28,000 21,000 36,000 27,000 27,500 7,000 28,000 75,000 7,000 20,000 20,000 26,000 8,500 $200,000 180,000 75,000 $75,000 60,000 50,000 10,000 175,000 70,000 50,000 42,000 10,000 $400,000 145,000 100,000 15,000 412,700 100,000 66,000 50,000 $375,000 $75,000 400,000 FY 10 FY 11 FY 12 FY 13 89 FIVE-YEAR CAPITAL IMPROVEMENT PLAN FY 09 CASHMAN CENTER Furniture & Equipment (continued) Tables Scrubber Turnstiles VISITOR INFORMATION CENTERS Furniture & Equipment Canopy Replacement - Laughlin VIC Counter Installation - Primm VIC TOTAL – FIVE YEAR CAPITAL PLAN $8,000 10,000 $191,702,929 $482,862,948 $160,225,829 $36,526,720 $27,237,200 $65,000 $88,000 40,000 $35,000 $30,000 15,000 FY 10 FY 11 FY 12 FY 13 (A) Funded by Commercial Paper – projects total $180 million and projected commercial paper draws are $255 million. (B) Funding from Extraordinary Repair and Maintenance Fund – will be used on projects in the North and Central Halls. (C) Miscellaneous Equipment – anything less than $5,000 has been combined for ease of reporting, includes items such as tools, easels, vacuums, portable generators and items for office moves. 90 DEBT SERVICE FUNDS SUMMARY Three of the LVCVA’s outstanding debt obligations are general obligation bonds of Clark County, acting by and through the LVCVA. They are primarily secured by ad valorem taxes and are additionally secured by net pledged revenues of the LVCVA, represented basically by room taxes. The LVCVA has never resorted to the use of property taxes for debt service, using only net pledged revenues derived from operations. In fact, no ad valorem property tax revenues are allocated to the LVCVA for any purpose. No change in this practice is contemplated. Three of LVCVA’s obligations are LVCVA revenue bonds, which are secured by room taxes and the facilities revenue generated by the LVCVA. The other obligation is commercial paper. The LVCVA’s Board of Directors approved an $822,000,000 debt issuance, which will initially be issued via commercial paper. The purpose of the debt issue is for construction of enhancements (i.e. improving connectivity between the various halls, upgrade building and technology systems) to the existing Las Vegas Convention Center complete with a police substation, and a fire station. The issuance began in FY 2007 and will continue over the next four years. The LVCVA issued $16 million in Commercial Paper during FY 2007, and estimates $80 million in FY 2008, $255 million in FY 2009, and the remainder of $471 million during FY 2010 and FY 2011. The timing and specific amounts of individual issues have not yet been determined. As authorized by Nevada Revised Statue 244A.637 the LVCVA will issue bonds to provide funding for the Nevada Department of Transportation (NDOT). The agreement requires the LVCVA to contribute $20,000,000 a year for a period of 15 years or a total of $300,000,000 to the NDOT for projects in Clark County. The new bond authorization will be for the total $300 million of which $45,000,000 will be issued in August 2008. Including the new issuance, the LVCVA will have seven outstanding bond issues, payable in annual installments and an outstanding commercial paper issue. Original Issue 36,200,000 150,000,000 118,745,000 38,200,000 50,000,000 45,000,000 822,000,000 SemiAnnual Interest 4.7 - 5.1% 4.8 – 6% 3.0-5.25% 4.0-5.5% 4.0-6.0% Unknown Variable Final Maturity FY 2027 FY 2013 FY 2020 FY 2022 FY 2038 Unknown Variable Outstanding Principal at 6/30/08 35,575,000 31,825,000 117,110,000 38,200,000 50,000,000 To be issued 96,000,000 Obligation Name and Type 4/1/98 Refunding Bonds (G.O.) 11/99 Building Bonds (Revenue) 3/05 Refunding Bonds (Revenue) 05/07 Refunding Bonds (G.O) 10/07 Land (Revenue) 08/08 NDOT (G.O) Commercial Paper** **See explanation of commercial paper above. Quarterly transfers from the general fund are made to fund interest payments due on January 1 and principal and interest due on July 1. These funds are invested in the interim, and interest earned on the investments is transferred back to the general fund. The budgeted ending fund balances of the debt service funds are sufficient to pay principal and interest due on the first day (July 1) of the next fiscal year. However, the commercial paper interest payments are variable and subjective to maturity date. The funds are invested in the interim. BOND ISSUE PROCESS As a governmental entity, the LVCVA must follow Nevada Revised Statute 350.013. This statute requires filing several reports with the Debt Management Commission prior to August 1 of each year regardless if new debt is being contemplated or not. These reports include a complete statement of current general obligation debt and a report of current debt and retirement schedules, a complete statement of general obligation debt contemplated, the entity’s debt management policy, and a five-year capital improvement plan. 91 DEBT SERVICE FUNDS SUMMARY The debt management policy must contain the following discussions: A discussion of ability to afford existing general obligation debt, authorized future general obligation debt and proposed future general obligation debt; A discussion of capacity to incur authorized and proposed future general obligation debt without exceeding the applicable debt limit; A discussion of general obligation debt that is payable from property taxes per capita as compared with such debt of other municipalities in this state; A discussion of general obligation debt that is payable from property taxes as a percentage of assessed valuation of all taxable property within the boundaries of the municipality; Policy regarding the manner in which the municipality expects to sell the debt; A discussion of sources of money projected to be available to pay existing general obligation debt, authorized future general obligation debt and proposed future general obligation debt; and A discussion of its operational costs and revenue sources, for the ensuing five fiscal years, associated with each project included in its plan for capital improvement. 92 DEBT SERVICE FUNDS SUMMARY TOTAL DEBT SERVICE FUNDS REVISED ACTUAL FY 06 REVENUES: Interest Bond Premium Total Revenues EXPENDITURES: Principal Interest Refunding Bond Escrow Bond Issuance Cost Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES): Operating Transfers In Proceeds from Sale of Bonds Operating Transfers Out Total Other Financing Source (Uses) 23,443,465 63,364,386 35,606,764 57,332,375 61% 23,955,869 (512,404) 26,924,594 38,200,000 (1,760,208) 36,401,764 (795,000) 58,021,375 (689,000) 59% 0% (13%) (22,713,107) (62,795,282) (25,478,351) (39,669,536) 56% 11,725,000 11,498,269 2,242 23,225,511 11,050,000 13,341,084 40,796,517 323,813 65,511,413 11,605,000 14,668,351 26,273,351 13,340,000 27,018,536 40,358,536 15% 84% 0% 0% 54% $ 512,404 512,404 $ 664,903 2,051,229 2,716,132 $ 795,000 795,000 $ 689,000 689,000 (13%) 0% (13%) ACTUAL FY 07 BUDGET FY 08 PROPOSED BUDGET FY 09 % CHANGE EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES FUND BALANCE, BEGINNING FUND BALANCE, ENDING $ 17,564,418 $ 18,133,523 $ 28,261,936 $ 45,924,774 62% 16,834,060 17,564,418 18,133,523 28,261,936 56% 730,358 569,105 10,128,413 17,662,839 74% 93 DEBT SERVICE FUNDS SUMMARY Since the LVCVA’s establishment in 1959, room taxes have provided sufficient funding for debt service with no effect on operations. The economic forecast does not indicate any reversal of this 48-year trend. Annual bonded debt service requirements (including the estimated commercial paper issues) thru the year 2040: FYE 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 6/30/2025 6/30/2026 6/30/2027 6/30/2028 6/30/2029 6/30/2030 6/30/2031 6/30/2032 6/30/2033 6/30/2034 6/30/2035 6/30/2036 6/30/2037 6/30/2038 6/30/2039 6/30/2040 Principal (in $) 13,340,000 13,140,000 13,850,000 14,625,000 15,485,000 16,300,000 17,165,000 18,055,000 19,000,000 19,965,000 20,985,000 22,075,000 27,340,706 28,921,448 30,882,635 32,674,093 34,565,939 36,568,595 38,697,811 35,464,679 37,570,660 39,812,600 42,182,756 44,693,821 47,353,950 50,176,787 53,166,495 56,332,784 59,685,951 63,241,909 63,782,223 67,609,156 Interest (in $) 27,018,536 40,284,723 61,418,198 60,633,616 59,823,660 59,007,029 58,137,791 57,222,929 56,277,454 55,306,335 54,301,704 53,244,716 52,594,810 51,025,608 49,338,241 47,544,251 45,640,917 43,619,658 41,477,452 39,350,696 37,239,215 35,001,900 32,631,119 30,119,054 27,457,300 24,636,838 21,648,130 18,481,216 15,125,549 11,569,841 7,882,777 4,055,844 Total (in $) 40,358,536 53,424,723 75,268,198 75,258,616 75,308,660 75,307,029 75,302,791 75,277,929 75,277,454 75,271,335 75,286,704 75,319,716 79,935,516 79,947,056 80,220,876 80,218,344 80,206,856 80,188,253 80,175,263 74,815,375 74,809,875 74,814,500 74,813,875 74,812,875 74,811,250 74,813,625 74,814,625 74,814,000 74,811,500 74,811,750 71,665,000 71,665,000 The LVCVA’s bonds issued through Clark County are rated “AA” by Standard and Poor’s and “Aa2” by Moody’s. LVCVA’s separate bond rating is “A+” insured by Standard and Poor’s and “Aa3” insured by Moody’s for the 11/99 and 3/05 bond issues. 