Arnold Tourism Commission Questions Years of Missing Guidance as City Funding Debate Intensifies

Years of unanswered requests for guidance, questions about financial oversight, and concerns over how tourism tax dollars are allocated took center stage during the Arnold Tourism Commission's October 7 meeting, as commissioners sought clarification about their responsibilities and the city's authority over the funds they oversee.

Former Arnold City Attorney Bob Sweeney, who has been retained to represent the city in certain matters, including tourism-related issues, attended the meeting to address questions about the commission's operations and explain changes being introduced to how tourism funding requests are reviewed.

During a lengthy discussion, Sweeney acknowledged that the commission had operated for years without formal training, clear guidelines, or adequate procedures for documenting how awarded funds were spent.

"Basically, tourism has been kind of sort of out of sight, out of mind," Sweeney told commissioners. "You're doing good work. People enjoy the event, and so there is no obvious problem. Nobody pays a lot of attention."

However, recent questions about tourism expenditures have brought longstanding procedural concerns into focus.

The discussion also exposed a disagreement about the future role of the commission, particularly as the city considers directing a larger share of tourism revenue toward events already operated by the city.

Commissioners Say Concerns Have Gone Unanswered for Years

One of the more significant revelations came as commissioners explained that many of the issues being addressed were not new.

Commissioner Wally Lionberger said the board had repeatedly raised concerns about its operations and the need for guidance from city officials.

"We've been raising that flag for a long time," Wally said. “We have requested training and guidance.”

Commissioners described years of seeking clearer procedures, including requirements for documenting expenses and ensuring that tourism funds were used for their intended purposes.

Commission President Drew Sophia also said the board had previously raised concerns with former city officials about collecting receipts and establishing safeguards.

"We suggested it to Brian Richardson multiple times that there should be some sort of safeguard," Sophia said. "I know Wally did. I did. We said they should be collecting receipts."

Sweeney acknowledged that he could not explain why those concerns had not resulted in changes.

"I cannot explain," he told commissioners. "No one ever raised this with me."

Sweeney said he had not been made aware that commissioners were requesting training or guidance, despite the concerns they described.

He also acknowledged that the lack of structure was a responsibility shared beyond the commission itself.

"It's as much my fault as anybody else's. I didn't know," Sweeney said.

Perhaps one of Sweeney's most pointed observations concerned the expectations placed on volunteer commissioners without the tools necessary to fulfill those responsibilities.

"What you've been burdened with is to determine what tourism is, whether they're spending their money without any guidelines or any kind of idea what kind of records you should keep," Sweeney said. "In some ways, it's remarkable that you've accomplished what you have."

Sweeney characterized the commission's previous operating structure as a form of longstanding informality that could no longer continue without additional safeguards.

"We've fallen into a comfortable informality that has grown, and there is nothing wrong with that until there is, where somebody calls the question," he said.

Who Is Responsible for Auditing Tourism Funds?

The discussion turned to financial accountability when Commissioner Joe Maddock questioned who was responsible for auditing tourism expenditures and what would happen if an organization received more funding than it ultimately spent on eligible tourism activities.

Sweeney explained that tourism tax revenue is restricted to tourism-related purposes and cannot simply be used for unrelated municipal expenses.

"The tourism fund is a special tax that is solely to be used for tourism," Sweeney said. "It's earmarked."

However, he explained that one of the commission's difficulties has been the absence of a sufficiently clear definition of what qualifies as tourism.

"You're put in a position where you are told to be vigilant about tax dollars and spend them in only a particular way, and then you're not given a specific definition," he said.

Sweeney identified two areas needing improvement: reviewing applications before funding is awarded and documenting expenditures afterward.

He emphasized that these concerns about procedures should not be interpreted as an accusation of misconduct.

"I have zero information that anyone has ever done anything wrong with the tourist dollar," Sweeney said. "There's no evidence of that."

Nevertheless, he agreed with the commission’s concerns that a lack of documentation could create problems if expenditures were questioned later.

Maddock asked who was responsible for that kind of audit.

"The city. The city's auditor should be auditing it," Sweeney responded.

Sweeney explained that Arnold uses an outside auditing firm and described that independent review as an important safeguard.

He also said city administration and staff should play a more substantial role before applications reach the commission.

"The staff should actually be vetting these things first," he explained.

Under the approach Sweeney described, city staff would evaluate whether proposed expenses meet tourism qualifications, while commissioners would review those determinations and raise objections when necessary.

The commission's central responsibility, he explained, is ensuring that specially designated tourism revenue is spent on qualifying purposes.

