LAKE DELTON — Village officials are predicting an average of 30% less premier resort and room tax revenue next year, considering COVID-19 will continue to affect tourism in 2021.
Lake Delton is predicting its premier resort tax operating revenue budget to be over $6 million this year, just shy of 24% less than last year. The room tax operating budget is expected to bring in 30% less for a total of only $8 million. Last year, officials budgeted room tax at $11.5 million and are only projected to receive $7.6 million in total revenues this year due to the coronavirus. The pandemic heavily impacted tourism around the nation as it forced shut downs to limit the spread of the coronavirus and people were more cautious with traveling and cancelling plans.
Both operating budgets were unanimously approved by the village board at its Dec. 14 meeting, wrapping up the village’s entire budget adoption for 2021. The board approved the village’s tax rate to remain neutral at $3.19 per $1,000 of assessed value Dec. 7.
Clerk/Treasurer Kay Mackesey said the operating budgets for both premier resort and room tax are the “best guesses” based on numbers taken in 2020. Village Board President John Webb said the decrease is due to the amount of revenue expected from tourism with the expectation the pandemic’s effects will continue next year.
“It’s less sales tax, less rooms being rented,” Webb said of the drop in the room tax budget.
The visitor and convention bureau receives 90% of the revenue from film tax while the village receives 10%, Webb said. Premier resort tax is the extra 1.25% of sales tax on certain goods and items. The tax helps fund infrastructure improvements in both Wisconsin Dells and Lake Delton.
According to documents, over $618,000 in surplus funds were applied to the budget to make up for the shortfall in funds. Webb said if both components decrease, even by $2-$3 million, it can affect the budget for items like equipment purchases.
“It can pretty much put a stop to anything,” Webb said.
Wisconsin Dells Visitor and Convention Bureau President/CEO Romy Snyder said the bureau’s board of directors approved its 2021 budget in early November, with a 25% decrease in room tax revenues from $10.1 million to $8.1 million. To make up for the shortage of funds, Snyder said $2.7 million have been pulled from its reserve fund to make up the difference.
The visitor and convention bureau’s reserve fund policy requires holding a reserve fund equivalent to at least 50% of its annual budget. The goal is to allow the continuation of its services in case of revenue projection declines due to unforeseeable events, like economic downtowns or natural disaster expenses requiring immediate action.
Snyder said the pandemic’s negative impact on the hospitality industry is why the visitor and convention bureau has the policy in place. She said the bureau is still in a good place financially to welcome tourists who visit the Dells’ area next year.
“The WDVCB is well-positioned to invite and welcome visitors back when they are ready to travel again,” Snyder said in an Dec. 16 email.
Comprehensive plan update
The village board approved a task order for MSA Professional Services, Inc. to review and update the village’s current comprehensive plan.
Village Engineer and MSA representative John Langhans said the need for a comprehensive plan in Lake Delton is overdue and it’s time for an update. He also said that potential recovery money from the coronavirus and funding from the state will be based on comprehensive plans in early 2021.
“We’re hearing from the industry that something is coming to the point where state agencies are saying ‘get ready,’” Langhans said.
Village Board Member Tom Diehl suggested the trustees receive a copy of the current comprehensive plan to get an idea of what it consists of, since there are some new members are on the board. Langhans agreed and said he would send the documents to board members.
Langhans said review of the comprehensive plan would likely start at the beginning of 2021 and completed in three months.
The village board approved an application to construct a 24’ x 28’ garage on the Waterfront Commercial District.
The board approved a certified survey map contingent of the approval of the plan commission to split 6.32 acres of land at Tommy Bartlett, Inc. from two parcels of land into three.
Follow Erica Dynes on Twitter @EDynes_CapNews or contact her at 608-393-5346.