94 DEBT SERVICE FUNDS SUMMARY INDIVIDUAL FY 2009 DEBT SERVICE FUNDS 4/98 BOND FUND REVENUES: Interest Total Revenues EXPENDITURES: Principal Interest Total Expenditures $ 13,000 13,000 10,620,000 1,525,981 12,145,981 $ 11/99 BOND FUND 173,000 173,000 100,000 1,803,375 1,903,375 (1,730,375) 11,790,775 (173,000) 11,617,775 2005 REFUNDING FUND $ 57,000 57,000 150,000 5,973,850 6,123,850 (6,066,850) 6,064,929 (57,000) 6,007,929 Excess (Deficiency) of Revenues (12,132,981) Over (Under) Expenditures OTHER FINANCING SOURCES (USES): 1,330,481 Operating Transfers In Operating Transfers Out (13,000) Total Other Financing Source (Uses) 1,317,481 EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES (10,815,500) FUND BALANCE, BEGINNING FUND BALANCE, ENDING $ 11,515,741 700,241 9,887,400 1,002,987 $ 10,890,387 $ (58,921) 3,199,627 3,140,706 MASTER PLAN BOND FUND REVENUES: Interest Total Revenues EXPENDITURES: Principal Interest Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures OTHER FINANCING SOURCES (USES): Operating Transfers In Operating Transfers Out Total Other Financing Source (Uses) $ 335,000 335,000 12,456,000 12,456,000 (12,121,000) 28,406,000 (335,000) 28,071,000 05/07 REFUNDING FUND $ 44,000 44,000 1,800,000 1,743,763 3,543,763 (3,499,763) 3,469,654 (44,000) 3,425,654 11/07 LAND PURCHASE FUND $ 33,000 33,000 670,000 2,615,567 3,285,567 (3,252,567) 3,059,534 (33,000) 3,026,534 $ 08/08 NDOT FUND 34,000 34,000 900,000 900,000 (866,000) 3,900,000 (34,000) 3,866,000 EXCESS (DEFICIENCY) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES 15,950,000 FUND BALANCE, BEGINNING FUND BALANCE, ENDING 7,245,591 $ 23,195,591 $ (74,108) 2,997,989 2,923,881 $ (226,033) 2,300,000 2,073,968 $ 3,000,000 3,000,000 95 DEBT LIMITS AND CAPACITY DEBT CAPACITY CLARK COUNTY, NEVADA AS OF JUNE 30, 2007 Approximate Assessed Valuation (1) Bonded Debt Limit (2) Statutory Debt Limitation Less: Amount of Debt Applicable to Debt Limit Total General Obligation Indebtedness Available Las Vegas Convention & Visitors Authority $ 93,359,179,034 5% 4,667,958,952 85,135,000 (3) $ 4,582,823,952 Clark County $ 93,359,179,034 10% 9,335,917,903 1,205,915,000 (4) $ 8,130,002,903 (1) This is the net total assessed value for the secured and estimated unsecured property for Clark County, Nevada for FY 2007. It includes the assessed valuation of the redevelopment agencies. These values are included for purposes of calculating the debt limit but are not subject to County taxation for the retirement of general obligation bonded indebtedness. This valuation is used to determine the LVCVA’s debt margin since our debt is issued in the name of the County as described below. (2) State statute requires debt issued by the LVCVA to be issued in the name of the County. The LVCVA’s Board of Directors is empowered to issue general obligation bonds, which are secured by the full faith and credit of the County and are additionally secured by a pledge of revenues derived by the LVCVA. Nevada Revised Statute (NRS) 244A.653 states that the County may not become indebted in excess of 5 percent of the total last assessed valuation of taxable County property for the issuance of general obligation bonds designated for County recreational purposes. This requirement applies to the LVCVA. NRS 244A.059 limits the aggregate principal amount of the County’s general obligation debt to 10 percent of the County’s total reported assessed valuation. (3) The LVCVA’s Outstanding General Obligation indebtedness is comprised of the following general obligation bonds: Bond name 9/96 Refunding/Building Bonds 4/98 Refunding Bonds 5/03 Refunding Bonds 5/07 Refunding Bonds Principal Outstanding $ 1,865,000 35,660,000 9,410,000 38,200,000 $85,135,000 (4) Clark County’s Outstanding General Obligation Indebtedness includes general obligation bonds, general obligation revenue bonds, notes, and medium-term obligations. 96 DEBT SERVICE - BOND COVERAGE The LVCVA’s bonds constitute direct and general obligations of Clark County (except for the 11/99 and the 2005 Refunding Series bonds). They are additionally secured by a pledge of revenues consisting of gross revenues derived from the operation and use of facilities, plus room and gaming taxes (gross pledged revenues), less operating and maintenance expenses of the facilities and collection allocation. Gross pledged revenues also include interest income and miscellaneous fees and charges in the general fund. It does not include the 5/8 of 1% room tax, which until July 1, 1999 was remitted to the LVCVA. This room tax was restricted to being used for advertising and promotion of tourism. Operating and maintenance expenditures include general government, operations and collection allocation. Also included are those marketing expenditures related only to the sales effort of the Las Vegas Convention Center and Cashman Center (i.e. Destination Services, Registration Services, Call Center, Convention Services and Sales). FISCAL YEAR 2000 2001 2002 2003 2004 2005 2006 2007 2008 (est) 2009 (bdgt) GROSS PLEDGED REVENUES $148,442,348 169,111,399 160,456,123 168,352,694 193,181,748 224,770,552 253,172,521 269,118,610 275,617,300 277,295,400 OPERATING AND MAINTENANCE EXPENDITURES $49,685,450 55,663,691 57,726,592 60,312,786 64,156,519 70,377,960 72,285,528 79,106,745 86,612,072 90,377,300 NET PLEDGED REVENUES $98,756,898 113,447,708 102,729,531 108,039,908 129,025,229 154,392,592 180,886,993 190,011,865 189,055,228 186,918,100 DEBT SERVICE PRINCIPAL AND INTEREST $18,699,212 28,365,893 26,134,645 26,129,201 25,237,306 24,477,555 23,223,269 24,391,084 26,273,351 40,358,536 DEBT SERVICE COVERAGE 5.28x 4.00x 3.93x 4.13x 5.11x 6.31x 7.79x 7.79x 7.19x 4.63x DEBT SERVICE AND NET PLEDGED REVENUES 2000 - 2007 ACTUAL 2008 - 2009 PROJECTED Millions 200 190 180 170 160 150 140 130 120 110 100 90 80 70 60 50 40 30 20 10 0 2000 2001 2002 2003 2004 2005 2006 NET PLEDGED REVENUES DEBT SERVICE 2007 2008 (est) 2009 (bdgt) 97 DEBT SERVICE - HISTORICAL PERSPECTIVE Certain outstanding general obligation (limited tax) bonds have been defeased in prior years by placing the proceeds of new refunding bonds in irrevocable trusts to provide for all future debt service payments on the old bonds. These trust accounts and the related defeased bonds are not included in the LVCVA’s budget or financial statements. Information regarding the defeased bonds is provided below: TRUST ACCOUNT 98A Escrow 3/05 Escrow BOND ISSUE 8/1/96 11/99 DEFEASED AMOUNT OUTSTANDING AT 6/30/07 $23,430,000 117,775,000 The schedule below presents a historical record of all debt issued by the LVCVA since it was established, including those bonds defeased by advance refunding. The LVCVA’s Board of Directors has approved a resolution to refund bonds during the latter part of FY 2007 which will result in an estimated savings of $4.5 million over the next 15 years. As of the time of this budget being prepared, the amounts have not been finalized. DATE ISSUED ORIGINAL ISSUE AMOUNT INTEREST RATE PURPOSE STATUS DATE RETIRED/ DEFEASED 1/15/57 12/15/58 7/15/63 1/15/71 7/1/73 5/1/75 4,500,000 1,000,000 4,790,000 7,500,000 6,960,000 12,000,000 5% 4-4.25% 3.5% 4.5-5% 4.5-5.3% 7-8% Original construction of Convention Center $500,000 for construction; $500,000 for recreation grants Refund 1/15/57 and 12/15/58 bonds East Hall expansion - $6,500,000; stadium construction - $1 million Refund 1/15/71 bonds East Hall and kitchen expansion; warehouse and meeting rooms annex construction Refund 5/1/75 bonds Cashman Center construction Purchase land; expansion of East Hall and cafeteria; construction of pedestrian bridge; $2.5 million for recreation grants Refund 7/73, 8/76, 7/80 and 10/80 bonds Refund portion of 12/1/82 bonds Expansion of Convention Center Purchase land; refund a portion of 6/1/88 bonds Expansion of Convention Center & Cashman Center, refund 6/1/86 bonds Refund a portion of 8/1/93 and 9/1/96 bonds Grant to the University of Nevada Las Vegas for the purpose of improvements to the Thomas and Mack Center and Sam Boyd Stadium Expansion of Convention Center Refund 8/93 Bonds Refund a portion of the 11/99 bonds Refunded by 7/15/63 bonds Refunded by 7/15/63 bonds Retired Refunded by 7/1/73 bonds Refunded by 12/1/82 bonds Refunded by 8/31/76 bonds 1/15/77 1/15/68 7/15/73 1/15/82 1/1/85 8/31/76 8/31/76 7/1/80 10/1/80 12,225,000 22,000,000 20,000,000 6.2-6.3% 7-8.5% 9% Refunded by 12/1/82 bonds Refunded by 12/1/82 bonds Refunded by 12/1/82 bonds 12/1/82 12/1/82 12/1/82 12/1/82 6/1/86 6/1/88 8/1/93 9/1/96 52,825,000 38,240,000 35,000,000 80,530,000 97,425,000 7-10.9% 5.9-8% 7-10% 4.8-5.2% 5.4-6% Retired Refunded by 9/1/96 bonds Partially refunded by 8/1/93 bonds Partially refunded by 98A and 5/03 Partially refunded by 98A and 5/07 Outstanding – Final payment date FY 2027 Retired 7/1/93 9/1/96 7/1/98 7/1/03 7/1/08 4/1/98A 4/1/98B 36,200,000 5,020,000 4.7-5.1% 4.5% Outstanding 7/1/03 11/99 