Loading...
HomeMy WebLinkAboutOrdinance 26-006 SVMC establishing a Tourism Opportunity FundCITY OF SPOKANE VALLEY SPOKANE COUNTY, WASHINGTON ORDINANCE NO.26-006 AN ORDINANCE OF THE CITY OF SPOKANE VALLEY, SPOKANE COUNTY, WASHINGTON, AMENDING CHAPTER 3.21 OF THE SPOKANE VALLEY MUNICIPAL CODE TO ESTABLISH A TOURISM OPPORTUNITY FUND, AND OTHER MATTERS RELATING THERETO. WHEREAS, the City of Spokane Valley City Council adopted Ordinance No. 22-016 which (1) established the Spokane Valley Tourism Promotion Area ("TPA") comprised entirely of the corporate limits of the City pursuant to RCW 35.101.020, (2) established the Spokane Valley Tourism Promotion Area Commission ("TPA Commission") to make recommendations for use of TPA tax revenue received by the City, (3) established a tax under RCW 35.101.050 and a separate tax under RCW 35.101.057 on overnight lodging within the TPA, and (4) restricts the City's use of such tax revenue for the purpose of promoting tourism within the City; and WHEREAS, on August 21, 2025, the TPA Commission recommended using a portion of TPA tax revenues to fund a "Tourism Opportunity Fund" from which the TPA Commission may, subject to review and approval by City Council, award funds to venues or event organizers to help defray the costs of locating a tourism -generating event within the City and incentivize such tourism -generating events to locate within the City; and WHEREAS, on November 18, 2025, the City of Spokane Valley City Council (1) approved a duly made motion to create the Tourism Opportunity Fund and fund it in 2026 with $170,000 from TPA funds for year 2026 and (2) directed City staff to propose amendments to the Spokane Valley Municipal Code to identify criteria for disbursements to be made from the Tourism Opportunity Fund to venues or event organizers; and WHEREAS, on February 19, 2026, the TPA Commission, by unanimous vote, recommended that City Council approve the presented draft text amendments to Chapter 3.21 of the Spokane Valley Municipal Code in order for the TPA Commission to begin administering the Tourism Opportunity Fund; NOW, THEREFORE, the City Council of the City of Spokane Valley, Washington, ordains as follows: Section 1. Amendment to SVMC 3.21.050. Spokane Valley Municipal Code 3.21.050 shall be amended as follows: 3.21.050 Uses of lodging charge revenue. A. The uses described in SVMC 3.21.050 are limited to tourism promotion pursuant to RCW 35.101.010(4) and may include payment of administrative costs associated with operation of the tourism promotion area as determined by the city council. B. Revenue from lodging charges collected from the charges under Chapter 3.21 SVMC shall only be used for the following purposes: 1. The general promotion of tourism within Spokane Valley and the Spokane metropolitan area as specified in the annual tourism promotion area work plan/budget, to be adopted annually; City of Spokane Valley Ordinance No. 26-006 2. The marketing of convention, trade shows, and events that benefit local tourism and the lodging business in Spokane Valley; 3. The marketing of Spokane Valley and the Spokane metropolitan area to the travel industry to benefit local tourism and the lodging businesses in Spokane Valley; 4. The marketing of Spokane Valley and the Spokane metropolitan area to recruit sporting events in order to benefit local tourism and the lodging businesses in Spokane Valley; 5. To operate a fund established hereby and referred to herein as the "Tourism Opportunity Fund". The purpose of the Tourism Opportunity Fund is to incentivize significant trade events, special interest events, entertainment events, and/or sporting events to locate within or near the City when said events are reasonably expected to generate a substantial amount of tourism within the City, including but not limited to overnight stays in lodging businesses. The funds may be used to mitigate an event organizer's expenses to locate an event within or near the City, or for a venue within or near the City to offer amenities for an event in order to incentivize an event organizer to locate a specific event at said venue. C. Pursuant to RCW 35.101.130, the city council shall have sole discretion as to how the revenue derived from the lodging charge imposed pursuant to Chapter 3.21 SVMC is to be used for tourism promotion. In exercising its discretion on use of these funds, city council shall consider the recommendation(s) of the Spokane Valley hotel/motel tourism promotion area commission established pursuant to SVMC 3.21.070. (Ord. 22-016 § 5, 2022). Section 2. Amendment to SVMC 3.21.070. Spokane Valley Municipal Code 3.21.070 shall be amended as follows: 3.21.070 Hotel/motel tourism promotion area commission. A. The hotel/motel tourism promotion area commission (also referred to in this Chapter as "the commission") is created as an advisory body to make recommendations to the city council for use of revenue derived from that portion of the taxes/charges imposed by this SVMC 3.21 et seq. that city council has not designated for the "Tourism Opportunity Fund" established in SVMC 3.21.050(B)(5). B. Tourism Opportunity Fund: 1. The commission is authorized