Friday, May 31, 2013
Hood River City Councilors met May 28 to plow through some tough issues — the likely reason behind the large audience packed into the city hall chambers.
On the agenda: an Oregon Land Use Board of Appeals remand (send-back) of the council’s decision previously approving the Naito development at the waterfront, and a Chamber of Commerce proposal addressing the potential shift in transient room tax dollars away from the Visitor Council budget.
TRT shift impacts
With the recent annexation of both the Columbia Gorge Hotel and the Vagabond Lodge into City jurisdiction, a significant change could take place in the way TRT dollars are distributed to the Chamber and its Visitor Council outreach functions.
With those properties previously under County jurisdiction, the TRT revenue was divided 90 percent to the Chamber and 10 percent to the County. The distribution formula as currently set by the City will allot 75 percent to the City and 25 percent to the Chamber. That significant drop brought out half of the evening’s audience, who uniformly offered their support of continuing current Chamber and Visitor Council activity levels.
“In real numbers, this means a reduction of approximately $90,000 per year, or nearly 25 percent of the Visitor Council’s budget,” wrote Mike Glover, Chamber executive director, in his letter to the council. The organization’s mission primarily focuses on year-round tourism promotion and marketing.
“This will drastically affect our ability to carry out our mission,” Glover said, as an introduction to providing the council with some potential solutions to maintain a workable funding situation.
“One method for accomplishing that would be to temporarily increase the amount of money allocated by the city to tourism promotion from 25 percent of total TRT collected, to 37 percent of total TRT collected. This would be phased out at the end of the third year in our proposal,” said Glover in a follow-up email.
“Another possibility for maintaining the current funding levels would be for the city to set aside a separate dollar amount for the next three years, after the end of this calendar year, to help offset the funds for tourism promotion.
“That could either be the same amount over those three years — approximately $50,000 annually — that would be matched by an equal amount of the Visitor Council reserve fund; or a sliding scale, again with the difference being covered by the reserve fund until it is depleted,” said Glover.
Although the proposals were part of a preliminary work session, the council dove in asking for additional information. Questions included: How do we know that advertising works? How do we justify promoting one industry but not another? How can we commit the TRT revenues when the City is not assured of their collection and, What is happening Gorge-wide with other tourism jurisdictions?
Glover provided an overview of the financial impact of tourism across all aspects of the local economy and several tourism-related business owners spoke out on behalf of the proposals.
The council agreed to submit a list of questions for further discussion and requested response on behalf of the Chamber.
Local business owners Stu and Kathy Watson then brought forward a proposal of their own, hoping to address the same underlying funding crisis.
“This is a good time to take a fresh look at that situation,” said Stu. “I’d like to suggest that we separate the Chamber and the Visitor’s Center and create something like: Travel Hood River.
Watson went on to suggest increasing the TRT rate charge itself.
“With a one percent increase in TRT, that could translate to about $84,000; at a 60 percent occupancy rate, that could offset a lot of that loss,” he said.
Look to upcoming city council meetings for additional fact-finding and deliberation on the topic.
See the Wednesday edition for a summary of the Naito project LUBA remand council discussions and proposed modifications on the ordinance tied to a street vacation adjacent to the Naito development.