Loading...
HomeMy WebLinkAbout2008-08-27 Lodging Tax CommentsAugust 13, 2008 '859 WAYNE SCOTT STATE REPRESENTATIVE Oregon House of Representatives, House District 39 Dave Kanner Deschutes County Administrator 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Mr. Kanner, I am writing to express my concern over the proposed room tax increase being discussed in Deschutes County and offer my insights as to the passage of House Bill 2267 during the 2003 legislative session. During the 2003 session, I served as the Vice Chair of the Revenue Committee for the Oregon House of Representatives. Additionally, I carried the bill on the House floor. It is absolutely clear that the intent of the 70-30 split was negotiated to allow up to 30% of any new room tax be allocated to cities and counties for local services. These services could include local roads and infrastructure, county fairgrounds, police, fire or any other local services as deemed appropriate. The remaining 70% (or more) was intended for tourism related marketing and/or facilities as defined in the bill. It was never the intention to have roads funded out of the 70% tourism allocation outlined in HB 2267. The bill's intent was the reinvestment of these important tax dollars to help grow the tourism contribution to the local economy by dedicating revenue to promotion and facilities that attract tourists, conventions, trade shows, and statewide meetings which could ultimately generate more room nights and the associated visitor spending. Tourism is a major socio-economic driver for the state of Oregon generating tens of thousands of jobs and millions of dollars in state and local tax receipts. Any consideration of a tax increase should be done cautiously and in cooperation with the local impacted industry. Given the economic slowdown across the state, I would caution the Commission on the possible negative impact that any increase in the lodging tax may have. Again, I urge you to work with the tourism industry as you consider policy decisions that will directly imp t their busine es and the health of the Deschutes County economy. Sincere Wayne : c , rego State ' -prese ative cc: Dave Kanner, County Administrator Oregon Lodging Association Capitol: 900 Court Street NE, Salem, OR 97301 - (503) 986-1439 rep.waynescott@state.or.us District: PO Box 664, Canby, OR 97013 - (503) 266-7589 5LJNftIVEft� Post Office Box 3609 Sunriver, Oregon 97707 Telephone 541-593.1000 Reservations 800-547-3922 www.sunriver-resort.com August 13, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners: As the Managing Director of Sunriver Resort and a major employer in Deschutes County, I am deeply concerned over the proposed room tax increase. Our business relies on tourists and locals to succeed. Given the economic slowdown in Central Oregon—and across the state—the tax increase from 7% to 9% is significant and represents a 28.6% increase to our guests: Statistics show that when consumers are expected to contribute more, consumers will decrease their spending in other areas. Before taking further action, I urge you to remember that even slight changes can have a detrimental effect on Sunriver Resort and our employees. I am aware that there has been talk of using new revenue for roadwork. l am also aware that state law says that any increases in the lodging tax must be allocated with no less than 70% of the increase being dedicated to tourism promotion and tourism related facilities. Should a lodging tax even be considered, let the lodging industry and COVA help determine the best use of room tax for marketing promotions that deliver the highest return on the investment to benefit the entire county. By bringing more people to visit and come to Deschutes County, revenue for all businesses AND the county will increase. I respectfully recommend that you work with the lodging industry and other members of the tourism and hospitality industry to reach a solution that is amenable to all parties. Local hotel and resort operators axe an integral part of Deschutes County and should be a part of finding a solution that benefits all of us. Sincerely, Tom O'Shea Managing Director, Sunriver Resort cc: Dave Kanner, County Administrator A distinctive experience provided by Destination Hotels & Resorts. ASPEN • BOSTON • CHARLESTON • CHICAGO • COLORADO SPRINGS • DALLAS • DENVER • FLORHAM PARK • JACKSON HOLE LA JOLLA • LAKE TAHOE • MAUI • NEW YORK • PALM COAST • PALM SPRINGS • PHOENIX • PORTLAND • ROSLYN • SAN DIEGO SAN FRANCISCO • SNOWMASS VILLAGE • SUNRIVER • TARRYTOWN • TELLURIDE • TEMPE • VAIL • WASHINGTON DC www.destinationhotels.com OREGON LODGING,. ASSOCIATION ...._...___.......__..._.......... _... August 13, 2008 Dave Kanner County Administrator Deschutes County 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Dave, On behalf of the Oregon Lodging Association (OLA), and in preparation for Friday's meeting with Deschutes County lodging operators, l would like to request a couple of items. First, you have mentioned in the past that you have determined that roads are an appropriate use of the portion of new or increased transient lodging tax revenue that Oregon statute restricts for use on tourism promotion or tourism facilities. Can you please help OLA understand how the County has come to this conclusion? It appears that the intent of any room tax increase being discussed with the County Commission would be used to support roads, Second, there has been much discussion at the County level that the Deschutes County Fairgrounds and Expo Center qualify for transient room taxes. Again, can you help clarify by what means and measurements was the determination reached that these facilities meet the definitions as outlined in state statute? Clearly OLA has a vested interested in the discussions surrounding the use of room taxes as well as the outcome of decisions being made in Deschutes County. Clarification of these questions will help make the meeting this Friday more productive. Don't hesitate in contacting me if I can answer any questions. I look forward to a productive meeting on Friday. J. Gregg Mindt President & CEO cc: Deschutes County Commissioners Deschutes County Lodging Operators OLA 18600 SW Salish Lane, Suite 3 Wilsonville, Oregon 97070 503-783-2797. 503-783-2798 '_ : info@oregonlodging.com August 13, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, I am writing to you as the General Manager of the Sunriver Owners Association (SROA) to express my concern over the proposed room tax increase. Sunriver relies on tourists and locals to succeed. Given the economic slowdown in Central Oregon — and across the state — I, too, am concerned about the impact that any increase in the cost of a vacation will have on Sunriver's businesses, employees and the Sunriver Owners Association in general. In addition to the 7% room tax paid to the county, the vacation rental managers and Sunriver Resort pay SROA an additional 2.5% of their room night revenues to support Sunriver's recreation facilities and programs. An increase in the room tax could jeopardize this needed revenue for our association and have serious impacts on Sunriver's recreational facilities. I certainly understand the need to increase revenues to make up for lost income. Our association is also struggling with a loss of revenue that can be attributed to difficult economic times and we are looking at ways to make that up. However, anything that might cause a reduction in what the vacation rental managers and resort currently agree to pay SROA in support of our recreational amenities will have far reaching financial consequences on our association. I support the vacation rental managers and the resort in their concerns and the points they have raised. I respectfully recommend that you work with the lodging industry and other members of the tourism and hospitality industries to reach a solution that is acceptable to all parties. Local property management companies and resort operators are an integral part of Deschutes County and should be a part of finding a solution that benefits all