[May 28, 2013]Earlier this year, the city of
Lincoln began exploring the possibility of taking over the
hotel-motel tax revenues that are currently being collected by the
county.
Representatives of the city of Lincoln have indicated that sometime
this year the city may take over the tax dollars collected for
tourism. The unclear plan has left county and tourism officials
wondering how to move on a number of matters in the present and in
the near future.
The city budgeted the hotel-motel taxes into its current fiscal
year that began on May 1 and indicated that it may take over the
funds on Dec. 1, when the county fiscal year would begin.
When the tourism bureau learned of the potential action, a
special meeting was set for March 18 to consider financial and event
planning and extended contract matters. Alderman Tom O'Donohue
attended and agreed to remain a liaison from the city to the tourism
bureau. O'Donohue made it clear to the bureau that the city was
concerned about how the tax dollars were being spent.
The bureau directors responded that they were willing to work
with the city and would welcome more input from the city. Later,
with county approval, O'Donohue was made a voting member.
In mid-May, the city council was presented a list of expectations
developed by Mayor Keith Snyder, city administrator Sue McLaughlin,
and Aldermen Tom O'Donohue and Melody Anderson. The list posed
actions for both the county and the tourism bureau. Aldermen were
asked to review the list and contribute if they saw anything more
that would be needed. (See list below this article.)
Primarily, the list called for actions that would manage or show
corresponding results in the use of the tax revenues.
The plan also proposes changes in the tourism bureau, if there
would be one. Currently, membership is set to be nine to 15
directors. Three seats are open. The city proposes a maximum of 11
directors. The makeup of the bureau would change in qualifications
and would add positions to be filled by hotel industry
representatives.
Geoff Ladd, the executive director for the past eight years,
announced his resignation on April 25.
When a report on tourism was called for during the Logan County
Board's session last Tuesday, Andrew Meister spoke first. He said
that the bureau had met on Monday, and the immediate need is to hire
a new executive director.
Meister said: "It's kind of a mess right now. I think people are
confused with what route tourism is going to go: if this is going to
be a permanent position or if this is going to be a temporary fix. I
would think that at least needs to be addressed before hiring
anyone."
Applications for the director position are due June 14.
The agency receives a $75,000 annual grant that requires an
executive director be in place. Without the grant the agency is
losing $6,250 per month.
Meister and Andy Anderson serve as the county board's liaisons to
the tourism bureau. They and board members Jan Schumacher and Chuck
Ruben led in a lengthy discussion.
Schumacher has been strongly interested and involved with tourism
in Logan County for several years. She has been involved with Main
Street Lincoln, with crossover activities with tourism.
"I don't know that role we have as the county, but I think this
is a lousy situation," Schumacher said.
"Well, it is," Anderson said. "But it was created by the city."
Ruben felt there could be quality people such as retirees who
would be interested in an interim position and would do a good job.
Anderson said Ron Keller had three names he presented to the tourism
board who would be interim but likely permanent candidates.
Emphatically, Schumacher said: "I'm really concerned because
quality persons are not going to be interested. You have to have
people with tourism experience. I'm concerned about this."
Meister said the tourism bureau thought that hiring a director
would help change the city's mind "and they (the city) wouldn't pull
the plug come Dec. 1 or whatever potential date the city would
decide on."
"It all boils down to what the city is going to do and when, and
when they are going to make up their mind," Anderson said.
"Right, I agree with that; they're holding us hostage,"
Schumacher responded. "But what you don't want to do is shoot
yourself in the foot by hiring a temporary person."
Ruben modified that by saying: "You're shooting yourself if you
hire a permanent person under these conditions. A temporary person
is probably what you should hire because they can generate the money
(in the grant)."
Pat O'Neill agreed that tourism is of great value to Logan County
and suggested that the county board chairman, Bob Farmer, meet with
Lincoln Mayor Keith Snyder to try to get a better understanding of
where tourism might be going.
Meister said he didn't think that would be effective because he
didn't think there were any answers. The mayor was at the tourism
meeting with Meister just the evening before.
"We tried to get that yesterday," Meister said. "You want to know
that when you are interviewing people, just at least to be fair to
them. We're going to hire them and say, hey, this is the potential.
Or, if the city is going to say, we'll see what the production is,
and then we can make our mind up. That would at least be incentive
for the person to do well and be successful at that."
Bill Martin agreed with Schumacher that in hiring an interim
person there would be nothing going on, and the city will get to
Dec. 1 or some date and pull the plug, "rein it in." He questioned
if it was sure that the city could claim the money at this time.
Gene Rohlfs agreed with Martin, saying: "I really think that our
state's attorney needs to research this. I think that there is a
glitch in the law and it might have to do with home rule."
Ruben recalled that it was default by the city to let the county
have the hotel-motel tax when it was set up 26 years ago. The way it
was established, with the city giving it up then, may bear looking
at now. Ruben recognized that it would take some time for the
state’s attorney's office to research the matter. So, a request
should be made now.
Ruben said he was told the city wouldn't take it over until Nov.
30, the end of the budget year. He hoped that the city could provide
an answer before the August budget hearings so he would know what to
do in the next budget.
As an aside, Ruben added that currently all the funds that go to
tourism from hotel-motel taxes are pass-through for the county. He
inquired of the auditors if the county could ask for an
administrative fee of 10 percent on $130,000 that is set aside for
historic sites. They told him, "No doubt."
