The collection of hotel-motel tax is authorized by RCW 67.28.180. Seventy-five percent of the revenues in excess of $5.3 million are allocated to the Arts and Cultural Development Fund. The remaining twenty-five percent is allocated to the Special Support Program.

The Cultural Resources Division of the King County Parks and Cultural Resources Department administers the Arts and Cultural Development fund. The Department of Finance administers the Special Support Program.

The Arts and Cultural Development fund received $1,956,766 in 1994 and $2,651,342 in 1995. The Special Support Program received $652,255 in 1994 and $883,780 in 1995.

At least 70% of the Arts and Cultural Development fund amount is used to support the Cultural Facilities Program. Up to 80% of the Cultural Facilities money is awarded to arts projects with no less than 20% awarded to heritage projects. The remaining 30% is used to fund the Cultural Education Program (12%) and the Special Projects Program (18%). At least 20% of the Cultural Education and Special Projects Program funds are awarded to heritage projects.

The Cultural Facilities Program provides funding for the purchase, design, construction, and remodeling of performing arts, visual arts, heritage and cultural facilities, and the purchase of fixed assets to benefit art, heritage, and cultural organizations.

The Cultural Education Program is designed to increase arts and heritage awareness among students in King County's K-12 public schools.

The Special Projects Program funds "innovative arts projects, heritage endeavors, and collaborative programs which reflect the cultural and geographic diversity of King County."

KCC 4.42.100(A) states that the Cultural Facilities Program shall consist of grants to performing arts, visual arts, heritage and cultural organizations responding to priorities established by the Council, reviewed annually.

The audit found that the process used by the Cultural Resources Division to award grants through the Cultural Facilities Program appeared to meet the mandates of King County Code 4.42.

Finding II-2. The process to contract and distribute funding through the Cultural Facilities Program appeared satisfactory.

The audit found that the process used by the Cultural Resources Division to contract and distribute funds through the Cultural Facilities Program appeared to meet the requirements set forth in the King County Code Section 4.42.

Finding II-3. The funding of computer equipment may not meet the definition of fixed assets as specified in the King County Code.

The Cultural Facilities Program regularly funds the purchase of computers and related equipment such as computer printers. The King County Code defines fixed assets as "tangible objects such as machinery or equipment intended to be held for ten years or more which will benefit cultural institutions." It is uncertain whether assets such as personal computers and computer-related equipment will be useful for ten years or more.

The audit recommended that the Cultural Resources Division determine whether personal computers and related equipment meet the definition of fixed assets per the King County Code, and whether Cultural Facilities Program funds will be used to purchase assets such as personal computers and related equipment.

Finding III-1. The process to award funding through the Cultural Education Program appeared satisfactory.

The purpose of the Cultural Education Program is to "enrich existing and create new comprehensive and sequential cultural education programs." Programs receiving funding must be "developed by cultural organizations, independent artists or heritage specialists in joint cooperation with a public school or school district."

The audit found that the process followed by the Cultural Resources Division to award grants through the Cultural Education Program appeared to meet the mandates of King County Code 4.42.

Finding IV-1. The process to award funding through the Special Projects Program appeared satisfactory.

The purpose of the Special Projects Program is to "fund innovative arts projects, heritage endeavors, and collaborative programs which reflect the cultural and geographic diversity of King County." Grants are made to "arts and heritage organizations, individual artists, heritage specialists, community educational organizations and community arts groups, and public agencies which reflect the multi-cultural, ethnic and geographic diversity of King County."

The review of project applications was similar to the review used by the panels for the Cultural Facilities Program and the Cultural Education Program. The Cultural Resources Division, through the Executive, submitted an annual report for Council review.

The audit found that the process to award funding through the Special Projects Program appeared to meet the requirements of the King County Code Section 4.42.

Finding V-1. All the Hotel/Motel Special Support Program funds were allocated to stadium capital improvements.

Twenty-five percent of hotel-motel tax revenues collected for King County in excess of $5.3 million are to be allocated to the Hotel-Motel Special Support Program and used for the following purposes and in a manner reflecting the following order of priority: stadium capital improvements, acquisition of open space lands, youth sports activities, and tourism promotion.

The audit found that during 1994 and 1995, the entire Special Support Program fund amounts were allocated for stadium capital improvements. No hotel-motel funds were used for acquisition of open space lands, youth sports activities, or tourism promotion.

Updated: 06/24/02