of us. Thank you. Sincerely, Bill Peck, CMCA, AMS General Manager Sunriver Owners Association cc: Dave Kanner, County Administrator August 13, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, I have followed the news regarding the proposed room tax increase. I am concerned that this proposal will further harm our already soft residential real estate market. Over 80% of our buyers in the Sunriver area are purchasing for vacation use. Many of these owners rely on rental revenue to help pay for their vacation home. Increased occupancy taxes reduce discretionary vacation dollars, and in turn could reduce length of stay and hurt overall occupancy and revenue for these owners. The ripple effect could further soften our already weak real estate market. I read about your plan to use the new revenue for road maintenance. I have learned that state law requires 70% of any lodging tax increase be used for tourism promotion and tourism related facilities. Roads are used by everyone - not just visitors, and it's not right to use the tax money in this way. I ask that you work with COVA and other lodging industry leaders to find a more amicable solution that keeps in mind the community benefit of a healthy lodging and real estate industry. John Fettig Principal Broker Sunriver Realty and Caldera Springs cc: Dave Kanner, County Administrator 541 593 7000 MAIN 541 593 5123 Fax 800 547 3920 TOLL FREE P.O. Box 3650 Sunriver, Oregon 97707 www.SunriverRealty.com SUNRIVER OWNERS ASSOCIATlOW MAINTAINING SUNRIVER AS A PREMIER RESIDENTIAL AND RESORT COMMUNITY PROTECTING AND ENHANCING ITS QUALITY OF LIFE, NATURAL ENVIRONMENT AND PROPERTY VALUES. August 13, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, I am writing to you as the General Manager of the Sunriver Owners Association (SROA) to express my concern over the proposed room tax increase. Sunriver relies on tourists and locals to succeed. Given the economic slowdown in Central Oregon — and across the state — I, too, am concerned about the impact that any increase in the cost of a vacation will have on Sunriver's businesses, employees and the Sunriver Owners Association in general. In addition to the 7% room tax paid to the county, the vacation rental managers and Sunriver Resort pay SROA an additional 2.5% of their room night revenues to support Sunriver's recreation facilities and programs. An increase in the room tax could jeopardize this needed revenue for our association and have serious impacts on Sunriver's recreational facilities. I certainly understand the need to increase revenues to make up for lost income. Our association is also struggling with a loss of revenue that can be attributed to difficult economic times and we are looking at ways to make that up. However, anything that might cause a reduction in what the vacation rental managers and resort currently agree to pay SROA in support of our recreational amenities will have far reaching financial consequences on our association. I support the vacation rental managers and the resort in their concerns and the points they have raised. I respectfully recommend that you work with the lodging industry and other members of the tourism and hospitality industries to reach a solution that is acceptable to all parties. Local property management companies and resort operators are an integral part of Deschutes County and should be a part of finding a solution that benefits all of us. Thank you. erel ill Peck, CMCA, AMS General Manager Sunriver Owners Association Dave Kanner, County Administrator AUG 1 8 2008 BOARD OF COMMISSIONERS AOM1NIS1RATION ! r`.SSa•n 57455 ABBOT DRIVE • P.O.BOX 3278 • SUNRIVER,OREGON 97707 • (541)593-2411 • TOLL FREE (888) 284-6639 • FAX (541) 593-5669 www.sunriverowners.org Dave Kanner From: Gary & Beverly Forrest [mammers3@comcast.net] Sent: Thursday, August 14, 2008 2:53 PM To: Dave Kanner Subject: proposed increase in transient room tax I am violently opposed to the proposed tax. I reside in Olympia and own a rental home: in Sun River. Obviously, I cannot vote, but let's be honest and not try to make up for your budget in one area only. I already pay over $5000 in property tax, and my fair share with the rental taxes. Please look for other options. Sincerely, Gary Forrest Golden Eagle 17 1 Page 1 of 1 Dave Kanner From: Ed Young [ed.youngl@comcast.net] Sent: Thursday, August 14, 2008 2:39 PM To: Tammy Melton; Dennis Luke; Mike Daly; Dave Kanner Cc: Larry Browning Subject: Proposed 2% room tax increase I am writing to you in opposition to the proposed 2% room tax increase. I own a rental home in Sunriver (10 Fawn Lane), and am very concerned over how this tax increase may affect my rentals. I am losing money already, and this will make things worse. Don't kill the goose who laid the golden egg. The homeowners in Sunriver who rent out their homes are a cash cow for Deschutes County. An increase in taxes will not translate into the increased revenue that you expect, for the number of days rented will drop. In fact, you may end up with less tax revenue, while forcing everyone serving these out of town guests to suffer in the process. Please consider the following data: The slow down in the economy over the past few years is clearly beginning to have an adverse effect on the tourism industry as a whole, and the lodging sector in particular. Smith Travel Research, the lodging industry's leading information and data provider, closely scrutinizes occupancy rates and trends in the lodging industry. Smith Travel Research's analysis shows occupancy growth at zero percent in 2008 nationwide. This flat projection comes on the heels of relatively flat occupancy rates over the past four years. Smith Travel Research shows occupancy at 50.5% in 2004, 51.7% in 2005, 53.3% in 2006 and 52.6% in 2007. Many Central Oregon resort operators predict that the industry is experiencing the worst economy in eight - plus years. These factors indicate that the timing for an increase in the transient occupancy tax is not in the best interest of the Deschutes County tourism economy, including restaurants, gifts shops, lodging facilities, and other businesses that rely on tourism to survive. A 2003 study titled Room Taxes and Economic Impact of the Lodging Industry, conducted by the American Economics Group Inc. ("AEG"), also sheds some light on the impact that a tax increase may have on the overall tourism industry in Deschutes County. The study suggests that an increase in the lodging tax causes some travelers to stay fewer days, visit less often and/or make other adjustments in their spending (i.e. retail, restaurants, entertainment, etc.). The executive summary to the AEG report states that "Econometric analysis reveals that on average a 2.0% increase in the combined tax on hotel and motel rooms will cause about a 2.4% reduction in sales and associated visitor spending." While a considerable amount of complex economic data was analyzed to produce this report, the conclusion is clear that an increase in lodging taxes results I n a negative impact across a broad spectrum of tourism -related businesses. Sincerely, Ed Young/Salem, Oregon (Sunriver homeowner) 8/14/2008 Page 1 of 1 Dave Kanner From: Sandra Jones [sandy@eagleladymultimedia.com] Sent: Thursday, August 14, 2008 4:01 PM To: Dave Kanner Subject: Unfair Tax increase I do not believe that one industry (Lodging) should be singled out to raise revenue for shortfalls that arose because of broad economic changes. I do not believe that one industry (Lodging) should be singled out to raise revenue for shortfalls that arose because of poor planning and budgeting. I strongly oppose this tax increase! Thank you, Sandy Jones tel: 541-419-9487 • studio: 541-536- 3794 • WWW.EagleLadyMultimedia.com 8/14/2008 August 14, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, lam the Director of Client Services for DVA Advertising & Public Relations and I am writing to express my concern over the proposed room tax increase. Many of our clients are directly or indirectly reliant on tourism. Given the economic slowdown in Central Oregon—and across the state—I am concerned about the impact that any increase in the cost of travel will have on our business and employees. Before taking further action 1 urge you to remember that even slight changes can have an effect on my business. A decrease in spending by travelers can occur if they see an increase in their tax rate at hotels and resorts. I am aware that there has been talk of using new revenue for roadwork and I am also aware that state law says that any increases in the lodging tax must be allocated with no less than 70 percent of the increase being dedicated to tourism promotion and tourism related facilities. I don't believe that roads are a tourism facility and I don't support using any new money for this. Should a lodging tax even be considered, let the lodging industry and COVA help determine the best use of room tax for marketing promotions that would deliver the highest return on the investment to benefit the entire County. If we can get more people to come to Deschutes County, revenue for all businesses AND the county will increase. 