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Council approves Chamber funding agreement after split debate over payroll restriction
Summary
After debate over whether city funds may be used for chamber payroll, the council approved the agreement with the Larksburg Chamber of Commerce (vote recorded). Staff noted IRS rules that typically discourage using public funds for nonprofit payroll; council discussed adding contractual language but ultimately voted on the agreement as recorded.
The Larksburg City Council approved a funding agreement with the Larksburg Chamber of Commerce to provide TOOT/operational support, after a split council debate about whether the city should insert a contractual prohibition on using the funds for chamber payroll.
City staff reminded the council that certain IRS rules and nonprofit guidance can make direct city funding of an employee salary risky for a nonprofit's tax status; the city manager recommended that if council wanted certainty it could add a clause prohibiting payroll use. One council member moved to approve the agreement with an explicit stipulation that city funds not be used for payroll, and another council member offered a counter‑motion to pass the agreement as read.
After discussion and roll‑call voting, the council approved the agreement (motion recorded as passing 4–1). Staff told council it could include non‑payroll language by amendment in the future, but the final recorded council action was to authorize the city manager to execute the agreement as adopted.
The city manager and staff will finalize the contract language consistent with the council's vote and ensure reporting requirements are met so the council can monitor how city funds are used.
