Holbrook’s mayor and council reached a final resolution Tuesday on how it will leverage its embattled lodger’s tax moving forward following a one-month recess of the discussion.
The officials elected March 8 to delay the final action to allow the Holbrook Chamber of Commerce, the Navajo County Fair Board and the Navajo County Historical Society, as well as the Navajo County Sheriff’s Hashknife Posse and City of Holbrook events coordinator Kathleen Smith, to prepare financial reports detailing how their funding allotments were used and profits gained, which were presented this week.
As the entities presented their financial cases, each demonstrated what the council found to be a solid record of activities for the prior fiscal year. The Chamber of Commerce, however, was in a more precarious position than the others due to what some council members perceived as a less than transparent log of profits and losses.
The council deliberated the pros and cons of multiple scenarios to avoid deeply cutting funding to the entities–or canceling such altogether–but the city’s bed tax balance still fell severely short, due in part to the $73,000 donation being requested by the chamber.
City Manager Ray Alley advised, “I think Kathleen Smith and our staff could fill in the voids were we to cut some of the events that the chamber handles. A handful of events have cost them money, such as the cultural dances, the Festival of Trees, Wild West Days and advertising.
“According to their numbers, Wild West Days wasn’t a source of revenue for them. They show an $8,000 loss, if I read their financials correctly,” said Alley.
Chamber Director Billie Ann Perkins and Chamber Board President Yvonne Larson explained that their accountant, Ranstrom & Company LLC, had not completely received or input the organization’s ledger entries during its months-long transition of records, and that this was reflected in the statements submitted for council review.
The pair stated that they were unclear what portion of their budget statements the council was seeking.
Vice Mayor Wade Carlisle observed, “In my experience, the chamber seems to be heading in the right direction, but the proof is in the pudding. They are showing a net income loss of $10,764, according to the books.
“There was a time when the council gave the chamber all of the lodger’s tax, and we did it for a two-year period. In that time, the only thing that increased was the number of employees, but they would still ask for more money to do projects. And that’s always been the result.
“As far as the chamber receiving anywhere from $150,000 in lodger’s tax down to less than $50,000, they are here to do economic development. In the past 12 years, I’ve seen very little movement on that front.
“We throw a lot of money the chamber’s way, and I’ve seen lots and lots of turnover,” Carlisle remarked, then noting his own comparison between the chamber’s and the fair board’s high level of community activities and fiscal responsibility.
“When I look at the fair board’s financials, they’re audited financials. The chamber’s financials aren’t even dated for this year; they have last year’s date on them. They’re also on a cash basis rather than on an accrual basis.
“So I don’t mind cutting the chamber’s funding, and I minded cutting it here in the beginning. I really felt bad for them about 10 years ago, when they were getting about $80,000 per year… and we’ve been cutting it ever since because the reality is that they don’t perform.”
Carlisle acknowledged that he feels that Perkins has “done the best” as the chamber’s newest leader, and recommended paying $38,000 to the entity to fund her fulltime salary.
After a tense, two-hour discussion and review, the council voted to maintain its $40,000 contribution to the fair board, increase the historical society’s slightly to $40,000 and to reduce its disbursement to the chamber to $40,000 from the $50,000 it received in recent years.
Much of the remainder of the $171,427 of the 2017 lodger’s tax budget go to utilities, $15,000; the city’s digital marquee signage annual maintenance contract, $3,200; city special events, $21,000; and tourism, $15,000.
Moving forward, the amended budget also called for Smith’s salary and benefits to continue to be sourced from the general fund budget, and deleted the development and construction of a park at the city’s north end. The Hashknife Posse will receive an allotment from the city next year, but directly from the city council fund as in the past.
Vice Mayor Wade Carlisle moved to approve the amended budget, and his motion was seconded by Councilwoman Francie Payne. Also voting in favor of the measure were Councilmen Tim Dixon, Earl Kester and Richard Peterson, and Mayor Bobby Tyler. Councilman C.J. Wischmann opposed it.
The chamber graciously accepted the council’s decision. “If our budget is going to be cut, I just need to know the dollar amount that we have to work with, and we will make it work. Because if that means that I do more volunteer hours to keep our events going until things start picking up, then that’s what we’re working for. We will figure it out,” Perkins said. She noted that in speaking with her, officials of other local chambers opined that the worst possible outcome would be the Holbrook chamber losing management of its signature events, like Wild West Days.
Mayor Tyler thanked each of the groups that presented and expressed his appreciation for their willingness to help the city work to attain fiscal balance.
“When we have participation in a meeting like this, I think it shows that we’re all on the same page,” said the mayor.
“This was a hard decision to make, because when you really look at it, we’re all headed in the same direction, but we only have so much money in our pockets. Please bear with us as we’re moving forward. We’re trying to do the best that we can. There are going to be some rough times ahead before we see smoother weather.”
In other business April 12, the council:
* Heard a recommendation by the City of Holbrook Zoning Commission to deny a residential zone change request submitted by Harry Ensor to establish a commercial trade establishment in the 300 block of North First Avenue. The the council unanimously denied the request.
* Proclaimed April 10-16 as the Week of the Young Child.
* Heard updates from Manager Alley regarding current streets department projects, including street surface paving projects at Third Avenue beginning April 13.
A construction status update for the new enclosed racquetball courts at Hunt Park was provided, with the courts expected to be fully complete by April 30.
The splash pad complex is being prepared for its seasonal opening, with a target date set for mid-May. The tentative opening date for the city pool is May 11.
* Received an update from Police Chief Mark Jackson regarding his attendance at a meeting of the Arizona Department of Homeland Security Regional Advisory Council, at which was discussed a funds request to outfit five department patrol vehicles with in-car computers for field use through the Homeland Security Grant Program.
The chief advised the council that grant funding is being sought to upgrade the Holbrook Police Department’s inventory of intoxilyzer DUI breath-testing units.
Jackson also provided for the council a response regarding police investigation of the March 27 death of Loreal Tsingine in Winslow. Investigation of the incident by the Arizona Department of Public Safety remains ongoing, and the chief declined to comment or speculate on details of its findings until the results of the investigation have been provided.
Chief Jackson related plans to present at the next council meeting the HPD’s proposed new public interactivity initiative in an effort to bolster positive public relations with city residents in the wake of Tsingine’d death.
* Heard the first reading of an amended city ordinance authorizing the lease of real property of the city to Petracom of Holbrook, LLC, for a term of 10 years, with the leaseholder’s option to terminate or renew the lease for an additional 10-year term.
* Pulled from the agenda possible discussion/action regarding award of bid for the purchase of benches slated for installation at Petroglyph Park. An alternate option has been identified at a cost that will not require council approval for purchase.
* Approved a resolution outlining the City’s adoption of a Fair Housing policy. The measure was opposed by Vice Mayor Carlisle and Councilman Peterson.
* Approved an expenditure of $12,800 to Fireworks Productions for the city’s 2016 Fourth of July display.
* Approved the consent agenda, including payment of claims for March 18-April 6 in the amount of $153,517.10.
* Approved payment of claims to Walt’s Hardware in the amount of $1,657.79.
The council will hold its next regular meeting at 6 p.m. on Tuesday, April 26.
