Council reviews lodging‑tax recommendations; debate over fan zone and increased funding for regional athletic complex

LACEY, Wash. — City staff presented the Lodging Tax Advisory Committee (LTAC) recommendations for 2026 funding and the council spent an extended discussion weighing priorities between tourism facility support and community events.

Staff summary: Sadie Sibley, management analyst, summarized the committee's recommendation of roughly $600,000 in awards (29 recommended awards through Oct. 31) and said the committee prioritized activities located in Lacey and those with higher potential to generate paid overnight stays. The LTAC proposed redirecting some previously awarded line items and reserves toward the Regional Athletic Complex (RAC), increasing its recommended allocation to around $326,000, and recommended pilot administrative changes such as a $5,000 minimum award and allowing up to 40% of approved marketing expenses to be advanced.

Council debate and key issues: Several council members praised the RAC as the "number one driver of heads and beds" in Lacey and supported increasing its LTAC allocation to reduce General Fund support. Other council members expressed concern about specific line items recommended by LTAC, most notably an $80,000 recommendation for a regional "fan zone" associated with a larger event outside Lacey (a proposed watch‑party component tied to an upcoming soccer event). One council member said they could not support funding the fan zone and suggested reallocating that money to the RAC; other members noted the fan zone recommendation would be funded from LTAC reserves and that the proposal included prepaid marketing and a digital app to drive visitors to Lacey businesses.

Process notes: Council members emphasized deference to the LTAC process — LTAC is composed largely of lodging stakeholders whose funding priorities are limited by state statute to tourism‑related uses — but asked staff to return the recommendations to council for public discussion (not on the consent agenda). Staff agreed to bring the package back for formal council action in December and to provide additional documentation, including LTAC quarterly reports and evidence on reported paid overnight stays tied to prior awards.

Next steps: Staff will refine materials and return with the LTAC recommendations for formal council action; council signaled it would not place the item on consent and requested line‑by‑line public consideration.