Mayor Garry Litke said it’s never too late to make a deal, but claims no direct knowledge of how negotiations between Tourism Penticton and the Penticton Hospitality Association are proceeding.
“The chamber asserts they are facts. I don’t see any evidence of them being facts, just rumours of we’re so close to a deal,” said Litke. “I would love it. If they could prove to us that they were offering one umbrella, there was one body operating all of the funds, then nothing would make me happier.”
It’s been a little more than a week since Litke announced the city was stripping control of the $400,000 generated annually by the two per cent hotel room tax from the PHA and turning it over to Tourism Penticton to manage.
The Penticton and Wine Country Chamber of Commerce issued a statement Friday pleading for the city to step back from its decision, citing that both groups say they were close to an agreement, before encouraging the city to reverse its decision to pursue legal action and instead return to diplomacy, allowing Tourism Penticton and the PHA to complete their negotiation.
“They were working towards it and they had someone from within the industry (Ingrid Jarrett of the B.C. Hotel Association) moderating it. If the city needed to impose a deadline, I understand that,” said chamber president André Martin.
PHA director Tim Hodgkinson, doesn’t understand how Litke could be unaware of their progress, since Chuck Loewen, the city’s general manager for recreation services and facilities, is a member of the executive committee for the Tourism Penticton Society.
“They would have known that we gave that last green light to actually move forward and present these different governance models,” said Hodgkinson.
“Those proposals were due to be presented to both groups within weeks. So if one society had come out of the back of that, the city would have had to deal with a board of directors that wasn’t just made up of the PHA but also industry stakeholders.”
Hodgkinson is concerned the city has a goal of regaining control of the funding, which the PHA was granted in a five-year contract last July. Since then, he said, the group has gone from a standing start and set up a successful marketing strategy.
Martin agrees that tourism numbers for the first six months of 2013 were up, which was part of the reason the chamber chose to speak in favour of letting the tourism groups finish their negotiations.
But Litke said the contract isn’t just between the PHA and the city. Since it involves a provincial tax, the provincial government is also a partner.
“There is a very strict legislative framework around how tax dollars are collected and distributed. They give it to the city of Penticton for administration,” said Litke, explaining that the city thought the money would be better handled by those in the tourism industry.
“We did not see enough evidence of that agreement being complied with.
“We have been alerting them since last spring, and then we went through a mediation process, which was not cheap,” said Litke, adding that one of the mediator’s directives was for the PHA to provide the city with financial statements.
“When we finally got them, suffice it to say we were disappointed with the numbers that were there, specifically related to the unspent funds that were in their control.”
Hodgkinson had a different view of the mediation process, which he said went well and cleared up some miscommunication between the city and the PHA.
“We cleared up the black and white of what was needed and what was going to be moving forward,” said Hodgkinson. “It meant nothing at the end of the day. They want to control the money, that’s basically it.”
According to the chamber, the end result of pursuing legal action will only be a further wasting of resources, fracturing of the community, and likely the loss of the hotel tax revenues all together.
“In the long run, this is a losing situation for everyone,” reads their statement.