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HomeMy WebLinkAboutMinutes 01/21/2000 CALL TO ORDER- REGULAR MEETING: ROLL CALL: Approval of Minutes Presentation by Bob Stepp - Virtual National Park Feiro Marine Life Center LODGING TAX ADVISORY COMMITTEE Port Angeles, Washington January 21, 2000 Councilman Wiggins called the meeting of the Lodging Tax Advisory Committee to order at 2:00 p.m. Members Present: Councilman Wiggins, Zoe Bayton, Carol Griffith, Jim Haguewood, Patty Hannah, Bob Harbick, John McCullough, and Steve Oliver. Members Absent: Councilman Campbell, David Morris, and Clay Oakes. Staff Present: Economic Development Director Smith, Finance Director Ziomkowski, and Clerk Upton. Others Present: B. Stepp, L. Zenonian, L. deBord, J. Walton, R. Erdman, D. Vogel, E. Hansen, R. Hert, and T. Woody. Approval of Minutes: John McCullough moved to approve the minutes of the Lodging Tax Advisory Committee meeting of January 7, 2000. The motion was seconded by Jim Hagnewood and carried unanimously. Presentation by Bob Stepp, Virtual National Park: Bob Stepp distributed brochures to committee members on the matter of a proposed virtual national park. With the availability of new teclmology, Mr. Stepp envisioned an IMAX style theater that would feature virtual trips in the national park. He felt that such an attraction would draw a lot of interested parties, and the projected cost would be approximately $170 per square foot. Carol Griffith indicated the proposal would also involve convention facilities, and Mr. Stepp further explained the proposal could also include associated educational opportunities, performing arts center, and the multimodal transportation project. Brief discussion followed, and Mr. Stepp urged the committee's consideration of the proposal during the formulation of funding recommendations. Feiro Marine Life Center: Dr. Jim Walton and Rob Erdman were present to submit funding requirements to operate the Feiro Marine Life Center for the summer, 2000. Distributed to the committee members were copies of the budget justification to operate the Marine Life Center for the summer months, under the direction of the new Director, Rob Erdman. Dr. Walton reviewed the history of the partnership between the City and Peninsula College in the operation of the Center, which resulted in many improvements. He reviewed the proposed budget whereby the summer schedule would run from Memorial Day weekend through Labor Day weekend, with public visitation hours from 10:00 a.m. - 6:00 p.m., Tuesday through Sunday. Dr. Walton further reviewed the required staffing levels, program offerings, and the proposed budget of $41,000. Also distributed to the committee members were copies of the request for funding in the amount of $10,000 to accomplish infrastructure improvements to the Marine Life Center, to include reconstruction of the pump room, a redesign of the aquarium floor - 1 - LODGING TAX ADVISORY COMMITTEE January 21, 2000 Feiro Marine Life Center (Cont'd) plan, as well as various other improvements. Discussion then centered around the cost of admission and the possibility that the gate could be forwarded to the City. Dr. Walton agreed that the funds received from admissions and concessions were not reflected in the budget, and he emphasized the fact that the gate could not be offset against the funding request as he could not have staff employment based on the level of the gate. Lengthy discussion followed concerning funding requirements, and Dr. Walton indicated that if full operational funding were not forthcoming, the College could not take on the operation of the Marine Life Center for the summer. When asked what total operating costs are for the entire year, he responded approximately $60,000. The ensuing discussion involved funding scenarios wherein the operational needs of the Center would not be compromised. Also considered was whether the Center could become self-sustaining, whether it is truly a tourist-oriented facility, or whether the funding issue is appropriate for lodging tax funding. Dr. Walton indicated the Center could never become self-sustaining. Tim Smith summarized funding possibilities in that operations could be funded at $41,000, capital at $5,000 (for pump replacement or a portion of anticipated costs of capital improvements) and, further, that a projected gate of $20,000 could be passed back to the City. The required funding then would approximate $26,000. Funding for Events and Programs Funding for Events and Programs: Erl Hansen and Rick Hert distributed a list of funding recommendations for events and programs which, as a follow-up to the motion passed at the last meeting, totaled $130,000. The list was reviewed by Mr. Hansen, and Mr. Hert expanded on how the ChamberNCB would propose to meet the needs of the different agencies. The question was raised as to why the committee was again being asked to address the line item allocations, and the opinion was expressed that the ChamberNCB are essentially being funded to a level of $2S0,000 and it should be their responsibility to determine how to get the "biggest bang for the buck". Discussion was also held on the matter of funding for Parks & Recreation, and it was reported that the Parks Director would have to cut programs in order to stay within a $28,000 budget. Money from the Parks General Fund budget would not be available to assist in these programs, especially in light of the passage ofl-695. John McCullough moved to accept the allocations of $130,000 as presented. The motion died for lack of a second. After further limited discussion, Steve Oliver moved that the ChamberNCB be directed to adhere to the $130,000 allocation and add the other four activities as they see fit. He clarified the $130,000 would be the budget for events and activities. The motion died for lack of a second. Again, discussion followed, and the merits of adding the new events and activities were considered. Also, the committee was reminded by Mr. Smith that the committee had previously identified the priority of filling beds in the shoulder and off-season months. John McCullough moved to increase the events and activities allocation to $137,000, to include the new events as proposed. Therefore, the $20,000 placed in reserve would be reduced to $13,000. The motion was seconded by Carol Griffith. Discussion as to the merits of the motion followed, and the opinion was expressed that the committee should not limit the use of the extra funds for only those events/activities listed. To do so would leave no funds to assist with new events or activities. Therefore, John McCullough amended his motion that the $7,000 would be dedicated to new events/activities and would not be specified by line item. Carol Griffith, as seconder of the motion, agreed to the amendment. A vote was taken on the motion, which