The Norman Transcript

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March 29, 2013

Hotel tax taps into outside income

NORMAN — Transient guest tax, more popularly known as hotel/motel tax, taps into outside sources to boost city income. When guests visit Norman, the special tax levied on the hotel or motel where they are staying funds public arts, parks and tourism promotion.

Voters can vote on a 25 percent increase hotel/motel tax increase during the city’s election on Tuesday. If approved, the rate would change from 4 percent to 5 percent and begin May 1. Parks, the arts and Norman Convention and Visitors Bureau will see more money, starting in July when Fiscal Year 2014 starts if voters say yes.

“Attracting outside tax dollars builds Norman’s economy and quality of life,” Norman CVB Executive Director Stephen Koranda said. “This is not a tax that would be paid by Norman citizens but by those who stay at our lodging establishments.”

City leaders look at the hotel/motel tax as free money because it is generated primarily from visitors rather than residents of the city.

Unlike other sales tax, which taps into the purses of shoppers — whether they are Norman residents or visitors, the hotel/motel tax generates a funding stream from sources that stretch around the globe.

Even so, city leaders do not take increasing that tax lightly. Keeping the tax low enough to be competitive, especially with Oklahoma City and Tulsa, means Norman can bring in conventions and other statewide events.

In January, the Norman City Council voted to place a measure on the April 2 ballot to raise the current Transient Guest Tax. After careful study and discussion with local business and lodging owners, city leadership decided the conservative 1 percent increase will keep Norman competitive in the convention and conference market while increasing funding for parks, arts and promotion.

The current 4 percent Transient Guest Tax has been in place since 1980.

Half of the hotel tax collected funds the Norman Convention and Visitors Bureau. The NCVB works hard to promote tourism within the city and bring in even more outside dollars.

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