EDITOR’S NOTE: Tillamook County has a measure on the May 20th ballot to increase the Transient Lodging Tax (TLT) from 10% to 14% – for more information – https://www.tillamookcounty.gov/sites/default/files/fileattachments/clerk039s_office/page/69486/sel_801_tlt000.pdf
By Doug Olson
A little over a dozen years ago Tillamook County had the worst roads in Oregon. And by a sizable margin. A widely used pavement condition index had Tillamook County’s roads in the 50s on a scale of 1 – 100. All 35 other counties were above 70.
Locals and visitors alike complained to anyone who would listen. The Tillamook County Commission was certainly aware of the longtime problem, but couldn’t agree on a workable solution.
A small group of local citizens got together to brainstorm. We thought a two-step solution might be a workable and equitable way forward. We would ask the County Commissioners to get behind it and ask voters for support. First would be a $15 million general obligation bond measure to be repaid by real property taxes across the County. Next, if the bond measure passed, would be to institute a room tax in unincorporated Tillamook County to generate additional funds from our visitors who use our roads and other local services.
The Commission agreed and the bond measure was passed by voters in Spring 2013 followed by passage of a ten percent Transient Lodging Tax (TLT) at the November election. The lodging tax became effective in January 2014. The bonds were sold soon thereafter and the County began a long term program to upgrade County roads.
We planned on generating about $1.3 – 1.5 million the first year based on the already in place state room tax. We were wrong. In the first full year, it generated about $2.3 million. And it’s been a phenomenal ride ever since. The past several years have generated about $7.5 million each year. Numbers for fiscal year 2024 – 25 so far look even better. Tillamook County has received over $55 million to date. Tourism expenditures across Tillamook County over the same period are approaching $1 Billion.
Now, there are some state rules and laws that determine how the funds may be spent. In 2003, the Oregon Legislature passed a law that directed any new lodging taxes to be spent on a 70% – 30% basis. The larger amount was (and is today) to be used for tourism promotion or tourism related facilities and activities. The remaining 30% could be spent at the discretion of the governing body – in this case Tillamook County.
Cities and counties, like the City of Tillamook, which had a TLT in place prior to the 2003 law requiring the 70-30% split, were grandfathered in and were able to retain full discretion over TLT funds generated in their jurisdictions.
The County Commission at the time directed the 30 percent (less a small administrative cost – one person to manage) to be used exclusively for County roads as was told to the voters. That has not changed today. The TLT is currently the second largest funding source for the Road Department, generating an additional $15 million since the program began.
The proposed increase in the TLT which is before voters in the upcoming May Special Election, would increase the current rate of ten percent to 14 percent over a two-year period. The first increase to 12 percent would be effective September 1, 2025 followed by the second increase to 14 percent July 1, 2026. The current rate has been unchanged for 11 years.
Before deciding to put the measure before voters, the County carefully examined TLT rates on the Oregon Coast as well as across the many significant tourist destinations in Oregon and Washington. The proposed new rates will be similar and competitive with coastal destinations including Seaside, Cannon Beach, Lincoln City and Newport. One might also note that the proposed rate will be significantly less than the City of Portland.
If successful, the new funds will be used as follows.
- The largest share of new funds, 80 percent, will be used to backfill the Sheriff’s Department to avoid budget reductions and retain current service levels.
- Ten percent will go to County Emergency Management which is heavily impacted by tourism.
- The final ten percent will go toward maintaining the County’s new radio system approved by voters in the Fall 2024 election. The new system will come with a significant warranty, but after that expires maintenance of the system will be the responsibility of the County.
It’s important to note that funding for County roads will not change. The original 30 percent allocated to the road department will remain in place. Only the new funds generated by the TLT increase will be allocated as indicated. The promise made to voters back in 2013 will remain in place.
It’s also important to note that the 70 percent which must be used for tourism-related activities, will increase substantially. That money will remain in the County and will be used for various projects across the County. The list of projects over the past 11 years since the tax was approved by voters is impressive.
Some of the larger projects include the following:
- Expansion and replacement of the swimming pool facilities at the North County Recreation District in Nehalem
- Kiwanda Corridor Project in Pacific City
- Wayfinding signage throughout the County
- Significant planning and improvements at the County owned fairgrounds
- Expansion of the Kiawanda Community Center in Pacific City
- Bike and Skate Park in Tillamook
- Kilchis Point restrooms
- Bay City Arts Center
- Neskowin Beach access ramps
- Port of Tillamook Bay Hangar repairs
- Tillamook Off Road Trail Alliance (TORTA)
- Oceanside Community Club new roof
- Waterfront restrooms in Wheeler
- Garibaldi Depot for the Coastal Scenic Railroad
And the list goes on and on.
Along with our famous dairy Industry, forest products, food, and fishing, tourism has become a major economic driver of the economy in Tillamook County. Our restaurants, lodging facilities, campgrounds, and shops employ hundreds of workers, both seasonal and year-round. They pay taxes, buy from local vendors, shop in our communities and are an integral part of the fabric of Tillamook County.
And, unlike most tourist destinations, Tillamook County through the Tillamook Coast Visitors Association, does not focus on bringing more and more visitors to Tillamook County. After a strong start, TCVA shifted its focus to Sustainable Tourism. It’s the only organization of its kind in the region which does not have a large marketing budget to simply bring more visitors to our region. The goal is to manage and enjoy our wonderful natural resources on a sustainable basis without damage, overuse or destruction. Indeed, Tourism in Tillamook County has become a model for much of the region and even across the nation.
We have an opportunity to make a very good thing even better. More funding will prevent reductions in key service programs including the Sheriff’s office and other tourism related programs.
The grant program which has returned millions of dollars to our community will grow helping fund even more projects which benefit us all.
Funding government at all levels is always challenging. Taxpayers often don’t know where the money goes, who benefits or why we pay what we pay. There is not always a direct connection from those who pay to those who receive benefits.
Citizens are frequently asked to vote for higher taxes to fund various programs at all levels of government. Most of the time it’s difficult if not nearly impossible to follow the money and measure results.
However, in the case of tourism in our County, it’s a different story. Our visitors, who do place a significant burden on many of our services including law enforcement, roads, and search and rescue help pay those costs through the TLT. That’s fair, easily understood and logical. That’s why the proposed increase in the Transient Lodging Tax in Tillamook County is the best and most reasonable method to help fund required services.
The proposed ballot measure to increase the Transient Lodging Tax is about as simple, straightforward, fair and logical as it gets.
Doug Olson is a 32-year resident of Pacific City and a native Oregonian. He and his wife owned and operated lodging properties in South County for 23 years. He also served as the Chair of the County Budget Committee for over 20 years. He also was part of the small group which asked the County Commission to place both the bond measure and TLT before voters in 2013. He also recently served as a Tillamook County Commissioner and was part of the decision to ask voters to consider an increase in the TLT in the upcoming election.
