Hospitality tax affects all who stay, eat, drink
In a March 23 letter, Mr. Tom Cooper expressed outrage over opposition to a proposed new 1 percent additional sales tax in Bemidji. He said patrons of hotels and not owners would be taxed and asserted it would be fair because those patrons enjoy the Sanford Center.
The actual legislation, HF 1037, proposes to tax up to 1 percent on the gross receipts of all food and beverages sold by a restaurant or place of refreshment located within the city, including bars, and on the gross receipts for the furnishing for consideration of lodging at a hotel, motel, rooming house, tourist court or resort.
The legislation doesn’t care whether you enjoy Sanford Center events. Every person who stays in Bemidji or who eats or drinks in Bemidji, most of whom do not enjoy events at the Sanford Center, will pay this tax.
The proposed tax really has no relation to the Sanford Center – it’s merely a cost shift to people who can’t vote against it and who didn’t vote to build the Sanford Center. If the Sanford Center and Bemidji government really want to have Sanford Center patrons pay the $400,000 annual operations shortfall (which would be fair), they can institute a ticket surcharge for Sanford events. Then actual patrons would provide financial support for the Sanford Center because they are enjoying events there.
Passage of the proposed tax would certainly be a positive for city residents and would lower Mr. Cooper’s property tax, but it would be a solid negative for every person who stays, eats or drinks in Bemidji whether they live within the city or not. And it certainly isn’t “fair” to anyone outside the city limits who didn’t vote to build the Sanford Center and isn’t being asked to vote to pay for the Sanford Center.
City residents and the city government knew the Sanford Center would run at a deficit every year into the future and still decided to build it. Now they should pay for it.