Explanation
BACKGROUND: This legislation authorizes the Columbus City Auditor to change the funding source for the contract with the Affordable Housing Trust for Columbus authorized under ordinance 0511-2020, passed by Council March 16, 2020. The funding source for this contract will be changed from wholly Hotel/Motel excise tax funding to Hotel/Motel excise tax and CARES Act funding. Due to the economic impact of the coronavirus, actual Hotel/Motel excise tax collections are anticipated to be significantly less than anticipated in 2020.
The economic fallout of the coronavirus has impacted Ohio and the national economy at historic levels. Ohio’s unemployment rate has risen to 16.8%, an increase of 11% versus pre-coronavirus levels. Similarly, Columbus’s unemployment level has risen to 13.7%, an increase of 9.5% versus pre-coronavirus levels. The travel and tourism sector of the economy has been disproportionately impacted and is experiencing an unprecedented contraction in business due to the COVID-19 pandemic. Marriott, a bellwether for the industry, recently projected a 75% decrease in global revenues and a 90% decrease in domestic (U.S.) revenues. The Airline industry has been similarly impacted with domestic U.S. flights decreasing 70% over pre-coronavirus levels. The aforementioned economic impacts to the travel and tourism have resulted in a significant decrease in 2020 Hotel/Motel excise tax proceeds, which in turn has drastically reduced funding available for social service contracts.
For 2020, it was estimated that $1,952,000.00 of Hotel/Motel excise tax would be available for these contracts. Through early June 2020, the city has received approximately $424,000 for this need when the expected amount is approximately $813,000. Depending upon the revenue received later this year, additional legislation may be needed to change the funding source again in order to fund the contract amount.
Emergency action is requested to change the funding source s...
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