5/03 3/05 150,000,000 35,075,000 118,745,000 4.8-6% 1.2-2.1% 3.0-5.25% Partially refunded by 3/05 – Final payment date FY 2013 Retired Outstanding – Final payment date FY 2020 Outstanding 7/1/08 Outstanding 98 DEBT SERVICE - HISTORICAL PERSPECTIVE DATE ISSUED ORIGINAL ISSUE AMOUNT INTEREST RATE PURPOSE STATUS DATE RETIRED/ DEFEASED 05/07 11/07 38,200,000 50,000,000 4.0-5.5% 4.0-6.0% Refunded 8/96 Bonds Purchase land Outstanding – Final payment date FY 2022 Outstanding – Final payment date FY 2038 Partially issued. Board authorized issuance of $822,000,000, ($680 million in Feb. 2006 and $142 million in May 2007). Outstanding – Final payment date FY 2039. Total NDOT bonds authorized $300,000,000 Partially issued. Board authorized issuance of $822,000,000, ($680 million in Feb. 2006 and $142 million in May 2007). Proposed – Final payment date FY 2039. Total NDOT bonds authorized $300,000,000 Partially issued. Board authorized issuance of $822,000,000, ($680 million in Feb. 2006 and $142 million in May 2007). Outstanding Outstanding FY 2007 16,000,000 variable Issue commercial paper for the Las Vegas Convention Center’s Master Plan Enhancement Program Nevada Department of Transportation Partial 08/08 45,000,000 Unknown Proposed FY 2008 80,000,000 variable Issue commercial paper for the Las Vegas Convention Center’s Master Plan Enhancement Program Nevada Department of Transportation Partial 06/09 255,000,000 Unknown Proposed FY 2009 255,000,000 variable Issue commercial paper for the Las Vegas Convention Center’s Master Plan Enhancement Program Proposed 99 PERSONNEL ALLOCATION SUMMARY OF PERSONNEL REQUESTS BUDGET PROCESS In the early stages of the budget process, personnel requests along with detailed justifications and other supporting documentation are submitted. Budget meetings and further analysis resulted in a reduction of requests. Every effort is made to limit the number of new employees while ensuring efficient operation of the LVCVA. The positions are funded in payroll suspense and are not reflected in any division’s budget. Funds will be transferred from the payroll suspense account to the appropriate budget as each position is filled. If any new positions had been requested, a summary of the justifications of each requested position along with proposed cost, which equals annual base salary plus employee benefits, would be presented below. However, due to the current and projected expenses due to the building enhancement and the Department of Transportation bonds, the LVCVA has instituted a strategy of deferring any new requests for personnel until next fiscal year. Reclassifications of current positions are approved by the President, except for executive (E-Level) positions. In a recent comprehensive classification and compensation study performed by two consultants, three positions were recommended for reclassification, which management has agreed with: Title Vice President, Convention Sales Vice President, Facilities Senior Director, Information Technology to Vice President, Information Technology Current Class E5 E5 M1 Reclass E4 E4 E5 There is no budget impact, as no salary increases are associated with reclassifications. 100 PERSONNEL ALLOCATION SUMMARY OF AUTHORIZED POSITIONS by organizational unit/section FYE 6/30/05 GENERAL GOVERNMENT Executive Human Resources Public Affairs** 15 7 -22 17 8 12 37 17 10 14 41 17 10 18 45 17 10 18 45 FYE 6/30/06 FYE 6/30/07 FYE 6/30/08 FYE 6/30/09 MARKETING Advertising Internet Marketing & Research Sports Marketing Sales Convention Center Sales Diversity Marketing Convention Sales Tourism Leisure Sales International Sales Destination Services Registration Services Call Center Visitor Information Convention Services Public Affairs 2 5 2 44 ---19 --10 4 26 18 15 12 157 2 6 2 -12 2 30 -17 2 10 4 26 18 15 -146 2 6 4 -12 4 30 -17 2 10 4 26 18 15 -150 2 7 4 -12 4 28 -15 8 10 4 24 18 16 -152 2 7 4 -12 4 28 -15 8 10 4 24 18 16 -152 OPERATIONS Facilities Client Services Engineering Systems**** Engineering Maintenance**** Engineering**** Security Traffic Physical Security Finance Purchasing Materials Management Information Technology Transportation Project Development Customer Experience*** 2 113 49 49 -47 5 6 20 9 9 12 -3 -324 503 -112 50 49 -49 11 5 19 9 9 12 -5 -330 513 -116 --100 50 15 5 21 10 9 12 -6 2 346 537 -126 --111 39 17 17 22 11 10 15 -7 2 377 574 -126 --111 39 17 17 22 11 10 15 -7 2 377 574 TOTAL LVCVA **Public Affairs moved to the Executive Division in FY 2006. ***Customer Experience department was created during FY 2006 as part of the Executive department, but in FY 2007 became a separate department under the Operations Division. ****Beginning in FY 2007 Engineering Systems and Engineering Maintenance were combined into one department, Engineering. 101 PERSONNEL ALLOCATION The following is the staffing pattern by organizational unit/section for FY 2009. All new positions, transfers, reclassifications, title changes and changes resulting from re-organizations are included. Upon approval by the Board of Directors at the public budget hearing, this staffing pattern will be authorized as of July 1, 2008. Total authorized positions: 574 EXECUTIVE (General Government) Secretary Administrative Assistant Executive Assistant to the Board Executive Assistant Internal Auditor Staff Auditor Executive Admin. Assistant to the President Director of Internal Audit Vice President of Strategic Planning Legal Counsel Senior Vice President of Marketing Senior Vice President of Operations Executive Vice President President and CEO 1 2 1 2 2 1 1 1 1 1 1 1 1 1 17 DIVERSITY MARKETING (Marketing) Secretary Administrative Secretary Sales Executive Director of Diversity Marketing 1 1 1 1 4 PUBLIC AFFAIRS (General Government) Secretary Photographer Video Specialist Curator Lead Photographer Administrative Assistant Media Specialist Public Relations Specialist Senior Manager of News Bureau Senior Manager of Public Relations Senior Manager of International PR VP of Resort Industry & Business Relations Vice President of Public Affairs 2 3 1 1 1 2 1 2 1 1 1 1 1 18 CONVENTION SALES (Marketing) Administrative Specialist - Chicago Administrative Specialist - WDC Secretary Secretary - Chicago Secretary - WDC Administrative Secretary Sales Representative Sales Executive Sales Executive - Chicago Sales Executive - WDC Senior Manager of Regional Sales - Chicago Senior Manager of Regional Sales - WDC Director of Convention Sales 1 1 7 2 2 1 3 6 1 1 1 1 1 28 LEISURE SALES (Marketing) Secretary Secretary - Laughlin Administrative Secretary Sales Representative - Laughlin Sales Executive Senior Manager of Regional Sales - Laughlin Senior Director of Leisure Sales 5 1 1 1 5 1 1 15 HUMAN RESOURCES (General Government) Human Resources Representative Learning & Development Specialist Employee Relations Coordinator Administrative Assistant Benefits Coordinator HR Information Systems Administrator Learning & Development Manager Director of Human Resources Vice President of Human Resources 2 1 1 1 1 1 1 1 1 10 INTERNATIONAL SALES (Marketing) Secretary Administrative Secretary Administrative Assistant Sales Executive Director of International Sales VP of International Brand Strategy 2 1 1 2 1 1 8 ADVERTISING (Marketing) Secretary Advertising Executive 1 1 2 DESTINATION SERVICES (Marketing) Administrative Specialist Account Representative Administrative Secretary Database Marketing Administrator Marketing Systems Manager Director of Destination Services 4 2 1 1 1 1 10 102 PERSONNEL ALLOCATION SPORTS MARKETING (Marketing) Secretary Administrative Secretary Sales Executive/Outlying Areas Director of Sports Marketing 1 1 1 1 4 REGISTRATION SERVICES (Marketing) Administrative Specialist Registration Services Supervisor Registration Services Manager 2 1 1 4 INTERNET MKTG & RESEARCH (Marketing) Administrative Secretary Research Analyst Senior Research Analyst Web Content Coordinator Web Publisher Internet Marketing Manager Director of Internet Marketing & Research 1 1 1 1 1 1 1 7 CONVENTION CENTER SALES (Marketing) Secretary Administrative Assistant Sales Executive Vice President of Convention Sales 5 1 5 1 12 CALL CENTER (Marketing) Call Center Agent Call Center Supervisor Call Center Manager 19 4 1 24 VISITOR INFORMATION (Marketing) Visitor Information Clerk Visitor Information Center Supervisor Visitor Information Supervisor Visitor Information Manager 12 4 1 1 18 ENGINEERING (Operations) Secretary Administrative Secretary Administrative Assistant CMMS Dispatcher CMMS Coordinator Facility Support Technician Groundskeeper Graphics Technician Skilled Craftsman - Carpenter Skilled Craftsman – Communications Skilled Craftsman - Electrician Skilled Craftsman – HVAC Skilled Craftsman - Mechanic/Welder Skilled Craftsman - Painter Skilled Craftsman - Plumber Quality and Inventory Control Technician CMMS Administrator Facility Support Supervisor Graphics Supervisor Grounds Supervisor Communications Supervisor Engineering Assistant Supervisor Engineering Maintenance