City tourism budget hits the skids

Posted

BY CHUCK VANDENBERG

PCC EDITOR

FORT MADISON - With city hotel/motel tax revenues on a 20% slide from previous years, request for funding from the Fort Madison Tourism Commission will look a lot different going into the next fiscal year beginning July 1, 2019.

City Manager David Varley painted a pretty grim picture of the tourism fund telling the board at it's Monday night meeting that if the city sees a 12% increase from current hotel/motel funding, and if the deficit of the Old Fort comes in smaller than previous years, the fund may have a $0 balance. He told the group, "that's the good news."

The commission spent close to three hours trying to retool the application process for funding and set a maximum request amount for the 2019-2020 budget year at $2,000. However, the number could get reset as the board grapples with how the new application works and what would be the best way to word requests going forward.

Several requests for funding were on the agenda for the meeting, including requests from Fort Madison Area Arts Association, North Lee County Historical Society, and Fort Madison Main Street for each groups next fiscal year. All three requests were deferred until April due to lack of funding.

In January, the NLCHS and the FMAAA both had funding reductions from the hotel/motel tax fund. The NLCHS was capped at $12,000 for the current fiscal year and the FMAAA was capped at $15,000. However, with changes to the funding request application, those funds could be slashed to as little as $2,000 per group for next year.

Mayor Brad Randolph, who chairs the commission, asked Andy Andrews, the director of the North Lee County Historical Society, who was in attendance, how that was going to sit with him as far as his budget.

"I'll be preparing a budget for next year that doesn't include any contributions from the city," Andrews replied.

But Randolph said after the meeting that there was lot of discussion about how to proceed with the application and he said he feels that number will probably be increased. The changes wouldn't go in front of the full city council for approval until January and he said a lot could change in that time.

"We're still looking at how we want to frame these one-time annual requests for funding and I think that $2,000 is probably a little low," he said.

Varley said the city saw a 16-year high of $222,950 in hotel/motel revenues in the 2016-17 fiscal year, which reflected the previous year's hotel stays boosted by construction of the Iowa Fertilizer Company's facility in Wever. When the numbers were high the city earmarked a straight percentage of the funds the NLCHS and FMAAA. Last year they reduced the percentage and capped the funds. In the past fiscal year that number dipped to $184,583 and Varley said the city is poised to see an overall 20% dip for this fiscal year.

Without paying out to any additional funding requests the fund may start the new fiscal year on July 1 with a fund balance of potentially nothing.

Varley said he in doing the projections he's assuming a 12% uptick in hotel stays for the next fiscal year. With the fund balance projected to start the 2019-20 fiscal year in the red $18,422, Varley and city Tourism Director Jean Peiton suggested some changes in the funding request process.

The fund balance started the current fiscal year at $151,193 and had revenues projected at $216,750. Total expenditures for the year are projected to amount to $386,365 which included Peiton's department budget and donations to events and attractions in the region. Those figures leave the fund upside down again by the $18,422.

The new application process is still under heavy review but as it stands would lump all event and attractions into one category with a step-down request allowance starting with a maximum of $2,000 the first year and then 75% of the original grant in years two through five. Years six and seven the grant would be unavailable, but the entity could reapply again in year eight for the maximum amount.

 

 

attractions, budget, events, fort madison, Fort Madison Area Arts Association, North Lee County Courthouse, Pen City Current, tourism

Comments

No comments on this item Please log in to comment by clicking here