Economic Development, Government, and Travel & Tourism

County extends lodging tax and payout to Experience GR

December 15, 2012
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Kent County commissioners unanimously agreed last week to extend the duration of the county’s lodging excise tax ordinance and award Experience Grand Rapids a larger payout for the success the destination marketer has had in raising revenue to the tax fund this year.

The commission’s action means the lodging tax will continue to charge hotel and motel guests who stay at facilities in the county a 5 percent tax on their bills through Dec. 31, 2042, which is roughly a 10-year extension of the levy that went into effect in 1975.

The expiration date was also extended in 1990 and 2001. The current extension brings the ordinance and its amendments into a single document and allows the regulation to remain effective beyond 2031, the year the bonds that built DeVos Place mature. The county uses the revenue from the tax to pay the convention center’s bondholders.

Commissioners also agreed to appropriate an additional $160,400 from the lodging excise-tax budget with the intention of distributing those funds to Experience GR. Revenue from the tax is higher than expected this year. The total will likely be between $6.6 million and $7 million, while $5.9 million was projected at the beginning of the year.

The current contract the county has with Experience GR allows the organization to collect 14.5 percent of the revenue total. At the year’s start, Experience GR was projected to receive $854,600 based on the expected tax amount, but with the increase in revenue, Experience GR is likely to receive $1 million this year for its marketing efforts.

A new three-year agreement between the county and Experience GR goes into effect Jan. 1, and under that contract, the organization will receive 16.75 percent of the total tax each year.

PDR funds

Commissioners also accepted $74,000 from a property owner whose farm is selling its development rights to the county through the Purchase of Development Rights program, which turned 10 years old this year.

The Bradford Family LLC made the contribution to help the county cover its cost to match a federal grant that was used to buy the rights from four farms in February.

The Bradford farm, 115 acres in Sparta Township, was one of the four that agreed to sell its rights to the county for $220,000 as part of an overall purchase of 300 acres for $468,000.

“I can’t emphasize this enough; $74,000 of the value of their property is what they’re giving up. How many people do you know would do that?” asked Commissioner Bill Hirsch.

Kendra Wills, of the Kent-MSU Extension Office and a consultant to the county on the PDR program, said she closed on one development transaction last month, was expected to close on two more last week, and planned to close on the fourth next month. The closings will be the final actions Wills will perform on the county’s behalf, as she has taken another position at the extension service.

“We’re going to terribly, terribly miss her,” said Gabe Hudson, a Gaines Township farmer and chairman of the county’s Agricultural Preservation Board. “The staff has been extremely helpful to our board.”

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