Supervisor Skilled Crafts Supervisor Senior Manager of Engineering Systems Sr. Manager of Engineering Maintenance Director of Facility Operations Director of Facility Projects Director of Engineering Vice President of Facilities CONVENTION SERVICES (Marketing) Administrative Specialist Secretary Leasing Administrator Convention Services Manager Director of Convention Services 1 2 1 1 1 1 13 2 12 8 13 10 7 8 7 1 1 1 1 2 2 2 2 6 1 1 1 1 1 1 111 1 3 1 10 1 16 CLIENT SERVICES (Operations) Custodian Service Worker Administrative Secretary Services Supervisor Facility Operations Manager Director of Client Services 57 54 1 11 2 1 126 SECURITY (Operations) Secretary Security Officer Administrative Secretary Security Sergeant Canine Supervisor Security Manager Director of Security 1 30 1 4 1 1 1 39 TRAFFIC (Operations) Security Officer Traffic Field Supervisor Administrative Traffic Supervisor Security Sergeant Traffic Manager 10 2 1 3 1 17 103 PHYSICAL SECURITY (Operations) Security Dispatcher Surveillance Investigator Control Center Supervisor Life Systems Coordinator Safety Coordinator Safety Supervisor Physical Security Manager 8 2 1 1 3 1 1 17 PERSONNEL ALLOCATION CUSTOMER EXPERIENCE (Operations) Administrative Secretary Director of Customer Experience 1 1 2 MATERIALS MANAGEMENT (Operations) Mail Clerk Distribution Center Clerk Materials Service Worker Copy Center Specialist Mail Room/Copy Center Coordinator Distribution Center Coordinator Materials Management Manager 3 1 2 1 1 1 1 10 FINANCE (Operations) Accounting Specialist Accounting Technician Payroll Specialist Lead Payroll Technician Secretary Records Management Specialist Administrative Assistant Analyst Transportation Coordinator Management Specialist Accountant Management Analyst Financial Analyst Senior Financial Analyst Financial Systems Administrator Financial Resources Manager Financial Systems Manager Senior Manager of Accounting Operations Vice President of Finance 2 3 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 22 INFORMATION TECHNOLOGY (Operations) Administrative Secretary Portable Systems Technician Senior Help Desk Specialist Systems Technician Programmer Analyst Systems Administration Specialist Senior Web Developer Telecommunications Supervisor Network Supervisor Software Development Supervisor Support Systems Supervisor Senior Director of Information Technology 1 1 2 1 2 2 1 1 1 1 1 1 15 PURCHASING (Operations) Secretary Administrative Secretary Purchasing Assistant Buyer Senior Buyer Contracts Coordinator Contracts Administrator Purchasing Manager Director of Purchasing 1 1 2 2 1 1 1 1 1 11 PROJECT DEVELOPMENT (Operations) AutoCAD Technician Administrative Secretary Project Planner Project Coordinator Director of Project Development 1 1 3 1 1 7 Personnel Level vs Operating Expenditures 580 # of Employees 560 540 520 500 480 460 100,000,000 Operating Expenditures 80,000,000 60,000,000 40,000,000 20,000,000 - FY 05 FY 06 Personnel FY 07 FY 08 FY 09 Operating Expenditures Operating expenditures, as presented in the graph above, include General Government, Marketing (not including Advertising), and Operations Division expenditures. 104 PERSONNEL ALLOCATION BARGAINING AND NONBARGAINING UNIT CLASSIFICATIONS The salary schedule for the bargaining (B) positions is effective from 7/1/07 to 6/30/08. Contract negotiations are currently underway for the new union contract. CLASS TITLE Account Representative Accountant Accounting Specialist Accounting Technician Administrative Assistant Administrative Secretary Administrative Specialist Administrative Specialist – Chicago/WDC Administrative Traffic Supervisor Analyst AutoCAD Technician Benefits Coordinator Buyer Call Center Agent Call Center Supervisor Canine Supervisor Communications Supervisor CMMS Administrator CMMS Coordinator CMMS Dispatcher Contracts Administrator Contracts Coordinator Control Center Supervisor Copy Center Specialist Curator Custodian Database Marketing Administrator Distribution Center Clerk Distribution Center Coordinator Employee Relations Coordinator Engineering Assistant Supervisor Engineering Maintenance Supervisor Executive Admv Assistant to President Executive Assistant Executive Assistant to the Board Facility Support Supervisor Facility Support Technician Financial Analyst Financial Systems Administrator Graphics Supervisor Graphics Technician Grounds Supervisor Groundskeeper HR Information Systems Administrator Human Resources Representative CLASSIFICATION NB NB B B NB NB B NB NB NB B NB B B NB NB B NB NB B NB NB NB B NB B NB B B NB B B NB NB NB B B NB NB B B B B NB NB 105 GRADE 18 22 16 20 22 20 13 13 22 22 20 22 20 13 22 22 25 29 20 15 23 19 22 14 20 9 23 13 20 22 22 25 29 23 23 25 20 26 29 25 20 22 17 29 16 SALARY SCHEDULE 38,294.27 56,716.14 44,842.41 66,351.82 35,517.51 52,468.12 41,423.26 61,399.26 44,842.41 66,351.82 41,423.26 61,399.26 31,538.86 46,541.58 31,538.86 46,541.58 44,842.41 66,351.82 44,842.41 66,351.82 41,423.26 61,399.26 44,842.41 66,351.82 41,423.26 61,399.26 31,538.86 46,541.58 44,842.41 66,351.82 44,842.41 66,351.82 50,499.52 74,723.53 59,016.26 87,446.85 41,423.26 61,399.26 34,087.70 50,499.52 46,541.58 68,983.54 39,910.56 59,016.26 44,842.41 66,351.82 32,740.76 48,510.19 41,423.26 61,399.26 26,917.89 39,910.56 46,541.58 68,983.54 31,538.86 46,541.58 41,423.26 61,399.26 44,842.41 66,351.82 44,842.41 66,351.82 50,499.52 74,723.53 59,016.26 87,446.85 46,541.58 68,983.54 46,541.58 68,983.54 50,499.52 74,723.53 41,423.26 61,399.26 52,468.12 77,728.20 59,016.26 87,446.85 50,499.52 74,723.53 41,423.26 61,399.26 44,842.41 66,351.82 36,843.73 54,457.45 59,016.26 87,446.85 35,517.51 52,468.12 PERSONNEL ALLOCATION BARGAINING AND NONBARGAINING UNIT CLASSIFICATIONS (continued) The salary schedule for the bargaining (B) positions is effective from 7/1/07 to 6/30/08. Contract negotiations are currently underway for the new union contract. CLASS TITLE Internal Auditor Lead Payroll Technician Lead Photographer Learning & Development Specialist Leasing Administrator Life Systems Coordinator Mail Clerk Mail Room/Copy Center Coordinator Management Analyst Management Specialist Materials Service Worker Media Specialist Network Supervisor Payroll Specialist Photographer Portable Systems Technician Programmer Analyst Project Coordinator Project Development Planner Public Relations Specialist Purchasing Assistant Quality & Inventory Control Tech Records Management Specialist Registration Services Supervisor Research Analyst Safety Coordinator Safety Supervisor Secretary Secretary – Chicago, WDC & Laughlin Security Dispatcher Security Officer Security Sergeant Senior Buyer Senior Financial Analyst Senior Help Desk Specialist Senior Research Analyst Senior Web Developer Service Worker Services Supervisor Skilled Crafts Supervisor Skilled Craftsman Software Development Supervisor Staff Auditor Support Systems Supervisor Surveillance Investigator CLASSIFICATION NB NB B NB NB B B B NB NB B NB NB NB B NB NB NB NB NB B B NB NB NB B NB B NB B B B B NB NB NB NB B B B B NB NB NB NB 106 GRADE 26 22 20 18 23 25 12 20 25 16 14 22 32 16 18 22 29 25 25 22 18 20 18 22 21 25 27 16 16 15 17 22 23 29 22 29 31 14 22 25 20 32 22 32 18 SALARY SCHEDULE 52,468.12 77,728.20 44,842.41 66,351.82 41,423.26 61,399.26 38,294.27 56,716.14 46,541.58 68,983.54 50,499.52 74,723.53 30,274.88 44,842.41 41,423.26 61,399.26 50,499.52 74,723.53 35,517.51 52,468.12 32,740.76 48,510.19 44,842.41 66,351.82 66,351.82 98,305.15 35,517.51 52,468.12 38,294.27 56,716.14 44,842.41 66,351.82 59,016.26 87,446.85 50,499.52 74,723.53 50,499.52 74,723.53 44,842.41 66,351.82 38,924.27 56,716.14 41,423.26 61,399.26 38,294.27 56,716.14 44,842.41 66,351.82 43,184.67 63,844.50 50,499.52 74,723.53 54,457.45 80,815.83 35,517.51 52,468.12 35,517.51 52,468.12 34,087.70 50,499.52 36,843.73 54,457.45 44,842.41 66,351.82 46,541.58 68,983.54 59,016.26 87,446.85 44,842.41 66,351.82 59,016.26 87,446.85 63,844.50 94,595.93 32,740.76 48,510.19 44,842.41 66,351.82 50,499.52 74,723.53 41,423.26 61,399.26 66,351.82 98,305.15 44,842.41 66,351.82 66,351.82 98,305.15 38,294.27 56,716.14 PERSONNEL ALLOCATION BARGAINING AND NONBARGAINING UNIT CLASSIFICATIONS (continued) The salary schedule for the bargaining (B) positions is effective from 7/1/07 to 6/30/08. Contract negotiations are currently underway for the new union contract. CLASS TITLE Systems Administration Specialist Systems Technician Telecommunications Supervisor Traffic Field Supervisor Transportation Coordinator Video Specialist Visitor Information Center Supervisor Visitor Information Clerk Visitor Information Supervisor Web Content Coordinator Web Publisher CLASSIFICATION NB NB NB NB NB B NB B NB NB NB GRADE 29 22 32 22 24 18 22 13 25 23 26 SALARY SCHEDULE 59,016.26 87,446.85 44,842.41 66,351.82 66,351.82 98,305.15 44,842.41 66,351.82 48,510.19 71,843.18 38,294.27 56,716.14 44,842.41 66,351.82 31,538.86 46,541.58 50,499.52 74,723.53 46,541.58 68,983.54 52,468.12 77,728.20 107 STATISTICAL DATA GENERAL FUND REVENUES