Report 2023-133 Recommendation 3 Responses

Report 2023-133: City of Anaheim: It Has Not Properly Managed Tourism-Related Contracts and Millions of Dollars in Related Funds (Release Date: January 2024)

Recommendation #3 To: Anaheim, City of

To improve Anaheim's oversight of the tourism district assessment contract with Visit Anaheim, the city should by January 2025 seek to renegotiate with Visit Anaheim to revise the contract to ensure that the contract does the following:

-Includes key performance indicators to allow the city to better gauge how effectively Visit Anaheim is using tourism district assessment funds. These benchmarks should include, at a minimum, hotel occupancy rates, convention center bookings, and the number of presentations made to convention center executives.

Annual Follow-Up Agency Response From January 2026

An amended and restated agreement was approved by the City Council on May 13, 2025 and went into effect on June 13, 2025. This recommendation is addressed in Section 5 which specifies the key performance indicators approved annually by the Visit Anaheim Board and those required by the City and as recommended in the State Audit. Together the key performance indicators cover all the recommended key performance indicators recommended in the audit report. In addition, Section 5 also includes reporting requirements related to the key performance indicators.

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

The City of Anaheim has fully implemented the recommendation by including in its revised contract with Visit Anaheim key performance indicators, including benchmarks such as hotel occupancy rates and convention center bookings.

1-Year Agency Response

An amended and restated agreement is currently being negotiated between the City and Visit Anaheim to implement the State recommended contractual reporting requirements and metrics into the amended and restated agreement. At the City's request, Visit Anaheim has already agreed to implement this recommendation and included Key Performance Indicators in their FY 2022/23 ATID Annual Report.

California State Auditor's Assessment of 1-Year Status: Pending

6-Month Agency Response

City staff worked with officials within Visit Anaheim to ensure that Key Performance Indicators, both prospective and retrospective, were included in the Fiscal Year 2022/23 ATID Annual Report which was approved by the Anaheim City Council on Tuesday, March 19, 2024.

An amended and restated agreement is being discussed between the City and Visit Anaheim to implement the State recommended contractual reporting requirements and metrics into the agreement. A proposed amended agreement will come before City Council for their review and consideration in Fall 2024.

California State Auditor's Assessment of 6-Month Status: Pending

60-Day Agency Response

City staff worked with officials within Visit Anaheim to ensure that Key Performance Indicators, both prospective and retrospective, were included in the Fiscal Year 2022/23 ATID Annual Report which was approved by the Anaheim City Council on Tuesday, March 19, 2024. The City is continuing to work with Visit Anaheim to implement State recommended contractual reporting requirements and metrics into the current agreement by January 2025.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2023-133

Agency responses received are posted verbatim.