PORT ANGELES — The Port Angeles City Council approved about $163,600 in lodging tax grants following a discussion regarding the legality of the lodging tax committee recommendations.

The council approved the grants in a 4-1 vote Tuesday night. Council member Lindsey Schromen-Wawrin voted against the recommendations while council member LaTrisha Suggs had an excused absence and council member Navarra Carr recused herself due to a potential conflict of interest.

The lodging tax awards, which were recommended to the council on a 5-1 vote by the lodging tax committee (LTAC) in March, previously had been reviewed by the committee in November. At that point, LTAC voted against fully funding the 16 applications.

However, when that recommendation came before the city council in November, they voted to return the applications to LTAC for further consideration following a slew of public comments.

Five of the applications remained unfunded this round after further consideration.

The applications that were awarded include:

• $90,000 for Port Angeles Youth Basketball;

• $25,000 for North Olympic Baseball and Softball;

• $18,680 for Hurricane Ridge Winter Sports;

• $15,000 for the Port Angeles Marathon Association;

• $5,460 for the Port Angeles Fine Arts Center;

• $2,587 for the Lincoln Street Block Party;

• $1,500 for the Elwha Bridge Run;

• $1,500 for the Spruce Railroad Run;

• $1,325 for the Spring Development Regatta;

• $1,278 for the Peninsula Regional Regatta;

• $1,283 for the Fall Development Regatta.

To fund the applications, the city will have to draw from its lodging tax reserves, leaving the remaining balance at about $1.4 million.

The lodging tax fund is supplied through a 2 percent excise tax applied to lodging for periods of less than 30 consecutive days.

During the LTAC meeting in March, former LTAC member Sydney Rubin expressed concern during public comment that continued use of the reserves will leave the city unprepared for potential decreases in tourism and therefore decreases in lodging tax funds.

Over the last 10 years, the lodging tax reserves have gone up most years, going from about $462,234 in 2015 to an estimated $1.58 million in 2023. The city’s policy requires a 25 percent minimum fund balance in reserves, which in 2025 would equate to about $318,600, according to city Communications Coordinator Jessica Straits. That leaves an available excess fund balance of about $1.1 million.

The legal discussion Tuesday night centered around whether the LTAC recommendations were valid based on a vacant seat on the committee. According to state law, lodging tax committees must include at least two members who represent potential users of lodging tax and at least two members who represent collectors of lodging tax. If the municipality elects to include more than two, each category must remain equal.

Port Angeles’ legal department has interpreted that requirement to mean there must be at least two positions on the committee for each category, not that those positions must be filled, according to City Attorney William Bloor. As long as a quorum of members are in attendance, the city’s legal department said the meeting is valid.

Other jurisdictions seem to have similar interpretations. When the Clallam County LTAC made funding recommendations in November, Commissioner and LTAC chair Randy Johnson said the committee had one vacancy, but that was never flagged as an issue by the county legal department.

However, Schromen-Wawrin said this is a matter in which legal experts disagree.

For example, Flannary Collins, managing attorney for the Municipal Research and Services Center (MRSC), wrote in an email obtained by Peninsula Daily News that she would see it as an issue if a committee made lodging tax recommendations while a seat was vacant.

“The LTAC vacancies should be filled before the LTAC makes decisions and recommendations about applications for lodging tax funds,” the email read.

While Schromen-Wawrin said he was not making a decision as to which legal interpretation is correct, “the better way for us to make this decision is to think about the consequences if one of these is right or wrong.”

If MRSC’s interpretation is correct, passing the LTAC recommendations would be out of compliance with state law and outside council authority, Schromen-Wawrin said.

“There is then a serious question of if the lodging tax contracts would be valid contracts,” he said, noting that if they were then challenged, the organizations wouldn’t have the money they thought they could rely on.

Because of that, Schromen-Wawrin moved that the council table the recommendations until the LTAC vacancy can be filled.

That motion failed 4-2, with Schromen-Wawrin and Carr voting for it.

“I think it feels very risky to proceed with a decision where somebody might be able to challenge that, and organizations that we chose to fund are then held up in essentially legal limbo,” Carr said.

On the flip side, council member Amy Miller said she was worried about the risk nonprofits might be put in if they were not awarded the lodging tax funds.

Council members Brendan Meyer, Drew Schwab and Kate Dexter said they voted against the motion due to the city legal department’s interpretation of the state law.

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Reporter Emma Maple can be reached by email at emma.maple@peninsuladailynews.com.