With the Fourth of July weekend roaring towards downtown faster
than a speeding Harley, Hollister Independence Rally organizers are
scrambling to make sure this year’s festivities mark the beginning
of a financially-sound franchise for both HIRC and the local tax
rolls.
Hollister – With the Fourth of July weekend roaring towards downtown faster than a speeding Harley, Hollister Independence Rally organizers are scrambling to make sure this year’s festivities mark the beginning of a financially-sound franchise for both HIRC and the local tax rolls.
For starters, several HIRC representatives, City Manager Clint Quilter and City Councilman Robert Scattini attended a meeting with State Sen. Jeff Denham, R-Merced, in Sacramento Friday to see if the state might be willing to give HIRC a break on its charges for sending extra peace officers to the rally.
“We met with Jeff Denham and basically told him our case, that we feel that because of the tourism and the people who come to the state and spend more than one or two days here – a lot of people come in from out of the country or out of the state – and the fact that hotels from here to Gilroy to Morgan Hill are completely booked and people are in overflow to Monterey County, we feel that it justifies them giving us some relief on the state bills, from CHP (California Highway Patrol), DOJ (Department of Justice), and State Parole,” said HIRC Executive Director Helen Nelson.
Last year, the annual rally was almost canceled when it looked as though HIRC wouldn’t be able to secure all of the necessary peace officers to watch over the event that draws around 100,000 motorcycle enthusiasts to downtown Hollister.
But this year may be the start of a new chapter for HIRC, according to Nelson.
“Jeff (Denham) was very open with what we had to say, and he said he’s already talked to the governor about this and the governor would be willing to put some auditors on it to come down and see what direction we’re moving in,” she said.
The committee is also putting together plans to make sure all of the rally vendors’ earnings and taxes are fully accounted for.
At last year’s rally, organizers tried out a mandatory cash register system in hopes of keeping track of vendors’ sales and subsequently how much money in sales tax they owed to the city, county and state. But this year, Nelson said, “it’s really not logistically feasible” to use the registers again.
Most rally vendors only file their incomes with the state yearly or sometimes quarterly, Nelson explained, and it’s tough to notice a financial hike from one event when its earnings are spread out over several months or even a year. And often traveling vendors don’t note where they were at the time they made sales when they file with the Board of Equalization (BOE), she added. This can keep the city and county from earning their fair cut in sales tax, she said, since the state gives San Benito County 11 cents for every tax dollar the county brings in.
In fact, HIRC still doesn’t have numbers for how much vendors did in sales at last year’s rally, and Nelson said “it’s not realistic” that they’ll ever know for sure.
So this year the rally committee is trying something new. Rally vendors will have to fill out the same BOE forms they send to the state and return them to HIRC, showing exactly how much money they make during the three-day event. When the BOE sends HIRC information at the end of the year regarding who was at the rally and how much money they made, Nelson will have information to check it against, she said.
And the forms offer another plus in that they discourage vendors from lying about how much money they actually earn over the rally weekend. If they don’t report making very much money at the event, HIRC will know that they are either lying or are not making a profit, and those vendors will be asked not to return the following year.
“We’re just working really hard to make sure that the revenues that are generated here are actually credited to this city and this county and this state,” Nelson said.
Other large annual events, like the Gilroy Garlic Festival, the Big Bike Weekend in Redding, and the Sturgis Motorcycle Rally in Sturgis, South Dakota aren’t responsible for keeping track of the same information. According to Garlic Festival Office Manager Chris Filice, organizers of that event don’t collect sales figures, opting instead to charge a flat-fee for vendors to rent booths, which HIRC does not. These fees can range from $575 for three days for an arts and crafts booth to $1500 for a food vendor. Those fees go straight to the festival, and organizers let the state worry about the taxes when vendors file with the BOE at the end of the quarter or year.
In Redding, vendors at the Big Bike Weekend also pay a booth fee, according to Committee Chair Connie Grinols, and event organizers aren’t responsible for gathering their tax information.
For about the past 10 years in Sturgis, the state has been sending one to two dozen officials who set up temporary shop in the South Dakota town and issue vendor licenses to each vendor, according to City of Sturgis Rally Department Director Lisa Weyer.
“With all those teams they have, they can actually go out and audit individual vendors every day,” Weyer said. And the state does it for free, she added. “That’s what they do in order to collect the amount of taxes the state gets, too, which is a high amount.”
But Nelson said this state isn’t forcing HIRC to do any extra work it’s not ready and willing to take on of its own accord.
“We aren’t required to (track vendor earnings), we want to do it so we know what’s happening,” she said.
Jessica Quandt covers politics for the Free Lance. Reach her at 831-637-5566 ext. 330 or at [email protected].
