Cedar Rapids city leaders are asking state lawmakers to increase the amount of money communities can collect from hotel/motel taxes from seven to nine percent. Cedar Rapids wants the extra money to use as a local match fore federal funds to build a new events center and upgrade the U.S. Cellular Center.
Cedar Rapids Mayor Ron Corbett says rather than raise property taxes, voters should have the option to approve an increase in the hotel/motel tax. “I think the hotel motel tax is a logical place to go. These are taxes that are provided by visitors who come to our community. And since the events center upgrade and the Cell Center upgrade would bring in more visitors, I think it’s a good use of funds,” Corbett says.
Corbett believes the community would approve the increase because the pay off from investing in the city. Corbett says “Ask the average person if someone came in and said I’ll give you $15,000 for a kitchen upgrade but you have to put $2,000 dollars in, I think most people would try to find a way to put that $2,000 dollars in.”
Corbett says getting the legislature and governor to approve raising the cap on the hotel/ motel tax will be an uphill battle. State Representative Tyler Olson, a Democrat from Cedar Rapids, says the state would not be raising taxes, that would be decided locally.
Olson says, “Any increase that would be allowed by the legislature would be approved by local cities and counties and also voters.” Olson says he’s still unsure whether he would support the measure.
“I think it’s important that local folks have a say in the decision but I do think it could be a tool that communities, particularly the one that I represent, could help rebuild from the disasters of 2008,” Olson says. If approved, the extra tax would raise an estimated $700,000 a year in Cedar Rapids. Olson says if the legislature considers making the change it will likely be toward the end of the session.