Lodging tax would benefit Nike, Intel first
SALEM A bill to double Oregons statewide tourist lodging tax is headed to the House after it passed out of committee last week on a 5-3 vote.
The short-term goal is to raise money so the state can subsidize a world track championship in Eugene in 2021. Nike and University of Oregon officials have pushed for the state to help pay for the event for the past couple of years.
To achieve that, the bill would increase the statewide tax on tourist lodging from 1 percent to 2 percent and allow the state greater flexibility to spend tourism tax revenue. State law currently requires the government to spend at least 80 percent of hotel tax revenues on tourism marketing. House Bill 4146 would allow the state to spend that money on any tourism programs, including to subsidize the costs of events such as the track championship.
The bill would also require the states tourism commission, Travel Oregon, to distribute set amounts of lodging tax revenue around the state through regional allocations and competitive grants.
In the two-year budget that begins in mid-2017, the bill would result in $34.2 million in new tax revenue, according to an estimate from the Legislative Revenue Office. The state would send $10.2 million in existing and new tax revenue to regional tourism agencies around the state during that period, and award $10.2 million in competitive grants to encourage tourism.
Portland tourism officials and rural lawmakers have both found aspects of the bill they dislike. Three Republicans on the House Committee on Revenue voted against the bill. A fourth, Rep. John Davis (R-Wilsonville) was excused from the vote.
State Rep. Cliff Bentz (R-Ontario), said hotel owners in his district do not expect the bill would help them. I talked to many of my hotel operators across my district and they were uniformly a no, Bentz said. State Rep. Gail Whitsett (R-Klamath Falls), said she agreed with Bentz.
State Rep. Mark Johnson (R-Hood River) said he voted against the bill because of concerns expressed by constituents, but he strongly supported the underlying concept.
The bill goes to the full House for a vote, which has not yet been scheduled.
Randy Tucker, Metros legislative affairs manager, said during a hearing last week that although the government supports using lodging taxes to help pay for the Eugene track event, doubling the state lodging tax would put Portland at a competitive disadvantage to other cities with lower tax rates.
Cities and counties across the state impose local tourism taxes and Elizabeth Edwards, from the city of Portlands Office of Government Relations, said the bill would push the total hotel tax in Portland to more than 15 percent. Metro owns and operates the Oregon Convention Center in Portland and Tucker said the group travel events hosted by the center bring in visitors who spend more than leisure tourists, the category that would attend sporting events.
We believe that permanently doubling the current tax rate and devoting the new resources primarily to state leisure tourism marketing will harm the states ability to continue attracting lucrative convention travel and convention groups, Tucker said.
Although there continues to be political support for TrackTown USAs bid to bring the 2021 World Outdoor Championships to Eugene, government officials involved with the plan face greater scrutiny since the BBC reported in early December that French investigators were looking into how Oregon landed the event.
The Register-Guard newspaper reported in January that Nike, company co-founder Phil Knight, Chief Executive Officer Mark Parker and University of Oregon trustees contributed nearly $400,000 to Gov. John Kitzhabers re-election campaign in fall 2014. Kitzhaber had previously been skeptical of TrackTown USA and the University of Oregon Foundations request for a $40 million state subsidy for the event, but the governor came out in support of the subsidy after his campaign received the contributions.
The UO board told the newspaper it was flat wrong to insinuate there was any connection.
Nike and the university trustees arent the only fans of the bill. The Oregon Winegrowers Association also submitted a letter in support of the legislation.
Our position is quite simple, the winegrowers wrote. Increased tourism to Oregon is vital to the future of the Oregon wine industry.