What is the Lodging Tax Fund?

Funding for this program comes from the City of Gig Harbor Lodging Tax Fund which receives a percentage of hotel/motel taxes from lodging establishments inside the city limits. The city collects a sales tax on charges for overnight lodging. These funds are distributed by the Department of Revenue back to the city for the funding of tourism related capital facilities, non- event operations, and event marketing and operations.

What can be funded with lodging tax funds?

Lodging taxes can be used for:

• Tourism Promotion/Marketing
• Operation of a tourism promotion agency
• Operation of a tourism-related facility owned or operated by a non-profit organization
• Operation and/or capital costs of a tourism-related facility owned by a municipality

Who May Apply?

Lodging tax funding is open to non-profit organizations and municipalities with the demonstrated ability to achieve tourism related goals as outlined below:

• Increase hotel/lodging occupancy in the City of Gig Harbor by creating overnight stays.
• Increase the number of visitors to the city from more than 50 miles away.

All applications must include estimates of how funding the activity will result in increases to people staying overnight, travelling 50 miles away or more, or coming from another state or country. To ensure this data is collected, the city is required to have applicants provide additional information in the lodging tax application.

Selection and Award Process

Funding of the program and specific awards are dependent on recommendations of the city's lodging tax advisory committee (LTAC). LTAC will receive all applications and recommend a list of candidates and funding levels that will be forwarded to the Gig Harbor City Council for final determination. Funds will be awarded on a competitive basis.

The City of Gig Harbor Lodging Tax Advisory Committee Considerations

In developing its recommendations, the committee may consider:

• The estimated amount of lodging tax funds available for the coming year as provided by the city’s finance department.
• Thoroughness and completeness of the proposal.
• Percent of the proposal request to the event/facility promotions budget and overall revenues.
• Percent of increase over prior year City of Gig Harbor lodging tax funded proposals, if any.
• Projected economic impact within the City of Gig Harbor, in particular projected overnight stays in Gig Harbor lodging establishments.
• The applicant’s financial stability.
• The applicant’s history of tourism promotion success.
• Committee member general knowledge of the community and tourism-related activities.

Reporting

Reporting requirements enacted by the Washington state Legislature in 2013 requires the city to report to the state regarding the use of funds for the year. All recipients of lodging tax revenue, regardless of what the revenue is to be used for, must submit a post-event activity report to the city describing the actual number of travelers generated. The city will, as part of the contract with the recipients, require that the report be provided immediately after the event or activity. The city will file an annual report to the Joint Legislative Audit and Review Committee (JLARC).

The post-event activity report must include the following:

• Total amount spent on the facility/operation/product.
• The number of participants who attended the activity/facility in each of the following categories:
  1. Staying overnight in paid accommodations away from their place of residence or business;
  2. Staying overnight in unpaid accommodations (e.g. with friends and family) and traveling fifty miles/two hours away or more one way from their place of residence or business;
  3. Staying for the day only and traveling more than fifty miles/two hours away or more one way from their place of residence or business;
  4. Attending but not included in one of the three categories above.
• The estimated number of participants in any of the above categories that attended from out-of-state (includes other countries).
• A description of methods used to determine attendance and distinguish among the visitor categories at the event/activity.

Any recipient awarded funding must complete the reporting requirements.