Judge issues partial ruling on lawsuit between City of Manitowoc, Manitowoc Area Visitor & Convention Bureau
MANITOWOC - A Manitowoc County Circuit Court judge ruled last week that the City of Manitowoc must contract with the Manitowoc Area Visitor & Convention Bureau for tourism promotion services under state law.
The partial ruling in the 2022 lawsuit was issued Thursday by Judge Mark Rohrer, who also said the city's newly created Tourism Department does not meet statutory qualifications to be a "tourism entity."
"It is clear to the court that the spirit of Wisconsin Statute section 66.0615 is to ensure that room tax dollars collected by a municipality are properly spent on behalf of the municipality by qualified organizations," Rohrer said.
The lawsuit, filed against the City of Manitowoc and the Manitowoc Room Tax Commission by the MAVCB, Wisconsin Association of Convention & Visitor Bureaus and Manitowoc business The Hearty Olive, claims the city's 2021 decision to drop the tourism contract with the MAVCB was illegal and that the newly developed tourism department did not meet the state's requirement of a tourism entity.
According to state statutes, a tourism entity must be "a nonprofit organization that came into existence before Jan. 1, 2015, spends at least 51% of its revenues on tourism promotion and tourism development, and provides destination marketing staff and services for the tourism industry in a municipality."
In response to the lawsuit from the MAVCB, the City of Manitowoc filed a brief claiming the MAVCB was disregarding another state statute that allows municipalities to create a commission for tourism and to forward all room tax revenue to the commission instead of any local tourism entities like the MAVCB.
The document states: "MAVCB does not have standing to prosecute this claim. Here, MAVCB is nothing more than a disgruntled entity that sought and ultimately lost out on a governmental contract. That is not sufficient to provide jurisdiction to the court."
The MAVCB filed the lawsuit in December in response to the City of Manitowoc severing its long-standing contract for tourism services. In exchange for roughly half of the room tax dollars collected each year, the MAVCB provided a yearly visitor guide to the area, several events and the operation of the Visitor Center on Calumet Avenue, among other marketing strategies.
Throughout 2021, the cities of Manitowoc and Two Rivers, along with the MAVCB, had been working on constructing a new agreement. However, the City of Manitowoc abandoned those talks after the Manitowoc Room Commission decided to create a new tourism department at City Hall.
At first, the city of Two Rivers continued negotiations with the MAVCB, but also eventually decided to cut ties and create a new tourism department.
Since the MAVCB's split with the two cities, which resulted in a loss of more than $300,000 in operating funds for the organization, the MAVCB was also evicted from its location on Calumet Avenue and Executive Director Jason Ring stepped down from his position.
The Manitowoc Tourism Department did not waste any time in taking over tourism promotion for the city. In the past year, the department has created a new Visitor Center in downtown Manitowoc, published a new website and marketing strategy for the city called "Visit Manitowoc," produced a 2023 Visitors Guide and purchased $75,000 of Christmas decorations for the downtown area.
The department has been completely funded by revenue from the 8% room tax levied specifically on hotels and other places of lodging.
Rohrer said that while the city must contract with the MAVCB for tourism services, he has no authority over what departments the city can create. He also said he was not ready to discuss any possible payment of damages or any remedies for the conflict. To that end, the parties will meet May 11 for a status conference and to schedule further hearings before a final judgment order is issued.
Dig deeper:
Former Visitor Center sold: Manitowoc's former Visitor Bureau site on Calumet Avenue sold to Illinois developer
Visitor bureau's future: Manitowoc visitor bureau faces future with low funding, hopes lawsuit will bring organization back on track
Visitor bureau director resigns: Manitowoc Area Visitor & Convention Bureau director is resigning to serve as Two Rivers Main Street director
Department of Tourism: As a lawsuit lingers, Manitowoc tourism director says building new city department has been 'very fun and exciting'
Two Rivers separates from MAVCB: Two Rivers joins Manitowoc in separating from Manitowoc Area Visitor & Convention Bureau
Contact reporter Alisa Schafer at aschafer@gannett.com or follow her on Twitter at @AlisaMSchafer.
This article originally appeared on Manitowoc Herald Times Reporter: Manitowoc visitor bureau lawsuit: Judge issues partial ruling vs. city
