Council sorts out room tax details
Councilors indicated they are leaning toward a rate of 7.5 percent to 8 percent, on top of the 1 percent already assessed by the state. They assured the agencies they would be careful and responsible with the additional money a higher rate would raise.
Newberg charges 6 percent and Carlton 7.5 percent, according to City Manager Kent Taylor. But some tourist locations around the state — and region — charge significantly more.
“We do not have any history suggesting we will not be good stewards,” noted Councilor Scott Hill.
“It will be used responsibly,” said Councilor Kellie Menke. “There are no issues there whatsoever.”
Phil Hutchinson of the chamber and Cassie Sollars of the downtown association suggested the city start at 6 percent. They said the council could always raise the rate later, if it concluded additional revenue was needed.
However, councilors rejected that idea. They advised staff to return next meeting with a draft reflecting their views.
Taylor has advised the council to schedule a public hearing, once it has settled on a tentative course of action.
The council also plans to establish an advisory committee to review proposals for use of the 70 percent mandated for tourism-related spending. It plans to include representatives of the lodging industry.
Hutchinson and Sollars said that’s a good idea — one that has proved its worth with jurisdictions around the state. Including members of the affected industry in discussion of how the proceeds would be allocated is an important component, they said.
Mayor Rick Olson proposed the idea of dedicating at least a portion of the money to the airport, where the city has coveted a new Fixed Base Operation for years.
Taylor discouraged locking in restrictions, though. “I think the main thing is to give yourselves and future councils maximum flexibility to make budget decisions as needs change,” he said. And that seemed to draw wide agreement as the discussion continued.
Councilors suggested putting the tax into effect on Jan. 1, 2014, and making the collections due quarterly. However, they took the advice of several participants in specifying monthly financial reports for better tracking.
Two members of the public, MDA public art committee chair Stephen Rupp and local photographer Bill Miller, joined in the discussion.