Slew of screw-ups scrap proposed tourism promotion in Spokane, Washington

Hotel group’s first attempt at implementing occupied-room tax, to raise $1.5 million for tourism campaign, fails

A proposed Spokane County tourism promotion area has derailed.

The Spokane Hotel-Motel Association can try for a tax of its industry as a way to promote local tourism, but Spokane County commissioners terminated processing the group’s first effort on Tuesday because of several defects.

Amy Cannata
Staff writer

http://www.spokesmanreview.com/news-story.asp?date=010704&ID=s1467767&cat=section.business

The association failed to notify recreational vehicle parks of the process or include them in the rate structure, as required by state law.

The outgoing Spokane City Council signed the wrong agreement, and the Spokane Valley City Council has yet to approve the agreement as required for the area to be established.

It all added up to too many problems to make the promotion area work this go around, said commissioners.

"It’s amazing to me that something that would be so good and positive for Spokane gets so screwed up when it enters the political system," said Commissioner John Roskelley.

"It’s not the political system … it’s bad lawyering," said Commissioner Kate McCaslin.

The hotel association wants the county to begin taxing occupied rooms throughout the county as a way to raise about $1.5 million a year for tourism promotions. A panel of hoteliers would decide exactly how the money is spent.

Hotel owners totaling more than 60 percent of the assessed value of the affected properties in the area signed a petition asking for the tax, and no one spoke against it at a hearing last month.

But commissioners have complained throughout the process that the legislation establishing tourism promotion areas is convoluted and confusing.

Tourism promotion areas like the one the association was seeking were just authorized by the state Legislature last year, and Spokane County is the first in the state to try to form one.

Roskelley urged the hotel-motel association to fix the problems in its current plan.

Proponents of the effort downplayed the complications.

"I think it’s going to work out just fine," said Ron Anderson, president of the hotel-motel association.

"The RV park thing — the hotel association never in our wildest dreams thought that as a lodging establishment that RV parks should be included," Anderson said.

Even though the state defines them as lodging establishments, there are no plans to tax RV parks as part of the promotion area, he added.

Under the association’s plan, hotels and motels with more than 40 rooms would be charged fees based on the property’s proximity to the downtown core.

Guests staying downtown would pay $1.50, those in the Valley $1.25 and those in the unincorporated county, $1 per night.

Guests at hotels and motels that have revenues less than $500,000 a year would pay just 50 cents per night.

All of the money collected would be used to promote local tourism.

As the association reworks its proposal, the fee structure could remain the same. But other aspects of the petition to establish the area would have to be changed.

"I don’t know how much of it they can salvage," said county attorney Jim Emacio.

Because RV parks weren’t included in the original hotel and motel owners’ petition, the number of owners that must sign the petition will likely change to satisfy state law, Emacio explained.

A majority of Spokane Valley City Council members want an opt-out or sunset clause added to the agreement, in case the promotion area doesn’t work as planned, said Spokane Valley City Manager David Mercier.

"We think this thing is going to be so positive and such a benefit that we have no problem with that," Anderson said.

Spokane Regional Convention and Visitors Bureau President John Brewer said he hopes the remaining issues can be quickly resolved.

"Every month that we don’t have this enacted, we lose about $150,000 in marketing funds," Brewer said.