Sequim Irrigation Festival chairman Joe Borden is pleased with a proposed new agreement to fund city services for the annual event with hotel/motel taxes instead of the city’s hard-pressed general fund.

"I understand what the city is doing. It’s trying to protect its general fund. I’m a resident of the city so I can understand that," Borden said.

"There’s not a lot of extra money left in the city. A lot of communities have festivals and parades that don’t have them this year because of the economy.

"My guess is that’s how it’s going to work for the next several years."

At the June 29 city council meeting, city staff will present a proposed special event funding policy to use the hotel/motel tax in 2010 for other events, such as the Lavender Festival and Sequim Open Aire Market.

In her weekly report to the council, Interim City Manager Linda Herzog wrote, "It is anticipated the new policy can be adopted by midsummer and then applied as the 2010 budget is being developed.

"In the meantime, staff will strive for consistency in its handling of these costs while continuing to preserve the general fund."

The city’s 2009 general fund of $7.8 million pays for virtually everything associated with local government (except utilities), including city manager and council, police, city attorney, planning and public works, building inspections and parks.

The city also collects $140,000 a year from 0.4 percent of the sales tax paid by guests at the city’s hotels, motels, bed and breakfasts and other lodging establishments.

But that can be used to fund only events that increase tourism or as the popular expression goes, "puts heads in beds."

A 2007 state law allows cities to reimburse themselves from those taxes when they incur expenses such as police and public works overtime for tourism-related events.

The proposal arose after the council agreed to use hotel/motel taxes to pay $4,000 to cover most of the police and public works expenses for this year’s Irrigation Festival.

The Sequim Marketing Action Committee, which advises the council on spending hotel/motel taxes, agreed but didn’t want that to set a precedent.

Then organizers of the North Olympic Discovery Marathon made a similar request to SMAC for $2,000 on May 18. SMAC recommended against it and city staff is developing a recommendation for the council.

Borden said, "Cities today, with the economy, are looking for ways to pay for things. The Irrigation Festival has been around for 114 years, and (the city and I) would hate to see it go away.

"So when we talked and we heard how much it costs the city, City Attorney Craig Ritchie found a solution and it’s gong to work."

"I appreciate all the city employees’ efforts – without them the festival wouldn’t happen. Whatever I can do to work out details, I will do," Borden said.

"It takes a lot of time and man-hours for the city to put on these events. We’d pay if we could but we’re a nonprofit."

Sequim Open Aire Market director Mark Ozias said he hadn’t heard of the proposed policy change but it might not be as applicable because his weekly event has a smaller impact on city services than other special events.

"The city is undergoing an effort to see where its staff time is going, so I’m not surprised. Special events are a big use of the city’s resources and a good use of the city’s resources," he said.

Reach Brian Gawley at bgawley@sequimgazette.com.