20260601-010 COTA RIDA Recommendation — original pdf

Recommendation

RECOMMENDATION TO COUNCIL MUSIC COMMISSION RECOMMENDATION 20260601-010 Date of Approval: June 1, 2026 Subject: Recommendations to Protect Cultural HOT Funds and Support Local Creatives in the RIDA COTA Agreement Recommendation Recommendations to Preserve Arts, Music, and Heritage Funding and Require Local Creative Engagement in the RIDA COTA Hotel Development Agreement Description of Recommendation to Council The Music Commission recommends that within the ongoing negotiations for the Business Expansion Program agreement with RIDA COTA Hotel, LLC, City Council includes the following directives to the City Manager and Staff: 1. Full Protection of Cultural HOT Allocations: Ensure that the legally assigned portion of Hotel Occupancy Tax (HOT) revenue dedicated to Arts, Music, and Heritage funds is not impacted or diminished by developer incentives. These allocations should be kept whole, calculated as though 100% of the HOT totals were being collected by the City, regardless of any gross room revenue payments or offsets granted to the developer. 2. Local Creative Requirements: Incorporate specific clauses into the agreement requiring a. A formal partnership with Rally Austin and Visit Austin to support local music talent procurement for hotel-hosted events, conferences, and public spaces. b. A set quota/percentage of budget for permanent and rotating art installations curated from local Austin artists Rationale: 1. Preserving the Integrity of Creative Funds The Music Commission maintains that HOT taxes are a key pillar to the financial health and vitality of Austin’s cultural sector. Using gross room revenue as a metric for developer incentives must not result in a "shadow cut" to the Arts, Music, and Heritage funds. By requiring these funds to be kept whole based on 100% of total HOT potential, the City ensures that incentivizing large-scale development does not inadvertently cannibalize the grants that sustain our local creative ecosystem. 2. Equitable Job Creation While we strongly support the creation of 900 union-represented hotel jobs, we must view our creative sector with equal professional gravity. Musicians and artists are essential workers within 1 of 2 the Austin economy. It is vital that the growth of the hospitality sector does not come at the direct expense of the stability of the arts. We must ensure that the "Creative Class", the people who make Austin an attractive destination to visit, does not bear the financial burden of these incentives through reduced grant availability. 3. Structural Integration of the Local Scene A 1,000-room resort at COTA provides a great opportunity for the "Austin Brand" to be realized through local talent. By mandating a quota for local art installations and a structured music booking pipeline, the City ensures that this hotel is not just a self-contained campus, but a functional extension of Austin’s unique cultural heritage. This guarantees that the developer is actively investing in the local talent that defines our city’s identity. The Music Commission applauds the economic ambition of the RIDA COTA project and the high-road labor standards it promises. We urge Council to ensure the final agreement drafted by the City Manager treats arts, music, and heritage as essential partners in this development. By protecting cultural tax revenues and integrating local talent, the City can ensure this project is a holistic success for Austin’s economy, its workers, and its identity. Motioned By: Pedro Carvalho Seconded By: Penny Jo Pullus Vote: 6-0 For: Clarissa Cardenas, Pedro Carvalho, Tami Blevins, Ray Price, Joe Silva, Penny Jo Pullus Against: Abstain: Absent: Attest: Shelbi Mitchell 2 of 2