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Monona alder questions room‑tax split as tourism fund falls and grant requests rise
Summary
Councilors heard that state law requires a 70/30 split of room‑tax receipts (70% tourism commission, 30% general fund). Alders expressed concern that the allocation limits general fund revenue while tourism grants (including multi‑day events) have received large awards; tourism commissioners will face tighter choices in 2026 after drawing down the fund balance.
City staff told the Committee of the Whole that state law requires room‑tax revenue to be split 70% to the tourism commission and 30% to the general fund; the tourism commission largely uses its share for marketing and event grants. Staff said the tourism fund balance was largely expended in 2025 and that the first 2026 grant cycle will be in January after fourth‑quarter room‑tax collections are posted.
Alder Doug Wood urged the council to consider discussing the statutory allocation with state legislators, calling the current split restrictive for small cities: "We're collecting 580,000... and we only get to keep 174,000 for general property tax," he said, arguing the distribution limits the city's ability to fund general services. Other council members acknowledged the statute and the commission's statutory duties, and staff said the commission will face difficult allocation choices given reduced fund balance and rising contractual costs for events.
Staff noted the tourism commission must follow state statute in approving grants that demonstrably drive overnight stays; some council members said that requirement precludes Parks & Recreation events that do not produce hotel nights from tapping the tourism dollars.
Next steps: tourism staff and the commission will prepare the first 2026 grant cycle in January; alder discussion with state legislators was suggested but no formal action was taken.