City's Plans for Tourism Revenue Raise New Questions

The most extensive discussion centered on a developing change in how the City of Arnold proposes to use tourism tax revenue.

Sophia described a meeting held before the fiscal year involving Mayor Bill Moritz and City Administrator Anthony Traxler.

According to Sophia, city officials discussed anticipated additional revenue associated with Arnold’s tourism tax, estimated an increase at approximately $70,000.

Sophia said commissioners were informed that the city intended to use that additional tourism revenue to help finance municipal events.

"We had a meeting in the back room at Wesley Rogers with Mayor Moritz, Anthony Traxler, and they're talking about the city using all the increase in funds, which they thought would be about seventy thousand dollars," Sophia said.

Sophia expressed concern that directing those dollars toward existing city events would reduce the amount available for other organizations seeking to create or expand tourism activities.

"They're still wanting to get the seventy thousand," he said. "So that reduces what we're able to do with other organizations."

The discussion also addressed the commission's existing $20,000 limit on individual funding awards and the possibility of changing that limit through a new city ordinance.

Maddock questioned what could happen if that restriction were removed, allowing the city to seek substantially larger allocations for its own qualifying events.

While the discussion involved a projected $70,000 in additional revenue, commissioners raised the larger question of whether the city could eventually request most or all of the tourism funding available in a given year.

Sweeney explained that the city has authority over its budget and, in his legal opinion, may allocate tourism revenue to city-operated events as long as the expenditures qualify under the tourism requirements.

"A city, in theory, can budget all of the tourism money," Sweeney told commissioners. "And here's all these events that we're going to do, and they all qualify."

Sweeney explained that, under this interpretation, the city could determine how much tourism revenue to allocate to its own events, establish that those events qualify for tourism funding, and then submit the applications to the Tourism Commission for approval. Provided the expenditures meet the legal requirements for tourism, the commission would have limited grounds to reject them, effectively reducing its role to a rubber stamp for funding decisions already made by the city.

"At that point, the tourism commission's job becomes basically ministerial, a stamp," Sweeney said.

His explanation raised a larger question for commissioners: If the city can legally allocate the entire tourism budget toward its own qualifying events, how much authority does the commission actually have to determine where tourism dollars are spent, particularly when it comes to supporting smaller organizations, local nonprofits, and developing new attractions.

Sophia questioned whether tourism funds should be used for events the city has historically financed through the city's main budget.

"After 50 years, if tourism starts giving money, couldn't you make the argument that we're, in a roundabout way, moving money into the general fund, for the city?" he asked.

Sweeney acknowledged his question and explained that tourism revenue cannot legally be transferred into the city's general fund for unrelated expenses.

However, using restricted tourism revenue to pay qualifying expenses previously supported by other city resources could free those other resources for different purposes.

From Sweeney's perspective, that is a policy question for the city's elected officials, not necessarily an unlawful use of tourism funds.

The question for commissioners, then, was not simply whether a city event qualifies for tourism support, but what effect a significant change in funding priorities could have on other events across Arnold.

"I just worry about where it stops." Sophia said. "If it's seventy thousand now, where does it stop?"

Sweeney Encourages Commission to Take Concerns Directly to City Council

Sweeney encouraged commissioners to formally communicate their concerns to the Arnold City Council.

He suggested that the issue deserved a council work session where elected officials and commissioners could discuss the direction of tourism funding.

Sweeney said commissioners had a responsibility to communicate their observations and concerns, even when those concerns involved decisions made by city leadership.

"The commission, speaking as a commission, should be heard and has authority to be heard," he said.

He encouraged commissioners to prepare a report outlining their concerns and present it to the council and mayor.

Sweeney also recognized that commissioners might reasonably want additional time before voting on requests involving these issues.

However, he cautioned that delaying eligible requests indefinitely could create another problem.

"If it runs into a situation where tabling becomes a pocket veto," Sweeney warned, the situation becomes more complicated.

He suggested that seeking clarification or additional discussion was reasonable, but that the commission's authority to deny otherwise eligible expenditures could be limited.

The exchange underscored the challenge facing commissioners: how to exercise oversight while responding to funding requests from the same city government responsible for establishing the commission's operating framework.

Council Liaison Directs Commission to Contact Mayor

The possibility of a council work session resurfaced later in the meeting after Sweeney had departed.

Commissioners continued discussing how to communicate their concerns and obtain clarification about their authority.

Sophia and other commissioners raised the possibility of arranging a work session with the City Council.

