Ocean Shores LTAC weighs 30–40% holdback, tightens 2026 application and reimbursement rules

Denise, Lodging Tax Advisory Committee member, called a special meeting Friday and reviewed the schedule for the City of Ocean Shores’ 2026 lodging-tax grant cycle: applications posted Sept. 2, prescreening by the city clerk due Sept. 30, submission to the committee Oct. 3 and the committee’s recommendation scheduled for the Ocean Shores City Council meeting on Nov. 10, 2025.

The committee discussed whether to hold back more of the lodging-tax fund than the 10% required by the city’s governing resolution. Sarah, city staff member, presented the committee with financial scenarios and said the resolution requires a 10% reserve but staff recommends presenting scenarios that withhold 30%–40% of funds given current hotel conditions and the committee’s priority to cover the convention center’s operating costs.

Why it matters: Holding back a larger share reduces the money available for events and marketing grants but preserves a reserve to cover convention-center operations and unanticipated shortfalls if local hotels underperform or fail to remit taxes.

Discussion and direction

Committee members emphasized the risk posed by local hotel conditions and cancellations. Shannon Rubin, LTAC member, said she is “not fine with less than 30%,” and urged caution given recent poor hotel reviews and several groups canceling or complaining about local lodging. George Lee, LTAC member, described groups that have canceled because of hotel conditions and supported moving cautiously.

The committee directed city staff to supply detailed funding scenarios showing the financial effects of holding back 10%, 30% and 40% (and versions that include or exclude convention-center capital requests). The committee will use those scenarios while reviewing applications in October and may release any held-back funds later if surplus is available.

Application, prescreening and reimbursement changes

The committee reviewed a substantially revised four-page application and supporting materials drafted by city staff and modeled in part on Westport’s form. The new packet incorporates: RCW 67.28 definitions for hotel-motel excise tax grants; a statement that projects must specifically promote the City of Ocean Shores and prominently display the city name in materials; a single-year project/budget limit; a required designated contact for each project; and a 12-item scoring framework (marketing, area of impact, cost effectiveness, clarity, promoting large events, cooperative nature, self-evaluation, innovation, scale, likelihood of participation, and degree of participation).

City staff will prescreen applications for completeness. The packet says incomplete applications will be given one reasonable grace period for revision; if not corrected they will not be submitted to the LTAC. The prescreening policy also clarifies that project costs incurred before grant approval and execution of a written contract will not be reimbursed.

On reimbursements, the revised contract language requires sponsors to expend funds and seek reimbursement with receipts. The agreement will allow LTAC to periodically review reimbursements and monitor compliance. Committee members asked about exceptions for small nonprofits that lack upfront capital; staff said the city can be invoiced but will check with legal counsel before adopting a formal invoice-payment exception.

Selection process and meetings

The updated procedure gives the committee discretion to request oral presentations from some, all or none of the applicants; members discussed using prescreening and the scoring criteria to limit interviews to applications that raise questions or could alter a funding decision. Several members argued that applicants are responsible for tracking the process and for submitting complete applications in advance rather than at the last minute.

The committee also set three tentative review dates in October to accommodate prescreening and possible applicant interviews: Oct. 9 at 1 p.m., Oct. 21 at 10 a.m. and Oct. 31 at 10 a.m. (all dates to be posted on the city calendar). The first meeting will be for initial review, the second for interviews if needed, and the third to finalize votes and draft the recommendation to council. The committee noted the city council may accept, modify or reject LTAC recommendations when it reviews them.

What the committee decided and next steps

- The meeting agenda was approved by voice vote. - Staff will provide 10%, 30% and 40% holdback scenarios (with and without convention-center capital costs) and an evaluation rubric for committee review. - Staff will finalize the application, prescreening procedures and contract language (including the 30-day post-event expenditure-report requirement) and will check with legal counsel about paying vendors directly by invoice for small nonprofits. - The committee tentatively scheduled the October review meetings and will determine whether all three are needed once applications arrive.

The LTAC emphasized that lodging-tax awards are intended as seed or enhancement funding, not perpetual operational support. Applicants who received prior LTAC funding will be required to report how previous funds were spent and to provide measurable outcomes in their 2026 application.

The committee adjourned after completing the agenda.