At a work session Monday, City Council received an update on city staff’s revised implementation strategy for the Tourism Development Fund.
Originally adopted by council last August, the Tourism Development Fund was meant to fund tourism marketing through increases to lodging and meals taxes and the creation of an admissions tax. Last May, City Council repealed those taxes to allow the Historic Triangle sales tax increase to take effect, which established a regional marketing fund and Tourism Council, funded by a 1 percent sales tax increase.
Since the passage of the Historic Triangle sales tax bill, the original policy document outlining the TDF has been in need of revision, according to interim City Manager Andrew Trivette.
“SB 942 passed and changed the landscape, particularly as it relates to marketing the destination, which was a major theme of the (TDF) policy document when it was adopted,” he said.
Trivette estimates the city will receive a total of $2.4 million in funds from SB 942 taxes, meant to generate local tourism. He said the city will spend $405,000 of that tax revenue on projects previously outlined in the city’s operating budget, including downtown vibrancy implementation and administrative costs. The city will also give $75,000 in funding to CultureFix and $25,000 to An Occasion for the Arts.
City finance director Barbara Dameron said the city will receive its share of the SB 942 sales tax revenue by mid-September and will start collecting funds from the $2 per night room tax at the end of August.
The remaining $2.1 million will be spent on grants funding new projects driving tourism to the city, Trivette said.
Organizations seeking funding for new tourism projects will have to go through an application process. The original TDF policy required the first phase of that process take place this month, which Trivette said city staff is not ready to go through with.
“Obviously we’re not ready to do that,” he said. “We want to make sure that we take the time to get the decision process correct.”
Two hurdles blocking organizations from submitting grant applications are the lack of a grant review committee, which has not yet been created, and the need for a new approval process timeline, according to Trivette and Economic Development Director Michele Mixner DeWitt.
The five-person advisory committee would review funding applications along with the Planning Commission and the Economic Development Authority, which would then recommend a project’s adoption to City Council, which has the final authority to allocate funds.
DeWitt also suggested a shorter approval process for tourism grants, which would begin next March and end in October 2019. Previously, it began in August and ended in July, following the city’s operating budget approval process.
“We would be streamlining the process, making it a little bit shorter and uncoupling it from the budget,” she said.
Finally, Trivette and DeWitt suggested the city hold two public meetings — not yet set — to gather community input before developing grant applications and appointing members to the review committee. The two “design charrette” meetings scheduled for the fall will gauge interest in the sorts of projects citizens are interested in spending TDF funds on.
Council members had a mixed reaction to the recommended changes, which DeWitt and Trivette said were still subject to change. Vice Mayor Doug Pons said the review committee should be assembled before holding public meetings and should include more tourism professionals.
“I’m just trying to reconcile whether we’re not utilizing the knowledge of tourism professionals that would make up a committee when it comes time to design what the criteria will be,” he said. “We’re missing the benefit of tourism professionals to play a role in what images get shown, what direction tourism fund could be spent in, so I’m not sure I’m fully on board with not assembling that body sooner.”
Mayor Paul Freiling said it was important to remember that the city has not yet collected the funds necessary for new tourism projects.
“There’s a lot to like about this presentation. I especially appreciate the condensed timeline, but something what’s important to keep in mind is that we don’t have any money yet,” he said.
When: 2 p.m. Thursday
Where: City Council Chambers, Stryker Center, 401 N. Boundary St.
Arriaza can be reached at 757-790-9313 or on Twitter @rodrigoarriaza0.