When commissioners asked Councilman Troy Blacksher, who serves as the commission's council liaison, to help arrange the discussion, Blacksher directed them to contact the mayor.

"Call the mayor," Blacksher said.

Blacksher explained that work sessions are generally held on the second Thursday of the month and that the mayor could allow commissioners to address the council during the session.

He instructed Sophia to email the mayor and request that the issue be placed on a work session agenda.

Blacksher also indicated support for the commission's work.

"I see a lot of good coming out of these meetings, and the commissioners have been doing a great job," he said.

He agreed that a discussion with the council would be worthwhile and suggested that an ordinance might help establish a clearer middle ground.

Commissioners Debate Whether to Approve City's Request

The discussion ultimately returned to an immediate funding decision involving the city's Christmas in the Park event.

The city's $20,000 request for Christmas in the Park included a previously tabled request for $13,500 promotional expense originally intended for Arnold Days.

The funding request had been tabled by the Tourism Commission at its September meeting, where they hoped to get clarification from Mr. Sweeney. After the request was tabled, the city canceled scheduled airtime for the television promotion.

The cancellation reportedly frustrated several local business owners who had taken time out of their holiday weekend to participate in filming intended to air ahead of Arnold Days.

Rather than abandoning the promotional agreement, the city shifted the expense to its Christmas in the Park funding request, with the expectation that the previously recorded footage could still possibly be aired as part of a later promotional campaign.

Sophia expressed concern that approving the request could establish a precedent for directing more tourism revenue toward existing municipal events.

"I feel like the options are: don't do what I think is best for the city of Arnold, or I fear the city's going to bring litigation against us," Sophia said, describing his interpretation of the earlier legal discussion.

Sophia was not alone in his interpretation of Sweeney's comments.

Another attendee, who identified themselves as an outside party without a vote, suggested that the commission had effectively been told it must approve the city's funding requests.

"What I just heard is they have to vote yes, period."" the attendee said. "If Arnold submits an application for the city and they prove it's tourism, they have to put a yes vote, no matter what.""

Tourism Commissioner Justin Price followed both of those statements saying "That's how I understood it."

At the same time, other commissioners argued that city-operated events are among Arnold's most significant tourism attractions and should receive support.

Wally Lionberger spoke in favor of using tourism revenue for events such as Arnold Days and Christmas in the Park.

"Tourism should be paying for Arnold Days and for these events," he said.

He also acknowledged the importance of protecting funding for smaller events.

"Now, should there still be money for smaller events to develop and hopefully into bigger events? Certainly," Lionberger said.

The discussion highlighted differing views about whether tourism dollars should primarily support established attractions or help create additional events that could attract new visitors.

Blacksher questioned whether the events receiving recurring tourism support were demonstrating any growth.

"Nothing's really growing," he said during the discussion.

Sophia pushed back against the suggestion that tourism-funded events were not growing, pointing to the success of many organizations and events that had received support from the commission.

Maddock then suggested delaying the city's request until commissioners could meet with the City Council and get clearer direction.

"My suggestion is going to be that we table this conversation until we get an opportunity to work together and present it to the city council," Maddock said.

Councilman Blacksher then raised concerns about whether another postponement could be viewed as the type of pocket veto Sweeney had described earlier.

Sweeney had cautioned commissioners that repeatedly delaying an otherwise qualifying request could be interpreted as "thumbing their noses" at the city.

That warning appeared to weigh on the discussion, as commissioners struggled to balance their concerns about the city's increasing use of tourism funds against the potential consequences of withholding approval.

Ultimately, the commission voted 3–1 to approve $20,000 for the city's Christmas in the Park request, with Maddock casting the dissenting vote.

The approval resolved that particular request, but did not settle the larger questions about future allocations, changes to the funding cap, or the commission's role in overseeing city requests.

Arnold Chamber Reports Growth as Tourism Commission Reviews Upcoming Events

The commission also reviewed funding requests for several upcoming community events, including a first-time event at the Arnold Eagles, HUNKS The Show, a proposed Evans Blue concert expected to attract visitors from multiple states, and Holy Family's third annual Festival of Trees. Organizers of Festival of Trees reported that last year's celebration attracted more than 1,000 visitors on Saturday alone.

The Arnold Chamber of Commerce Executive Director also shared encouraging news, announcing that membership had surpassed 300 businesses and organizations, reaching 303 members.

The chamber's upcoming Trunk or Treat event, scheduled for October 23, was also approaching capacity, with 41 trunks already registered compared with 26 last year, noting the considerable growth the Chamber has seen this year under President Brad Cary and Executive Director Courtney Sokolis.