1 respectfully recommend that you work with the lodging industry and other members of the tourism and hospitality industry to reach a solution that is amenable to all parties. Local hotel and resort operators are an integral part of Deschutes County and should be a part of finding a solution that benefits all of us. Thank you. Sincerely, Mary L. Ramos DVA Advertising & Public Relations cc: Dave Kanner, County Administrator Page 1 of 1 Dave Kanner From: Leonard & Karen Cross [Ikabcross@comcast.net] Sent: Thursday, August 14, 2008 6:51 PM To: Dave Kanner Cc: Karen and Leonard Cross Subject: I oppose the room tax increase I oppose the proposed 2% room tax increase that would go on the November ballot. My opposition is based on a number of factors, but they include: 1. The slow down in the economy over the past few years is clearly beginning to have an adverse effect on the tourism industry as a whole, and the lodging sector in particular. Smith Travel Research, the lodging industry's leading information and data provider, closely scrutinizes occupancy rates and trends in the lodging industry. Smith Travel Research's analysis shows occupancy growth at zero percent in 2008 nationwide. This flat projection comes on the heels of relatively flat occupancy rates over the past four years. Smith Travel Research shows occupancy at 50.5% in 2004, 51.7% in 2005, 53.3% in 2006 and 52.6% in 2007. Many Central Oregon resort operators predict that the industry is experiencing the worst economy in eight -plus years. These factors indicate that the timing for an increase in the transient occupancy tax is not in the best interest of the Deschutes County tourism economy, including restaurants, gifts shops, lodging facilities, and other businesses that rely on tourism to survive. 2. A 2003 study titled Room Taxes and Economic Impact of the Lodging Industry, conducted by the American Economics Group Inc. ("AEG"), also sheds some light on the impact that a tax increase may have on the overall tourism industry in Deschutes County. The study suggests that an increase in the lodging tax causes some travelers to stay fewer days, visit less often and/or make other adjustments in their spending (i.e. retail, restaurants, entertainment, etc.). The executive summary to the AEG report states that "Econometric analysis reveals that on average a 2.0% increase in the combined tax on hotel and motel rooms will cause about a 2.4% reduction in sales and associated visitor spending." While a considerable amount of complex economic data was analyzed to produce this report, the conclusion is clear that an increase in lodging taxes results in negative impact across a broad spectrum of tourism -related businesses. 3. The lodging industry should not be singled out to cover shortfalls in the County Budget due to broad economic changes and lack of proper planning. I appreciate that budget challenges exist, and that creative solutions need to be found, but this feels like the wrong solution, and one that will actually create larger problems for our collective future. A concerned home owner, Leonard Cross 8/15/2008 Page 1 of 2 Dave Kanner From: Richard Jenkins [Richard.Jenkins@sa.ucsb.edu] Sent: Thursday, August 14, 2008 3:49 PM To: Dave Kanner; Tammy Melton; Dennis Luke; Mike Daly Subject: Consider Alternative Revenue Streams to supplement County Shortfall. Dear Commissioners, I am a property owner in Sunriver Oregon my address is 1 Cinder, Sunriver Oregon. I do not believe that one industry (Lodging) should be singled out to raise revenue for shortfalls that arose because of poor planning and budgeting. I write to express my opposition to the proposed County 2% increase tax for the following reason: • The County has been aware of this "Sunset" for at least five years. If they had been paying attention they would have been aware that the timber industry in Central Oregon has been subsiding for the last 20 years. Commissioners have been remiss in their duties to plan and budget appropriately for this upcoming shortfall. • Revenue from building permits has subsided. What happened to the increase in revenue from the boom Deschutes County experienced over the last five years? • Did you really expect Deschutes County to remain as one of the fastest growing counties in the country forever? • Maintenance of County Road 45 (the road from Sunriver to Mt Bachelor). Approximately 10 years ago discussions began involving the maintenance of Road 45. The expense for maintaining this road from its opening until now has been borne by Sunriver Resort, the Sunriver Owner's Association, Sunriver rental management companies and the US Forest Service. It was agreed by all parties involved seven years ago that once Road 45 was brought up to County standards (this was paid for by the Forest Service) the County would take over the maintenance of the road. Onc again, 10 years notice and no budgeting or planning regarding the transfer. • Lodging should not be singled out to raise revenue for shortfalls that arose because of broad economic changes. • The roads in Sunriver are maintained by the property owners here and you can begin to see what a cash cow Sunriver and the other Resorts like Eagle Crest, Black Butte and The Inn of the Seventh Mountain are to the County. I question what has been happening with all of these funds and why the County has singled out our industry to make up for the shortfall. • An increase in transient room tax not only affects the Lodging industry, it affects all of the support businesses associated with the lodging industry. This includes and is not limited to contractors, repair businesses, office supply business and others in addition businesses such as restaurants, gilt shops, hair salons and recreational vendors will experience a down turn in revenue. Should there is a decrease in revenue I am less likely to improve and upgrade my property. Vacationers are les, likely to dine out. Consider In Earnest: 1. The slow down in the economy over the past few years is clearly beginning to have an adverse effect on the tourism industry as a whole, and the lodging sector in particular. Smith Travel Research, the lodging industry's leading information and data provider, closely scrutinizes occupancy rates and trends in the lodging industry. Smith Travel Research's analysis shows occupancy growth at zero percent in 2008 nationwide. This flat projection comes on the heels of relatively flat occupancy rates over the past four years. Smith Travel Research shows occupancy at 50.5% in 2004, 51.7% in 2005, 53.3% in 2006 and 52.6% in 2007. Many Central Oregon resor 8/14/2008 Page 2 of 2 operators predict that the industry is experiencing the worst economy in eight -plus years. These factors indicate that the timing for an increase in the transient occupancy tax is not in the best interest of the Deschutes County tourism economy, including restaurants, gifts shops, lodging facilities, and other businesses that rely on tourism to survive. 