Agenda - Council - 03/27/2012 - Laserfiche WebLink

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Funding Source: In 1983, the Minnesota Legislature passed the Local Option Tax. The law was passed such that 95% of all proceeds from a local option lodging tax must be used to fund a local convention or visitors bureau for the purpose of "marketing and promoting the area as a tourism or convention area." The remaining 5% could be retained by the taxing authority (the City) for its administrative costs. The State statute section which directs the disposition of proceeds provides as follows: Subd. 3. Disposition of proceeds. Ninety-five percent of the gross proceeds from any tax imposed under subdivision 1 shall be used by the statutory or home rule charter city or town to fund a local convention or tourism bureau for the purpose of marketing and promoting the city or town as a tourist or convention center. This subdivision shall not apply to any statutory or home rule charter city or town that has a lodging tax authorized by special law or enacted prior to 1972 at the time of enactment of this section. Any community desiring to join Twin Cities Gateway, is required to adopt a lodging tax (up to 3.0%). This is a statewide requirement for any city wishing to join any CVB organization. This would be added to the current sales tax paid by customers. Both the Comfort Suites management and the owners are supportive of the City joining the CVB and implementing this revenue change. It is estimated that this would generate approximately $24,000 based upon last year's gross revenues. A simple majority of the Twin Cities Gateway Board of Directors must also approve the admission of the City of Ramsey into the CVB. Council Action: Motion to waive the City Charter requirement to read the Ordinance aloud. Motion to adopt Ordinance # 12 which is an Ordinance Imposing a Lodging Tax and permitted membership in the Convention and Visitors Bureau (CVB). Roll call vote: Councilmember Strommen Councilmember Tossey Councilmember Backous Councilmember Wise Councilmember McGlone Councilmember Elvig Mayor Ramsey Proposed Ordinance Imposing Lodging Tax Attachments Form Review Inbox Reviewed By Date Kurt Ulrich Kurt Ulrich 03/22/2012 12:51 PM Form Started By: Bill Goodrich Started On: 03/22/2012 09:39 AM Final Approval Date: 03/22/2012