Groups benefit from MLT lodging tax

MOUNTLAKE TERRACE — The City Council approved recommendations to allocate $23,500 in lodging tax funds to four groups whose events help draw tourists:

• Tour de Terrace, Tour de Terrace summer festival: $17,820

• Friends of the Arts, Arts of the Terrace Juried Art Show: $1,920

• Mountlake Terrace Business Association, Farmers Market: $1,000

• Snohomish County Tourism Bureau, membership dues: $2,760

Mayor Jerry Smith and council members Seaun Richards and Rick Ryan abstained from the vote; the trio serves on the Tour de Terrace board.

The money comes from hotel-motel taxes collected by Studio 6, the city’s only hotel, located at 6017 244th St. SW. The funds are required to pay for operational and promotional expenses of events and programs that generate overnight stays in the city.

The events that benefit from the tax in turn benefit the hotel, which then further feeds event budgets, said Ayesha Sheikh, Studio 6 manager and Lodging Tax Advisory Committee member. “The more nights we get, the more money they get.”

The funds will cover radio and newspaper advertising for Tour de Terrace, Smith said.

“We wouldn’t have Tour de Terrace advertising without that funding,” the mayor said.

Lodging tax revenues have dwindled in the past few years because of the sour economy causing fewer hotel stays and an increased demand for these funds.

However, tax revenue collected by the hotel saw an upward swing in 2011. The hotel collected $19,299, an $879 increase from 2010 despite a major remodel that reduced inventory by 25 percent for six months. During the past four years, the lodging taxes collected per year averaged $21,528.

Although each group that applied for funds received money, not everyone received as much as they requested. The business association requested $7,500. However the committee pointed out the Farmers Market doesn’t draw many outsiders or encourage people to stay overnight in Mountlake Terrace.