Lodging tax revenue indicates tourism industry is doing well; the tax is up for renewal this year

Based on increases in city lodging tax collected and other marketing data, 2016 was a great year for the Stillwater and Oak Park Heights tourism industry.

The cities of Stillwater and Oak Park Heights implemented a 3 percent lodging tax in 2008 to generate revenue for a convention and visitors bureau (CVB) to market the area’s tourism industry. Since then, the board of the CVB has used the tax funds to purchase advertising and marketing materials, manage the Discover Stillwater website and sponsor events with the goal of bringing visitors to Stillwater and Oak Park Heights.

Jerry Helmberger, owner of the Aurora Staples Inn, is the president of the CVB.

“It has been a record year for collecting lodging taxes,” Helmberger said in a presentation to the Stillwater City Council Feb. 21. “The third quarter [was] the highest lodging tax collected in the history of the CVB, but also … we had the highest first quarter and the highest second quarter and we would expect the highest fourth quarter also.”

CVB marketing director, Christie Rosckes, said the increase in taxes collected has resulted from an increase in occupancy rates in local lodging establishments, not from price increases.

“There has been a 29 percent increase in lodging tax revenue since 2008 with no increase in the number of rooms available,” Rosckes said.

Due to the increased revenue from the tax, the CVB has carried forward a cash reserve from year to year.

“We do budget fairly conservatively and keep a cash reserve,” Rosckes said. “If there was an event that caused a downturn in the tourism industry, we would use that money in a targeted marketing campaign to try and recover.”

At the end of 2016, the CVB had an annual budget of $289,725.31.

The city of Stillwater is expecting at least one new hotel on Main Street, and is considering approval for another, which would increase the number of rooms available to visitors. Rosckes called that “a good sign of growth.”

The lodging tax will be up for renewal by the cities of Stillwater and Oak Park Heights later this year, and it would be an opportunity to eliminate or lower the rate of taxes collected. Rosckes said that there will always be a need to continue to market the area’s amenities.

“Unfortunately, there is no plateau when it comes to marketing,” Rosckes said. “There is always a need to remind people and new markets to reach.”

Rosckes said there is opportunity for more mid-week activities in town through more corporate events. About two years ago, the CVB made it a goal to market Stillwater more in the “off-season” of January, February and March — and has seen success, Rosckes said.

“We have heard from businesses and really feel that Ice Castles is the first event that has ever touched all sectors,” Rosckes said. “It has benefited hotels, restaurants, boutiques and attractions and it has been sending a sort of trickle of business every single day for two months straight at a time of year when things are quite quiet.”

Contact Alicia Lebens at [email protected]