Elkhart County CVB asks commissioners to raise innkeeper-tax budget as collections climb

John Hunsberger, executive director of the Elkhart County Convention & Visitors Bureau, told county commissioners on Sept. 11 that the bureau is asking to align its 2026 spending with growing innkeeper-tax collections and the agency's program plan.

Hunsberger said the bureau contracts annually with the Innkeeper Tax Commission and asked the board to increase the budget cap that governs how much of the tax the CVB can plan to spend in a given year. He said the bureau is requesting an increase on the innkeeper-tax portion from $2.6 million to $2.9 million, and that its total proposed budget for 2026 is $3.1 million. The CVB explained that historical overcollections have produced carryovers held by the treasurer’s office that the bureau cannot spend until the next calendar year unless the budget ceiling is raised.

Why it matters: The CVB uses innkeeper-tax dollars for marketing and event support that the bureau says draws visitors and hotel-night stays into Elkhart County. Commissioners and other elected officials pressed CVB leaders on how much the bureau spends on events, staff overhead and on how innkeeper-tax dollars are collected and held.

What the CVB said

Hunsberger outlined the CVB’s 2025 business plan and a long list of events and attractions supported by innkeeper-tax dollars, including the Elkhart Jazz Festival, Goshen First Fridays, Nappanee Apple Festival, Celebration Under the Stars (downtown Elkhart concert that brought 15,000–16,000 people), and others. He said the CVB co-invests with municipalities and the Elkhart Redevelopment Commission on promotional efforts and that July hotel occupancy in 2025 was “above 70%.” He also noted repeat-visit metrics, saying visitors average “2.3 times” in Elkhart County.

Hunsberger described the CVB’s contribution to a downtown amphitheater pilot — the Celebration Under the Stars concert — saying the bureau matched $150,000 with the city to secure headline acts. “We partnered with the city, dollar for dollar,” he said.

Questions from commissioners

Multiple commissioners pressed Hunsberger on staff and overhead. Hunsberger said the CVB has seven staff members and eight total including visitor-center staffing. Commissioners questioned why roughly 30% of the CVB’s budget goes to staff and operating overhead; Hunsberger said those costs also support a staffed visitor center and core operating functions and that 31% is “not unreasonable for any business.”

Several commissioners and other attendees raised a perception issue about board composition, noting that the bureau’s appointed board includes more hoteliers and business representatives from Elkhart than elected municipal officials from other communities. Hunsberger responded by reading the Innkeeper Tax Commission roster and saying members represent multiple towns, including Middlebury, Nappanee and Goshen.

How the money gets to the CVB

Commissioners asked how innkeeper-tax funds are collected and where rollover balances are held. Treasurer Cindy Chadwell said collection works two ways: many hoteliers remit county innkeeper tax directly to the county treasurer monthly; separate “third-party booking” collections (for example, some VRBO/Airbnb third-party remittances) are received from the state and deposited by ACH. Chadwell said the treasurer currently holds carryover balances on the county cash book and that those balances have not been set up to accrue interest for the CVB; “They’re not getting paid interest. It was never set up that way,” she said.

Hunsberger described the rollover history and rationale for the requested budget increase: because the treasurer must hold collections in the year they are received and the CVB cannot budget more than the advertised cap, rollovers have built up year over year. He said the bureau expects a $728,000 rollover if pace holds and asked to align the annual budget with actual collections to avoid repeated large year-end rollovers.

Legal limits and board appointments

Hunsberger and others noted that state law requires innkeeper-tax proceeds to be used for marketing and promotion through the locally created Innkeeper Tax Commission and that board members are appointed locally. “By state statute, it has to go to the body that is created,” Hunsberger said; the transcript records commissioners saying the commission’s members are appointed by the county commissioners.

What’s next

Commissioners did not take a formal vote on the CVB’s request at the Sept. 11 session. The treasurer and CVB staff committed to provide additional accounting detail about collections, rollovers and interest treatment, and commissioners asked the commission and bureau to clarify board representation and program-level spending plans for advertising and events in follow-up work.

Ending

The CVB presentation led to several follow-up requests from commissioners for line-item detail and whether interest on treasurer-held balances can be credited to the CVB’s fund; county treasurer Cindy Chadwell agreed to investigate. Commissioners also signaled interest in drafting guidance or a policy ceiling for overhead vs. programming spending, but no formal policy decision was made at the meeting.