In the end, the Cannon Beach Chamber of Commerce may get more money from the city than it originally asked for to run its Visitor Information Center beginning fiscal year 2015-16.
At the fourth and final city budget committee meeting May 13, the committee voted to recommend a 1-percent increase to the city’s transient lodging tax beginning Oct. 1, 2015. The City Council, at its June 2 regular meeting, plans to vote on the total proposed budget of $14,659,865, which represents an 8.5 percent increase over the current fiscal year’s budget. If the council needs more deliberation, they will hold a special meeting later in the month.
If the City Council adopts the proposed budget, the increase would generate approximately $260,000 for the next fiscal year; 70 percent, or $182,000, would go to the chamber to spend on its information center, and 30 percent, or $78,000, would go into the city’s general fund.
If the tax carries over into FY 2016-17 — the tax’s first full fiscal year in effect — it would generate at least $280,000: that is, $196,000 (70 percent) for the information center, $84,000 (30 percent) for the general fund.
City Manager Brant Kucera said he would like to see a portion of the extra tax revenue to fund the Cannon Beach Library, which, he said, should become a line item in the city budget.
In previous meetings, the budget committee discussed a half-percent tax increase that would have kicked in July 1, 2015, and raised only $140,000 exclusively to fund the information center.
With the 1-percent tax hike, the chamber will enhance its website, grow its marketing efforts, continue leveraging social networks, make repairs to the chamber building and add spindle racks to the information center, Courtland Carrier, executive director of the chamber, said.
“These are basics. These are nothing fancy,” Steven Sinkler, president of the chamber board, said.
Carrier said that the money would be used to draw visitors to Cannon Beach during the offseason and shoulder seasons, not during the already-busy summer season.
The chamber also plans to hire a full-time employee for the information center paid at $17 per hour with benefits and, possibly, a parttime employee paid at $14 per hour, Carrier said.
Currently, the information center jobs pay $12 per hour and don’t include benefits, Sinkler said.
“There’s a saying: ‘You pay peanuts, you get monkeys,’ and we’re paying peanuts,” he said, “and it’s a shame that we have to pay peanuts based on the funding level that we’ve received/”
Right now, the information center has the equivalent of one fulltime employee. By contrast, Seaside and Astoria’s visitor centers staff more than three fulltime equivalents, Carrier added. Meanwhile, Cannon Beach’s information center receives about three times as many walk-in visitors and must rely on chamber personnel.
“It’s overwhelming. Totally overwhelming,” Carrier said. “We’re here to bring more business to Cannon Beach, and without additional staffing we aren’t able to do that outreach. We literally don’t have the staff bandwidth to be able to do it right now.”
The tax revenue, he said, would provide for the chamber — and, by extension, the information center — a stable stream of income on top of the Tourism and Arts grant awarded to the chamber in varying amounts each year.
He added that Cannon Beach — though the city currently ranks at number 10 in the state for bringing in lodging tax revenue — gives a far smaller percentage of that revenue to its chamber, about 7 percent, than do other Oregon cities; the statewide average is about 40 percent.
Before the May 13 budget meeting, more than a dozen of Cannon Beach’s hoteliers and other representatives of the city’s hospitality industry — the industry most affected by the proposed tax hike — met with Carrier and Kucera at Haystack Gardens to discuss the matter.
Most of the lodging leaders who spoke said they approved of a 1-percent increase, though not without qualifications.
Linda Beck-Sweeney, owner and president of Cannon Beach Vacation Rentals, said that her rooms are booked up through the summer and that it would be unfair to make guests pay more taxes after they’ve already reserved the room.
For this reason, Kucera told the budget committee that it would be prudent to implement the tax increase at the start of the second quarter — hence, the new Oct. 1 launch date.
Ken Quarles, manager of the Sea Breeze Court, objected that his and other relatively inexpensive hotels in town probably won’t see a benefit from the tax increase or the chamber’s expanded promotional efforts. “We know how to fill our rooms,” he said.
He added that the tax simply takes more money from lodgers already paying a high room rate typical of tourist destination-type cities.
Carrier responded that most people who can afford to stay overnight in Cannon Beach don’t complain about the transient lodging tax, which would increase from 6 to 7 percent, not including the state’s 1 percent lodging tax.
Patrick Nofield, president of Escape Lodging, told the budget committee he would support a 1-percent tax increase, with 100 percent of it going to the information center, but would like the chamber to provide a means of measuring its success, of indicating whether it is spending the tax wisely.
Carrier said that promotion builds on itself and that it may take a few years to show a marked increase in tourist activity that can be traced back to the tax increase.
“Three years is what we’re asking for in terms of stability of funding, and if we’re not doing the job, throw us out,” he said.
Because more than 50 percent of the city’s general fund revenue comes from transient lodging taxes, the tax increase “would have a very positive fiscal impact,” Kucera argued May 6. The benefit to the chamber would “come back to (the city) in visitors and tourism.”
He reminded the committee that, whether the tax increase is 1 percent, half a percent or zero percent, the amount won’t affect the city’s operations, only the chamber and information center.
The budget, he said, is supposed to reflect the aspirations of the City Council, including how and whether to help grow the Cannon Beach economy, he said.
“I believe a real need was brought to me by the organization that is called the chamber ... We entrust them to act as our economic development arm of the city,” Kucera said. “Empirical evidence was presented to me that it’s underfunded for what they’re trying to accomplish.”
Benefield said he believes that giving the extra tax revenue to the chamber would be money well spent, and that many people will consider it an investment in the town’s future.
“We are growing, but you can’t just sit back and rest on your laurels,” he said.