2016-06-27 Lodging Tax Advisory Committee Packeto r E 1) fL.
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AGENDA
Lodging Tax Advisory Committee
Edmonds City Hall
Fourtner Meeting Room, 121 5th Ave N
Monday, June 27, 2016
3:30-5:00PM
Approval of March 14, 2016 Meeting Summary
2. Public Comment
3. Report on Tourism Promotion Support
4. 2017 Budget Discussion and Approval
Lodging Tax Advisory Committee
Draft Summary Notes from 03/14/16 Meeting
Committee members present: Mike Nelson, City Council
Joe Mclalwain, Edmonds Center for the Arts Executive Director
Frances Chapin, Edmonds Parks, Recreation, & Cultural Services, Mgr.
Jan Conner, Harbor Inn
Pat Moriarty, The Studio
Committee members absent: None
Staff present: Patrick Doherty, Economic Development & Community Services Director
Cindi Cruz, Economic Development
Meeting was opened by Mike Nelson at 3:30 p.m.
1. Approval of November 30, 2015 meeting minutes.
Joe Mclalwain moved to approve the 11/30/15 meeting minutes and Frances Chapin seconded
the motion. Motion passed with Pat Moriarty and Jan Conner abstaining.
2015 Year-end Financial Reports. The 120 Fund budget as proposed last fall was_approved by
City Council. The $3,000 allocated for RevitalizeWa conference will not be expended in 2016.
The new tourism brochure was distributed. After some discussion it was suggested that the next
printing of the brochure should include more focus on staying the night in Edmonds along with
including that message in ads throughout the year. Frances gave a brief explanation of the 123
Fund budget which is 25% of the LTAC funds dedicated to the arts project awards from the
Edmonds Arts Commission (EAC). No more than $2,000 is awarded to each applicant subject to
approval and recommendation by the EAC.
Patrick gave an update on the downtown public restroom project which the LTAC has budgeted
$60,000 for 2016. The project was estimated to cost $300,000 and the City is working with
consultants and a committee to determine the best layout and location in the parking lot
adjacent to the south side of City Hall. The identified funds are $260,000 with $60,000 from
LTAC, $10,000 from the BID, and the Rotary potentially contributing up to $10,000. Costs could
be as high as $320,000 and the proposal will be presented to City Council on 3/22/16.
Funding request for 2016:
Edmonds Center for the Arts requested $2,500 in support of their 10th Anniversary Birthday
Bash to be held on July 30, 2016. Jan moved for discussion the approval of $2,500 to the ECA.
Pat seconded the motion. Joe gave a brief explanation of the events that will be happening in
celebration of the 10 year anniversary of the grand opening of the ECA. The ECA attracts 60% of
their visitors from outside of Edmonds. The July 30 event will be free to the public. Motion
passed 4-0, Joe Mclalwain abstained.
Edmonds Waterfront Festival requested $1,000 in support of advertising for the Waterfront
Festival to be held June 3-5, 2016. The $1,000 will be used to purchase a bus wrap on a
16 03 14 LTAC minutes
Community Transit bus advertising the festival. Joe moved for discussion the approval of award
of$1,000 to the Waterfront Festival for advertising. Frances seconded the motion. There were
some concerns expressed about the Festival not attracting overnight stays but approximately 70
bed -nights are generated from vendors. It is an event that brings 20,000 visitors to Edmonds
over three days. Bringing new visitors to Edmonds is always a good investment. There will be a
stipulation that the advertisement must state that it is partially funded by the Lodging Tax Fund.
Motion passed 4-1 with Jan Conner voting no
4. Discussion of schedule for awards cycle for 2017 funds.
Currently the Arts Commission advertises the application process for grants from the 123 Fund
which is 25% of the total received LTAC funds per year. These grants are no more than $2,000
and are recommended to the Committee by the Arts Commission. The awards are included in
the budget process along with the awards that the LTAC gives out to the ECA, Edmonds
Chamber/Visitor Center, and to the Snohomish County Tourism Bureau. The discussion revolved
around advertising grant opportunities from both the 123 and 120 funds or keep it the way it
has been and only advertise 123 Fund awards through the Arts Commission. There are new
organizations that have been established in recent years and the Committee expressed support
for jointly advertising these two grant opportunities. Grants from direct application to the LTAC
will generally be small. Frances moved to advertise small grant opportunities for limited LTAC
funding to promote events held in Edmonds at the same time as advertising the Arts
Commission Tourism Promotion grants. Jan seconded. Motion passed unanimously.
