Delafield face possible $150,000 to $200,000 annual revenue loss

CITY OF DELAFIELD - City government could lose $150,000 to $200,000 a year if the State Legislature adopts a proposal to increase the share of hotel tax revenues devoted to local tourism promotion, City Administrator Tim Schuenke warned tonight.

Schuenke told the Common Council at its Monday, February 20, meeting that the legislative proposal would require all municipalities to allocate 70 percent of their hotel tax revenues to promote tourism with the remaining 30 percent contributed to the general revenue fund of the municipality.

Schuenke explained the existing hotel tax revenue allocation is Delafield is almost oppose of what would is required in the legislative proposal.

Since 1997, 75 percent of the estimated $350,000 to $400,000 in annual hotel tax revenues has gone into the city's general operating fund and 25 percent was donated to the local tourism council, according to Mayor Ed McAleer

Schuenke said the legislative proposal "will have a devastating effect on us" if it is adopted.

"We cannot take this kind of revenue hit. There is no way we have to recover the lost revenues because of the state levy limits imposed on us. We will have to lay people off," he added.

The council unanimously agreed on a resolution opposing the proposal that will be sent to area lawmakers and surrounding communities.

However, as Council President Erv Sadowski pointed out, Delafield, Oconomowoc and Pewaukee are the only communities in Lake Country that have significant hotel tax revenues.

"The rest of the communities probably don't care because it doesn't effect them," he added.