Tourism-related infrastructure, such as the waterfront Wave Gallery and the Cotton Building in downtown Port Townsend, and a fund for tourism marketing were part of a $557,338 lodging tax expenditure budget that was approved Jan. 16 by the Port Townsend City Council.

The budget, for 2018, was drafted by the Lodging Tax Advisory Committee (LTAC). The council’s vote in favor of the budget was unanimous.

“We actually had [in 2017] $508,000 in total revenue, which was a record year,” said City Manager David Timmons of the revenue. “So, we’ve revised the estimate for lodging tax income to be about $500,000 next year [in 2018]. So, that gives us a total income available of $708,000, and then subtracting out these recommendations, it would bring the ending fund reserves down to $151,000,” Timmons said.

“The lodging tax also is restricted to basically two categories: community marketing and promotion, as well as … tourism-related infrastructure. So, the funds are basically earmarked for those specific purposes,” Timmons said.

According to city code, the lodging tax is 4 percent, and all proceeds are to pay for the cost of tourism promotion or the acquisition of tourism-related facilities.

Timmons said the law requires the city to establish an LTAC, which then makes recommendations to the City Council. The city may not make unilateral spending decisions without consulting the LTAC.

The allotment of funds breaks down as: $176,000 to Jefferson County Chamber of Commerce for a contract for Visitor Information Center operations, including rent; $158,500 to the city for general marketing and promotion transitional services; $125,000 to the city for debt service on tourism infrastructure; $25,000 for Fort Worden PDA tourism infrastructure; $20,000 to the city for a lodging study; $20,000 to the Port Townsend Main Street Program for a winter marketing campaign; $12,838 to the city for general fund administration services; $10,000 to the city for facilities rentals for special events; and $10,000 to the Northwest Maritime Center for facilities rentals for the Wooden Boat Festival.

There is $208,915 in LTAC beginning fund reserves. The city estimates $500,000 of lodging tax income is to be collected in 2018. The ending balance for 2018 funds is estimated to be $151,577.

FROM CITY TO CHAMBER

Timmons said 2018 would be a transition year as tourism marketing shifts from the city’s responsibility to that of the Chamber of Commerce, by contract. Timmons said 2018 is a good year for the transition, because the chamber is hiring a new executive director.

Of those funds, about $90,000 goes toward marketing and $25,000 to the chamber’s membership in Olympic Peninsula and statewide organizations.

The chamber’s Visitor Center is to have an increase of $60,000 to allow it to hire staff to take on tourism marketing roles as the transition takes place.

Timmons said another part of the budget is for two studies. One study is to look at the city’s hotel capacity. That study was last conducted five years ago and needs to be updated. The second study is to look at what should be done in regard to performing arts centers.

“There’s currently three separate plans underway for performing arts venues in the community. It seems … that we probably only have capacity for one, because the studies that I’ve read is that the performing arts isn’t necessarily a destination market. So, we need to look at what the community can support,” Timmons said. The study would look at Key City Theatre, the schools and Makers Square at Fort Worden.

“We wanted to bring in a theater consultant to basically take a look and kind of give us a reality check,” Timmons said.

WINTER, EFFICIENCY, FESTIVAL

Downtown businesses struggled in the winter months after the holidays, Timmons said, so $20,000 in the budget is to be directed to help bring people downtown during the slower winter months.

Per the budget, $25,000 is for Fort Worden tourism infrastructure to help with energy-efficiency improvements and to reduce the fort’s carbon footprint.

In addition, $10,000 is to go to the city to pay for rental of the Pope Marine and Cotton buildings for special events such as the Port Townsend Film Festival. That way, the city’s facilities department would be paid for the rentals rather than having the city waive the rental fees.

The Northwest Maritime Center is to receive $10,000 to pay for a portion of rental charges as part of the Wooden Boat Festival.

Timmons said the city might upgrade trash receptacles in high-tourism areas. Council member Michelle Sandoval suggested a bathroom at the other end of town be built for tourist and residents.

TOURISTS AND LOCALS

Timmons said marketing efforts have hit a peak and “the issue now is really we need to look at the infrastructure to support the visitor experience.

“The idea was that we invest in a lot of the infrastructure for the benefit of the community first, as a priority, and secondarily as a tourism-related [feature]. So, like Wave Gallery and the waterfront improvements, the Cotton Building, all of that. That’s why the lodging tax is not paying for all of that. It’s only paying for a portion because the original design intent was to build it for the community as an asset,” Timmons said.

“We’re seeing the shoulder seasons filling in and … the strategy that we’ve been trying to do is more long-term visits than short-term. But we’re also getting a lot of competition throughout the region,” Timmons said.