Ashland's hotel tax revenues are up 4.7 percent compared to this time last year, according to the city of Ashland's Finance Department.

Ashland's hotel tax revenues are up 4.7 percent compared to this time last year, according to the city of Ashland's Finance Department.

Not only is that good news for the town's tourist-based economy, but the city government will take in more money off Ashland's 9 percent sales tax on lodging.

The city traditionally keeps the lion's share of the money but shares some of the revenue with the Ashland Chamber of Commerce, the Oregon Shakespeare Festival and smaller groups that promote economic and cultural development, as well as sustainability.

With hotel tax revenues projected at almost $1.89 million for the coming fiscal year, the Ashland City Council decided on Tuesday to keep $1.29 million to fund city services, the city government's economic development work, public art and miscellaneous city projects. That's up from about $1.24 million this fiscal year.

The Ashland Chamber of Commerce will get $293,160 — a bump up from this fiscal year's $280,000 — to help fund its Visitors' and Convention Bureau.

The City Council held the Oregon Shakespeare Festival's share of hotel tax receipts flat at $110,000.

Smaller groups like the Ashland Independent Film Festival, THRIVE and the ScienceWorks Hands-On Museum that competed for a share of $167,080 in funding for this fiscal year will have a larger pool of $188,758.

Ashland City Councilor Carol Voisin said she would have liked the smaller groups to have even more money.

"These organizations that come to us for grants bring new and different tourists to Ashland," Voisin said.

The Citizens' Budget Committee will decide during this spring's budgeting season which smaller groups will get money, and how much.

Competition is usually fierce, with about two dozen groups vying for funding.

Collectively, they usually ask for twice the amount that is available.

The competition grew more intense last year when the City Council decided for the first time that sustainability groups could compete for money, along with economic development and cultural organizations.

City Councilor Greg Lemhouse said he would prefer that only the Chamber of Commerce and the city government get increased funding from the rising hotel tax revenues. He said the city government needs to confront its budget issues by setting aside financial reserves.

Ultimately, Lemhouse did join with Voisin and Councilors Michael Morris and Russ Silbiger to approve the new division for hotel taxes. Councilor David Chapman voted against the changes.See correction, below.

Councilor Dennis Slattery, who is married to Chamber of Commerce Executive Director Sandra Slattery, did not vote or take part in the discussion because of his conflict of interest.

The rising hotel taxes revenues mark a turn-around from early 2009, when economic troubles caused revenues to fall $119,000 short of estimates.

Staff reporter Vickie Aldous can be reached at 541-479-8199 or vlaldous@yahoo.com.

Correction: An earlier version of this story gave incorrect information on which councilors voted for and against the new division for hotel taxes.