5. Meeting adjourned at 5:16 p.m.
16 03 14 LTAC minutes
PROPOSED 2017 LTAC BUDGET
REVENUE AND EXPENDITURE NARRATIVES
TOTAL LODGING TAX REVENUE
The 2016 approved budget included total projected revenue of $109,000. 2016 lodging tax
revenue receipts through May 31s' have totaled $21,269, up 13% year -over -year. In order to
estimate the 2016 total revenue, we can look back at the 2015 lodging tax receipts through
May 31St, which constituted 17.6% of last year's total of $106,881. Applying that same year-to-
date percentage to this year would yield a projected 2016 year-end total of $120,850 in lodging
tax receipts, compared with the above -cited 2016 forecast of $109,000. To be more
conservative, for forecasting purposes we believe a 2016 year-end revenue figure of $115,000
should be considered.
For 2017 we have suggested a flat rate of growth over the 2016 final figure, resulting,
therefore, in a 2017 revenue projection of $115,000.
Per City Council Resolution 630, 25% of lodging tax receipts is to be dedicated to Fund 123
(Tourism Promotion/Arts Fund) for arts and cultural programs and activities that attract visitors,
while 75% of lodging tax receipts is to be dedicated to Fund 120 for general tourism -promotion
programs and activities.
Based on the above -cited 2017 revenue projection, the break -down of lodging tax revenue
would be as follows:
• Fund 123 $28,750 ($1,500 increase from 2016)
• Fund 120 86 250 ($4,500 increase from 2016) + $200 interest = $86,450
• TOTAL $115,000
FUND 120 ON -GOING EXPENDITURES
Contingency. Increase to $4,625. We propose to increase the Contingency line item over the
2016 budget by adding half of the unallocated 2017 increased revenue here. This accomplishes
two things: 1) provides a small cushion to compensate for less than projected revenue, and 2)
allows for minor additional expenditures in approved line items, such as advertising. This can
be revisited mid -year in 2017.
Printing/Distribution of Rack Card. Retain $7,500 for printing and distribution.
Promotion/support of Bird Fest. Retain $1,500 for Bird Fest.
Snohomish County Tourism Bureau. We concur with the Bureau's request to increase support
from $6,000 to $6,200.
2017 LTAC BUDGET NARRATIVE
pg. 2
Edmonds Visitor's Center. We suggest continuing our long-standing support at $2,500.
General Advertising. Increase to $27,250. We propose to increase General Advertising over the
2016 budget amount by adding half of the unallocated 2017 increased revenue here. This will
help fund the more aggressive tourism advertising strategy set in place last year:
Edmonds Center for the Arts Season Brochure. Our principal form of support for the ECA,
which also provides a two -page advertising spread on Edmonds, we suggest continuing our
long-standing support at $12,500.
Miscellaneous. Retain at $2,575. This allows for several occasional expenses, such as
photography, design work, emerging opportunities, etc.
Transfer to Fund 117 for arts promotion. Retain $4,000. For many years an amount of $4,000
has been transferred to Fund 117 to help fund arts promotion through the CRAZE, Arts Access
and the Snohomish County Visitor Guide.
Tourism Promotion/Support for Website, Calendar, etc. The 2016 budget included $18,000 to
fund professional services in the areas of:
• Tourism website and calendar maintenance
• Pitching earned media coverage of Edmonds
• Social media promotion
• Ad development and strategic placement
• Strategy development on new, enhanced marketing, events, etc.
Propose continued support at $18,000.
ONE-TIME EXPENDITURES
With expenditures from this account in 2016 for the Downtown Restroom ($60,000) and Log
Cabin Maintenance ($4,500), and accounting for some additional growth in revenue than
originally budgeted, we project a potential total fund balance of approximately $92,385 by the
end of 2016.
Expenditures related to one-time events or programs, intermittent expenditures and/or pilot
programs are best funded as "one-time expenditures" from this fund balance.
The following expenditures are proposed from as one-time expenditures:
Support for Renewed RevitalizeWA Conference Bid. Although we were not awarded the 2015
event, we were encouraged to reapply for future consideration. 2017 would be the next year
the event should be held on the western side of the state. $3,000 would support host city
costs.
2017 LTAC BUDGET NARRATIVE
pg. 3
Waterfront Festival 2017 grant request. $2,000 to support regional advertising.
Chamber of Commerce 2017 Chowder Cook -Off. $1,000 to support regional advertising.
