Tourism budget in city council’s crosshairs

This graphic from the City of Fort Madison 2020-21 projected budget shows the volatile nature of the city's Hotel/Motel tax. Image courtesy of City of Fort Madison.

BY CHUCK VANDENBERG
PCC EDITOR

FORT MADISON – The money spent annually on marketing and tourism out of Fort Madison’s Hotel/Motel tax receipts is under fire from several city elected officials.

According to the city’s annual budget for 2020-21 ending June 30, the city expected to receive about $209,000 during the year, but City Manager David Varley said that number is down about 40%. The city carried a balance of $110,000 from the previous year.

Approximately $40,000 is spent on salaries and benefits for the city’s part-time marketing director Jean Peiton.

At Tuesday’s City Council meeting, Councilwoman Rebecca Bowker asked pointedly what the city gets for that investment.

“Part of my concern is that we’ve got $40,000 budgeted for salary and benefits. What do we actually do with that money to put heads in beds,” she said.

“Jean’s a nice person and all that, but in times where it’s tough we have some significant dollars going out and I’m just hoping and wondering that we’re spending it correctly.”

According to the budget report the city was projected to spend $42,800 on contract services which would be advertising commitments, and donations. A $50,270 transfer to the general fund for assistance with the Amtrak Depot Project and $88,130 was to be transferred to the Old Fort to help cover shortfalls in revenues there.

The Hotel/Motel tax fund going forward will also be used for utilities and upkeep on the depot. However Amtrak has agreed to annual rent of the space in the facility and to help with some of the maintenance costs up front.

Other expenditures out of the fund include marina operations, rodeo expenses, repair and maintenance, and tourism reimbursements.

The city had projected total expenditures of $273,454 creating a shortfall of about $64,000 which would eat into the $110,668 beginning fund balance. With receipts down 40% the shortfall could increase significantly.

Bowker said the city has to get solid data on how those dollars are being converted into tourism revenue and the city doesn’t have much to show for it.

“I have 30 years experience in that field and I’m a little underwhelmed by our efforts,” Bowker said.

“We have to be data-driven and make decisions on actual facts and information coming in and I’m curious as to where she’s getting her information and what she’s basing her decisions on.”

Bowker said she didn’t want Peiton to feel like she’s being attacked, but only to have a real conversation about the effectiveness of current allocations.

Councilman Tom Schulz said conducting a study to get the information Bowker was looking for would probably cost the city about three times what it brings in from the tax regularly. But he said people in that industry locally are telling him numbers are returning to pre-pandemic levels.

“The simple fact is that it’s an anomaly. I have some contact within that industry because I do business with them. I can tell you right now the people in the hotel/motel business in this town are dancing. They’re happy,” Schulz said.

“There numbers are way up. I’m not speaking out of school saying the Kingsley is open back up and they are literally booked for the summer.”

Fort Madison Mayor Matt Mohrfeld, who has history on the Fort Madison Chamber of Commerce and the past tourism boards, said he’s not sure “a single thing” would change if the city didn’t spend the money as it is currently allocated.

“I don’t think one single thing would change if we didn’t do it. We don’t even define tourism. And it’s very simple. it’s people that come from outside our city limits and spend money. Pure and simple that’s tourism and it can’t be defined differently,” he said.

“If we’re doing anything that doesn’t increase the number of people and the dollars spent here, we’re not doing our job. We’re not reviewing the process, it’s historic driven. It’s not getting guided from any industrial people.

“When they talk about marketing the area, Nobody gives any directive. Nobody reviews it. They don’t set up any matrix. There’s no outcomes, and there’s no industry standards. It becomes a vague term that means absolutely, positively nothing.”

Varley said Peiton is charged with bringing people in from outside the city. And then she spends part of her time attending to and organizing cruise tours that take place in the city with Fort Madison Chamber of Commerce Coordinator Savanna Collier.

“They spend a lot of time organizing cruise tours that come into the city, “Varley said. “It takes a lot to put together 2 to 3 tours for every cruise that comes in so she spends a lot of time working with Savanna on that for the touring months.”

When the cruises started coming in, the city spent $5,000 on a contract with a company called “Tour Burst” out of Nauvoo. The company was to evaluate data and get feedback from cruise passengers to see where they were going when they got off the boat. The firm was on hand when passengers came off the American Cruise Lines in 2019, but the pandemic shut the cruises down in 2020.

The city still has not received a final report from Tour Burst, but Varley said he’s hopeful the city will get that report shortly.

“We’ll be getting that, hopefully… they promised to us, in the next few weeks,” Varley said. “It’s taking them a very long time to put that information together.”

Varley said Peiton also gets a lot of requests from people locally to help them advertise, but she generally doesn’t have extra time to spend on that. She’s also working on updates to the city’s websites to make them more coordinated to enhance online merchandising.

Bowker said it would be worth the time to take a hard look at how the money is being spent and if it’s still warranted at current levels.

The fund used to also help prop up the Fort Madison Area Arts Association and the North Lee County Historical Society. The Fort Madison Tourism Commission, which hasn’t met in more than 18 months, all but pulled support for those in 2019.

That was one of the moves that former FMAAA director Brian Riggs cited as a reason for his departure this spring. Lori Illner Greene has since taken over the post.

Mohrfeld created a committee of three councilmembers to review the budget with Peiton and bring recommendations back to the council.

That committee will have to meet in open session as the committee is an ad hoc committee as defined by Iowa code and therefore falls under the umbrella of Iowa’s open meetings laws.

1 thought on “Tourism budget in city council’s crosshairs

  1. Bowker probably knows a lot about wasting taxpayers money. She draws a fat paycheck from the state of Iowa living off the the backs of taxpayers.

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