As states and localities continue to struggle with budget problems, they are increasingly turning to a time-honored source for more dollars: out-of-towners. Tourism taxes are going up all over, with states taking their share from a traditionally local revenue stream.
Oregon Governor Ted Kulongoski pushed through a new hotel-motel room tax last year, a move his colleague to the north, Alaska Governor Frank Murkowski, would like to emulate. Murkowski's fiscal 2005 budget includes a 5 percent "transient accommodation" tax on rooms and a $5 per person per night fee for people sleeping in cruise ships in Alaska waters.
The plan would raise $15 million but met with early opposition from Anchorage officials. They were hoping to raise bed taxes themselves to pay for a new convention center, and their plans for a ballot initiative would be effectively preempted by the state increase.
Meanwhile, other localities across the country--from Onondaga County, New York, to Gage County, Nebraska--are looking at tourism tax increases. Sometimes, the proposed uses for the bed-tax money don't seem that connected to tourism. In Pismo Beach, California, some residents wanted the city council to raise bed taxes to pay for a renovation of the sewage treatment facility. Their reasoning was that 2 million annual visitors exert more wear and tear on the system than the town's 7,000 residents. But city council member Bill Rabenaldt argued visitors would soon find other beaches to frolic on if the city started imposing surcharges on them to finance street repair, utilities, signage and pier repair.