A proposed ordinance increasing room taxes on motels, vacation rentals and other temporary lodging in unincorporated Clatsop County continues to be considered by county commissioners.

The board will decide whether to increase the transient room tax to 9.5 percent at its June 11 meeting after reconsidering an 11 percent proposal on Wednesday and hearing from members of the public.

The amended ordinance also includes Jan. 1, 2015 as an effective start date for the increase to allow rental owners to prepare for the adjustment.

The proposal generated public comment from some owners including Richard and Lynda Lee who said the increase would be burdensome. A letter in response to the proposal suggested increasing the tax incrementally and expressed concern about the effect it would have on vacation rentals as they pass on the cost to visitors.

The board opened a public hearing on the ordinance at the May 12 meeting. The proposed increase emerged during work sessions regarding infrastructure improvements for the Arch Cape community earlier this year. A range of options was considered for addressing stormwater drainage and potholes in the South Clatsop County community.

The transient room tax is currently 7 percent for rentals in unincorporated areas. Up to 85 percent of county room taxes is generated in the Arch Cape and Cove Beach area. Throughout the county, the tax provides about $180,000 to the general fund. Each city has its own room taxes within city limits.

The county looked at a Local Improvement District and a possible Urban Renewal District to address failing infrastructure in Arch Cape. However, residents were unfavorable to a LID, and taxing districts would have taken a hit if an Urban Renewal District was imposed.

The increase in transient room tax is allowed by the state if at least 70 percent of the revenue is used for funding tourist promotion or tourism related facilities. The remaining 30 percent can be used for infrastructure improvement.

If the ordinance is passed, two funds would be set up to differentiate the two amounts. At the May 12 meeting, Julia Decker, Clatsop County planner, presented the board with the available revenue from increases. From 7 to 9 percent, the county could use up to $77,860 over five years to address the infrastructure issues. With 11 percent, $155,720 could be used for improvements in unincorporated areas over the same time span.

Commissioner Matt Samuelson said on paper the ordinance didn’t seem to make any sense given the burden it may cause and the amount being directed primarily to the Arch Cape and Cove Beach community.

“I can’t support any of this,” Samuelson said. “Back to the drawing board, I would say.”

Although language in the ordinance would direct funds primarily to Arch Cape, money from the increase could be used for other unincorporated areas.

Commissioner Peter Huhtala proposed a compromise of 9.5 percent and delaying the increase until January.

In other news:

• The board approved a proposed amendment to the county’s land use rules governing development of residential lots smaller than the minimum lot size under the current zoning designation.

• Commissioners approved an ordinance requiring compliance and adoption of DEQ rules as the Oregon Department of Environmental Quality’s onsite wastewater program transfers to Clatsop County.

• Approved a contract allowing free prescription discount cards to be offered to residents through a partnership with CVS Caremark as a member of the National Association of Counties.

• Chose to replace Knutsen Insurance with Hagan Hamilton Insurance Services as the county’s insurance agent. The county has contracted with Knutsen Insurance since 1993, but a committee determined that Hagan Hamilton would provide better long-term savings and greater attention. The switch was recommended to the board by county staff.

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