The fate of Newport Beach Restaurant Week has been called into question.
In its current financial state, the Newport Beach Restaurant Assn. Business Improvement District cannot support the annual event, President Jim Walker told council members Tuesday.
The city agreed to contribute $40,000 to the district last year. It is also responsible for collecting assessments from the 400 district members and turning the money over to the association. Member assessments and late fees totaled about $114,500 for fiscal year 2013-14, according to the association's operating budget.
But too much money goes toward administrative costs once taken care of by the city, leaving the association with minimal funding to market its wide variety of members, Walker explained.
The association, which includes everything from local eateries to gas station mini-marts, already faced a marketing challenge, and the more than $40,000 left after expenses was simply not enough, Walker said.
"That's pretty insufficient," he said. "It really has no influence on the outcome."
The district also lost $25,000 in potential sponsorship funding during the last restaurant week, a special event that features prix-fixe lunch and dinner menus at participating restaurants.
That loss further depleted its marketing potential — which is exactly the purpose of the business improvement district.
"We don't repair trash cans, and we don't plant palm trees," he said in a phone interview Friday. "The purpose of the restaurant BID is to market the restaurants in Newport Beach."
The restaurant association last year hired an administrator to help facilitate some of the tasks once overseen by the now-dissolved economic development department, Councilwoman Nancy Gardner said.
Doing so pushed back the timing for choosing a consultant to help with the 2014 restaurant week. San Diego-based McFarlane Promotions was selected in October to plan, market and execute the eighth annual event in January, leaving it without enough time to secure sponsorship, according to a staff report.
The association also signed on in December with Newport Beach and Co., an agency that markets the city to do year-round marketing for the association. The city offered $10,000 for getting the partnership started, and a new "Dine Newport Beach" website overseen by the company is set to launch this fall.
Newport Beach and Co. will be available to help discuss a direction for restaurant week, President Gary Sherwin said.
"A lot of people here felt that the concept was worth keeping," he said of the 10-day January event, "and I'm open to that."
Still, at Tuesday's meeting, Gardner asked that the association return with more information about how it might be restructuring before the council would approve the budget. Her colleagues agreed, and in a unanimous vote, continued the budget for further discussion.
"Certainly, we understand their frustration," Gardner said, "and we're working together with them."
Walker said during the phone interview that he believes that the city should be contributing more toward the business improvement district. He noted that restaurants are the top contributors to sales tax in the city, and added that the city gave much more — $150,000 — to the film festival, which lasts just a week and featured some events outside of the city.
The city might grant $6,000 in special events funding for restaurant week. With a 6-1 ratio of restaurant seats to residents, marketing outside the city is vital for the success of its restaurants, Walker said.
"I think that Newport Beach should really be the culinary star for Orange County," he said.