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Wyoming legislative committee endorsed lodging tax proposal

November 29, 2018

CHEYENNE, Wyo. (AP) — A bill that would levy a 5 percent lodging tax in Wyoming won the endorsement of a legislative panel Thursday after it wrestled with how to account for cities and counties that already levy a local lodging tax.

The bill endorsed on a 9-3 vote by the Joint Revenue Committee will be presented to the full Legislature when it meets in January.

Under the proposal, a 3 percent tax will be levied to fund tourism promotion efforts, subject to legislative oversight, while another 2 percent tax will be levied and go to local governments. Together, the 5 percent tax will raise an estimated $32.5 million a year.

The proposal is a reworked version of a bill that failed in the Legislature last winter. The failed proposal and the new one both aim to provide a dedicated source of money for the state tourism office. The office’s annual budget of about $12.5 million is currently funded by the general fund, which is subject to fluctuations in state revenue.

Sen. Ray Peterson, R-Cowley and co-chairman of the committee, said when the Legislature is faced with a revenue shortfall the tourism office tends to be among the first to see budget cuts because the agency doesn’t provide needed services like others, such as the state Department of Health.

The trouble with that is a growing tourism economy generally means more money for state coffers so it makes financial sense to invest more in tourism promotion.

Chris Brown, representing the Wyoming Lodging and Restaurant Association and the Wyoming Travel Industry Coalition, testified in favor of the new proposal.

Brown and others said it’s important that Wyoming provide a dedicated source of funding for tourism in order to compete with surrounding states for lucrative out-of-state travelers.

“Getting our state’s marketing program on more secure, stable and competitive footing by removing ourselves from the state general fund with a dedicated funding source is absolutely what’s best for growing the visitor economy in Wyoming,” he said.

State tourism executive director Diane Shober said Wyoming ranks 31st in the nation in tourism marketing spending and is outspent by its neighboring states.

The state benefits from a strong tourism economy because of the money visitors spend on hotels, attractions, gas and food while in the state.

Before approving the proposal, the committee addressed concerns that the new statewide tax would impose too high of a tax burden in some places.

Currently, about a dozen local counties, cities and towns already levy lodging taxes that are approved by local voters. Some of them impose up to 4 percent lodging tax, using the proceeds mostly for local tourism promotion. Such taxes can only be imposed for four years and then are subject to another vote in order to be renewed.

Sheridan County voters last month approved a 4 percent lodging tax in that county, for instance.

If the proposed 5 percent statewide tax was enacted, there were concerns some places faced the prospect of levying as much as 9 percent in lodging tax.

The panel decided the best solution was to delay imposing part of the statewide tax in jurisdictions with lodging taxes until those local taxes expire.

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