2. A 2003 study titled Room Taxes and Economic Impact of the Lodging Industry, conducted by thy; American Economics Group Inc. ("AEG"), also sheds some light on the impact that a tax increase; may have on the overall tourism industry in Deschutes County. The study suggests that an increase in the lodging tax causes some travelers to stay fewer days, visit less often and/or make other adjustments in their spending (i.e. retail, restaurants, entertainment, etc.). The executive summary to the AEG report states that "Econometric analysis reveals that on average a 2.0% increase in the combined tax on hotel and motel rooms will cause about a 2.4% reduction in sales and associated visitor spending." While a considerable amount of complex economic data was analyzed to produce this report, the conclusion is clear that an increase in lodging taxes results in a negative impact across a broad spectrum of tourism -related businesses. 3. The lodging industry should not be singled out to cover shortfalls in the County Budget due to broad economic changes and lack of proper planning. Please consider alternative revenue streams to supplement Deschutes County budgetary shortfall. Respectfully submitted, Richard and Judy Jenkins 8/14/2008 Page 1 of 1 Dave Kanner From: Stanley Thomas [s.e.thomas@sbcglobal.net] Sent: Thursday, August 14, 2008 6:00 PM To: Dave Kanner Subject: Deschutes County Room Tax Increase Why is it, after all the economic studies that have shown the opposite result, politicians always think that raising the tax rate will increase total tax receipts? Your failure to look beyond your election cycle to plan for the loss of timber revenues, your failure to save during boom times to meet needs during economic downturns, certainly does not meet the description of leadership. Now your "leadership" skills have lead you to try foist yet another tax on the segment of county taxpayers who already provide much more in tax revenue than they use in county services. Real leaders get up in front of their constituents and tell them the truth about the situation, and ask EVERYONE to contribute, not just the very few. I leave it to you should you want to tell them how their politicians got them into this mess. Stanley E. Thomas 14 Wallowa Loop Sunriver, Oregon 8/15/2008 Page 1 of 1 Dave Kanner From: Linda Wilson [lindwilson@gmail.com] Sent: Friday, August 15, 2008 5:55 AM To: Dave Kanner; Tammy Melton; Dennis Luke; Mike Daly Subject: Lodging Room Tax I do not feel it is fair to penalize the lodging industry which supports so much industry with tourism in the Bend area by increasing the room tax for the following reasons: 1. Our slowdown in economy has already had an adverse affect on tourism. By increasing the room rate taxes, you will discourage yet further the industry and visitor spending, thus affecting other businesses in the community such as, restaurants, sports shops, grocery stores and more. 2.The lodging industry should not be singled out to cover shortfalls in the County Budget due to broad economic changes and lack of proper planning. Please consider carefully these points as you plan your year. Thank you sincerely, Linda Wilson 8/15/2008 Page 1 of 3 Dave Kanner From: Dennis Luke Sent: Friday, August 15, 2008 4:15 PM To: Dave Kanner Subject: FW: RE: Deschutes County Room Tax Increase Tom's response. Dennis Luke From: Luersen, Tom [mailto:tluersen@sunriver-resort.com] Sent: Fri 8/15/2008 2:16 PM To: Dennis Luke Subject: RE: RE: Deschutes County Room Tax Increase Larry Browning is not in favor or aligned with my thinking or the group at large. He feels strongly there should be no increase, etc. My view is different. I am not keeping up with his views nor do I share them. My perspective is that we are ok with an increase, hopefully post 2009 summer season. I am suggesting we consider 1% now (Jan1, 2010) and leave the other 1% of the 2% for post this time to see how the market responds, and when. Hopefully that shows good intent on our part and willingness to understand the county's perspective, and likewise from you to us. The 'industry' is weighing in from the state perspective on their assumption or understanding of intent on the allocation. I want to ensure that COVA remains fully funded. I further support the Expo Center does contribute to tourism, but just want to meet the language of the legislature that defines 'substantial'....vs creating a new precedent the state will want to debate to protect their understanding of the allocation language. Thanks for sharing. tl From: Dennis Luke [mailto:Dennis_Luke@co.deschutes.or.us] Sent: Friday, August 15, 2008 1:57 PM To: Alana Audette; Luersen, Tom Subject: FW: RE: Deschutes County Room Tax Increase Thought you would like to see this. Dennis Luke From: Dennis Luke Sent: Friday, August 15, 2008 1:49 PM To: Larry Browning; Stanley Thomas Subject: RE: RE: Deschutes County Room Tax Increase You are absolutely right Larry, the County has no effect on tourism. The quality of our road, public safety, and positive attitude towards the tourism business does not bring a single tourist to the region. Oh, did I mention our partnership with others in supporting the airports or the two and a half million dollars we put into the Sun River Interchange (state highway not a county road). But clearly that has nothing to do with bring people here. Road ,'“5 took over 10 years from initial request to final completion, financially many things changed during that time. If all these efforts by the County has no effect on tourism, maybe we could save a lot of money by not doing then anymore. Also, we have union contracts that we have to abide by when dealing with our employees. We have let some people go because of the downturn and I assume there may be more. Also, we are self insured for health insurance and have been for several years. We have used the money we would have paid to an insurance 8/15/2008 Page 2 of 3 company to build up reserves so we did not have to cut benefits for our employees. We put money away for the plan during the better years for the years that are not so good. Gee, that was the point of the orginal e-mail. Dennis Luke From: Larry Browning [mailto:Tarry@discoversunriver.com] Sent: Fri 8/15/2008 1:06 PM To: Stanley Thomas Cc: Dennis Luke Subject: Re: RE: Deschutes County Room Tax Increase Thanks Stan, I knew this wouldn't be easy. Obviously there is a lot of background that everyone has not been privy to. And there are always 2 sides to every story sometimes 3 or 4. When the County agreed that the road was their responsibility the reasoning behind it was that 40% of Mt Bachelor's business came from Sunriver and it provided access to all of the residents in the South County. And they understood that the transient room tax revenue generated by Sunriver in the winter would all go to the City cf Bend if the road was not maintained. It was the lodging industry and Mt Bachelor that first approached the county with a proposed room tax over 30 years ago. I feel Mr. Luke has things backwards here. The County does not put money into tourism. Tourism donates money to the county. There is a state law that was proposed by the lodging industry and went into effect about a year and a half ago tc help alleviate the threat of what we are know facing. Mr. Luke is correct in stating that a portion of the funds will be allocated to COVA (Central Oregon Visitors Association) As a matter of fact 70% of any increase is required to go to the tourism industry. Where he is treading on thin ice is trying to allocate those funds towards the Deschutes County Fair Grounds and road 45 which I believe are currently funded through the general fund. The County first brought up the road issue last February and were met with quite a bit of resistance. My feeling is they regrouped. got their attorneys involved and now believe they can defend their position in court. In my opinion they have totally disregarded the spirit of the bill and are now trying to find ways to make it fit their current needs. Mr. Luke is also correct in stating that the city of Redmond and the city of Bend