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Yamhill to review options for collecting transient lodging tax; staff to consult state revenue agency
Summary
Councilors discussed a previously passed transient lodging tax (TLT) ordinance that has not been collected and asked staff to explore an intergovernmental agreement with the Oregon Department of Revenue; staff also flagged a pending House bill and potential county actions that could affect revenues.
Yamhill councilors on March 11 discussed how to implement a transient lodging tax (TLT) ordinance the city passed several years ago but has not yet collected.
City staff said the city’s ordinance appears to follow the Department of Revenue template but the city lacks the staff capacity to track short-term rentals (Airbnb/VRBO) and that the state can collect TLT on behalf of cities via an intergovernmental agreement. The administrator told the council the Department of Revenue would take administrative fees before sending net receipts to the city and cautioned that if collections are very small those fees could exceed revenue in some circumstances.
Staff said they had reviewed a Department of Revenue handbook and a model ordinance; the administrator asked the council whether to proceed with drafting an ordinance that would let the state collect and remit the tax. A councilor noted the state recently raised its TLT rate in the short legislative session and that a county proposal could add another layer of taxation, which might affect lodging demand and overall revenue.
Staff also referenced a House bill (discussed in the meeting as '3558') that, as described in the staff conversation, would direct roughly 70% of TLT receipts to tourism and could expand allowable uses to include public safety. Councilors asked staff to gather more information from the Department of Revenue and from county officials before asking the council to adopt implementing resolutions or an IGA.
No formal action to adopt a collection method was taken; staff will return with additional information about expected administrative costs, sample revenue estimates for small numbers of rentals, and model ordinance language for council review.
