Anaheim City Council members are increasing oversight of the city’s tourism bureau, Visit Anaheim, after a scathing state audit report found loose regulations on the tourism tax spending.
In a report earlier this year, California Auditor Grant Parks found Visit Anaheim gave tourism dollars – a self-assessed hotel tax intended to fund the tourism bureau – to the Chamber of Commerce, which then improperly lobbied politicians.
[Read: CA Auditors Lambast Anaheim’s Tourism Bureau, Find Improper Tax Dollar Spending]
“The Chamber then used tourism district assessment funds for unallowable services, including advocating for or against proposed federal, state, and local legislation, meeting with elected officials and policymakers, and supporting resort-friendly candidates through the Chamber’s political action committee,” reads the audit.
“Because the city did not have a meaningful process for contract monitoring, Visit Anaheim was able to pay the Chamber for unallowable services that involved political advocacy and influence,” auditors wrote. “We also found that the city did not conduct substantive monitoring or oversight of these and other contracts.”
Tourism tax money is supposed to be used to promote the city and attract convention center bookings, according to city staff.
What Kind of Oversight is Coming?
City council members – a majority of whom had their campaigns backed by resort interests – are forming an advisory committee in an effort to better track where the tourism tax is being spent.
“Every year, Visit Anaheim is our contracting entity and they put together a report … in order to discuss how they are spending the funds, how they spent the funds through the previous year,” Assistant City Manager Greg Garcia said during Tuesday’s meeting. “This board is just another layer of oversight to review those plans and make recommendations.”
Some council members raised concerns about current Visit Anaheim board members serving on the freshly minted advisory committee.
“Right now it’s very loosely formed and it seems like it’s just a mirror image of the current board and that creates an issue for me – especially when a state audit has given us direction to have additional oversight,” said Councilwoman Natalie Rubalcava during Tuesday’s meeting.
No council members raised the issues of Visit Anaheim improperly spending tourism dollars detailed in the state audit – an audit officials refused to conduct themselves last year.
[Read: Anaheim Officials Refuse To Audit Tourism Bureau’s Alleged Illegal Diversion of COVID Funds ]
And nobody brought up the allegations from independent investigators that the tourism bureau diverted $1.5 million of its $6.5 million city bailout to a Chamber of Commerce-controlled nonprofit.
The move to increase oversight sparked a rare public disagreement among resort-backed council members.
“This has been working very well for years. Now the state, out of the blue, made this recommendation that I disagree with. Now the government is sticking their fingers in something that worked very well for years,” Councilman Jose Diaz said. “This made me very uncomfortable. It sounds bureaucratic to me.”
Councilwoman Natalie Meeks, who ultimately voted for the measure, echoed some of those concerns.
“I agree with Councilmember Diaz that this is another layer of government which is probably not necessary,” Meeks said. “I’m not even sure you’re going to have a lot of hoteliers jumping up to serve on this board because it doesn’t get to make fun decisions.”
Diaz, Meeks and Rubalcava all had their city council campaigns heavily financed by Disneyland resort area interests.
[Read: Will Mickey Mouse Continue to Cast a Big Shadow Over Anaheim’s Election Campaigns?]
City Council members voted 6-1 Tuesday night to create the new advisory board.
Diaz, who unsuccessfully pushed for a delay so staff can further consult with hoteliers, voted no.
The seven-member advisory board is slated to consist of two hoteliers, a Visit Anaheim representative, City Manager Jim Vanderpool and three other city employees.
Rubalcava also raised concerns by letting Visit Anaheim make advisory board membership recommendations
“In a transparency perspective, it doesn’t appear to come off well to me,” Rubalcava said, later adding “we could be the people who are recommending who serves on this oversight committee for it to truly be an oversight committee.”
While her suggestion of having city officials recommend which hoteliers sit on the advisory board failed to gain traction, a majority of her colleagues agreed to bar hoteliers currently sitting on a Visit Anaheim board from serving on the city’s new advisory board.
“I think Councilmember Rubalcava raises a good point,” Mayor Ashleigh Aitken said. “It would seem to me that if you’re on the contracting entity board (Visit Anaheim) and you’re potentially on this board, you’re asking to oversee actions that you’ve taken.”
Councilman Carlos Leon successfully pushed his colleagues to make sure the advisory board, which will have to publicly meet under the state’s transparency laws, will file meeting minutes and reports to the city council.
“I think it would be helpful,” Leon said, “just to increase transparency and information.”
Editor’s note: Ashleigh Aitken’s father, Wylie Aitken, chairs Voice of OC’s board of directors.
Spencer Custodio is the civic editor. You can reach him at scustodio@voiceofoc.org. Follow him on Twitter @SpencerCustodio.
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