BY SOURCE LAST TEN FISCAL YEARS The schedule below includes only revenues earned in the general fund. It does not include other financing sources such as operating transfers into the general fund or sale of fixed assets. The percentage shown in the column boxes indicate the percent of increase or decrease for that column compared to the preceding year. FISCAL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 TOTAL REVENUES $118,296,737 136,347,308 149,507,345 169,111,399 160,456,123 168,352,692 193,181,748 224,770,553 253,172,521 269,118,610 ROOM TAXES $86,249,080 2% ROOM TAXNRS 244 (S.B. 170) $11,256,130 12,777,779 1,064,997 ------------------------------------------------------2% 14% -92% 0% 0% 0% 0% 0% 0% CHARGES FOR SERVICE $16,458,277 22,226,496 23,598,086 27,698,278 32,483,745 34,644,609 37,353,827 45,056,357 48,359,639 50,916,320 3% 35% 6% 17% 17% 7% 8% 21% 7% 5% GAMING FEES $1,783,015 1,722,086 1,775,145 2,085,169 2,001,338 1,881,540 1,914,920 1,861,748 1,963,608 1,949,332 21% -3% 3% 18% -4% -6% 2% -3% 5% -<1% INTEREST AND OTHER $2,550,235 1,748,593 2,532,816 3,486,581 1,799,218 1,077,073 793,850 1,513,190 2,762,447 2,996,882 97,872,354 13% 120,536,301 23% 135,841,371 13% 124,171,822 130,749,470 -9% 5% ---------- -100% * 153,119,151 17% 176,339,258 15% 200,086,827 13% 213,256,076 7% Room Tax Revenue Millions 250 200 150 100 50 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Room Taxes Charges for Service Revenue Millions 60 50 40 30 20 10 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Charges for Service *As of July 1, 1999, the special promotion room tax was diverted to the Clark County School District for new school construction. 108 STATISTICAL DATA GENERAL FUND REVENUES BY SOURCE LAST TEN FISCAL YEARS (continued) The components of “Charges for Service” are shown below: the percentages shown in the column boxes indicate the percent increase or decrease for that column compared to the preceding year. TOTAL FISCAL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 CHARGES FOR SERVICE $16,458,277 22,226,496 23,598,086 27,698,278 32,483,745 34,644,609 37,353,827 45,056,357 48,359,639 50,916,320 CONVENTION CENTER FACILITIES RENTAL $10,490,812 14,375,925 15,171,576 19,035,306 24,001,457 25,807,382 27,053,317 33,406,123 36,089,748 36,280,156 2% 37% ** 6% 26% 26% 8% 5% 23% 8% <1% CATERING & CONCESSIONS $2,924,680 3,814,495 3,810,119 3,850,719 4,067,516 4,268,815 5,415,860 6,899,231 6,493,289 6,917,274 -2% 30% <1% 1% 6% 5% 3% 27% -5% 7% CASHMAN CENTER FACILITIES RENTAL $1,269,295 1,536,480 1,677,482 1,885,896 1,919,459 1,980,546 1,895,910 1,968,685 2,182,678 5% 21% ** 9% 15% 24% 3% -4% 3% 11% CATERING & CONCESSIONS $169,739 164,911 283,761 162,162 178,041 146,953 -5% -3% 72% 2% 23% -7% OTHER FEES & CHARGES $1,603,751 2,334,685 2,655,148 2,767,606 2,701,916 2,504,566 2,726,063 2,695,646 3,660,964 5,411,821 158,751 -44% 144,387 -11% 159,447 -10% 124,392 -15% 1,550,694 -18% ** Increase due to increase in rental rates at both facilities. The Convention Center expansion (i.e. additional halls and meeting rooms) was also completed in FY 1999. Millions 40 35 30 25 20 15 10 5 - Facilities Rental - LVCC Millions 8 7 6 5 4 3 2 1 - Catering & Concessions - LVCC 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Facilities Rental - LVCC Catering & Concessions - LVCC Facilities Rental - Cashman Millions 2.5 2.0 1.5 1.0 0.5 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $- Catering & Concessions - Cashman 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Catering & Concessions - Cashman Facilities Rental - Cashman 109 STATISTICAL DATA GENERAL FUND EXPENDITURES BY SOURCE LAST TEN FISCAL YEARS The schedule below includes only expenditures in the general fund. It does not include other uses such as operating transfers for special revenue, debt service or capital project funds. The percentages shown in the column boxes indicate the percent of increase or decrease for that column compared to the preceding year. REMAINING FISCAL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 TOTAL EXPENDITURES $108,278,032 103,494,864 111,791,730 133,020,634 140,940,658 140,863,330 151,864,095 176,076,252 193,486,005 205,278,234 PERSONNEL (A) $25,735,398 27,291,137 29,065,820 32,499,587 34,922,148 35,723,305 37,113,372 37,988,620 40,185,908 44,145,739 0% 6% 6% 12% 7% 2% 4% 2% 6% 10% ADVERTISING (B) $27,033,664 28,039,590 34,359,091 48,196,736 60,058,012 59,059,994 64,831,141 78,027,753 82,732,989 84,506,694 5% 4% 23% 40% 25% -2% 10% 20% 6% 2% BUILDING (C) $3,739,289 -12% 4,589,887 4,644,749 5,001,774 6,263,385 6,858,458 7,142,396 8,712,917 9,180,097 10,696,262 23% 1% 8% 25% 10% 4% 22% 5% 17% * COMMUNITY SUPPORT (D) $35,653,165 26,694,290 27,376,226 21,511,863 24,388,640 28,753,093 34,248,193 38,416,171 38% 3% 3% 3% 13% 18% 19% 12% SUPPLIES & SERVICES $16,116,516 16,001,450 17,027,780 19,946,311 18,892,853 17,709,710 18,388,546 22,593,869 27,143,818 27,513,368 27,572,800 -29% ** 20,807,260 -24% (A) The column labeled “Personnel” includes salaries and employee benefits. (B) Advertising includes only the services and supplies. (C) The “Building” column includes repairs and maintenance (excludes computers and portable equipment), utilities, and insurance costs for the Convention Center and Cashman Center. Many repair and maintenance items can only be performed when the buildings are empty which results in fluctuating costs from year to year. (D) The “Community Support” column includes collection allocation, grants, and special events. * ** Increase due to construction and opening of new halls and meeting rooms. Decrease due to loss of the 5/8 of 1% room tax that was restricted to the promotion of tourism and special events. Expense Trend - Advertising Millions 100 80 60 40 20 0 Expenditures Trends Millions 50 40 30 20 10 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Personnel Building Remaining Supplies & Services 04 98 99 00 01 02 03 05 06 20 20 19 19 20 20 20 20 Advertising 20 20 07 Community Support 110 STATISTICAL DATA GENERAL FUND EXPENDITURES BY SOURCE LAST TEN FISCAL YEARS (continued) The components of personnel expenditures are shown below. The percentages shown in the column boxes indicate the percent of increase for that column compared to the preceding year. FISCAL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 PERSONNEL EXPENDITURES 25,735,398 27,291,137 29,065,820 32,499,587 34,922,148 35,723,305 37,113,372 37,988,620 40,185,908 44,145,739 SALARIES AND WAGES 19,787,987 21,068,200 22,337,889 25,026,869 26,597,881 27,615,392 28,220,780 28,746,860 30,285,218 33,251,674 2% 6% 6% 12% 6% 4% 2% 2% 5% 10% EMPLOYEE BENEFITS 5,947,411 6,222,937 6,727,931 7,472,718 8,324,267 8,107,913 8,881,472 9,231,120 9,900,690 10,894,065 -6% 5% 8% 11% 11% -3% 10% 4% 7% 10% BENEFITS AS A PERCENT OF SALARIES 30% 30% 30% 30% 31% 29% 31% 32% 33% 33% Salaries and Benefits Millions 50 40 30 20 10 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Salaries & Wages Employee Benefits 111 STATISTICAL DATA USE OF FACILITIES LAST TEN FISCAL YEARS The yearly increase in the number of convention delegates visiting Las Vegas is related to a rise in total conventions held in the Las Vegas area. While many of those conventions and events are held at resort hotels, the LVCVA has also benefited from activities held at the Las Vegas Convention Center and Cashman Center. Facilities usage revenue does not include catering/concessions revenues or reimbursed services. LAS VEGAS CONVENTION CENTER - BUILDING UTILIZATION FISCAL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 TOTAL ACTIVITIES 240 173 170 168 **88 105 108 96 106 96 FACILITIES USAGE REVENUE 10,243,852 *14,135,912 14,848,193 18,818,224 *23,841,647 25,599,432 26,877,290 33,244,601 35,825,314 35,961,813 CONVENTIONS 57 50 68 68 63 79 80 74 84 78 EVENTS 7 17 18 4 8 3 4 12 12 15 MEETINGS 176 106 84 96 17 23 24 10 10 3 Source: Las Vegas Convention and Visitors Authority – Convention Services and Finance departments * Increase due to rental rate increase and expansion opening. **2002 activity counts are based on an updated methodology that removes in-house meeting room events such as internal meetings and employee events. LVCC Activities vs. Facility Usage Revenue 300 # of Activities 250 200 150 100 50 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Total Activities Facilities Usage Revenue Millions 40 30 20 10 0 Facility Usage Revenue 112 STATISTICAL DATA USE OF FACILITIES LAST TEN FISCAL YEARS (continued) CASHMAN CENTER - BUILDING UTILIZATION FISCAL YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 TOTAL ACTIVITIES 456 484 447 495 451 479 **217 203 240 257 FACILITIES USAGE REVENUE 1,238,679 1,524,804 1,846,319 1,837,459 1,532,790 1,904,130 1,971,544 1,884,378 1,966,014 2,157,445 CONVENTIONS 1 3 4 10 8 6 4 6 4 4 EVENTS 175 166 177 224 218 241 136 135 137 158 MEETINGS 280 315 266 261 225 232 77 62 99 95 Source: Las Vegas Convention and Visitors Authority – Convention Services and Finance departments **2004 