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Home My WebLink AboutReg 2015-11-02 Item 7 - Discussion - Selection Process for Lodging Tax Advisory Committee AppointmentsCOUNCIL AGENDA SYNOPSIS Initials Meeting Date Prepared by Mayors rev Council review 11/02/15 BM n Motion Mtg Date V\ ( I Ordinance Mtg Date [ Bid Award Mtg Date Public Hearing Mtg Date Other Mtg Date CATEGORY ►1 Discussion Mfg Date SPONSOR Council Mayor L f _ DCD Finance I 'Fire IT I I P&R Police LW SPONSOR'S SUMMARY The City imposes motels. promotion required members; a 1% lodging tax on the certain overnight stays at area hotels and Under Washington State law, lodging tax proceeds can only be used for tourism (overnight and day visitors) and other tourism related activities. The City is to have an LTAC overseeing use of the lodging tax funds. The LTAC has nine one is an elected City Official; four are hoteliers; and four are non - hoteliers. Rim I WI .M BY CA &P Cmte Cmte n Arts Comm. ITEM INFORMATION ITEM No. 7 51 STAFF SPONSOR: BRANDON MILES ORIGINAL AGENDA DxiI:: 11/2/15 Ac;1;NDA ITi?M TIT] l' Briefing on the role and appointment process of the City's Lodging Tax Advisory Committee (LTAC). 11/02/15 n Motion Mtg Date _ Resolution Mtg Date ( I Ordinance Mtg Date [ Bid Award Mtg Date Public Hearing Mtg Date Other Mtg Date CATEGORY ►1 Discussion Mfg Date SPONSOR Council Mayor L f _ DCD Finance I 'Fire IT I I P&R Police LW SPONSOR'S SUMMARY The City imposes motels. promotion required members; a 1% lodging tax on the certain overnight stays at area hotels and Under Washington State law, lodging tax proceeds can only be used for tourism (overnight and day visitors) and other tourism related activities. The City is to have an LTAC overseeing use of the lodging tax funds. The LTAC has nine one is an elected City Official; four are hoteliers; and four are non - hoteliers. Rim I WI .M BY CA &P Cmte Cmte n Arts Comm. r F &S Cmte _ Transportation Cmte Comm. Planning Comm. CHAIR: N/A i4 COW Mtg. C Utilities DATE: N/A a Parks COMMITTEE RECOMMENDATIONS: SPONSOR /ADMIN, COMMI Mayor's Office nm N/A COST IMPACT / FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $N /A $N /A $N /A Fund Source: N/A Comments: N/A MTG. DATE RECORD OF COUNCIL ACTION 11/2/15 MTG. DATE ATTACHMENTS 11/2/15 Informational Memorandum dated 10/29/15 51 52 �YJtLgN, 7' 4T City of Tukwila Jim Haggerton, Mayor INFORMATIONAL MEMORANDUM TO: City Council FROM: Brandon Miles, Economic Development Liaison DATE: October 29, 2015 SUBJECT: Lodging Tax Advisory Committee Appointment Process ISSUE Briefing on the role and appointment process of the City's Lodging Tax Advisory Committee (LTAC). BACKGROUND The Council President has asked staff to brief the Council on the LTAC and the appointment process. The City imposes a 1% lodging tax on the certain overnight stays at area hotels and motels. For 2016, the City's budget estimates that the City will receive approximately $630,000 in lodging tax funds. Under Washington State law, lodging tax proceeds can only be used for tourism promotion (overnight and day visitors) and other tourism related activities (RCW 67.28.1816). The lodging tax is a separate charge from the Tourism Promotion Area (TPA) fee of $2 per night per room. All hotels and motels are subject to the lodging tax, but only hotels and motels with at least 90 rooms are subject to the TPA fee. The TPA fee does not go to the City, instead the fee goes to the newly created Seattle Southside Regional Tourism Authority ( "Authority "). The Authority collects the TPA fee from eligible hotels in the cities of Tukwila, SeaTac, and Des Moines. In 2016, the Authority will assume most of the operations of Seattle Southside Visitor Services (SSVS), which is currently a division within the City of Tukwila, and will be responsible for marketing the region to potential overnight guests. The 2016 budget approved by the Authority's board estimates 2016 revenue at $4.6 million. In order to collect the lodging tax and spend the funds collected, the City is required by State Law to have a Lodging Tax Advisory Committee. The Committee makes recommendations to the City Council on any request to use lodging funds, including requests by the City. The City Council can accept or reject any of the LTAC recommendations. However, the City Council cannot change the specific funding amounts recommended by the LTAC. The City's LTAC has nine voting members (State law only