carried by a majority vote, with Bob Harbick, Jim Haguewood, and Steve Oliver voting in opposition. - 2- LODGING TAX ADVISORY COMMITTEE January 21, 2000 Estuary proj ect Estuary Project: Present on behalf of Soroptimist International were Liz Zenonian and Linda deBord, with a funding proposal for the Valley Creek Estuary Project. Ms. Zenonian and Ms. deBord reviewed the history of the project, the participating and funding entities, volunteer efforts, and the details specific to the design and plans for the project. Showing drawings of the project, they described the funds needed in order to hopefully complete the project this year. In reviewing funding needs, Ms. deBord indicated they have spent $80,000 thus far, they have $102,000 in the bank, but they are in need of approximately $135,000 to complete the project. There is a need for more funds for lighting, as well as public restrooms. Questions and answers followed, with discussion as to the different aspects of the project and the associated funding needs. Break Councilman Wiggins recessed the meeting for a break at 3: 15 p.m. The meeting reconvened at 3 :25 p.m. Capital Financing and Leveraging Capital Financing and Leveraging: General discussion was held concerning a newspaper article on Port Townsend's position on funding capital, particularly as relates to the proposal for a convention facility in Port Angeles. Councilman Wiggins noted the difference in opinion between the two communities. Yvonne Ziomkowski, Finance Director, distributed a mem~randum prepared for the committee on the matter of reserves and the considerations relative to capital. She urged the committee members to consider three factors during their deliberations: cash flow requirements, the stability of the revenues, and the possibility of funding future opportunities or capital projects. Ms. Ziomkowski stressed the fact that two facilities represent 55% ofthe revenue generated by lodging taxes. Ms. Ziomkowski explained the significance of having a funded reserve, particularly at a time when bond funds are being sought. She noted that bonding agencies closely scrutinize the capacity of the bond to meet the debt service. Further, Ms. Ziomkowski urged the committee to adopt a long-term, global, approach to fmancial planning for the fund. Lengthy discussion followed on seeking grants, which would most likely require matching funds. Also, the merits of building a reserve without a specific capital project were considered. This led to discussion on the value of a public versus privately funded convention facility, but the committee was in agreement that expenses would have to be cut in order to build a reserve to meet any kind of debt service. Many and varied opinions were expressed, but it was agreed the committee should establish some guidelines from which to operate. It was suggested that a reserve fund should more appropriately be called an opportunity fund. Councilman Wiggins offered commentaries on the state of the downtown core, and he emphasized that investments in the downtown area need to be forthcoming in order to attract tourists. Lengthy discussion followed and Jim Haguewood, representing the Downtown Forward Executive Committee, relayed the message that the DFEC would like to see the Lodging Tax Advisory Committee set aside a percentage of funds for capital improvements. Further, the DFEC supports funding of the Feiro Marine Life Center, as it is important to invest money in activities and capital improvements in the community. In the ensuing discussion, it was pointed out that there is discomfort with the "hand-to- mouth" existence each year, and a strong recommendation was submitted that the committee establish policies and a plan for future direction. The newer members of the committee supported the recommendation, as the existence of such direction would have been helpful at the time they joined the committee membership. Councilman Wiggins suggested a meeting be held to address this matter, perhaps in broader terms, to which the committee agreed. - 3- LODGING TAX ADVISORY COMMITTEE January 21, 2000 Funding Recommendations Funding Recommendations: The committee turned its attention to the additional funding requests under consideration. Steve Oliver moved to fund capital requests for the Marine Life Center at $10,000 for interior renovations and to set aside another $10,000 of reserves to be made available for the completion of the Estuary Project when the Soroptimists come up with the other $30,000 from other sources that would complete everything but the restroom facility and, furtber, that the balance be held in reserve for use for specific projects to be decided by the committee in the future. The motion was seconded by Jim Haguewood. Discussion followed, and it was reiterated that Dr. Walton indicated the Marine Life Center could not be operated with partial funding. A vote was taken on the motion, which failed unanimously. John McCullough moved to fund the Marine Life Center to the extent of $26,000 as requested. The motion was seconded by Jim Haguewood. The question was raised as to whether it is appropriate for the operation of the Marine Life Center to be dependent entirely on lodging tax revenues. Further, the members of the committee queried as to whether the City budget could accommodate the funding of the Center, and Finance Director Ziomkowski explained the ramifications of 1-695 and the impacts to the City's General Fund. Councilman Wiggins indicated that if the committee chose to not fund the Marine Life Center, he was of the opinion the City would revisit the budget in order to remedy the situation and keep the Marine Life Center open. Therefore, John McCullough withdrew the motion, and Jim Haguewood withdrew the second to the motion. Jim Haguewood then moved to fund the Marine Life Center for one-half of the $26,000 or $13,000 and to fund the Estuary Project for $30,000 out of the $113,000 reserve. John McCullough seconded the motion. Jim Haguewood added language to the motion that the committee recommend to the City Council that the Lodging Tax Advisory Committee is willing to participate in funding the Marine Life Center, but the City should find the remainder of the funding out of the Cily budget. Following brief discussion, a vote was taken on the motion, which carried by a majorily vote, with Carol Griffith voting in opposition. Workshop on Goals Workshop on Goals: It was agreed that the committee would meet to conduct a workshop on goals. The next meeting had already been set for Friday, March 24, 2000, at 2:00 p.m., to receive the first quarter report on the tourism marketing plan. It was agreed that the goals workshop could also be conducted at that time. ADJOURNMENT: The meeting adjourned at 4:35 p.m. .c;;~y..~L;7 ,..-- ." -- Glenn Wiggins, Chair A~~~ .-llpta^ Becky J. U , Ci lerk -. - 4-