Jun 252015

No Decision On Lodger’s Tax As

City Approves Tentative Budget

By Tammy Gray

A $10.7 million tentative budget was adopted by the Holbrook City Council Tuesday evening. The tentative budget sets a guideline for spending within city departments as the new fiscal year begins on July 1, but allows the council to continue to make changes until the budget is finalized in August.

Division of the lodger’s tax and contributions to the chamber of commerce remained the lone contested portion of the budget, with the council ultimately deciding to leave the staff-recommended $51,500 in place for the chamber, pending further discussion. Council members did not make a determination whether the chamber’s budget will be further reduced if the Wild West Days and Christmas parade are turned over to city staff.

Chamber President Yvonne Larson told the council that the chamber has decided to take a new direction, focusing primarily on business-related services and events.

“We had a special meeting regarding Wild West Days and decided to take it out of our budget along with the Christmas parade event at the courthouse,” Larson said. “We felt with the special events manager at the city could handle it.”

She asked the council to leave the chamber’s portion of lodger’s tax at $51,500, noting that it already represented a cut in funds from the previous year.

Chamber Vice President Troy Klein remarked, “The chamber doesn’t mind carrying a burden as long as it is equally shared across the city. I hope you understand that we are all unpaid volunteers except for the director.”

Klein told the council that the chamber is rededicating itself to the business community and intends to drop events that don’t support local business growth due to a lack of manpower and funding.

Councilwoman Francie Payne asked whether the chamber would continue to qualify for lodger’s tax funds if the organization no longer offers events or services intended to draw tourists to Holbrook.

Vice Mayor Wade Carlisle reviewed the ordinance establishing the lodger’s tax, which notes that the funds are to be used to promote tourism.

Larson told the council that the chamber will continue to promote the summer cultural dances, and that supporting local businesses in turn encourages visitors to stop and stay in Holbrook.

“Without businesses you don’t have tourism,” she said. “By having businesses, that is part of promoting tourism.”

Payne noted that she is glad to see the new direction the chamber is taking, and feels that the chamber should not have to answer to the city. She stated that the city may owe the chamber some funding for equipment such as computers that the organization gave up when its offices were shifted to city hall. She noted that it may be more appropriate for the city to purchase a platinum membership from the chamber than try to guide the chamber’s operating budget.

“I am certainly not trying to work against the chamber,” Payne said. “I’d like to see us all work together. I like your focus.”

Larson told the council that as part of the chamber’s service to businesses, it would serve as a liaison between city government and the businesses.

Carlisle noted that he is uncomfortable with providing tax dollars to an organization that focuses on working with the government.

“I don’t like the new model that chambers have taken in government relations,” he said. “They’re taking government money to lobby the government.”

He noted that the chamber has received 100 percent of the lodger’s tax in the past and he felt that taxpayers did not receive a good return on that investment.

“I recognize that now it is all different people and I like your new direction,” he said. “Before there was a lot of money going in, but not a lot coming out of it.”

Councilman Richard Peterson noted that the council did not have to decide on the specific amounts requested by the chamber in order to approve the tentative budget. He also pointed out that the amount included in the budget was based on the chamber hosting Wild West Days.

“We can move forward and decide that later,” he said. “If this becomes the actual budget, then we can tell them either you do these events or give the money back.”

Councilman Myron Maxwell noted that he felt the council would be wise to adopt the budget recommendations made by City Manager Ray Alley and Finance Director Randy Sullivan.

“We’ve spent hours talking about the lodger’s tax, but I can’t see that it’s in the best interest of the city to go against the suggestions made by Alley and Sullivan,” he said. “They’ve spent many more hours than us at this and they’re the professionals.

The council unanimously approved the tentative budget as presented. Under state law, the final budget must be adopted no later than the third Monday in August.