WATERLOO - The city has agreed to provide financial support to help the RiverLoop Expo and Waterloo Public Market get up and running.

City Council members voted 6-0 Monday to approve a $20,000 grant from hotel-motel tax revenues to provide start-up operating funds to Waterloo Expo Services Corp.

WESCO, a newly formed nonprofit organization, will promote, book and operate the $4.5 million exhibition area under construction between Park Avenue, Bluff, West Third and Commercial streets.

The city owns the facility, which is expected to host its first major event, My Waterloo Days, at the end of May. Last month, council members approved an agreement for WESCO to manage the Expo.

Mayor Tim Hurley said the initial operating costs would cover dram shop insurance, liability insurance and various licenses WESCO needs so the site can host My Waterloo Days at the end of this month.

"As with any start-up organization, cash flow in the first year is critical," Hurley said. "I believe it will take $50,000 to fund WESCO for the first year, at which time it will be established and bringing in revenues over expenses."

Hurley said he was only seeking the $20,000 hotel-motel funding. WESCO will need to find the remaining operating funds from other sources.

Councilman Steve Schmitt supported the grant, but said he thought the start-up funding wasn't supposed to come from city coffers.

"I know it's going to be a great project once it gets up and running," Schmitt said. "Can we assume this will be the end of the surprises?"

Hurley replied, "Going forward we would expect this Expo/Public Market to be self-sustaining."

"We did get the cart before the horse," he said. "We had a structure before we had a manager. We had a manager before we had liquidity - cash flow."

The hotel-motel revenue, generated from a surtax on overnight lodging, is awarded at the discretion of the council to projects that promote or enhance tourism.