News

City and PHA still at odds over disposition of hotel tax funds

Any progress in the ongoing dispute between the City of Penticton and the Penticton Hospitality Association seems to have moved completely behind closed doors, with both sides saying very little.

The last public move was in mid-January, when the PHA’s legal representative sent a letter to the city asking again for a return of the hotel room tax funds, frozen since November when city council announced it was breaking the contract giving the PHA control of the approximately $400,000 collected annually through the two per cent additional hotel room tax.

That January letter, said PHA operations director Tim Hodgkinson, was something of a last chance opportunity to avoid legal action.

About all either side will say is that work is being done to settle the dispute.

Penticton Mayor Garry Litke said they are close to a solution, though he wouldn’t say what form that solution might take.

“We had hoped to have it concluded by last week but their counsel has asked for some extra time, so that is where it is at right now,” said Litke, who declined to comment on what form the meetings are taking, whether they are before a judge, adjudicator or negotiations between legal representatives.

“I am hoping to have this situation resolved as quickly as possible. We are pressing for a quick resolution because we know that buys need to be made for the tourist season coming,” said Litke.

Hodgkinson said there has been ongoing correspondence between each side’s legal counsel and that the request for extra time was due to the city adding additional documents that they needed time to respond to.

“There has been continuing low-level legal activity. But there hasn’t been any meaningful discussions since the ones in December broke down,” said Hodgkinson, who was also reticent to describe what “low-level legal activity” entailed and declined comment on rumours the city is seeking an injunction to prevent the PHA from using the hotel room tax funds already in their possession. The PHA maintains they are just trying to continue business as normal, and continue funding advertising and marketing for the 2014 tourist season and beyond.

“The city are still withholding the funds from the PHA and peddling misinformation. The PHA still intends to get those funds back and get the truth out,” said Hodgkinson

 

 

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