By JOHN MOORHOUSE February 15, 2008 Penticton Herald
Uncertainty over parts of the city‘s economic development and tourism funding has the Penticton and Wine Country Chamber of Commerce wondering what the fuss is all about. The chamber signed a five-year contract with the city last year covering tourism, economic development, and visitor information services through until 2011. The agreement sets annual funding of $498,000 for the three services. However, chamber president Randy Kowalchuk said Thursday now the chamber must go before city council to defend “special project” budget requests which should be guaranteed under the city contract. Although council has approved the core budgets for economic development ($151,000), tourism development ($102,000) and visitor information ($128,000), a further $118,000 in special project funding for tourism and economic development may not be a done deal. Council will discuss the matter in detail this Monday, as part of a review of all supplemental grant requests. Kowalchuk said the core budget only covers salaries and office expenses. The special project funding includes such areas as tourism advertising, economic development marketing, physician recruitment efforts and other expenses. “We don‘t believe they‘re grants. We believe they‘re fee-for-service contracts, no different than we have a fee-for-service contract for garbage pickup in the city,” he said. “What they‘ve agreed to is cover the basic overhead of the contracts but don‘t want us to do any services. Recruitment of doctors and all of those things, takes money.”
Jack Kler, the city‘s director of corporate services, said although council hasn‘t requested such information in the past, they asked for more details prior to confirming this year‘s budget. “This year they want to have a presentation made on what those items are, so they can make an informed decision,” he said. “We will continue dispersing the money for economic development, tourism and visitor information that is in the core budget.” Kler noted council has $250,000 in unallocated budget money. Deliberations on supplemental grant requests were postponed last month, even though council adopted the 2008 budget. Kowalchuk said he was surprised by the change in process, noting the chamber did not to have make any similar presentations before council last year. “There has been no indication they have been disappointed in the service that‘s being provided, so why would you handcuff those departments to do the work?” Kowalchuk added when the additional two per cent hotel room tax came into effect in 2005, the city agreed it would not decrease its annual tourism funding. The chamber president also said the chamber contract does not include extra funding for wage increases over the five-year period. He noted the city has budgeted wage increases for its staff, but does not include extra funding in the chamber contract. “Why does it not seem reasonable to increase the pay for our staff?” he said. “We asked for a minimal increase to assist us in that.” Kowalchuk said he remains hopeful a solution can be found, even in a tight budget year. A presentation will be made Monday by chamber manager Lorraine Renyard, economic development officer Wayne Tebbutt, and tourism development services officer Kelly Reid. Delegations representing other organizations are also scheduled to make presentations before council Monday. A final decision could be made shortly afterwards, although council legally has until mid-May to finalize the 2008 budget. It currently includes a 4.95 per cent average tax increase.
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Don Quixote Note: Contrast the $498,000 for the 3 services plus the 2% hotel tax that goes directly into the Tourism/Economic Development/Visitor Information in Penticton with the total NORD Requistion for Econimic Development of $554,180 in 2008. Vernon's share in 2008 is 67.47% of thids total or $373,882 which is an increase of $29,650 (8.6%) over 2007. (Areas B and C will be withdrawing from the service in 2009) . Vernon still has no hotel tax to use as the base funding towards this regional function despite efforts by some Vernon Councillors to introduce such a needed tax. (The population of Penticton is approximately 33,000 and the greater Penticton area population is 41,500. )
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