currently collect a 9% room tax. The wording (2 cents) is misleading and political speak. I would estimate the average daily rate in Redmond to be in the $70 to $90 range and the average daily rate in Bend to be in the $100 to $140 range. I estimate the average daily rate in Sunriver to be $220 to $240. So.. 2 cents in Sunriver equates to $4.80 while 2 cents in Bend equates to $2.80, about 70% less. The average length of stay in Sunriver is 4.5 days I would guess the average length of stay in Bend and Redmond to be 1.5 days. So.. 2 cents turns into $21.60 in Sunriver. That's lunch, a canoe trip, a hair cut....He also fails to recognize that the streets in front of the lodging facilities in Redmond and Bend are maintained by those cities and the streets in Sunriver are maintained by the Sunriver Owners. I do applaud Mr. Luke for building reserves over the last several years and working at eliminating the use it or lose it mentality. I think the needs of the County should be bourne by the residents of the County of which I am one. The other alternative would be to freeze employee benefits and salaries until there comes a time when the County can afford an increase. I believe the standard increase is tied directly to the CPI and is awarded annually. I know of 2 managers that received pay increase this year I can only assume that all county employees receive annual increases. I was recently at a County meeting where the allotted insurance benefit for the Planning Department was increased from I believe $275 per month to $340 per month. In contrast, with my company, we did not have an annual salary increase allotted to our employees in 2007. We were also forced to make the tough decision of raising the deductible on our health insurance and asked our employees to increase their monetary contribution °o the plan. Larry Browning President 8/15/2008 Page 3 of 3 Discover Sunriver Vacation Rentals Thanks for the letter Stanley. Some of the money from the increase is going to COVA for tourism promotion. Some is scheduled to go to the Expo Center which also brings in tourists. Road 45 is an excellent example of a road that would not be kept open in the winter if it were not for tourists. The County has over 1.3 million dollars invested in construction of that road and is required to maintain it forever. I remember when Sun River decided not to keep road 1808 open one winter and they lost a lot of business to Bend because people had to go through Bend to get to the Mt. The next year, Sun River oil mat paved Road 45. We have been working with COVA on this issue. As you know, Deschutes County is two cents below both Beni and Redmond with our room tax. I think if you compare the amount Deschutes County puts into tourism promotion as compared to the Cities, you will find we are well ahead of them. Deschutes County did in fact put money into reserves over the last several years and that is a major reason we should be able to ride out the down turn with very little reduction in service to our citizens. Many of our department are in their own fund with any savings they are able to achieve carried over to the next year. This helps eliminate the use it or lose it mentality you find in some state agencies. Our departments are not penalized for saving money. I know of no county in Oregon that would not prefer to have sustainable timber being harvested and receive the revenue from that and the jobs it would create instead of asking the Federal Government that owns close to 80% of Deschutes County to continue the timber payments. I do stand up in front of my constituents and tell them the truth even if they would rather not hear it. Dennis R. Luke Deschutes County Commissioner 1300 NW Wall St. Suite 200 Bend, Oregon 97701 541-388-6568 dennisl@co.deschutes.or.us From: Stanley Thomas[mailto:s.e.thomas@sbcglobal.net] Sent: Thursday, August 14, 2008 6:14 PM To: Dennis Luke Subject: Deschutes County Room Tax Increase Why is it, after all the economic studies that have shown the opposite result, politicians always think that raising the tax rate will increase total tax receipts? Your failure to look beyond your election cycle to plan for the loss of timber revenues, your failure to save during boom times to meet needs during economic downturns, certainly does not meet the description of leadership. Now your "leadership" skills have lead you to try foist yet another tax on the segment of county taxpayers who already provide much more in tax revenue than they use in county services. Real leaders get up in front of their constituents and tell them the truth about the situation, and ask EVERYONE to contribute, not just the very few. I leave it to you should you want to tell them how their politicians got them into this mess. Stanley E. Thomas 14 Wallowa Loop Sunriver, Oregon 8/15/2008 August 15, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, Please consider all input regarding the proposed room tax increase. I am an owner of Juniper Paper & Supply and a large portion of my business comes from the tourist industry. As a supplier of disposable products to the tourism industry, I am fully aware of the rapidly increasing operating costs that are being presented by today's economy. Much of these costs have to be passed onto the visitors. Thus, adding to the challenge of attracting visitors to our area. A tax increase tacked on to these other higher visit costs, could be the deciding factor, for a family planning a vacation in Deschutes County. They may just go elsewhere. It is conceivable that overall tax revenues would decrease as a result of a higher room tax rate. All due to a reduction in tourist visits. I ask you to work with tourism leaders to make sure that all aspects of this issue are considered. Sincerely, Dan Ellis Juniper Paper & Supply Page 1 of 1 Dave Kanner From: karolinasplace@aol.com Sent: Friday, August 15, 2008 10:29 AM To: Dave Kanner; Tammy Melton; Dennis Luke; Mike Daly Subject: increase in lodging tax. I am a Sunriver rental home owner. although I generally am not an anti -tax person, and usually vote for tax increases, I agree with the points Larry Browning sent in an email to Discover Sunriver property owners. A tax increase if needed, should not be be via a rental room tax. Carolyn Hokanson Loch 5 Stag, Sunriver It's time to go back to school! Get the latest trends and gadgets that make the grade on AOL Shopping. 8/15/2008 Page 1 of 1 Dave Kanner From: Steve [lovs@charter.net] Sent: Saturday, August 16, 2008 6:49 AM To: Dave Kanner; Tammy Melton; Dennis Luke; Mike Daly Subject: No Bed Tax! I am opposed to the Deschutes bed tax! Here's why: 1.The slow down in the e conomy over the past few years is clearly beginning to have an adverse effect on the tourism industry as a whole, and the lodging sector in particular. Smith Travel Research, the lodging industry's leading information and data provider, closely scrutinizes occupancy rates and trends in the lodging industry. Smith Travel Research's analysis shows occupancy growth at zero percent in 2008 nationwide. This flat projection comes on the heels of relatively flat occupancy rates over the past four years. Smith Travel Research shows occupancy at 50.5% in 2004, 51.7% in 2005, 53.3% in 2006 and 52.6% in 2007. Many Central Oregon resort operators predict that the industry is experiencing the worst economy in eight -plus years. These factors indicate that the timing for an increase in the transient occupancy tax is not in the best interest of the Deschutes County tourism economy, including restaurants, gifts shops, lodging facilities, and other businesses that rely on tourism to survive. 