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Cottage Grove CVB approves preliminary 2026 budget; projects $72,300 lodging-tax revenue and $4,131 shortfall
Summary
The CVB approved a preliminary 2026 budget projecting $101,800 in revenue and $105,931.25 in expenses, leaving a planned shortfall of $4,131.25; staff said they will monitor expenses and may use fund balance to cover any gap. Q2 lodging-tax collections were reported at $30,949, 4.7% above budgeted Q2.
The Cottage Grove Convention and Visitors Bureau on Aug. 26 approved its preliminary 2026 budget after a staff presentation that also reviewed second-quarter lodging-tax collections.
Phil, a CVB staff member, told the board that Q2 2025 lodging-tax collections and related revenue totaled $30,949, 4.7% higher than the 2025 Q2 budgeted amount; he attributed the increase in part to activity around the Food Truck Festival.
On the 2026 preliminary budget, Phil said the CVB based lodging-tax projections on a 63% occupancy assumption, yielding an estimated $72,300 in lodging-tax revenue for 2026. Other projected 2026 revenues included $4,500 in visitor guide ad sales and $23,000 projected from the Food Truck Festival. The CVB also reported a $2,000 Explore Minnesota Tourism Grant that staff plan to use for online advertising for festival and outdoor food-related events.
Phil said the CVB plans to continue shared funding for the Deckard Technologies "Rentalscape" software used to identify and monitor short-term rentals; that expense is shared with community development.
Total projected 2026 revenues were $101,800 and projected expenses were $105,931.25, leaving a preliminary shortfall of $4,131.25. Phil told the board staff will closely track expenses and trim where possible; any remaining deficit could be covered by existing fund balance.
During the meeting board members asked about hotel development and its effect on lodging-tax capture. A city staff member said the request for proposals for a hotel at the targeted site had a deadline later in August and that the city is pursuing site remediation (phase 1 completed, phase 2 soil sampling underway). The staff member said the city has federal grant funds (approximately $3,000,000) intended to support infrastructure to prime the site for development.
Director Reese moved to approve the CVB's 2026 preliminary budget; Director Levine seconded. The motion carried with the board approving the preliminary budget.
