Island County commissioners and a committee of volunteers are playing a game of ping-pong over the distribution of lodging taxes.
The elected officials and an advisory group disagree over how much the Greater Oak Harbor Chamber of Commerce should receive from the fund next year. As a result, the recommendations from the county’s Lodging Tax Advisory Committee may continue to be passed back and forth between the two bodies.
Mixed up in the disagreement is possible funding for a new chamber event. The chamber is proposing “New Year’s Eve Island Ice,” in which a portable ice rink would be brought to the city next year.
Commissioner Rick Hannold said the chamber leadership is acting “kind of greedy” in not being willing to share more of the money with other worthy causes, specifically the PBY Naval Air Museum in Oak Harbor and the Island County Historical Society Museum in Coupeville.
“The money would help two entities that are destination places that are on their own,” he said. “They aren’t receiving other tax dollars while the chamber is getting money from Oak Harbor.”
The chamber will get a total of $167,500 in lodging taxes from Oak Harbor next year if that city’s City Council approves the recommendation from its Lodging Tax Advisory Committee.
Lisa Bernhardt, director of Pacific NorthWest Art School in Coupeville, is one of the new members on the advisory committee. She said the members unanimously felt that funding chambers of commerce is the best use of the lodging tax dollars, which are specifically intended to boost tourism.
“Historically, 80 percent has gone to the chambers of commerce,” she said. “That’s their full-time job, putting heads in beds.”
She also pointed out that, historically, the commissioners have accepted the advisory committee’s recommendation without back-and-forth negotiations.
“We’re in unchartered waters here,” she said.
Under law, a Lodging Tax Advisory Committee is made up of representatives of those who collect the tax — hotels and motels — and those who receive the money — such as chambers and other nonprofit and for-profit groups.
The tax, also known as the hotel/motel tax, is a 2 percent tax on lodgers. Under state law, it may be used for promotion of tourism or construction and operation of tourism-related facilities. To confuse matters, there are actually two forms of lodging tax: the “basic” 2 percent and a second 2 percent tax. The county and city entities are currently considering the basic tax.
The advisory committee has more power under a law change a couple of years ago. The elected officials can no longer change the amount that the committee recommends for each group. They can approve the list as-is, reject the list or remove an item from the list; they can also send items back for reconsideration.
The latter option is what the commissioners did.
The advisory committee recommended $210,000 in allocations, with the highest amount — $31,465 — going to the Oak Harbor chamber. The committee also recommended an additional $2,581 to the chamber, specifically for the ice rink.
The commissioners, however, were concerned that certain groups didn’t receive enough money. They decided to release an additional $20,000 in tax dollars and asked the committee to reconsider funding Ebey’s Reserve, Four Springs on Camano Island and port-a-potties for Island County Parks at higher levels.
In addition, the commissioners unanimously recommended that some of the funds earmarked for the Oak Harbor chamber — not to exceed $15,000 — be redistributed to the PBY Museum and the Historical Museum. The recommendation, written by Commissioner Jill Johnson, notes that both museums received less funding than in previous years and have fixed costs associated with running an ongoing operation.
“I would say they need the money more than the chamber,” Hannold agreed.
The commissioners’ recommendation would, however, represent a decrease in funding to the Oak Harbor Chamber, just as the group is experiencing record membership — close to 500 members — and is looking at creating new events in the city.
This year the chamber received $30,000 from the fund. Last year it got $23,000.
Hannold chaired the advisory committee meeting earlier this month in which the members were asked to reconsider the recommendations. He said the members were upset about being asked to change their position, but he reminded them that they’re an advisory group.
He also stressed that the county’s lodging taxes come from unincorporated areas — outside of the city — and that the city has its own allocation of funds.
He said he would like at least $10,000 of the $31,465 recommendation allocation to go to the two museums.
Christine Cribb, the chamber’s executive director, made her case for receiving the larger amount and the committee members agreed with her.
In an email, Cribb said the chambers looks forward to the final announcement from the commissioners on the award. She said she and the chamber board are grateful for the unanimous support from the advisory committee.
“The volunteer committee is made up of longtime members of our community and I value and appreciate their extensive time serving and researching the challenging task of dispersing 2 percent funds,” she said.
The committee again recommended the same amount for the chamber — including the ice rink funds — and increased funding for Ebey’s and county port-a-potties with the additional $20,000.
Hannold said he was not pleased.
“I just wonder what we are getting on a return of investment from the chamber,” he said, adding that the PBY museum and the history museum are destinations that bring people to the island.
Hannold said he will vote to send the recommendation back to the advisory committee for re-reconsideration. He said, technically, the two bodies could continue sending the list back and forth until someone gives in.
“Or possibly we could just bank the money and look at it again next year,” he said.
Meanwhile, Oak Harbor’s Lodging Tax Advisory Committee -— not to be confused with the county’s committee of the same name -— came up with its list of recommendations Monday. The council limited the “basic 2 percent” awards to $150,000 this year.
“It was a pretty smooth process,” City Administrator Doug Merriman said.
The process was somewhat controversial last year after the committee recommended the city-owned Whidbey Island Marathon receive nothing from the fund. This year, however, the committee recommended the marathon receive $10,000.
The largest recommended award is for the chamber of commerce at $67,500, which is the same as last year.
Merriman said the chamber asked for an additional $28,300 for three events, namely the ice rink, movies in the park and “bikes at the bay.” The committee recommended against funding those new items.
“There’s just not enough money to do everything,” he said.
The chamber will also receive $100,000 from the “second” 2 percent tax next year. The funds are for operations.
Both the City Council and the county commissioners are scheduled to consider the lodging tax recommendations in early December.