2.A 2003 study titled Room Taxes and Economic Impact of the Lodging Industry, conducted by the American Economics Group Inc. ("AEG"), also sheds some light on the impact that a tax increase may have on the overall tourism industry in Deschutes County. The study suggests that an increase in the lodging tax causes some travelers to stay fewer days, visit less often and/or make other adjustments in their spending (i.e. retail, restaurants, entertainment, etc.). The executive summary to the AEG report states that "Econometric analysis reveals that on average a 2.0% increase in the combined tax on hotel and motel rooms will cause about a 2.4% reduction in sales and associated visitor spending." While a considerable amount of complex economic data was analyzed to produce this report, the conclusion is clear that an increase in lodging taxes results in a negative impact across a broad spectrum of tourism -related businesses. 3.The lodg ing industry should not be singled out to cover shortfalls in the County Budget due to broad economic changes and lack of proper planning. Steve Lovs 8/18/2008 Dave Kanner From: Jim Gustafson [Chiefgustafson@lapinefire.com] Sent: Saturday, August 16, 2008 9:26 AM To: Mike Daly; Dave Kanner; Tammy Melton; Dennis Luke Subject: Transient Room Tax Good Day All: Page 1 of 1 received an email from an individual in Sunriver asking support against transient room tax increase. I am not against a transient room tax or an increase of it. However, as a Fire Chief I believe that it should be modified tc, provide an amount to Fire Districts and Departments. Our tax payers basically pay for readiness standby, in other words they pay towards the equipment, stations and staffing. Visitors to Central Oregon are benefiting from this standby but do not help support or provide it. Therefore, they should help offset the cost of readiness standby through the transient room tax and maybe even through a fuel tax. Thank you for listening to me. If I can be of further assistance please contact me. Jim Gustafson Fire Chief La Pine RFPD P. O. Box 10 La Pine, OR 97739 541-536-2935, X-103 chiefgustafson@lapinefire.com 8/18/2008 Dave Kanner From: Michael Diven [mdiven@prunw.com] Sent: Saturday, August 16, 2008 9:25 AM To: Dave Kanner; Tammy Melton; Dennis Luke; Mike Daly Subject: room tax'7'7'7'7'7 Page 1 of 1 Dear Sirs: As a owner of two restaurants and as a real estate broker who is trying to sell rental properties and as someone who is desperately trying to make ends meet in these most difficult of times, I feel the county's move to increase the room tax is in total disregard to the needs my family, our 40 plus employees and our tourism industries. Our restaurant business is highly dependent on tourism and already this year we are seeing a sharp decline -?.0% or more over the previous year. Plus, wages, food cost and rent have gone up collectively over 6% this year alone. Your tax increase will further damage our ability to attract tourist to our place of business. Do I even need to go into the real estate side of the business? I am sure the Central Oregon Realtors Assoc. has some scary numbers to share with you. Plus, investments into homes for rentals has come to a screeching halt. I beg you, please don't twist the dagger that has already threatened our ability to survive in these horrible of times. Sincerely, Michael Diven NE Greenwood Ave, Ste 100 d, OR 97701 322-8880 Fax 866 755-6207 N: 541 948-9974 www.michael-diven.com 8/18/2008 ear cer sed Broker in the State of Oregon Page 1 of 1 Dave Kanner From: William Kitto [wdkitto@gmail.com] Sent: Sunday, August 17, 2008 7:18 AM To: Dave Kanner; Tammy Melton; Dennis Luke; Mike Daly Subject: Transient Tax Increase I am sending you this email to request that you vote against the increase in the visitors lodging tax. I own vacation rental properties in Sunriver and believe an increase in the tax will hurt the County in the long term. I think the evidence is quite clear that higher taxes affect behavior. In this case they would either discourage people from visiting Deschutes County or reduce the length of the visit. In either case all he restaurants, entertainment and retail businesses that benefit from tourists would suffer. I refer you tc a 2003 study entitled Room Taxes and Economic Impact of the Lodging Industry, conducted by the American Economics Group Inc. ("AEG"). The study suggests that an increase in the lodging tax causes some travelers to stay fewer days, visit less often and/or make other adjustments in their spending (i.e. retail, restaurants, entertainment, etc.). The executive summary to the AEG report states that "Econometric analysis reveals that on average a 2.0% increase in the combined tax on hotel and motel rooms will cause about a 2.4% reduction in sales and associated visitor spending." In addition, you are probably aware the vacation rental market has been down the last few years and raising taxes would make that situation worse. Not only does tourism provide revenue for local businesses, but vacation rentals also provide properties with the opportunity for additional income thereby increasing their values. There are enough downward pressures on housing prices; a tax increase which would help lower their values further is bad policy. Having a as strong a housing market as possible, with the associated property tax revenue to the County, is important to the County and rot worth impacting through an increase in the transient tax. I recognize that the County, like many of us, faces economic challenges under the current economic conditions requiring tough choices. I urge you to consider the long term negative consequences of a transient tax increase on the County and vote against it. Thank you for your consideration of this request. Bill Kitto 8/18/2008 Bt Brooks Resources Corporation August 18, 2008 Deschutes County Commissioners 1300 NW Wall Street Bend, Oregon 97701 Dear Commissioners, I understand that the County is considering raising the room tax rate to 9% and allocating the increased tax revenue to the county road fund. Our business and Deschutes County have benefited economically over the years from the success of the tourism industry. Given the current strains on tourism created from the slow down in our statewide and national economy we would like to recommend that the County not increase the room tax rate at this time. The people who come to Central Oregon have a choice of where they choose to spend their vacation dollars. Our first hand experience at Mount Bachelor Village Resort is that business group travelers are quite sensitive to the room tax rates in their decisions on where to hold their meetings. Maybe more troubling is the proposal to use the proceeds from the increase in tax rate for something other than the promotion of tourism. We at Brooks Resources Corporation feel strongly that the County allocate funds to tourism promotion according to the existing 70/30 split, with 70% being tourism's share. Sincerely, Kirk Schueler President 409 NW Franklin Avenue Bend, Oregon 97701 (541) 382-1662 (Fax (541) 385-3285 www.brooksresources.com 0 Printed on recycled pep er Bt Brooks Resources Corporation August 18, 2008 Deschutes County Commissioners 1300 NW Wall Street Bend, OR 97701 Dear Commissioners, As the Vice President of Sales and Marketing for Brooks Resources Corporation, I am writing to express my concern over the proposed room tax increase. I am aware that the County is considering raising the room tax rate to 9% and allocating the increased tax revenue to the county road fund. An increase in the room tax rate at this time is not a wise decision given our current economic conditions. Additionally, we feel that the County allocate funds to tourism promotion as outlined in House Bill 2267, with a 70/30 split (70% going to tourism related marketing and/or facilities). Serving on the COVA Board of Directors and being an active member of the organization for years, we are fully aware that business group travelers are sensitive to room tax rates and the rates certainly play a part in their decision on where they travel. Our business benefits significantly from tourism and the satisfaction that visitors have while in our community. Please reconsider the tax increase at this time. With economic conditions as challenging as they are right now and straining the tourism industry, an increase could have a very negative impact on an already difficult business environment. Since .ely, Ronly Mo ' ensen Vice President, Sales & Marketing Brooks Resources Corporation eM Ap\oc r c 9 \ 409 NW Franklin Avenue Bend, Oregon 97701 (541) 382-1662 (Fax (541) 385-3285 www.brooksresources.com 0 Printed on recyclec ,aper OREGON LODGING ASSOCIATION August 18, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, I have been asked by the Board of Directors of the Oregon Lodging Association and by travel and tourism industry members in Deschutes County to provide input on the issue of a proposed County -wide room tax increase to 9% that has been discussed by the County administrator and at the Deschutes County Board of Commissioners work session on August 6. Oregon law clearly states that any increase in the room tax must be allocated with no less than 70% being dedicated to tourism and tourism related facilities and up to 30% being allocated for city or county services (ORS 320.350 (6)). The Oregon Lodging Association and Deschutes County lodging operators are unanimously opposed to the idea that any transient room tax revenues be used for county roads. However, it was the intent of the legislation passed in 2003 that roads and other city or county services could be funded with up to 30% of any new or increased transient lodging tax. If the Commission considers an increase in the County lodging tax, the Commission must also consider current economic conditions. The most up-to- date data from Smith Travel Research, the lodging industry's leading information and data provider, show that occupancy and other indicators are all trending downward in Deschutes County and have been over the past 12 months. County -wide occupancy (as tracked by Smith Travel Research) for June 2008 was 61%. This represents an 8.1% decrease vs. June 2007. Occupancy year-to-date is 45%--a decrease of 6% vs. the same period in 2007. The prospect for future occupancy growth is equally concerning as the end of the summer season nears and the industry braces for a slowing economy. Another topic that has been considered by the Board of Commissioners is the use of room tax funds to support the Deschutes County Fairgrounds and Expo Center. To qualify within the statutory framework, these facilities must have "a substantial purpose of supporting tourism promotion or accommodating tourist activities" (ORS 320.305(9)(b)). Tourists are defined in statute as those persons who come to the facility from over 50 miles away or stay overnight. Prior to determining that any facility meets the standards of a "tourism -related facility," it is incumbent upon the County to provide evidence that the facility falls within the statutory definition. It is clear that some tourism benefit is realized when significant statewide events, conventions or large group meetings bring visitors from outside Deschutes County to use the Expo Center facility. To that end, Deschutes County lodging operators have offered to meet with the Fair board and staff to explore ways to work closer with COVA to improve the overall marketing of this property to tourists and increase the tourism benefits for industry, the County and all of Central Oregon. OLA I 8600 SW Salish Lane, Suite 3 I Wilsonville, Oregon 97070 1 T: 503-783-2797 1 F: 503-783-2798 1 E: info@oregonlodging.co n www.oregonlodging.con: Page 1 of 1 Dave Kanner From: Ralph Curran [r.curranl@verizon.net] Sent: Monday, August 18, 2008 10:41 AM To: Dave Kanner Cc: Larry Browning Subject: 2 °!o room tax increase We have owned a home in Sunriver for over 10 years. Our family uses it about one week per month and the rest of the time it is available for rent. We love the area but depend on rental income to afford the investment. I have noted that resorts of this type are a great deal for the county because you get most of the property tax yet most ow the services normally supplied by the county are supplied by our owners association. Because of this we are already being double taxed. Therefore I believe it is not appropriate for the county to add an additional tax burden that may actually effect the income from my property and jeopardize my ability to retain it. Ralph Curran - 20 Hickory, Sunriver 8/18/2008 Dave Kanner Subject: FW: Lodging Tax Issue Importance: High From: Dennis Luke Sent: Monday, August 18, 2008 5:31 PM To: Dave Kanner Subject: FW: Lodging Tax Issue Importance: High From: Larry Campbell [mailto:Larry@victorygrp.com] Sent: Monday, August 18, 2008 9:17 AM To: Dennis Luke Subject: Lodging Tax Issue Importance: High Dennis, A voice from the past! You will remember how hard we worked to pass HB 2267 in 2003 (the 1% lodging tax and the 70/30 split for new, local taxes to ensure that there would be a long-term investment in the tourism industry). A broad coalition of industry representatives and legislative leaders (including the Governor) came together in 2003 to help make this happen. While the intent was to have 100% of new local taxes be dedicated to tourism, the "up to" 30% was negotiated for cities and counties to receive some of these funds for local services (roads, police, general services, etc.). Roads should :lot be considered tourism under the 70% of any new tax. I understand the commission will be considering an increase in the tax during a meeting this morning and that one of the options is to dedicate money from the 70% to roads. This clearly was not the intent of HB 2267 and was clearly excluded from the definitions during deliberations in 2003. I know Central Oregon is feeling the economic downturn in significant ways and the loding industry is really struggling. This tax increase comes at a bad time for lodging operators that are already experiencing a significant decrease in room nights and downward pressure on rates. I know you understand these factors and I'm confident you will be sensitive to the lodging industry as you deliberate about a potential increase in the tax. Thank you in advance for giving this careful consideration! Please give me a call on ry cell at 503-510-4457 if you have any questions My best to the Lukes! Larry Larry Campbell The Victory Group, Inc. 1 1191 Capitol St. NE Salem, OR 97301 503-315-1411 (w) 503-315-1416 (f) larry@victorygrp.com <mailto:kevin@victorygrp.com> www.victorygrp.com <http://www.victorygrp.com/> 2 Page 1 of 1 Dave Kanner From: Rocky [rocky@northlandfurniture.com] Sent: Monday, August 18, 2008 9:31 AM To: Dave Kanner Cc: board@deschutes.or.us Subject: Federal Lodging Dollars Dear Commissioners: I am the Director of Sales at Northland Furniture Company in Bend Oregon. I am concerned about the proposed room tax increase. We are already seeing a decrease in business from the cost of fuel and this room tax increase would hurt us even more. Hotel and Motel owners will not remodel their rooms if their occupancy rates continue to decrease. We have already had to lay off some of our employees. Thank you. Sincerely, Rocky McCaw so NORTHLAND 1 ilkNI 1 URI COMPANY Rocky McCaw — Director, Sales and Technical Services 681 S.E. Glenwood Bend, OR 97702 Tel: 541-389-3600 ext. 105 Toll Free: 800-497-7591 Fax: 541-389-4943 rockym@northlandfurniture.com 8/18/2008 08/17/2008 21:44 5415935207 SRNC ! SUNRNER NATURE CENTER & OBSERVATORY, INC. Via Facsimile: 385-3202 August 18, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, PAGE 01/01 I am the Executive Director of Sunriver Nature Center & Observatory and am writing on behalf of the Board of Directors to express our concern over the proposed room tax increase. The viability of our non- profit organization relies to a large extent on tourism and the local tourist supported businesses for our support, Given the current economic slowdown in Central Oregon—and across the state—we are concerned about the impact that this increase in the cost to visitors to our region will have on our organization. Before taking further action we urge you to remember that even slight changes in costs can have an adverse effect on tourism and in turn impact our operations. if we can get more visitors coming to Deschutes County, revenue for all businesses AND the County will increase, so this tax increase could be counterproductive to