activity counts are based on an updated methodology that removes in-house meeting room events such as internal meetings and employee events. Cashman Center Activities vs. Facility Usage Revenue 600 500 400 300 200 100 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Total Activities Facilities Usage Revenue Millions 2.5 2 1.5 1 0.5 0 Facility Usage Revenue # of Activities 113 STATISTICAL DATA EXCERPT OF RENTAL RATES PER FACILITY In mid-FY 2002, the Board of Directors approved rental rate increases at both the Las Vegas Convention Center and Cashman Center. Below is a basic rate guide. Events and trade show/conventions that already had signed lease agreements prior to January 1, 2002 were honored at the previous rates. LAS VEGAS CONVENTION CENTER CONVENTION/TRADE SHOW AND PUBLIC EVENTS When used for commercial exhibits, the cost per individual exhibit hall is either the minimum daily rate (ranges from $5,500 to $30,500) or $.25 per net square foot, whichever is greater. Exhibit halls used for catered food functions only are at no charge. The total number of move in/move out days equal to one (1) times the number of show days are at no charge. Additional move in/move out days are at 50% of the minimum daily rate per day. Beginning in FY10, the net square foot cost will increase to $.29, and in FY13 the net square foot cost will increase to $.34. When exhibit halls are used for commercial exhibits and meeting rooms are used for association's use, meeting rooms will be provided in the amount of 10 complimentary meeting rooms per 100,000 square feet of exhibit space used. Additional rooms will be charged the minimum daily room rate (ranges from $125 to $1,475). This includes a one-time set-up per day – i.e. lights, heat, air, custodial and sound services (one microphone per room). Change-overs and revised room set-ups will be charged the daily room rate. Meeting rooms used by exhibitors are charged the daily rate. Exhibit halls used for meetings without commercial exhibits are charged twice the daily rate. If meeting rooms are sublet, a fee will be charged. Rental of meeting rooms only is at the daily rate. Parking fees are $10.00 per space per day with in and out privileges. CASHMAN CENTER CONVENTION/TRADE SHOW Exhibit hall rates are based on $0.25 per net square foot or $6,130 minimum. The total days of move-in/moveout equal the number of actual show days (minimum two days at no charge). Extra move-in/move-out days are at 50% of the minimum daily rate. Meeting rooms are $300 per day and leased at three levels: (1) Used by a lessee for their association meetings only will be charged at the minimum daily rate. (2) Sublet by the lessee for meetings only will be charged the minimum daily rate or 15% of their sublease rate, whichever is greater. (3) Used for exhibit space or registration areas will be charged at twice the minimum daily rate. PUBLIC EVENT Exhibit hall rates are set at $3,000 per day for each hall or 12% of gross admission receipts, whichever is greater. Extra move-in/move-out days are charged at 50% of the minimum daily rate for activity days for all events less than two days duration. Meeting room rental rates are $300 per day ($800 per day if using the Club Level Restaurant) or 12% of gross admission receipts, whichever is greater. The stadium rental rate is $4,000 per day vs. 12% of gross admission receipts, whichever is greater. The daily field rate (restricted use) is $500 per day. The theater rental rate for performances is $2,500 per day vs. 12% of gross admission receipts, whichever is greater. Business meeting use rate for the theater is $1,250 per day. Dress rehearsals performed prior to actual show days are charged 50% of the minimum daily rate. Parking fees are $3.00 per car per day with no in and out privileges. As referenced against closed-to-the-public conventions and trade shows, public invited events come in a wide variety of compositions and are subject to different rate classifications: full rental, half rental and cost reimbursable. 114 STATISTICAL DATA DEMOGRAPHIC STATISTICS - CLARK COUNTY, NEVADA LAST TEN FISCAL YEARS Even though Clark County combines the glamorous gaming and entertainment mecca of Las Vegas alongside rural living, it is not much different from other counties its size. There are parks, museums, libraries and religious centers. The median age of the population is 50.1, with approximately 23.9% of the total population under 18 years of age. The Clark County School District is the 5th largest in the nation. It has a total of 341 schools. The median household income is $53,704 and 68.6% of the residents are homeowners. Per the Census Bureau, Clark County is the nation’s 16th most populous county in the United States. This is evident in that 55.1% of the population has lived here over ten years, and almost 50 newcomers arrive daily. The population in FY 2007 increased by 4.2% over FY 2006. Incorporation Date 1909 1911 1946 1953 1958 1984 2007 Population 858,715 590,321 210,472 260,161 15,863 18,787 Square Miles (approx.) 8,260 110 80 96 200 15 Source: www.co.clark.nv.us/ceit/gismo/gismo Entity Clark County Las Vegas N. Las Vegas Henderson Boulder City Mesquite Clark County, Nevada Source: population estimates - Nevada State Demographer. Further statistics that reflect the local economy are shown below. MEDIAN AS OF DEC 31, 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 HOUSEHOLD INCOME 40,958 41,875 41,657 43,787 45,607 44,307 47,097 47,320 53,111 53,704 MEDIAN AGE 47.5 46.6 48.5 46.3 47.8 48.4 47.5 47.9 47.5 50.1 SCHOOL ENROLLMENT (C) 239,064 216,237 231,125 257,754 269,382 283,885 295,165 304,444 315,697 323,037 LABOR AS OF JUNE 30, 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 POPULATION (A) 1,261,150 1,327,145 1,394,440 1,485,855 1,549,657 1,620,748 1,715,337 1,796,380 1,874,837 1,954,319 FORCE (B) 665,800 704,870 724,110 757,910 781,800 805,300 834,230 875,710 922,420 958,400 UNEMPLOYMENT RATE (B) 4.6% 4.6% 4.7% 5.3% 6.1% 5.8% 4.8% 4.3% 4.3% 4.7% Sources: (A) June 30 population estimates from the Nevada State Demographer. (B) June 30 labor force statistics and unemployment rates from the Nevada Dept. of Employment, Training & Rehabilitation – Information Development & Processing Division – Research & Analysis Bureau. (figures rounded) (C) Total public, private and parochial school enrollment for FY 1998 – 2003 are from the Nevada Department of Education, Administrative & Fiscal Services. FY 2004 – 2007 is from the Las Vegas Perspective. All other statistics are as of December 31 and are from the Las Vegas Perspective. 115 STATISTICAL DATA VISITOR ANALYSIS LAST TEN CALENDAR YEARS In its role of promoting Las Vegas as a travel destination, the LVCVA contributes to the growth of the entire local economy. The Las Vegas economy is heavily dependent on the hotel/gaming/recreation industry, which employs 29.3% of the labor force. The health of the hotel/gaming industry is directly related to the volume of visitors, presented below. The number of visitors to Las Vegas has grown by 28% since 1998. % OF TOTAL VISITORS 10.8% 11.2% 10.7% 14.5% 14.6% 15.9% 15.3% 16.0% 16.2% 15.8% % OF TOTAL VISITORS 89.2% 88.8% 89.3% 85.5% 85.4% 84.1% 84.7% 84.0% 83.8% 84.2% CALENDAR YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 CONVENTION DELEGATES 3,301,705 3,772,726 3,853,363 5,014,240* 5,105,450* 5,657,796 5,724,864 6,166,194 6,307,961 6,209,253 TOURISTS 27,303,423 30,036,408 31,996,328 30,003,077 29,966,054 29,882,330 31,663,917 32,400,523 32,606,928 32,987,508 TOTAL VISITORS 30,605,128 33,809,134 35,849,691 35,017,317 35,071,504 35,540,126 37,388,781 38,566,717 38,914,889 39,196,761 INCREASE/ (DECREASE) 0.5% 10.5% 6.0% (2.3%) 0.2% 1.3% 5.2% 3.2% 0.9% 0.7% Source: Las Vegas Convention and Visitors Authority, Marketing Division – Internet Marketing & Research * - 2002 convention delegate counts are based on an updated methodology that reflects significant growth in the small meetings market. 