Prowers Lodging Panel Has Money on the Mind

Larger funding requests and requests for funding earlier on the calendar have the Prowers County Lodging Tax Panel looking at their balance sheet. Through no fault of their own, the panel has dealt with requests of this nature without being given a clear picture of when funding from the state will become available. The panel works with an annual budget of around $85,000 which is derived from the 2% lodging tax on rented motel rooms in Prowers County. The panel funds events in the hope that attendees from outside the immediate area will attend and spend the night gaining revenue for the panel, which continues the cycle. One of the difficulties encountered is the lack of accounting for ‘heads on beds’, a literal headcount of how many people do come to the county for one of these events. Another is essentially an ROI, Return on Investment. If a panel-sponsored event costs $10,000 and only 30 people spend the night at $100 a room, that 2% tax on $3,000 is only $600.

Panel members are aware of this type of shortfall and have been encouraging event organizers to conduct their marketing outside the boundaries of southeast Colorado, attracting responders from far enough away to require an overnight’s stay. The panel is addressing another problem, not knowing if all the motels are paying their taxes to the state and not knowing when or how much they’ll receive from the state on that 2% tax. It’s like running the Indy 500 without knowing how much gas you have. Carla Scranton, panel office manager states that the state usually sends four large payments a year, spread out over several months, but how much or when is left in doubt, and there’s little the panel can do about it. The county clerk is bound by confidentiality from stating which motels may be delinquent in their tax payments to the state or by how much. Calls to the state seeking some answers haven’t usually been returned.

This situation was evidenced at the panel’s April 19^th meeting when one request for funding was withdrawn by the applicant and two other requests were tabled pending receipt of funding from the state. One for $6,000 for an October event and another for $3,000 for a mid-June event. The panel maintains a contingency fund of $14,000 in case an approved request must meet a deadline to pay marketing or contract funds to secure the event. However, with no guarantee of when the next payment comes due from the state, or how much, the panel decided to table the requests until their next meeting, May 17^th, when another payment is generally expected.

The panel has discussed at length, spending funds to hire a past employee with the state Department of Revenue to conduct an audit of tax fees paid by motel owners in the county or if there are any shortfalls in payments to the panel that may have been overlooked. The state stipulates that only past employees of the department are allowed access to the confidential records. The service doesn’t come cheap, either. County Commissioner, Ron Cook, said he would contact county clerk and recorder, Jana Coen to see how the panel can address the problem at the state level. He said he’ll ask about the steps needed to originate an audit, how many years back the audit can be conducted, the timing of the payments to the panel and what it would cost for an audit of at least two years. The basic tax breakdown on a motel room is 1% for the county, 3% for the City of Lamar and 2% for the Lodging Panel. Panel President, Pat Palmer, said, “The Panel should be receiving at least two-thirds of what the city is paid.” Each month, the city issues a sales tax report which includes motel tax revenues, but that formula has not matched what is sent to the county by the state. Some motels may pay their taxes annually, while others usually pay quarterly, which would weigh some months heavier than others.

The two requests that were tabled were the Cowboy Up at the Wagons, now entering it’s third year at the Arena in the Dust in Granada. The two day event featured chuck wagon presentation and campsite cooking, plus working cattle competition in the arena. The other request featured the Sip and Savor fundraiser sponsored by the local branch of the Share the Spirit Foundation. The October event would present a night of cooking classes at Amache Studio at Prowers Farm, plus a night of Americana food with a touch of sophistication on the menu such as bleu cheese sliders or French Fries dusted with crumbled bacon or a lobster mac and cheese dish. Both requests will be considered at the May 17^th Panel meeting.  The Panel welcomed new member, Lisa Carder, Lamar Chamber office manager to the board.

By Russ Baldwin