City plans major hotel tax hike to boost tourism funding

During a recent government meeting, officials discussed the proposed increase of the hotel-motel tax from 3% to 8%, a move anticipated to significantly boost local revenue. The current budget allocates $200,000 for the popular third Friday concert series, with an additional $75,000 earmarked for the general fund. The increase in tax is expected to generate over $275,000 annually, which would help alleviate pressure on the general fund.

City representatives expressed optimism about the legislative process, noting that similar tax increases have historically faced few challenges when supported by local representatives. The additional 5% tax revenue will be restricted to tourism-related initiatives, including funding for parks and recreation, and necessitates the establishment of a Destination Marketing Organization (DMO), commonly known as a Convention and Visitors Bureau.

While the tax increase is proposed for the upcoming state legislative session, officials anticipate that if passed, it could be enacted by July 1, allowing for some revenue collection in the fourth quarter of the fiscal year. Currently, the city collects approximately $300,000 annually at the 3% rate, and the increase is projected to have a substantial long-term impact on local funding for tourism and community events.