February 10, 2020 at 4:26 p.m.
RTMC still seeking agreement with city on room tax
RTMC still seeking agreement with city on room tax
The RTMC, made up of representatives from the city, town of Pelican, the Rhinelander Area Chamber of Commerce and area hotels, met last Tuesday, Feb. 4, to discuss the impasse on the collection of the room tax from area hotels, resorts and other lodging establishments.
The issue of room tax collection has been on the front burner since the city made its 2020 budget presentation during the Nov. 25, 2019 Common Council meeting.
The presentation left chamber officials with the impression the city was looking to keep 45 percent of the room tax revenue, rather than the usual 30 percent, in 2020. It was later clarified that the extra 15 percent was actually unspent room tax money left over from the 2019 budget.
However, at the Dec. 9 council meeting, city administrator Daniel Guild introduced a revised room tax ordinance in which the city would create its own room tax commission, with no mention of including town of Pelican hotels and resorts. The proposal was set for a Jan. 10 public hearing, and seemed to be headed for approval
The RTMC discussed the proposed ordinance at its Dec. 10 meeting at which time Chamber director Lauren Sackett and Erin Skinner, president of the RTMC, said their attorney had identified several concerns.
The biggest concern the committee had was the proposal would give the final say on grants and contracts to the City Council.
In the end, the public hearing was postponed so that the city and RTMC could find common ground.
Last Tuesday, Sackett told the committee that a meeting between herself, Skinner, mayor Chris Frederickson, Guild and city attorney Steve Sorenson has yet to occur.
She also noted that she heard from the attorney advising them that although setting up the RTMC as a official room tax zone as spelled out in the revised statute would be one way to do it, each municipality could also independently contract with the chamber, which is the only tourism agency in the area.
"We have to have the official, legal municipal agreement to still be a zone, we'd just be an unofficial zone," Sackett said.
Skinner said it would be more like a "partnership" between tourism commissions, and Sackett agreed.
Sackett said the lawyer pointed to the Wausau/Central Wisconsin Convention & Visitors Bureau as an example of several municipalities banding together to promote tourism in their collective areas.
"They're physically located in Wausau, but Wausau, Rothschild, Rib Mountain, Weston and Schofield all contribute to that tourism entity to be the promoter," she said. "Due to a variety of reasons, these municipalities did not want to create a legal zone, but they still wanted the CVB to perform their tourism promotion and tourism development. All agreed to enter into separate tourism agreements with the CVB with the ultimate goal of a common plan that benefits all."
While each agreement is separate, many of the provisions are similar, she added.
"Again, the lawyer that I have been dealing with said how we're doing room tax currently is legal," Sackett said. "A municipality can contract directly with a tourism entity, which is what we are doing with the City of Rhinelander. A municipality can also create a tourism commission that can contract directly with a tourism entity, which is what we are doing with Pelican."
She admitted she has yet to talk with Guild or Sorenson and didn't know what the status of the proposed ordinance was other than "it was postponed."
"It's postponed until the mayor puts it back on the agenda," said alderperson Steve Sauer, who is one of two representatives on the RTMC. Mayor Frederickson is the other representative.
"From my understanding, the contract that the Chamber and the city has can be enforceable, and that runs through the end of 2020," Sackett said. "So regardless, I guess there needs to be conversation about if it's not something we're doing right now, what are we doing going forward? I don't know what we want our next steps to be."
"It sounds like, basically, what we're doing is what we should be continuing to do, again, with some tweaking of the language. Basically what we talked about two months ago," Skinner said. "It looks like we need to tweak, just like we have every few years when they change the state statute and we tweak it (the contract) a little bit more."
Skinner said some of what is in the proposed ordinance change is acceptable.
"But there is enough big differences that need to be addressed, that do change this structure pretty drastically," she said.
"The proposed ordinance is a proposed ordinance, it's nothing beyond that, you need to remember" Sauer said.
"That's why we're trying to hash it out and get more information," Skinner pointed out. "I mean, I read through that (updated) statute again this morning and the proposed ordinance and I found two or three other things that didn't quite jive up one way or the other."
Frederickson said one reason the ordinance was taken off the Jan. 13 agenda was to give Sorenson time to review it and have discussions with the RTMC's attorney.
"That didn't happen, and we came back to this meeting and we took it off the agenda again," Frederickson said. "And we were supposed to have a discussion with Barry (Chase, the RTMC's lawyer) during this time, but she (Sackett) was collecting more information from Pelican to find out what they wanted to do."
Sackett said she was under the impression that Guild and Sorenson would be attending the Feb. 4 RTMC meeting.
Frederickson said before he left to come to the Chamber for the meeting, Guild inquired if the meeting was going to be held at City Hall.
In the end, neither Guild nor Sorenson attended the Feb. 4 meeting, either in person or by phone.
Sackett said the RTMC is technically a Chamber committee, and the Chamber board of directors will have to get involved at some point.
RTMC member Dan Brekke, who represents the Pelican promotions committee, said that group wants to remain with the city in the zone, but raising the room tax rate their lodging establishments charge from the current 3.5 percent to the 5.5 percent Rhinelander charges would be a tough sell to the town board.
Sackett said she would talk to officials with the Wausau/Central Wisconsin Convention & Visitors Bureau, and obtain a copy of the document it operates under.
It was also agreed that members of the RTMC and Pelican town board would attempt to schedule a meeting with Guild and Sorenson "by the end of next week."
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