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Guest column: New county lodging tax increase is a kick in the teeth

Local lodging operators were stunned by this vote

By Stephen Malkowski

Published on August 3, 2018 12:01AM

Last changed on August 3, 2018 6:50AM


Last week, without any discussion or consideration of the largest employment sector, Clatsop County commissioners voted for a countywide tax increase on lodging.

The additional 1 percent lodging tax, when added to the 9.5 percent tax already in place in unincorporated areas of the county, results in a whopping tax rate increase of 10.5 percent.

Local lodging operators were stunned by this vote and the county’s backwards approach, as not a single outreach effort was made by the county in advance.

Before moving forward, local lodging operators asked that our industry taxes be discussed fairly and openly under the principles for which they were established — tourism promotion.

It is highly uncommon for a local government jurisdiction to increase an industry-specific tax without holding proactive discussions with those impacted by the decision first.

Weeks ago, the Oregon Restaurant & Lodging Association submitted a letter to the county in support of a renewed commitment to county/lodging industry conversations.

The letter was sent offering assistance in coordinating meetings as a first order of business before any lodging tax increases were considered.

Clatsop County lodging operators were highly engaged in this issue and were in opposition to any increase without these crucial industry conversations.

Here are some statements from staff at the two commission readings:

• “this is not a tax on the hotels, this is not a tax on this industry”

• “the burden is not on the hotel/motel”

• “the 1 percent tax has nothing to do with the bottom line” … “it is not affecting their bottom line”

• “we fall well within the guidelines of other counties that do this”

• “this county doesn’t really need a lot of promotion”

• “this is a great way to help fund a local facility without a burden to our local citizens.”

These statements could not be further from the truth, as evidenced in this region’s dismal tourism performance compared with the rest of the state.

The 2018 Oregon Travel Impacts report breaks down overnight visitor volume within Oregon’s tourism regions. The latest report highlights overnight visitor changes from 2015-2017, which is the latest data available.

The regional breakdown for this period is Oregon + 6.3 percent, Portland +10.1 percent, Willamette Valley + 2.9 percent, Central Oregon + 7.8 percent, Mt. Hood/Gorge +15.3 percent, Eastern Oregon + 6.5 percent, Southern Oregon + 6.0 percent and the Central Coast +10.5 percent.

In contrast, the North Coast suffered a 2.9 percent decline.

Clatsop County local economies rely upon the strength of the tourism sector and the full utilization of marketing dollars to trigger visitor spending.

Every lodging dollar represents three tourism dollars into our economy. These three dollars are then spent on coffee shops, restaurants, art galleries, et cetera. Conversely, for every lodging dollar that is not spent, three more are also not spent in coffee shops, restaurants and art galleries.

Given this latest data, lodging operators felt it irresponsible to increase the lodging tax until the current investments in lodging tax revenues were fully evaluated. A full analysis of current lodging tax revenue investments was recommended by the association given the results highlighted above.

Lodging requested that the county ensure it is leveraging tourism promotional dollars to their maximum benefit before increasing taxes further.

The county completely ignored any requests for these meetings, or to slow the process down for further review. Instead, they recommended the vote move forward without any industry outreach or discussion.

The tax increase passed without input to learn what impact this tax would have on the lodging business owners, and, therefore, the collateral impact on all employees/jobs in this, the largest employment sector in our county.

Whether one agrees or disagrees with the benefits of tourism, the true issue is the dynamics of how this all went down as an example of countywide leadership failure on all levels.

The final kick in the teeth is that this tax increase was passed for the purpose of funding a jail ballot measure that has yet to be voted on by you, the voter.

It is irresponsible governance examples like these that keep any worthwhile business from considering Clatsop County as a place to invest, expand or relocate.

Meanwhile, regional leadership will continue to wonder why storefronts remain empty, unaffordable housing escalates, and no family-wage jobs come into our area.

Stephen Malkowski is the owner of Arch Cape Inn and Retreat and a former Clatsop County planning commissioner.



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