and directed to receive and review complete written applications for funding from the Tourism Opportunity Fund. Except as otherwise provided herein, the commission shall review pending complete Tourism Opportunity Fund applications, if any, at each regularly scheduled meeting of the commission. If delaying review of a complete application until the next regularly scheduled meeting renders the request moot, then upon receiving a Tourism Opportunity Fund request the City shall (1) schedule a special meeting of the commission to review the request, and (2) provide notice thereof to the public in accordance with applicable law. 2. Tourism Opportunity Fund Application: An event organizer or venue may apply for a funding award from the Tourism Opportunity Fund by submitting a written application to the hotel/motel tourism promotion area commission. If an applicant is applying for multiple non -associated events, then they must submit a separate application for each event. To be eligible for consideration, the application must include the following: i. The applicant's name, phone number, email address, and physical mailing address. If the applicant is an entity, then the applicant must also identify what type of entity it is (i.e. corporation, limited liability company, etc.) and whether it is a for -profit or non-profit entity. City of Spokane Valley Ordinance No. 26-006 ii. Detailed description of the proposed event. The description shall include (a) the date(s), location(s), and specific venue(s) of the event; (b) the purpose(s) of the event and a description of the activities that will occur at the event; and (c) whether the event is intended to be a one-time event, an event that will repeat on a recurring basis (including the expected interval between events), or part of a series of associated events. iii. Whether the applicant is a venue owner or operator and, if so, identify (a) whether and specifically how the applicant intends to use the funds to recruit one or more events to said venue, (b) the specific event(s) to be recruited, (c) any pertinent deadlines that applicant must meet in order to recruit said event(s), and (d) the date by which the applicant anticipates being notified whether the event will locate at the applicant's venue. iv. Whether the event will be held at the identified location if the application for funding from the Tourism Opportunity Fund is denied and, if not, the alternate location or locations at which the applicant may hold the event. v. Identify the market demand for the event along with an explanation of how the event will generate tourism activity within the City, including but not limited to (1) the total projected number of "tourists," as defined in RCW 35.101.010(5), that are reasonably expected to attend the event, and (2) the projected number of overnight stays in lodging businesses within the City by tourists as a result of the event. vi. Identify the demographic and geographic market(s) to which the event is or will be targeted. This information should be demonstrated by market data and research. If the applicant has data regarding one or more past similar events, and the data demonstrates whether and the extent to which those past events generated tourism in the area where it was held, then said data must be included with the application unless applicable law prevents the applicant from doing so. vii. The marketing plan that the applicant will implement to attract tourists to attend the event, which plan must include a marketing budget, strategy, and timeline. viii.Identify (a) the amount of funds the applicant is requesting from the Tourism Opportunity Fund, and (b) the specific expenses of the event for which the funds will be used, or the amenities that the venue will provide using the funds, if the application is approved. xiv. Identify the methods the applicant will use in order to (1) measure the total number of lodging room nights of tourists that were generated by the event for hotels within the City and outside of the City, but within Spokane County, and (2) quantify the actual economic impact on hotels of the event in the tourism promotion area based on an average daily rate. 3. Review by the Commission: In reviewing applications for use of the Tourism Opportunity Fund, the commission shall determine whether each of the following criteria are met: i. The applicant may be a person, nonprofit entity, or for -profit entity, but must be either (a) a venue owner or operator; or (b) an event organizer/organization. ii. The proposed use of the funds must be for an approved use identified in RCW 3 5. 