requires that the LTAC have five members). Four of the members are representatives of businesses that are required to collect the tax (hoteliers), four are persons involved in activities authorized to be funded by the tax (non - hoteliers); and one member is a City elected official who serves as the LTAC chair. Traditionally, the Council President has served as the City's elected official chairing the LTAC. Due to member resignations, the City currently has four vacant positions on the LTAC. State Law requires that the City Council, "review the membership of the advisory committee annually and make changes as appropriate (RCW 67.28.1817)." This annual review requirement is also found in City Council Resolution # 1533. 53 INFORMATIONAL MEMO Page 2 DISCUSSION The LTAC is different from many of the City's other board and commissions in that typically non- residents serve as its members. As discussed above, the LTAC members are divided into two categories, hoteliers and non - hoteliers. The following is a list of lodging businesses in the City: Hotel /Motel Name Geographical Location Hampton Inn Southcenter Embassy Suites Seattle Southcenter Courtyard by Marriott, Southcenter Southcenter Courtyard by Marriott, Seattle /SeaTac Southcenter Doubletree Hotel Southcenter Extended Stay America (WVH) Southcenter Extended Stay America (51St Ave) Southcenter Tukwila Homewood Suites Interurban Home2Suites Southcenter Ramada Southcenter Residence Inn Southcenter America's Best Value Inn Interurban Jet Inn Tukwila International Blvd Comfort Inn Interurban Days Inn Interurban Econo Lodge Tukwila International Blvd Knight's Inn Tukwila International Blvd Ramada Limited Tukwila International Blvd Travelodge Tukwila International Blvd With regards to hotelier appointments the City has typically strived to have a diversity in ownership and brands; and diversity in lodging business type (short term vs. extended stay). The non - hoteliers eligible to serve on the LTAC are considerably broad. In the past the City has had entities serve on the LTAC such as, Albert Lee Appliance, Chamber of Commerce, the Museum of Flight, Rainforest Cafe, and Westfield Southcenter. Again, the City has strived to have diversity in the types of businesses that serve on the LTAC, for example having entities such as commercial property owner, restaurant, and entertainment related businesses. For both hoteliers and non - hoteliers, the LTAC's members have typically been businesses and hotels within or near the Southcenter area of the City. The reason for this is that the City looks for entities engaged in tourist attraction (both overnight and day tourists). The Southcenter area is the largest draw in the City for both overnight and day tourists. Over 90% of all hotel revenue is generated in hotels in and around Southcenter; 90% of all restaurant sales occur in the Southcenter area; and, with the exception of the Museum of Flight, most entertainment businesses are located in or near Southcenter. Economic Development staff looks for business representatives to serve on the LTAC who are clearly engaged in marketing, business collaboration, and businesses that cater to overnight and day tourists. For appointments to the LTAC, the City has followed its standard appointment process in which the Mayor makes a recommendation to the City Council for appointment. However, unlike other appointments, the Council appointments the LTAC member, instead of confirming the Mayor's recommendation. In the past appointments to LTAC were done on a case by case basis as positions became open. Starting this year Economic Development staff assumed staff support 54 INFORMATIONAL MEMO Page 3 for the LTAC, and suggests that the Council review the membership of the LTAC on a yearly basis in order to follow the requirement under State Law and the City's adopted resolution. The LTAC currently has a number of vacant positions and the Mayor is ready to present recommendations to the Council for appointments. Economic Development staff would like to have the Council appoint members to the LTAC at its November 16th Regular Council meeting. The recommendations that will be put forward are the result of nearly two dozen meetings Economic Development staff has had with businesses engaged in the tourism industry. At that same meeting staff will also provide an overview of the preliminary budget for lodging tax in 2016. RECOMMENDATION Discussion only. 55