Village-Chamber accord allocates 70% of room-tax revenue to promotional work
Village of Grafton officials are sharpening their focus on the use of room tax revenue to promote tourism.
In response to changes in state law, the Village Board on Monday approved a three-year agreement with a Grafton Area Chamber of Commerce committee to oversee the collection and distribution of room-tax funds.
In a report to the board, Village Administrator Jesse Thyes said the state budget now requires municipalities that collect room taxes to give 70% of that revenue to a “tourism entity,” with the remaining 30% retained by the municipality.
In response, village officials drafted an accord that received tentative approval from the Chamber’s board of directors, Thyes said.
The agreement calls for the creation of a seven-member Tourism Promotion and Development Committee, including five members appointed by the Chamber and two appointed by the Village Board.
One member has to be the owner or operator of a hotel or motel that collects village room taxes.
The agreement — which runs from Jan. 1, 2017, through Dec. 31, 2019 — requires the committee to report how the revenue is used for tourism promotion and development.
Using the $240,000 in room-tax revenue the village received in 2015 as an example, Thyes said the committee would receive $168,000 as its 70% share. The remaining $72,000, or 30%, would be retained by the village.
Besides tourism promotion and development, the agreement calls for the scope of services provided by the committee to include employing or contracting a destination marketing staff, providing marketing services and continued support of Celebrate Grafton activities and the annual Grafton Christmas parade.
Annual allocations will include $15,000 for Celebrate Grafton events — Giro d’Grafton, Grillin’ in Grafton and Fall Into Grafton — and $1,500 for the parade.
The village has a 7% room tax. Under previous agreements, the Chamber has received 1% of that revenue for tourism promotion, as well as additional funding for general marketing.
Pam King, executive director of the Chamber and president of the Ozaukee County Tourism Council, said the agreement will provide a much-needed boost for promoting Grafton as a tourism destination.
“We have a very good working relationship with the Chamber,” Village President Jim Brunnquell said.
“It was a natural fit for what they already have in place.”