Ottertail to wait on adopting 3 percent lodging tax
After meeting with representatives from various lodging institutions, Ottertail City Council member Terry Wagenman reported to the rest of the council that the group has decided to wait on adopting a lodging tax for the city.
The concept of imposing a 3 percent lodging tax was recently brought up with the city of Perham's decision to implement such a tax to help promote the area. The idea behind the tax is that by taxing local lodging facilities, the money from that tax can go directly toward promoting the area and bringing in more tourists.
It is not uncommon for cities to have a lodging tax, with those dollars collected bringing in revenue for marketing a given area. When approached by representatives from Perham about the tax, the Ottertail City Council decided the decision to adopt the tax should be made by members of the city's lodging industry.
In order to discuss the city's adoption or rejection of a lodging tax, various parties gathered together on Feb. 11. Those in attendance at the Ottertail meeting included Terry Wagenman, Ottertail City Council member; Ron Sugdon, Ottertail Tourism; Vicki Boom, Thumper Pond; Linda Buchanan, The Otter Supper Club and Lodge; and Brad Stevens, Thumper Pond.
The committee members ultimately decided that they needed more information about the tax before coming to any conclusions. At the Feb. 18 Ottertail City Council meeting, Wagenman reported to the council that the city's lodging facilities are not completely against the tax.
"It's a positive thing we want to continue to talk about," said Wagenman. "We'd like to keep as much money locally as possible, if or when this happens."
Ottertail Mayor Raymond "Ole" Mounts questioned Wagenman about whether the lodging tax the group is considering would be a separate thing from what is happening in Perham. Wagenman said that Ottertail's tax would be separate.
Although the city of Ottertail is not planning on entering into an arrangement with the city of Perham right now, Wagenman said the committee is looking into the possibility of working with other cities. He mentioned that they would still like to meet with Perham representatives in the future to discuss some type of an arrangement that would benefit both cities.
Brad Stevens, who has served as the new general manager of Thumper Pond for the past month, said that the committee's consensus was to slow down the process a little bit and make sure what they're doing is right.
Stevens reported that, after examining the funds generated during this past year, they'd be looking at about $30,000 raised through the lodging tax in any given year. His main concern was that the money from the tax stay local, to directly feed the Ottertail lodging industry. Presently, Thumper Pond Resort and The Otter Supper Club and Lodge are the only two lodging facilities within the city limits.
"It's not just buying ads or billboards," Stevens reminded the council when discussing what the tax would be used for, "it's focusing on whatever it takes to support your community."
The Ottertail committee will continue to meet, with a goal of finding a lodging tax rate appropriate for the city. If the city decides to move forward with a 3 percent tax, the local lodging facilities would turn over 3 percent of their proceeds to the city of Ottertail. The city would then keep 5 percent for their share in the administrative work in making the collections. The rest of the money would be allocated to promoting the Ottertail area.