Room tax and business licenses

Seaside will struggle with uncertainty as the 2020-21 budget addresses room taxes.

Two hours and 45 minutes into the third budget meeting last Thursday, budget committee members and city councilors unanimously approved the next fiscal year’s budget.

The $27.8 million budget shows about a 25% drop in revenue and expenditures from last year’s $36.9 million budget, which will go into effect July 1.

Room tax, estimated at just under $5 million, is budgeted about $500,000 less than last year’s numbers.

“The most uncertain revenue component of the budget is the transient lodging tax,” Mayor Jay Barber said. “The city will not have a clear idea of the $5 million-plus revenue line item until after the summer tourism season is over at the end of September.”

City Manager Mark Winstanley said the city had been “hitting numbers for room tax. Then we began to shut everything down.”

With closures due to the coronavirus pandemic for much of this spring, numbers have fallen off “and we don’t expect June to be like a normal June,” Winstanley said. “Room tax is a crap shoot. If we are going to make our room tax budget, we’ll know a lot about it when we get through July, August and September.”

The Seaside Civic and Convention Center will not reopen earlier than September, but “is carrying very healthy reserves,” Winstanley said. The center is budgeted to receive about $3.1 million in room tax funds. Reserves stand at about $3.65 million.

Winstanley said the city will be lucky to see numbers like last year, even though the building is a quarter bigger after expansion and remodeling.

Temporary workers have been let go and some full-time employees have been transferred at the center to other city departments, Winstanley said. They will return to the center when it reopens.

The city is budgeted to receive $347,000 of Clatsop County’s transient room tax collections.

A hike in business license fees will bring an additional $330,000.

Changes to the budget could come later in the year, depending on lodging tax numbers, Barber said after the budget approval.

“I see the number the budget committee approved for the lodging tax only as a ‘placeholder,’” he said. “It is very likely we will be revisiting that issue in the fall and making adjustments.”

Revenue sharing

The committee voted to deliver a total of $98,350 to 12 local nonprofits as part of state revenue sharing funds. Helping Hands, which provide homeless shelter services, received $25,000, the largest donation.

The South County Food Pantry and The Harbor received $12,000. Clatsop Community Action and Seaside Museum each received $10,000.

Nonprofit donations are delivered through the general fund, the public safety fund and the room tax and business license fund.

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