101 et seq. or SVMC 3.21 et seq. iii. The event must be either a destination convention, conference, trade show, association gathering, sports event, entertainment event, or similar event that is expected to generate tourism activity in the City. City of Spokane Valley Ordinance No. 26-006 iv. The event cannot be a private wedding, memorial, family reunion, or similar private social event. v. The date of proposed event must be identified in the application and be within five (5) years after the application was submitted. vi. The applicant must demonstrate that the event will generate substantial tourism within the City, including but not limited to overnight stays of tourists within the City. vii. The event does not include any activity that is contrary to applicable law. 4. Decision of the Commission: The commission must deny all Tourism Opportunity Fund applications that do not satisfy all of the criteria identified in subsections B.2. and B.3. herein. If an application meets all of the criteria, then the commission may grant the request, in full or in part, only if and to the extent the expected return on investment to the economy within the tourism promotion area warrants an award from the Tourism Opportunity Fund. The commission does not have authority to award funds in amounts greater than that requested by the applicant in their written application. ii. The commission's decision on any given application shall be placed on the next regularly scheduled consent agenda of City Council. Alternatively, the commission's decision may be presented as a non -consent agenda item at the next regularly scheduled Council meeting rather than on the next regularly scheduled consent agenda if the next regularly scheduled City Council meeting does not include a consent agenda. The commission's decision shall be final immediately following said City Council meeting unless the City Council vetoes the commission's decision by majority vote at said meeting. If City Council vetoes the commission's decision, then the application shall be deemed denied in its entirety. 5. Before receiving any funds awarded from the Tourism Opportunity Fund, a successful applicant must first execute an agreement containing terms identified by the City. Said agreement must include the following terms in addition to other terms the City deems appropriate: i. Identify the total amount of funds awarded from the Tourism Opportunity Fund. ii. Identify a mandatory process for seeking fund disbursements, including whether the funds will be disbursed on a reimbursement basis for qualified expenses incurred for the event or an alternative basis. If the disbursement is on a reimbursement basis, then the applicant must provide invoices or other evidence demonstrating the expenses submitted for reimbursement are qualified expenses for the event that the applicant actually paid. If the disbursement process is not on a reimbursement basis, then within forty-five (45) days after receiving a disbursement, the applicant must provide the City with invoices or other evidence sufficient to establish that the disbursed funds were used for uses authorized by the agreement. iii. Require the applicant to apply the awarded finds only for the specific purpose(s) authorized by the commission and specifically identified in the agreement, iv. Require the applicant, within sixty (60) days after the event has concluded, to complete and submit a report to the City identifying the event's total economic lodging impact within the tourism promotion area, including but not limited to the total overnight stays generated by the event and the total number of tourists that attended or participated in the event; City of Spokane Valley Ordinance No. 26-006 v. Require the applicant to indemnify the City for any claims arising out of any matter or situation related to the event other than claims alleging injury or damage resulting solely from negligence of the City; vi. Require the applicant to procure insurance naming the City as an additional insured with coverage limits in amounts that the City deems sufficient to satisfy the applicant's indemnity obligations; and vii. Provide that a breach of the agreement by the applicant entitles the City to (a) a return of any funds disbursed to but not yet expended by the applicant, (b) be reimbursed by the applicant for funds spent in violation of the agreement, (c) deny pending or future applications submitted by the applicant for funding from the Tourism Opportunity Fund; (d) terminate the agreement; and (e) demand any other relief authorized by applicable law. viii. Provide that funds from the Tourism Opportunity Fund (a) cannot be used for any event other than the event identified in the application and for which the commission awarded said funds, and (b) must be returned to the City for deposit back into the Tourism Opportunity Fund if the event is cancelled or otherwise does not occur at the location identified in the application. C. Appointments to or removals from the hotel/motel tourism promotion area commission shall be made by the mayor, with confirmation by a majority of council pursuant to the then -currently adopted governance manual. D. The hotel/motel tourism promotion area commission shall be composed of five voting representatives from the following hotel chain scales, as defined by Smith Travel Research (STR). If no representative from a hotel in the corresponding chain scale is willing or able to serve on the hotel/motel tourism promotion area commission, that position may be made available to a representative of any lodging business within the boundaries of the tourism promotion area: 1. One economy hotel; 2. One midscale hotel; 3. One upper midscale