2001 counts were revised retroactively using the new methodology. Total Visitors Million 40 30 20 10 0 1998 1999 2000 2001 2002 2003 2004 Tourists 2005 2006 2007 Convention Delegates 116 STATISTICAL DATA VISITOR ANALYSIS LAST TEN CALENDAR YEARS (continued) Strong visitor levels produce beneficial secondary effects in other industries, as well, since visitors purchase a significant amount of goods and services while they visit the area. Visitors to Las Vegas in 2007 contributed nearly $41.6 billion to the economy of the area. Indicators of the economic impact include total gaming revenues in Clark County and room taxes collected on behalf of the LVCVA. GAMING REVENUES (000) 6,346,958 7,209,032 7,671,252 7,636,547 7,630,542 7,830,856 8,710,976 9,709,408 10,643,206 10,868,029 ROOM TAXES (Fiscal Year) 86,249,080 97,872,354 120,536,301 135,841,371 124,171,822 130,749,470 153,119,151 176,339,258 200,086,827 213,256,076 CALENDAR YEAR 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 TOTAL VISITORS 30,605,128 33,809,134 35,849,691 35,017,317 35,071,504 35,540,126 37,388,781 38,566,717 38,914,889 39,196,761 INCREASE/ (DECREASE) 0.5% 10.5% 6.0% (2.3%) 0.2% 1.3% 5.2% 3.2% 0.9% 0.7% INCREASE/ (DECREASE) 3.2% 13.6% 6.4% (0.5%) (0.1%) 2.6% 11.2% 11.5% 9.6% 2.1% INCREASE/ (DECREASE) 1.8% 13.5% 23.2% 12.7% (8.5%) 5.3% 17.1% 15.2% 13.5% 6.6% Source: Las Vegas Convention and Visitors Authority, Marketing Division – Internet Marketing & Research Nevada State Gaming Control Board Total Visitors vs. Room Taxes 45,000,000 40,000,000 # of Visitors (CY) 35,000,000 30,000,000 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 $$200,000,000 $150,000,000 $100,000,000 $50,000,000 $250,000,000 Room Tax Revenue (FY) Total Visitors Room Taxes 117 STATISTICAL DATA VISITOR DEMOGRAPHIC STATISTICS LAST TEN FISCAL YEARS The Las Vegas Convention and Visitors Authority conducts and compiles various research information on visitors to gain a better understanding of the composition of the Clark County visitor and to tailor advertising campaigns. The median age is 49 with 29% of visitors between the ages of 21 to 39, 42% between 40 and 59, and 29% over 60. The majority of visitors are married and employed. Further statistics regarding visitors to Las Vegas are shown below: AS OF JUNE 30, 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 GENDER Male 47% 47% 43% 47% 52% 50% 52% 51% 52% 50% Female 53% 53% 57% 53% 48% 50% 48% 49% 48% 50% MEDIAN AGE 49.2 49.9 50.4 48.2 47.6 50.2 49.0 47.7 48.0 49.0 MARITAL STATUS Married 70% 71% 70% 70% 70% 73% 73% 74% 79% 79% Single 18% 18% 17% 18% 17% 16% 17% 16% 14% 14% Other* 12% 10% 13% 12% 13% 11% 10% 10% 7% 7% JOB CATEGORIES Employed 64% 65% 64% 67% 64% 64% 67% 67% 70% 67% Retired 27% 28% 28% 25% 27% 30% 26% 24% 24% 26% Other** 10% 9% 8% 8% 9% 6% 7% 9% 6% 7% Source: Las Vegas Visitor Profile Study - Data from 1998-2002 was based on fiscal year July – June. Beginning in 2003 data is based on a calendar year. *Martial Status - Other includes separated, divorced or widowed. ** Job Categories Other includes student, homemaker or unemployed. UNITED STATES OF AMERICA AS OF JUNE 30, 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 FOREIGN 13% 11% 13% 12% 8% 12% 13% 12% 13% 12% Eastern States 10% 10% 9% 9% 9% 8% 9% 9% 8% 9% Southern Midwestern Western States 13% 12% 13% 13% 12% 12% 13% 13% 13% 13% States 16% 18% 18% 15% 15% 16% 17% 14% 14% 14% States 48% 48% 48% 51% 55% 52% 48% 52% 52% 52% Source: Las Vegas Visitor Profile Study – Data from 1998-2002 was based on fiscal year JulyJune. Beginning in 2003 data is based on a calendar year. Eastern states: Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont. Southern States: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia. Midwestern States: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin. Western States: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada (excluding Clark County), New Mexico, Oregon, Utah, Washington, and Wyoming. 118 STATISTICAL DATA PRINCIPAL ROOM TAX PAYERS DECEMBER 31, 2007 The primary source of revenue for the LVCVA is from room taxes imposed on hotels and motels in Clark County. The hotels listed below represent the ten largest hotel properties in Clark County and, accordingly, are in the group that generates the greatest volume of room taxes for the LVCVA. Rooms at December 31 5,034 4,408 4,328 4,027 3,991 3,933 3,763 3,565 3,348 3,044 39,441 3,454 90,052 132,947 10,696 2,729 146,372* MGM Grand Luxor Mandalay Bay (including THEhotel) Venetian Excalibur Bellagio Circus Circus Flamingo Las Vegas Caesar’s Mirage Total Top 10 Hotels Total Jean/Primm Other hotels/motels Total Las Vegas metropolitan area Total Laughlin Total Mesquite Total Inventory of Rooms Source: Las Vegas Convention and Visitors Authority, Marketing Division – Internet Marketing & Research Note: Other hotels/motels does not include timeshare properties. *Does not included Palazzo which opened January 17, 2008 with approximately 3,000 rooms. 119 STATISTICAL DATA OCCUPANCY RATE LAST TEN CALENDAR YEARS In spite of the increasing availability of rooms, the occupancy rate for Las Vegas continues to grow, exceeding the national average by 27.2 points for calendar year 2007. Rooms Available* 109,365 120,294 124,270 126,610 126,787 130,482 131,503 133,186 132,605 132,947 Occupancy Percentage 85.8 88.0 89.1 84.7 84.0 85.0 88.6 89.2 89.7 90.4 National Occupancy Percentage 63.8 63.3 63.7 60.1 59.1 59.2 61.3 63.1 63.4 63.2 Calendar Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: Las Vegas Convention and Visitors Authority, Marketing Division – Internet Marketing & Research * Total Las Vegas metropolitan area includes properties in the Jean/Primm area. Las Vegas Occupancy vs National Occupancy 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Las Vegas Occupancy Rate National Occupancy Rate 120 STATISTICAL DATA ROOM TAX RATE DISTRIBUTION BY JURISDICTION AS OF JUNE 30, 2008 CLARK COUNTY Others Others Resort Within Outside Hotels 35 miles 35 miles Distributed to: State of Nevada Clark County School District Collecting Jurisdiction County Transportation* Fremont St. Experience** LVCVA Total Room Tax Rate 3/8 1 5/8 1 1 0 5 9 3/8 1 5/8 2 1 0 4 9 3/8 1 5/8 2 1 0 2 7 LAS VEGAS Downtown 3/8 1 5/8 1 1 2 or 1 5 11 or 10 Resort Hotels 3/8 1 5/8 1 1 0 5 9 Others 3/8 1 5/8 2 1 0 4 9 Reference to miles – is distance from Las Vegas Convention Center. NORTH LAS VEGAS Resort Hotels Others Distributed to: State of Nevada Clark County School District Collecting Jurisdiction County Transportation* LVCVA Total Room Tax Rate 3/8 1 5/8 1 1 5 9 3/8 1 5/8 2 1 4 9 HENDERSON Resort Hotels Others 3/8 1 5/8 2 1 5 10 3/8 1 5/8 2 1 4 9 BOULDER CITY Resort Hotels Others 3/8 1 5/8 0 1 6 9 3/8 1 5/8 0 1 4 7 MESQUITE All 3/8 1 5/8 2 1 4 9 Source: Annual City/County Transient Lodging Tax Report as filed with the State of Nevada – Department of Taxation. * enacted by the Clark County Commission in 1991. ** enacted by the Las Vegas City Council in 1993. The Fremont Street Experience is a downtown revitalization project. This room tax applies only to properties within a specified geographic area. RESORT HOTEL DEFINITIONS BY JURISDICTION Clark County – An establishment having a casino containing not less than three games. Las Vegas – A hotel having seventy-five or more rooms. North Las Vegas – A hotel having one hundred or more rooms and a casino containing not less than three games. Henderson – An establishment renting rooms and having a casino on the same premises containing not less than three games. Boulder City – An establishment having one hundred or more rooms. Mesquite – No distinction between resort hotels and other transient lodging establishments. 121 GLOSSARY The annual budget contains terminology unique to governmental finance and budgeting. To assist the reader of the budget document in understanding these terms, the following glossary has been compiled. Account Group A self-balancing set of accounts that have no expendable financial resources. Account groups are used to maintain records of general long-term debts and general fixed assets. Accounting System The total set of records and procedures that are used to record, classify, and report information on the financial status and operations of an organization. Accrual Basis Accounting A system of accounting in which revenues and expenses are recorded as they are earned and incurred, not necessarily when cash is received or paid. Activity A financial and budgeting classification of similar endeavors or groupings of organizational units performing a specific and distinguishable type of work. In the LVCVA’s organizational chart, activities generally relate to departments. Appropriation An authorization made by the Board of Directors that permits the LVCVA to incur obligations and to make expenditures of resources. Augmentation An action increasing total appropriations. Augmentations are governed by State statute and require formal resolution by the Board of Directors. Balanced Budget A budget in which proposed funds or revenues available are equal to or exceed planned fund expenditures. Bond A written promise to pay a sum of money on a specific date at a specified interest rate. The interest payments and the repayment of the principal are detailed in a bond ordinance. Budget A financial plan for a specified period of time (fiscal year). Budget Document The instrument prepared by the Finance Department and supporting staff that presents a comprehensive proposed budget to the Board of Directors. Budget Message The opening section of the budget document that provides a general summary of the most important aspects of the budget and discusses significant changes from the current and previous fiscal years. Budgetary Control The control or management of a governmental unit in accordance with an approved budget for the purpose of keeping expenditures within the limitations of authorized appropriations and available resources. CAFR Abbreviation for Comprehensive Annual Financial Report. CC Abbreviation for Cashman Center. Capital Asset A financial resource meeting all of the following criteria: (1) generally tangible in nature (software is the exception); (2) useful life greater than one year; (3) not a repair part or supply item; and (4) original cost greater than the capitalization threshold. 