What is the Tourism Development Tax (TDT)
The Tourism Development Tax (TDT), enacted in 1984, is levied on all short-term rentals of accommodations (less than 180 days). TDT funds are used to promote travel, drive visitation and generate hotel room nights in Lake County in order to facilitate on-going, economic benefits for Lake County residents, the business community and its fourteen municipalities.
Recently the Lake County Board of County Commissioners have entertained the question of raising the Tourist Development Council (TDC) tax in Lake County from the current 4% to 5%. A one percent increase in the current 4% tax rate is estimated to generate an additional $850,000 per year. The increase in the tax is being justified because the Lake County Board of Commissioners would like to build large sections of bicycle trails in the county. There is broad support among the TDC members to help fund the trails through the current 4% tax that already exists. In fact, in a vote of 6 to 1, the TDC voted against increasing the tax as unnecessary.
The TDC currently retains over $500,000 every year in unspent excess funds. These funds are put into a capital funding program. This capital funding program has been abused many times over the years by funding pet projects with little or no relationship to tourism development. Some examples of this misuse are a classroom at the agricultural extension office, the maintenance of a softball field over multiple years, and the support of “a museum“ on the first floor of the historic courthouse. The list of these projects is without limit. There has been little to no support on the part of the county commission to require performance checks or any claw back (return funds when the proposed number of room nights or other commitments are not met) and certainly no accountability to protect these funds for their original intended use.
At the end of September the TDC and the Lake County Board of Commissioners are scheduled to hold a workshop. This workshop was never envisioned to discuss increasing the TDC tax. However, this proposed tax will end up dominating the conversation. There is a great deal of backdoor and backroom conversations taking place regarding this topic.
The stakeholders who collect the tax, the industry that pays the tax, and the industry experts, have not been solicited for an opinion on the new increase in taxation. In addition, the opinions that have been expressed have been marginalized and for the most part ignored.
Lake County business stakeholders would appreciate your support to oppose this tax increase. Especially now, as the industry again faces a debilitating pushback as the Delta variant increases in COVID cases. More states are putting restrictions on travel and more travelers are becoming cautious with their plans. The Lake County Board of Commissioners has available project funding without this tax increase. Funds were supposed to be used to bring in tourists to Lake County. This purposed tax and subsequent spending is nowhere close to meeting that criterion.
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