That’s what “two downtown hotel executives” (Donald Welch of the Hotel Pere Marquette and Sami Quereshi of the Holiday Inn City Centre) told the Journal Star. They are quoted in the paper as advocating a quarter-percent increase in the overall HRA tax to “draw large conventions and out-of-towners to Peoria.”
A quarter-percent increase in the (HRA) tax could generate $750,000 to $800,000 to the tourism reserve fund, allowing the Peoria Area Convention and Visitors Bureau to market the Civic Center and other venues to larger-scale conventions and events….
“The impact [of the tax increase] on the individual is insignificant,” [Welch] said. “The impact to the community to have a fund to attract conventions, out-of-towners, is huge.”
Well, that certainly defies conventional wisdom, doesn’t it? Ironically, there was an article in the State Journal-Register yesterday that says the exact opposite. Apparently there’s a proposal by a city alderman to raise Springfield’s hotel tax, and hoteliers are speaking out against it:
Michael Fear, general manager of the Hilton Springfield downtown, said the higher tax would raise only a pittance for the city but could rob Springfield of its competitive advantage when it comes to tourism. “It’s a bad idea,” Fear said. “We are able to attract conventions because of our tax rate. For large meeting planners, 1 or 2 percent can be thousands of dollars. It may be the difference between coming here and not coming here.”
In Springfield, the hotel tax is 10%, so the proposed increase would put it up to 11 or 12%. Here in Peoria, the hotel tax is 11.5%, and a quarter-percent increase would raise it to 11.75%. In Springfield, a tax rate that high would “rob Springfield of its competitive advantage when it comes to tourism.” In Peoria, a higher tax rate “could draw large conventions and out-of-towners to Peoria.” If anyone can figure that out, please explain it to me.
I also love the way hoteliers have turned Economic Development Director Craig Hullinger’s original proposal of a voluntary hotel tax into an overall HRA tax increase proposal in a little over a week and a half. That didn’t take long, did it?
This proposal should be blown out of the water immediately. The HRA tax was supposed to be temporary and for a single purpose — to support the establishment of the Civic Center. It was never supposed to be permanent nor a source of revenue for other agencies (although that hasn’t stopped the city from funding agencies like ArtsPartners from the proceeds).
Besides, didn’t the Civic Center just spend $55 million for expanded convention space so that that development would bring in tons of tourists and boost our economy? Didn’t the council just approve extending the HRA tax another 30 years for that effort? What, that wasn’t enough? Now we need to raise the HRA tax even more?
Hey, I have an idea: why don’t we all just set our money on fire instead?
