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Lodging Tax Reports: Changes to Reporting Process


February 17, 2016 by Toni Nelson
Category: Lodging Tax (Hotel-Motel Tax)

Lodging Tax Reports: Changes to Reporting Process

 

Editor's note: The JLARC lodging tax reporting deadlines have changed since the original publication of this post in 2016. For current deadline information, refer to the JLARC reporting website.

The deadline for lodging tax reporting for cities and counties is just around the corner. As you prepare your reports we thought it would be a good idea to clarify the reporting requirements and inform you of the changes that have been implemented for this reporting period.

RCW 67.28.1816(2)(c)(ii) requires that the Joint Legislative Audit & Review Committee (JLARC) report to the economic development committees of the legislature on the use of lodging tax revenues by municipalities. As a result, local government is required to report to JLARC in order to meet this statutory requirement. This new reporting system began last year with the collection of 2014 data.

The reporting period begins the first of November and ends on March 15th of each year.

Last year’s inaugural launch of the lodging tax reporting form revealed areas of the reporting system that needed improvement. As a result, JLARC staff implemented changes to improve both clarity and ease of use. The 2015 online reporting system is different from the one provided last year. As a result it will require that each municipality create a Microsoft account using their email as the username to access the SharePoint site. If you have not completed this step of the reporting process you will need to email JLARClodgingtax@leg.wa.gov as soon as possible.

The next step after creating your SharePoint site will be to email JLARClodgingtax@leg.wa.gov with an invitation to join. Be sure to include in your email subject line, “Request for lodging tax system invitation.” This will allow the JLARC analyst to finalize the connection and distribute instructions for filling out the online reporting form.

Now that you have the connection and the reporting form, it’s important to report all of the required data. There are three potential scenarios:

  • Scenario 1: Municipalities who did not distribute or expend any lodging tax dollars in 2015. The first question on the report form is “Did you expend lodging tax – yes or no?” With a response of “no” you will have completed your reporting requirement.
  • Scenario 2: Municipalities that did not distribute lodging tax funds to applicants but who may have expended funds for local government purposes such as debt service (loan payments). This was a source of misunderstanding by some entities last year. Keep in mind that the statutory requirement for reporting includes “all expenditures” of lodging tax dollars whether they are for municipal facilities such as debt service or reporting support costs for the lodging tax advisory committee (LTAC). If your municipality expended lodging tax dollars there is a requirement to report to JLARC.
  • Scenario 3: Municipalities that distributed lodging tax funds as well as using this resource for municipal purposes as allowed by statute. The majority of local government will have both distributions and expenditures and will be required to providing a report to JLARC.

For those entities that expended lodging tax revenues, it is a requirement to report both the amount of the distribution as well as attendance numbers associated with any lodging tax funded events, activities, and/or facilities. RCW 67.28.1816(2) requires that entities that receive lodging tax funds must provide the municipality both initial estimates and actual numbers of people that traveled to the event, activity, or facility for business or pleasure. Estimating attendance and traveler information can be challenging. A good faith best estimate can be made, however, these estimates must be supported with a methodology that meets the intent of the statute. For technical assistance with these complexities JLARC does offer support, however they encourage local governments to work with their association: Association of Washington Cities (AWC) or Washington State Association of Counties (WSAC).

Completing this annual reporting form with JLARC is both essential and a legal compliance issue for local governments. The report deadline is March 15th but you can file at any time up to the deadline. Now seems like an excellent time to complete this reporting requirement.

About Toni Nelson

Toni has over 24 years of experience with Local Government finance and budgeting. Toni's area of expertise include "Cash Basis" accounting and reporting, budgeting, audit prep and the financial issues impacting small local government.

VIEW ALL POSTS BY Toni Nelson

Comments

"Well written article. Thank you!"

Susan Conniry on Feb 29, 2016 9:33 PM

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