The Sedona City Council will be entering into a long-term contract with the Sedona Chamber of Commerce but with stipulations and oversight.

Council unanimously approved the draft contract on Tuesday, April 11. It calls for a seven-year contract with automatic two-year renewals after the initial term. These renewals are proposed to continue as long as each party is satisfied with the terms, relationship, process and performance, and does not wish to revisit the contract.

The contract also contains a provision that allows either party to terminate for any reason with 60-day written notice, a city report states.

At a March 1 work session, it was decided that beginning in 2018 a joint meeting would be held every January with council and the chamber prior to development of the upcoming year’s program of work, budget and marketing plans.

This would be an opportunity for the two parties to “engage in dialogue regarding current year goals and objectives, assess the state of the tourism industry at that time and respond to changing needs,” a city report states. It’s also a way for council to decide on what projects would fall under the category of the chamber’s product development, which will have its budget increased greatly in upcoming years.

By May 1 of each year, city staff will meet with the chamber to develop a final list of recommendations that will be presented as part of the Destination Marketing and Development Plan to council for approval before July 1 each year, at the same time as the budget.

“It’s important, even with a long-term contract, to have an annual opportunity to revisit the successes, what’s working, what might not be working, what needs to be tweaked as well as our goals and direction for the upcoming fiscal year,” Assistant City Manager Karen Osburn said, adding that this way the chamber will have sufficient time and direction when discussing matters with its own board of directors.

The city report states that since the last contract was developed three years ago, the state of tourism in Sedona has changed. The chamber has seen success with its destination-marketing efforts and by all accounts, visitation to Sedona is at an all-time high. With this success has also come challenges, including striking the right balance between the needs of visitors and the quality of life of residents, and dealing with the overall strain on city infrastructure.

In light of these changing conditions and as part of the contract renewal, council has expressed the need and desire to: 

n Structure the contract to promote more active involvement from the council in annual decisions related to desired outcomes and policy-level objectives relating to the program of work, marketing approach and product-development programs and projects.

n Develop a more sustainable tourism approach that considers and addresses the need to better balance the interests of residents and tourists, and to mitigate the unintended consequences of such a robust tourist economy.

In addition, while the chamber will continue to market the area as a vacation destination — focusing more on quality over quantity — product development will continue to be an area of emphasis. And because product development has not been defined, funding can be used for a variety of sources that enhance the visitor experience [traffic and parking mitigation and trail maintenance] while benefiting the city.

While the majority of the contract was met with approval by the council, the one sticking point that was discussed at length was whether to require an annual audit of the chamber at a cost of around $8,000.

“The purpose of an audit is not a reflection of a lack of trust in any particular person but it is a reflection of something that doesn’t come to your attention immediately,” said Councilman John Currivan, who feels an audit is needed as opposed to an annual review. “When you’re talking about money and the finances of an organization, the whole purpose of an audit is to find things that are not obvious — things that you would not normally see on your own.”

By a 4-3 vote, council decided to not make the audit mandatory. Instead, one can be requested when deemed needed. In addition to Currivan, councilmen Joe Vernier and Tom Lamkin said they were in favor of an audit.

“The amount of money we’re talking about each year is approximately $8,000 out of a $2 million [chamber] budget,” Currivan said. “This is not a big number.”

Martinez said he has a concern with the length of the contract and worries that other city-funded entities like the library, community center and recycling center will request the same. City Manager Justin Clifton said that the seven-year term was something he came up with, not the chamber.

“Whether it’s three years with automatic renewal or one year with automatic renewal, it really doesn’t matter if we’re in the mindset that this is an annual responsibility,” Clifton said. “We’re not waiting for some milestone that’s really arbitrary if we’re doing the work we’re supposed to be doing every year.”