122 GLOSSARY Capital Budget A plan of proposed capital outlays and the means of financing them. Capital Expenditure (aka Capital Outlay) A purchase or improvement of a tangible fixed asset (i.e. land, buildings, furniture) with a cost of $500 or more and a useful life of at least one year. Capital Improvement Plan A financial planning and management tool that lists proposed capital projects and capital acquisitions for a rolling five-year period. Capital Projects Fund A fund used to account for financial resources to be used for the acquisition or construction of capital assets. Capitalization Threshold The level of cost at which an asset becomes subject to control and reporting as a fixed asset. Cash Basis Accounting A system of accounting in which transactions are recorded, and revenues and expenses are recognized, only when cash is received or paid. Commercial Paper A short-term negotiable paper arising from business transactions. Coterminous In conjunction with term of office. Debt Service Fund A fund established to account for the accumulation of resources for and the payment of principal and interest on general long-term debt. Debt Service Requirements The amount of resources that must be provided so that all principal and interest payments can be made in full on schedule. Defeased Retirement of debt of a state or local governmental unit in an indirect manner. Department A grouping in the organizational structure of related sections or units. Depreciation The process of allocating the cost of tangible property over a period of time, rather than expensing the entire cost in one year. Generally, at the end of an asset’s useful life, the net value of the asset (original cost less accumulated depreciation) will equal the salvage value of the asset. Division A major grouping in the organizational structure of related activities within a functional area. EFT Abbreviation for electronic funds transfer; an automated means of payment. Employee Benefits A budget category that is comprised of retirement, insurance, unemployment and educational assistance expenses. Encumbrance The legal commitment of appropriated funds to purchase an item or service. To encumber means to set aside or commit funds for a future expenditure. 123 GLOSSARY Expenditure The amount of cash paid or to be paid for a service rendered, goods received or an asset purchased. Fam Abbreviation for familiarization trip. Fiduciary Fund Type A fund used to account for assets held by a government in a trust capacity or as an agent for others. Fiscal Year A consecutive twelve-month period signifying the beginning and ending period for recording financial transactions. The LVCVA has designated July 1 to June 30 as its fiscal year. Fixed Asset See capital asset. FTE Abbreviation for full-time employees. FYE Abbreviation for fiscal year ending. Function Financial and budgeting classification of a group of related activities aimed at accomplishing a broad goal or a major service. In the LVCVA's organizational chart, functions generally relate to divisions. Fund A separate self-balancing accounting entity. Resources are allocated to and accounted for in a particular fund based on the purposes of expenditures and the means of controlling them. Fund Balance The excess of an entity's assets over its liabilities. GAAP (Generally Accepted Accounting Principles) A body of accounting and financial reporting standards set by the Governmental Accounting Standards Board (GASB) for state and local governments, and by the Financial Accounting Standards Board (FASB) for private sector organizations. General Fund The general fund accounts for all of the financial resources not specifically accounted for in another fund. General Obligation Bonds G.O. bonds have the full faith and credit of the LVCVA pledged to the repayment of the bonds. They are primarily secured by ad valorem taxes and are additionally secured by net pledged revenues of the LVCVA, represented basically by room taxes. The LVCVA has never resorted to the use of property taxes for debt service, using only net pledged revenues derived from operations. In fact, no ad valorem property tax revenues are allocated to the LVCVA for any purpose. GFOA Abbreviation for Government Finance Officers Association. Goal A statement of broad direction, purpose, or intent. 124 GLOSSARY Governmental Fund Type A fund used to account for general governmental activities. Includes the general fund, capital projects funds, and debt service funds. Grant A contribution or gift to be used or expended for a specified purpose or activity. Green Items Products and services with reduced effects on human health and the environment. Intranet A network operating like the Internet but having access restricted to a limited group of authorized users (such as employees of a company). Inventory The process of verifying physical fixed assets with records of fixed assets. LEED Abbreviation for Leadership in Energy and Environmental Design. A voluntary, consensusbased national standard for developing high-performance, sustainable buildings. LGBT Abbreviation for Lesbian, Gay, Bisexual and Transgender. LVCC Abbreviation for Las Vegas Convention Center. Las Vegas Territory Refers to the area that encompasses the City of Las Vegas and surrounding towns and cities located within Clark County. Line-Item Budget A budget that lists each expenditure category (salary, telephone, travel, etc.) separately, along with a dollar amount budgeted for each specific account. Long-Term Debt Debt with a maturity of more than one year after the date of issuance. Modified Accrual Accounting A basis of accounting. Revenues are recognized, and any related receivable is recorded, when they become both measurable and available. Expenditures are recognized when the liability is incurred, except for unmatured principal and interest on long-term debt, which is recognized when due. MPEP Abbreviation for the Master Plan Enhancement Project. This project includes construction of a Las Vegas Metropolitan Police substation, a fire station and the connection of the existing buildings, and upgrading building and technology systems. The project is scheduled to be complete in 2011. NRS Abbreviation for Nevada Revised Statutes. Objective A statement of specific direction, purpose, or intent based on the goals established for a particular function. Operating Budget The portion of the budget that pertains to daily operations. The operating budget contains appropriations for such expenditures as personnel, supplies, utilities, materials, travel, and fuel. 125 GLOSSARY Operating Transfer Legally authorized transfers from a fund receiving revenue to the fund through which the resources are to be expended. Organizational Unit Financial and budgeting classification for a responsibility unit within a government. Organizational units, which relate to sections in the structure of the LVCVA are the basic unit of the operating budget. Original Cost The invoice amount paid to the supplier of an item plus any other costs incurred to make the item capable of being used. Original cost includes shipping and installation. PERS Abbreviation for Public Employees Retirement System. P/R Abbreviation for public relations. Purchase Order A document authorizing the delivery of specific merchandise or the rendering of specific services. Residual Equity Transfer Nonrecurring or non-routine transfer of equity between funds. It does not represent expenditures of the transferring fund, but may represent the creation or expansion of a fund or the liquidation or contraction of a fund. Resources Total dollars available for appropriations including estimated revenues, fund transfers, and beginning fund balances. Revenue Bonds Bonds that pledge a specific dedicated revenue source for their repayment. Revenues Resource increases from the sale of services or goods derived primarily from normal operations. S.B. 170 The name given to the 5/8% portion of the 1% tax imposed by the Nevada legislature in 1984, which was restricted for the promotion of tourism and special events in Nevada. Salaries and Wages A budget category comprised of all full-time and temporary employee salaries including overtime and retirement payouts. Salvage Value The amount for which the asset could be sold at the end of its useful life. Services and Supplies A budget category that includes those goods and services that are consumed and purchased on a regular basis (i.e. office supplies, utilities, repair and maintenance). Tangible An item capable of being touched. Useful Life The estimated number of months or years that an asset will be able to be used for the purpose for which it was purchased. 126