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For decades, what’s been known as the bed tax in Ely has done good things.
Hotels, motels and resorts have collected three percent, and more recently four percent in Fall Lake Township, and the funds have generated badly needed revenue to market the Ely area and keep folks coming back.
In the last decade alone, more than $2 million has been collected. That’s not a small chunk of change.
And the money is put to good use, with creative folks using catchy ways to introduce Ely to new audiences and to keep us on the front burner with those already familiar with the region.
No doubt there have been some complications in recent years, with revenues generated by Fall Lake establishments going to the state, then back to Lake County, and eventually to the area lodging tax board.
There have been dust-ups over how the money should be allocated, enough that it has required mediation involving the Ely Tourism Bureau, Ely Chamber of Commerce and local government entities.
And finally, a changing landscape in the rental world has apparently made it more difficult to track down who exactly is in the rental business - and if they are paying the lodging tax as required.
Required is the optimum word here. The lodging tax isn’t a donation. It isn’t something that those in the rental business can bypass.
It’s a tax. No different than sales taxes or property taxes or income taxes.
We’d all like to avoid taxes, but that’s not how it works.
Those in the rental business, whether it’s a longstanding hotel or resort or a property owner trying to make a few bucks on Airbnb, need to pay their fair share.
Discussion this week at Morse Township showed there’s some ambiguity over who is required to monitoring rental property owners, but it’s something that needs to be cleared up. And fast.
Part of the problem is the convoluted way the tax is collected, with properties in St. Louis County sending their taxes to Cook County, which serves as a fiscal agent. Cook County then sends the tax revenues this way, with the lodging tax board then contracting with the non-profit Ely Tourism Bureau to use those monies to market the region.
Add a different process for Lake County, where establishments send those proceeds elsewhere which in turn come back to the county and in turn to the lodging tax board, with a quarter of it staying in the county for its own promotion of events, and one can see this is a recipe for confusion.
But confusion or not, the government entities, starting with the area’s lodging tax board, need to make sure all lodging establishments are paying their fair share.
That’s a different argument than one deciding over how the monies are best spent, and with whom.
No other taxes are collected on an “honor system” and putting some teeth and government weight behind lodging tax collections is the first step toward solving this problem.