Approved 2014
Budget
Approved 2015
FBudget
Year -to -Date 2015
Approved 2016
Budget
Year -to -Date 2016
Revenue
75% Fund 120 - General Tourism Promotion $54,000 $67,500 $80,161-7 $81,750 $15,952
25% Fund 123 - Arts/Culture Tourism Promotion $18,000 $22,500 $26,720
Total Lodging Tax Revenu $106,881
120 Fund
Beginning Fund Balance * $106,736 $112,841 $133,991
$27,250 $5,317
llkfW,1,270
$153,885 $153,885
75% Fund 120 - General Tourism Promotion Revenue $54,000 $67,500 $80,161
$81,750 $15,952
Interest $140 $175 $1,090
Total: $160,876 $180,516 $215,242
$400 $436
$236,035 $170,273
ON -GOING EXPENDITURES
Contingency"
$2,575
General Tourism Promotion (Fund 120):
Printing/distribution of rack card
$6,000
$6,000
$4,240
$7,500
$7,360
Promotion/support of Bird Fest
$1,500
$2,500
$1,871
$1,500
$200
Sno Co Tourism Bureau
$6,000
$6,000
$6,000
$6,000
Edmonds Visitor's Center
$2,500
$2,500
$2,500
$2,500
General Advertising
$21,000
$21,000
$16,610
$25,000
$6,322
Edmonds Center for the Arts Season Brochure Ad
$12,500
$12,500
$12,500
$12,500
Miscellaneous - Design, photography, emerging opportunities
$500
$500
$1,638
$2,575
$65
Transfer to Fund 117 for arts promotion CRAZE etc.
$4,000
$4,000
$4,000
$4,000
Tourism Promotion/Website/Calendar Support $12,000 $12,000
Subtotal: $54,000 $67,000 $61,358
$18,000
$82,150
$7,500
$21,447
"Note: To Account for less than projected revenue and/or minor additional expenditures in approved line items
Fund 120 Subtotal (ending fund balance confirmed with Finance 6/20 $106,876 $113,516 $153,885
$153,885
$148,826
ONE-TIME EXPENDITURES
Support for Restroom Construction
$60,000
Support for RevitalizeWA Conference
$3,000
$3,000
Log Cabin Maintenance (2016)
$4,500
Waterfront Festival 2017 grant request
Chamber's 2017 Chowder Cook -Off
Fund 120 Ending Fund Balance
148826
Approved 2014
Budget
Approved 2015
Budget
Year -to -Date 2015
Approved 2016
Budget
Year -to -Date 2016
123 Fund
Beginning Fund Balance* $70,429 $75,297 $77,645 $82,780 $84,568
25% Fund 123 - Arts/Culture Tourism Promotion
$18,000
$22,500
$4,707
$27,250
$5,317
Sale Maps/Books
$100
$150
$14
$30
$14
Interest
Total:
$100
$88,629
$250
$98,197
$227
$82,593
$250
$110,310
$223
$90,122
On -going Expenditures:
Art/Culture Tourism Promotion Grants:
Cascade Symphony
$1,700
$2,000
2000
$2,000
EAF for Art Studio Tour
$800
$1,000
1000
$1,000
Edmonds Arts Festival
$1,000
Sno-King Chorale
$1,000
$1,500
1500
$1,500
DeMiero Jazz Festival
$2,000
$2,000
$2,000
$2,000
$2,000
Olympic Ballet Theater
$2,000
$2,000
2000
$2,000
Driftwood Theater
$2,000
$2,000
2000
$2,000
Phoenix Theater
$1,500
1500
$1,500
Art Walk
$750
Cascadia Art Museum
$750
Cascade Symphony
$1,500
Edmonds Historical Museum
$1,500
Jazz Connection
$2,000
CAFE
Subtotal - Tourism Promotion Grants
Write on the Sound
$5,000
$7,200
$12,000
$5,925
$19,500
$8,000
$5,270
Promotion of public art/brochure/web
$2,000
0
$2,000
Concerts in the Park (poster distribution)
$1,000
Miscellaneous Ads e.g. Sno Co Visitor Guides
Subtotal - LTAC approved EAC program expenditures
Wayfinding Signage installation
$14,500
$21,200
$2,578
$8,503
$613
$1,000
$12,000
250
$7,520
Subtotal: Expenditures
$14,500
$21,200
$21,116
$31,500 $7,520
0 $82,602
Wayfinding Signage installation from Ending Fund Balance
2022
2022.29
Approved 2014 Approved 2015 Approved 2016
Budget Budget Year -to -Date 2015 Budget Year -to -Date 2016
Fund 123 Ending Fund Balance $74,129 $76,997 i $61,477 $76-7� $80,579
*Verified with Deb Sharp, Finance Division