The taxes visitors pay on overnight lodging will be up for debate at the Bend City Council meeting Wednesday night where councilors are slated to decide if a two percentage point increase should be sent to voters for approval.
The issue has drawn contentious arguments on both sides – those in favor say raising taxes from 9 percent to 11 percent would help boost marketing out-of-state while opponents maintain that a tax increase would harm business during a fragile economic recovery.
Raising taxes would generate upwards of $850,000 in increased taxes for the city, according to city estimates. By state law, the city would allocate 70 percent of the TRT collections increase to tourism promotion efforts and 30 percent to the city’s general fund.
By those projections, Visit Bend, which contracts with the city to market tourism, could receive an estimated $600,000 budget increase from its current budget of $1.2 million. The visitor bureau could use the increased dollars to market
“This is an opportunity to expose visitors to this area which tends to lead to people wanting to relocate here and move businesses here,” King said.
Opponents dispute the city’s projections, saying that higher room taxes would deter visitors, including large groups, from
“I would argue that it will pass through to local residents in the form that it might affect tourism adversely,” said Scott Ramsay, a
Opponents, who include Ramsay and Wayne Purcell, managing partner of The Riverhouse Hotel, argue that shifting marketing efforts to attract out-of-state visitors would benefit some hotels and lodging property owners more than others.
“It’s a money shift to some degree,” Purcell said. “Customers who come from
Ben Pearle, regional vice-president of operations with the Oxford Hotel Group in
“(Opponents) are basically placing judgment on those people from
The issue has significant consequences for various businesses associated with
In-state visitation, meanwhile, has dropped during summer from 40 percent of the total visitation to 33 percent, according to RRC.
Judith Light, a frequent visitor to
“I do not understand the logic of asking your core visiting clientele to help fund a marketing campaign to attract a smaller out-of-state clientele,” she wrote in her letter. “Your core ‘local’ clientele will not see any benefit from paying these higher taxes other than possibly more crowded recreation venues.”
Nine out of the ten letters received by the City of
Visit Bend, which markets tourism for the city, supports the ordinance that would raise lodging tax rates by 2 percentage points, but its board of directors wrote in a written statement that it would defer to citizens and businesses to “lead the conversation and voice their thoughts” on raising the rates.
City officials liked the idea of a tax that could boost tourism and the general fund without burdening local taxpayers.
“Right now, I think it is a good thing to do for the community,” said Bend City Councilor Mark Capell. “The vast majority of cities are charging more for tourism than we are which means we’re leaving money on the table.”
According to data provided by Visit Bend, the city is currently charging 10 percent on overnight visitors, which includes a 1 percent state tax. The tax would increase to 12 percent under the proposed increase, second highest in the state among cities. Other cities in Oregon including Seaside, Hood River, Astoria, and Portland are charging rates of 9, 10 and 14.5 percent, respectively, according to Visit Bend’s data.
The Riverhouse, in fact, charges up to 3 percent additional fees for services including Internet, free local phone calls and use of the tennis courts.
Those fees are not mandatory and many people choose not to pay them, Purcell said.
Many hotel properties charge fees for such services as parking and Internet, explained Purcell, who compared them to airport baggage handling fees now common in the airline industry.
According to Doug La Placa, Visit Bend’s executive director, the higher fees charged by The Riverhouse and Central Oregon resorts demonstrate how raising taxes would not deter visitors from coming to
“The primary argument against raising the city’s TRT rate to 12 percent is that the increased rate will discourage tourists from visiting
GETTING THE MEASURE ON THE BALLOT
Bend City Councilors will discuss the idea to increase transient room taxes assessed on all overnight lodging properties in city limits at Wednesday night’s meeting. Councilors could either pass on the idea or put the measure on the May ballot at this meeting. Or, they could wait and put the measure on the November ballot.
City Councilor Scott Ramsay, who also owns
Councilor Marc Capell sees the room tax as an opportunity because he believes it will bring more people to
“If we spend more money on marketing, will we be able to bring even more tourists here,” he said. “That would mean more people spending money on restaurants and other services. It is a tax that locals don’t have to pay that would improve the local economy. If you believe in marketing, it’s a great deal.”
Councilor Jodie Barram is in support of the increased room tax, but would like to discuss the timing of the ballot measure that already includes a possible School Board measure and a Deschutes County 911 operating levy. “My question is, are we going to overload this ballot with a variety of tax questions?” she asked. “Will this confuse voters?”
