The city will use $2,280 in hotel/motel taxes to pay its overtime costs for the 2009 Sequim Lavender Festival under a contract approved July 20 by the city council.

The hotel/motel taxes will be used in future years to pay for marketing the annual festival.

"This is the first time we have had a contract with the city and, like the Irrigation Festival, this recognizes the important role of the festival and the lavender industry," said Scott Nagel, executive director of the Lavender Festival.

According to the contract, the Sequim Lavender Growers Association will submit a special events application and pay for a special use permit fee.

It also will document the Lavender Festival’s economic benefit to tourism and the city, including increased lodging and sales tax revenue.

Last month the council agreed to use hotel/motel taxes to cover most of the $4,000 in 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.

The change in funding sources is being sought to relieve pressure on the city’s $7.8 million general fund, which pays for police, streets, parks and virtually everything associated with city government except utilities.

The city 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 only to fund events that increase tourism or, as the popular expression goes, "puts heads in beds."

At the July 6 city council meeting, Councilor Erik Erichsen said, ""A lot was done behind the scenes to come up with that solution, thank you (Interim City Manager Linda Herzog)."

Reach Brian Gawley at bgawley@

sequimgazette.com.