While the city has been demanding that benchmarking begins
showing results that correlate the use of the tax funds in the form
of "heads in beds and numbers of visitors to an event present for
day stays," Ruben pointed out that the state statue regulating the
use of the funds gets "very broad." It even stipulates by example
painting fairgrounds buildings, and several other specific fix-up
work details are mentioned. "So, I'm not so sure beautifying
downtown wouldn't qualify," he said.
Meister said that after the city document was released, people on
the tourism bureau board questioned if they currently fit the bill.
"There are a lot of people there who have been on the board a
long time. They are curious where they currently stand as being on
the board and are now wondering where they and the bureau fit in
with the guidelines," Meister said.
"So, there is a lot of confusion with that, and speculation," he
said.
Rohlfs said he found it interesting "that it is a
county-appointed board and it is a county- funded organization, yet
the city seems to be putting all the guidelines on it."
Anderson countered in part: "It's a city-funded organization.
We're just the pass-through people. That's their money." He had
pointed out earlier that the primary tax funding comes from
businesses in city limits and that the city supplies the paid
infrastructure to those businesses.
Returning to the executive director position, Schumacher said:
"If the city is trying to see if this person that is hired this
summer is going to save the organization, that's a fallacy. I think
it needs to be contract position that ends Nov. 30 or whatever. And
that's it. Whoever applies for that knows that they're just holding
the fort down."
On another point, Anderson said one of the qualifications for the
director is that the person has to live in Logan County. He was not
sure if that is in the tourism bylaws or what. It would be looked
into if that could be bypassed now, particularly if considering an
interim director.
Schumacher urged the liaisons, Anderson and Meister: "I think you
all need to be outspoken. I don't think that the city has decided.
It isn't that the mayor isn't telling us anything. They just haven't
decided."
Meister agreed.
"Right now, there's just a lot of things in limbo," Anderson
said.
It was determined to get the opinions from the state's attorney's
office as soon as possible.
"I think there is an urgency to this," Schumacher said.
Ruben said that if the city is going to take over these taxes, he
would want the city to also take over administering the Atlanta
taxes as pass-through money. He clarified that the county has not
taken anything for managing these taxes all these years because "I
felt it was their money."
The county collects 5 percent sales tax from hotels and motels.
Of that amount, the bureau receives a 4 percent tax, Main Street
Lincoln gets a quarter percent, Looking for Lincoln gets a quarter
percent, and the remaining one-half percent goes to historic sites,
which is decided once a year at the discretion of the county board
during budget hearings.
In the current fiscal year, the tax is budgeted at $142,770.
The tourism bureau received $134,540 from hotel-motel taxes in
2011, up nearly 30 percent since 2006, which is for the most part
attributed to tourist visits. Most of those businesses are located
in Lincoln. There is one hotel in Atlanta and occasional
bed-and-breakfast revenues.
With a budget of $194,000 for 2012-13, approximately 75 percent
of the tourism bureau's funding is from tax revenues collected by
hotels and motels. The taxes are passed through the Logan County
Board to the agency and used to promote tourism in the county. The
bureau is also supported by a state grant. The state grant requires
that a full-time administrator or director be in place.
[LDN]
City of Lincoln aldermen received the following document at the
May 14 workshop and were asked for their input:
(Copy)
Tourism expectations
The chief elected official of the entity imposing the tax (the
county board chairman in the case of the county board and the
mayor in the case of the City Council) should appoint the
members of the Tourism Board, if there is one, with those
appointments confirmed by the legislative body of the entity
(the county board or the City Council, as the case may be). That
way there is an elected official and an elected body accountable
for the results of the imposed tax.
The Tourism Board, if there is one, should be of a reasonable
size (no more than eleven), must include an appropriate number
of representatives of the City of Lincoln and at least two
members representing the hotel industry, and must have
appropriate term limits on its membership (to ensure adequate
turnover and fresh ideas).
The Tourism agency must have an updated and periodically
reviewed job description for each employee of the agency and
must at least annually evaluate the performance of each employee
against that job description. If a particularly position is
funded with any portion of the hotel/motel tax, the description
for that position must include a delineation of the specific
duties of that position that will be focused on promoting
additional overnight hotel stays.
The agency must provide an annual operating plan that outlines
activities for the upcoming year, that describes those planned
activities broken down by visitors (those coming and spending a
day) and overnight guests (those spending one or more nights in
a local hotel), and that reports on the results of the prior
year's operating plan.
Included in that operating plan, the agency should, for each
piece of significant property it owns (e.g., the covered wagon,
the Mill, etc.), detail an annual capital projects plan that
outlines annual maintenance/upkeep costs, any improvements
planned for the property for that year, any expected costs to
finish developing that property, an annual operating plan for
the property, and a thorough description of how each of those
costs will be provided.
As part of that operating plan, the Tourism agency must define
and report its level of involvement with each and every event
supported by the agency. Possible levels of involvement might
include: "Donor" (where the agency simply contributes a
financial amount to the event); "Participating Sponsor" (where
the agency contributes financial and has staff and/or board
members volunteer at the event); "Host" (where the agency plans,
raises funds for, and executes the event).
As part of the operating plan, the Tourism agency must define,
begin tracking, and over time improve the agency's Return on
Investment ("ROI") for the hotel/motel taxes received by the
agency.
Applications for funding from the agency must include a section
where the applicant details how the event will boost overnight
hotel stays and how the applicant will track and report the
overnight stays generated by the event.
Representatives of the city of Lincoln have indicated that sometime
this year the city may take over the tax dollars collected for
tourism. The unclear plan has left county and tourism officials
wondering how to move on a number of matters in the present and in
the near future.
