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County board instructs staff to research logistics of tourism lodging tax, tourism improvement district

The Yamhill County Board of Commissioners will likely consider some sort of tax on hotels and other lodging in the county next month.

The board voted Aug. 17 to approve a measure instructing county staff to study two potential options that would both add a small fee to the bills of tourists who pay to spend the night in Yamhill County.

"What this motion is intended to do is start the process of developing the necessary materials to – and looking at what all of our options are … this allows staff to continue to move forward in researching," said Commissioner Stan Primozich.

His motion was primarily aimed at preparing a ballot measure for voters to decide in May whether the county should implement a transient lodging tax (TLT), but the motion eventually came to also include having staff research the feasibility of a tourism improvement district such as one in Portland.

The board voted to approve this motion 2-1 with Primozich and Rick Olson voting yes and Mary Starrett voting against.

Transient lodging tax

By state law, new local transient lodging taxes must allocate 70 percent of the funds they levy to further promote tourism through promotional activities such as advertising and marketing or tourism-related strategic planning.

"The way that tax works is, by statute, you're obliged to spend 70 percent of it on tourism-related things," said Yamhill County Counsel Christian Boenisch said, adding that the other 30 percent can go into the city's general fund, but many governments use it to administer the disbursement of the tourism funds.

Both Newberg and McMinn­ville assess a transient lodging tax. Newberg disburses much of the funds generated through two grant programs for efforts that will bring tourists to town and get them to stay the night as well as allotting some money to the Chehalem Valley Chamber of Commerce.

TLT work session

It was the board's second discussion of a lodging tax that week after they had a work session to discuss the issue with Tillamook County Commissioner Bill Baertlein.

The News-Register reported that Baertlein urged caution, warning that voters approved their TLT to improve roads that were heavily worn down by tourists and fixing those roads only increased tourism.

He reportedly advised that the board should make a plan for TLT before implementation and attempt to invest funds in infrastructure as much as possible.

It's unclear to what extent the 70 percent of funds aimed at tourism could be used on infrastructure, as they are required to be spent on drawing tourists to an area.

Tourism improvement district

Before the board's discussion Aug. 17, Veronica Hinkes, board member of Travel Yamhill Valley, championed the cause of a tourism improvement district to the board.

She explained that a consultant had researched funding options and found that either that or a TLT are the "only viable" and "sustainable" ways to fund Travel Yamhill Valley, the local state-sanctioned destination marketing organization.

She underscored the unpredictability of other funding options by announcing that Travel Yamhill Valley will likely have to suspend operations in September, as membership dues haven't generated enough funding to continue operating.

Sheryl Kelsh – treasurer and media contact of Travel Yamhill Valley as well as executive director of the Chehalem Valley Chamber of Commerce – did not respond to a request for an interview for this story.

While a viable funding model, Hinkes said "we do have concerns about a public vote on a transient lodging tax and whether it's possible to educate the broader public … that it is the norm everywhere else, including all of the counties right around us that we're competing with, and that it is a tax that is actually paid by the tourists themselves."

She urged the board to consider a tourism improvement district that would assess a percentage or flat rate on overnight stays, citing how Portland doubled its tourism funding in this manner.

Boenisch said city staff will draft a potential ballot measure and pertinent information for a TLT as well as a feasibility study for a tourism improvement district for the board to consider, which they expect to present in early October.

During the meeting, Olson noted his intent to produce a request that the county offer some funding assistance to Travel Yamhill Valley, but the board had yet to take up such a proposal as of Monday.

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