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Lodging Tax Advisory Committee <br />Guiding Principle #1 <br />Six Year Financial and Ending Fund Balance <br />Topic: Guidance on financial modeling and ending fund balance. <br />Background: The City of Tukwila (the "City") collects a 1% charge on eligible lodging stays at area <br />hotels, motels and Airbnbs. Under Washington State law these funds can only be used <br />for tourism promotion activities. Any request to lodging tax funds is reviewed by the <br />Lodging Tax Advisory Committee (LTAC) and, if LTAC recommends approval, is forward <br />to the Tukwila City Council for final review and action. <br />The City is projecting a significant ending fund balance for 2019 and 2020. In order to <br />provide strategic direction on the use of funds, LTAC is proposing that a six -year <br />funding model be maintained showing possible future uses of lodging tax funds. The <br />goal is to ensure that as applications come in the LTAC consider the request in a <br />strategic context of the City's overall goals and ensure the funds are available in future <br />years for the City's priorities. <br />Principle: LTAC will maintain a six -year financial model outlining anticipated revenue and <br />anticipated expenditures. The expenditures are concept only and at a very high level. <br />The model provides no approval to expend any of the funds listed. Any request to use <br />funds require going through the formal application process. <br />Furthermore, the financial model will strive to ensure that the forecasted ending fund <br />balance in any year not be below $400,000. The goal with keeping this minimum <br />ending fund balance is to provide significant amount of funds that could be used <br />during an economic downturn or to take advantage of a major opportunity. <br />City of Tukwila <br />6200 Southcenter Blvd. <br />Tukwila, WA 98188 <br />K <br />