County income. We respectfully recommend that the County work with the lodging industry and other members of the tourism and hospitality industry to reach a transient room tax and tourism promotion solution that is amenable to all parties, local transient visitors and resort operators are an integral part of the future success of our non-profit. We have concern regarding any initiative that will discourage and/or not promote increased visitation to our region and that will, in turn, reduce visitors to support and experience the educational opportunities the Sunriver Nature Center & Observatory offers. Thank you. Kathy Pazera, Executive Director Sunriver Nature Center & Observatory cc: Dave Kanner, County Administrator A non-profit corporation E.I. #93-O8179)7 Founded in 1968 Incorporated in 1982 1 n!pi,rc frown. a+ed fu(.u.rr, generations to rheri,FI And un,4nrstand our natural world Sunriver Nature Center & Obeervatory, Inc. P.O. Box 3533 Sunriver, OR 97707-0533 www.9unriverNa tnreCPnter.nrg Adminietration: (641) 698-4442 Oheervatory: (641) 59B-4406 Vi.aitot'n Center: (541) 593.4394 Fax (541) 693•5207 August 18, 2008 Deschutes County Commissioners 1300 NW Wall Street, Suite 200 Bend, OR 97701-1960 Dear Commissioners, As the new leader of Mt. Bachelor and board member of the Central Oregon Visitors Association, I have been asked to provide input on the issue of a proposed County -wide room tax increase to 9% that was discussed at the Deschutes County Board of Commissioners work session on August 6. As a newcomer to the area I am not completely up to speed on all of the details of Oregon law pertaining to the room tax, however, I am well versed in the impacts and potential, unintended consequences of such a tax increase from other states where 1 have lived and worked. I also have met recently with many leaders of the local lodging community who have expressed their position against the tax increase directly to me. There are two key issues bringing lodging and tourism operators together in opposition to an increase in the transient lodging tax: the impact of higher taxes on the total cost of a Deschutes County vacation in these economically challenging and competitive times, and the prospect of new lodging tax revenues being spent on initiatives that do not inherently support travel and tourism. It is no secret we are experiencing an economic slowdown. The cost of energy and the trickle-down effect it has on just about everything we consume is well documented. As personal disposable income shrinks, the potential negative impact of additional cost increases - even a small percentage on the tax line - will have a further impact on slowing growth and making a Deschutes County vacation Tess competitive in the market place. The most recent data from Smith Travel Research, the lodging industry's leading information and data provider, show that occupancy and other indicators are already trending downward in Deschutes County and have been over the past 12 months. As consumers begin to scale back on long-haul travel (possibly a driver of the current trend) the potential for regional, "rubber -tire" vacations may grow. Now is not the time to be disrupting Deschutes County lodging operators' ability to be competitive with other areas of the Northwest for a growing regional destination market by raising the lodging tax. Another topic that has been considered by the Board of Commissioners is the use of room tax funds to support the Deschutes County Fairgrounds and Expo Center. To qualify for such a use, it is my understanding these facilities must have "a substantial purpose of supporting tourism promotion or accommodating tourist activities" (ORS 320.305(9)(b)). Tourists are defined in statute as those persons who come to the facility from over 50 miles away or stay overnight. Prior to determining that any facility meets the standards of a "tourism -related facility," it is necessary for the County to provide evidence that the facility meets this definition. It is clear that some tourism benefit is realized when significant statewide events, conventions or Targe group meetings bring visitors from outside Deschutes County to use the Expo Center facility. To that end, Deschutes County lodging operators have offered to meet with the Fair board and staff to explore ways to work closer with COVA to improve the overall marketing of this property to tourists and increase the tourism benefits for industry, the County and all of Central Oregon. In consideration of County needs, and given that additional resources be dedicated to COVA for targeted marketing to spur the tourism economy, the Oregon Lodging Association supports an increase to 8%. This increase would represent an estimated $500,000 in lodging tax revenues. If enacted, an increase should not go into effect before July 1, 2009, allowing operators to reach guests and group business that may have already booked a stay in Deschutes County and to make any necessary updates to software systems and accounting practices. My personal recommendation is to hold the lodging tax at its current level, or dedicate any increase specifically for the purpose of funding additional tourism -generating activities. Thank you for your attention and consideration to this matter. Sincerely, Dave Rathbun President & General Manager Mt. Bachelor, Inc. Page 1 of 1 Bonnie Baker From: Mike Daly Sent: Tuesday, August 19, 2008 1:04 PM To: 'Paris Martin'; Board; Dave Kanner Subject: RE: Deschutes County Hearing/Room Tax Increase No decisions were made at yesterdays meeting on the room tax issue. Michael M. Daly Deschutes County Commissioner 1300 NW Wall St., Ste. 200 Bend, Or. 97701 541-388-6569 Cell 541-948-7591 Fax 541-385-3202 From: Paris Martin [mailto:paris@ora.org] Sent: Tuesday, August 19, 2008 10:17 AM To: Board; Dave Kanner Subject: Deschutes County Hearing/Room Tax Increase Greetings! I attended the hearing yesterday, and had to leave before I heard the outcome on the Room Tax Increase. Can you please give me an update? Thanks! Paris Ann Martin Regional Representative Oregon Restaurant Association 541.788.4599 direct 541.647.1610 fax paris@ora.org www.ora.org /1 //emhersliip Doesn't Cost It Pays! Joining the Association is quick and easy! Restaurants: www.ora.org/membership_home.htm 8/20/2008 Page 1 of 1 Bonnie Baker From: David Herman [david-herman@comcast.net] Sent: Tuesday, August 19, 2008 4:40 PM To: Board Subject: Regarding Transient Accommodations Tax Increase Proposals The problem with attempting to tax visitors to support local services is that at some point, the tax encourages visitors to go elsewhere. While Central Oregon is a very attractive destination for many travelers it is not fair or equitable to expect visitors to support local services disproportionately to their utilization of facilities and services that are primarily provided for residents. Jurisdictions like Portland have found that the magic bucket of transient tax revenue actually gets smaller as the tax increases. People are sensitive to the effect of taxes on their lodging bills and vote with their feet when the tax burden becomes disproportionate. Most travelers come from jurisdictions that impose sales and use taxes and are familiar with a level of taxation on lodging that approaches 8%. Beyond that rate, the average traveler will see the excess tax as an extraordinary extraction of their resources and will consider this when they make future travel decisions. Best regards, David Herman Equine Management, Inc. Electronic Privacy Notice. This e-mail, and any attachments, contains information that is, or may be, covered by electronic communications privacy laws, and is also confidential and proprietary in nature. If you are not the intended recipient, please be advised that you are legally prohibited from retaining, using, copying, distributing, or otherwise disclosing this information in any manner. Instead, please reply to the sender that you have received this communication in error, and then immediately delete it. Thank you in advance for your cooperation. 8/20/2008