hotel; 4. One upscale hotel; 5. One frill -service hotel over 200 rooms. A commission member may only represent one type of property identified in SVMC 3.21.070(B)(1) through (5) at any given time, and an ownership group may only represent one such property on the commission at any given time. E. In addition to the above voting commission members, there shall be one nonvoting ex officio member as assigned by the city manager, who will function as a liaison between the city council and the hotel/motel tourism promotion area commission. F. For appointment of the initial hotel/motel tourism promotion area commission, three members shall have a three-year term, and two members shall have a two-year term. Upon the expiration of the initial three-year term, the term for those three positions shall thereafter convert to a two-year term. G. Members of the hotel/motel tourism promotion area commission shall serve without compensation. City of Spokane Valley Ordinance No. 26-006 H. All meetings of the hotel/motel tourism promotion area commission are subject to Washington's Open Public Meetings Act, Chapter 42.30 RCW, and Washington's Public Record Act, Chapter 42.56 RCW. (Ord. 22-016 § 7, 2022). Section 3. Amendment to SVMC 3.21.080. Spokane Valley Municipal Code 3.21.080 shall be amended as follows: 3.21.080 Spokane Valley tourism promotion area annual work plan/budget. A. The hotel/motel tourism promotion area commission shall develop a recommended annual work plan/budget for use of Spokane Valley TPA revenues. The work plan shall include (1) recommended activities and programs for funding from the taxes/charges authorized by Chapter 3.21 SVMC, (2) a complete list of projects for which application was made for funding for that year, and (3) the amount of funding, if any, to designate for the Tourism Opportunity Fund in the City's budget for the upcoming fiscal year. The recommended work plan/budget shall be submitted to the city council in written form no later than November 15th of each calendar year for inclusion in the City's annual budget adoption process. B. The city council may by motion approve the proposed work plan/budget, or instead return the proposed work plan/budget to the hotel/motel tourism promotion area commission for further recommendations. C. The city council may not add a project to the annual work plan/budget.that was not previously considered by the hotel/motel tourism promotion area commission. If such action is proposed by city council, the proposed work plan/budget shall be returned to the hotel/motel tourism promotion area commission for further discussion and recommendation, providing at least 20 days for comment unless the comment period is waived by the hotel/motel tourism promotion area commission. After the comment period, the city council may exercise its sole discretion as to how the revenue derived from the charge is to be used to promote tourism, pursuant to RCW 35.101.130(1). D. After the annual work plan/budget is adopted by city council, it shall govern the use of revenue derived from the charges during the calendar year in which annual work plan/budget was approved. The city council may make amendments to the annual work plan/budget by motion, subject to compliance with the requirements of SVMC 3.21.080(C) regarding review and comment period by the hotel/motel tourism promotion area commission. E. The hotel/motel tourism promotion area commission shall provide a written report to the city council at least fifteen (15) days prior to when the annual work plan/budget is due to the city council. The report shall include information on the previous year's operations of the tourism promotion area such as (but not limited to): 1. The number of hoteliers paying the tourism promotion area fee; 2. A summary of key factors influencing Spokane Valley's visitor industry in the past year; 3. An outline of major initiatives including visitor marketing and promotion, recruitment of group meetings or sporting events occurring in the past year; 4. The level of hotel occupancy and associated room demand contrasted to previous year; 5. The level of TPA per -room night proceeds contrasted to previous year; 6. The number of group meetings or sporting events that were booked, or in which significant support services were provided by the booking organization. This would include the number of participants and estimated economic impacts; City of Spokane Valley Ordinance No. 26-006 7. Other relevant efforts and impacts of the TPA activities. (Ord. 22-016 § 8, 2022). Section 4. Severability. If any section, subsection, sentence of clause of this Ordinance is for any reason held to be invalid, such decision shall not affect the validity of the remaining provisions of this chapter. Section 5. Effective Date. This Ordinance shall be in full force and effect five days after publication of this Ordinance or a summary thereof occurs in the official newspaper of the City as provided by law. Passed this 5" day of May 2026. Laura Ndden, Mayor ATTEST: I Approved As To Form: 4,11'all, A ' Offi of the Cil Attorney Date of Publication: 2,(p Effective Date: City of Spokane Valley Ordinance No. 26-006