By Pauline Masson –
Focusing on State and City requirements for how tourism tax funds can be spent, the City Tourism Commission asked Pacific Partnership officials to redraft a proposed contract between the City and the Partnership.
The discussion took place at the March 12 Tourism Commission meeting. A draft of the contract that Partnership officials said would meet their needs was submitted to the Tourism Commission for review prior to the meeting.
The call for a new agreement with the city dates to early 2022 when aldermen asked for a report on how the Partnership spent the tourism tax funds it received. The contract at that time said the Partnership would receive funds quarterly and would make quarterly reports on how the funds were spent. But no reports had been made to the city.
In a wide ranging question and answer session at the Mrch 12 meeting, Tourism Commissioners discussed which Partnership activities qualify for tourism tax funds, the Partnership’s requirement to report how tourism tax funds are spent, and how to determine whether tourism tax funded events bring in visitors.
Commissioners acknowledged the value to citizens of the public events the Partnership provides and acknowledged the organization’s long standing relationship with the City.
The agreement between the City and the Partnership has centered on the Partnership accepting responsibility to organize a series of public events that attract tourists. Listed in the contract for 2024 were the St. Patrick’s Day Parade, Car Show, Iron Horse Rodeo and the Christmas Parade and Plaza events.
But the Partnership, in its alignment with the Missouri Main Street program, widened its program to include projects outside the realm of tourism, such as, “improving the overall look of downtown, improving downtown buildings with facade grants, historic preservation of the downtown district, recruiting new businesses, strengthening the management capabilities of individual merchants, and planted flower pots that beautify the downtown area.
The contract that the Partnership submitted asks for $32,000 in tourism tax funds to be paid quarterly – $8,000 per quarter – retroactive to January 1, 2024. The Partnership agreed to provide one event each quarter for 2024. The contract also stipulated that the city has already budgeted the $32,000 for the year and includes a clause that Any changes to budgeted amount to Partnership prior to annual budget review must be agreed upon by Partnership.
The contract opening paragraphs say that the Partnership works “under the guidance of the Missouri Main Street (MMS) program, reports to MMS and duplicatea of the MMS reports are provided to the City.
Commissioners noted that the contract contained no requirement to refund tourism funds if the Partnership failed to stage an event that the city has paid for – or for money received if the Partnership ceases to operate.
“If you don’t award any facade grants, there needs to be a provision to return the $8,000 to the city,” Commissioner Ann Trent said.
City Administrator Harold Selby said in a telephone interview that he has posed the question of the facade grants being funded with tourism taxes to City Attorney Bob Jones
“He (Jones) doesn’t think the tourism taxes an be spent for that,” Selby said.
Tourism Commission members also raised concerns about the Partnership’s financial reporting practice. A financial statement that accompanied the contract showed showed $16,000 in miscellaneous costs.
Jen Blakely, Tourism Commission chair said $16,000 in miscellaneous expenditures was, “a bit much,” for determining how the tax money was spent.
Blakely also said she thought the amount, $32,000, was pretty steep in relation to the tourism fund budget. She worried that the Partnership focus on downtown might be seen as a slight by other sections of the city that welcome tourists (such as historic Route 66). She said there are many other civic groups and other areas of the city that organize events to attract visitors and are entitled to receive tourism promotion funds.
Val Droege, Partnership executive director said the Missouri Municipal League had suggested that the Partnership should get 30 percent of its budget from the city.
“The $32,000 is 30 percent of our budget.We asked MMS how other cities do it and they suggested that 30 percent of our budget should come from the city,” Droege said.”Other cities do get 30 percent and it comes from tourism.”
In a telephone interview with former Mayor Herb Adams, who oversaw both the city vote that approved the tourism tax and the tourism commission authorized to determine how the funds would be spent said, “the funds have to follow state law.”
“All these questions should be reviewed by our city attorney,” Adams said. “I feel for the current officials. It’s hard to say ‘No,’ but the City can’t just hand over funds to volunteers with good intentions. There are great business people on the Partnership board. They have good intentions. But they are not accountble for city tax money. The Board of Alderman is accountable.”
On comments that no hotel guests stayed overnight during the car show and questions of whether events that receive tourism tax funds should reflect an uptick in overight hotel/airbnb guests, Adams said common sense should prevail.
“If there are 20,000 people downtown for a car show, in a city of 7,000, its pretty clear some of those folks are visitors,” he said.
Although no citizens spoke at the meeting, on several social media platforms citizens have questioned spending tourism funds on the salary of the Partnership executive director. They say the City employs Kelley O’Malley as director of the City Visitor Center at the Red Cedar and paying another director to promote tourism seemed like excess spending.
The agreement between the City and the Partnership will come before the BOA for review and possible approval once the Partnership and Commission agree on the fine print of the contract.
The Commission took no official action following theMarch 12 discussion, giving the Partnership time to rewrite its proposed contract and bring it back to the Tourism Commission.
“We (the Tourism Commission) need to agree to the terms of the contract before we can recommend approval to the Board of Aldermen,” Chairman Blakely said.
In the end, Blakely concluded that the overall state of tourism in the city is positive
“In the end, we are doing something right,” she said. “But we must make sure we’re spending the taxpayer money appropriately.”
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The meeting which streamed live on YouTube, was recorded and can be viewed on the City’s webpage.
Something gives me the gut feeling that if enough rocks are turned over in the course of due diligence on this matter, we will find some suspect activity or misappropriated funds. As someone who has paid a lot of taxes to Pacific in the 17 years I’ve lived here, I hope I’m wrong.