Spokane Valley opts out of regional tourism agreement, breaking with county, city of Spokane for hotel dollars

Spokane Valley’s decision to secede from the regional tourism promotion effort that uses tax dollars to woo overnight visitors to the area ended an 18-year-old collaborative marketing endeavor.

The decision won’t cause a titanic shift in local economic development strategy but the Valley, Spokane and Spokane County are now in the process of creating two separate tourism promotion systems before the end of the year.

The Spokane Valley City Council in October voted unanimously to leave the regional tourism promotion area, an economic development effort that uses money raised by a hotel room tax of $4 a room to market the area to outsiders. The tax is projected to bring in more than $5 million in 2022.

Valley City Council members say leaving the Spokane Tourism Promotion Area, which was formed in 2004, and creating a Valley-centric one would allow the city to get more bang for its buck.

Instead of spending on marketing campaigns that try to lure people to Spokane’s conventions and sporting events, the money could help promote attractions within the Valley’s confines.

“The money stays here, we direct where it goes,” City Councilman Tim Hattenburg said in an Aug. 23 meeting. “I’m not very happy about where some of it goes now with the arrangement.”

By opting out of the tourism promotion area, Spokane Valley scheduled its demise – it will cease to exist on Jan. 1. In their interlocal agreement, Spokane, the Valley and Spokane County agreed to dissolve the entity if one of them abandoned it.

With the tourism promotion area’s final days drawing near, the three local governments are working to replace it. Spokane and Spokane County are sticking together and forming their own while the Valley goes solo.

Washington law establishes clear guidelines for creating a tourism promotion area.

First, a government or governments must win the support of hotel managers and obtain signatures “of the persons who operate lodging businesses who would pay sixty percent or more of the proposed charges.”

Once the hoteliers sign off on the proposal, governments can require visitors to pay a fee of up to $5 for every night they stay in a hotel. Spokane County in 2021 raised its fee from $2 to $4. Some 34 Spokane hotels, 16 Valley hotels and three unincorporated Spokane County hotels charge guests the $4 on room bills.

The Spokane County commissioners, advised by an 11-member board of hoteliers, decide how to spend the tourism promotion area dollars. They give most of the money to two economic development nonprofits. Visit Spokane gets 78% and Spokane Sports gets 22%.

Spokane Valley City Councilman Ben Wick said he wants to make sure Spokane Valley’s dollars benefit Spokane Valley. He said paying to promote the Spokane Convention Center or downtown Spokane’s new indoor track and field facility may not be in the Valley’s best interest.

The Valley could still work with Visit Spokane and Spokane Sports but instruct those organizations to market city venues. One example, Wick said, would be to promote the Spokane Valley Mall at Christmas and the sand volleyball courts at Browns Park in summer.

Eric Sawyer, CEO of Spokane Sports, said he understands why the Valley opted out of the tourism promotion area.

“I don’t fault them for civic pride, and I don’t fault them for wanting to make sure they use those dollars to the benefit of Spokane Valley,” he said.

But Sawyer emphasized that a regional tourism promotion effort has value. Spokane sporting events benefit the Valley, he said, explaining that the Valley is home to many of the cheaper, chain hotels that sports teams prefer.

“It doesn’t matter where they’re playing, it’s where they’re staying,” Sawyer said.

City Councilman Rod Higgins said he believes Spokane Valley needs to stand up for itself. The city can’t allow Spokane and Spokane County to treat it as an afterthought, he said.

“We’re able to stand on our own,” Higgins said. “We’re not who they think we are anymore.”

A majority of hoteliers in Spokane County, Spokane and Spokane Valley support creating the two tourism promotion areas. The Spokane Valley City Council and Spokane County commissioners could vote to create the new entities in the coming weeks.