SANDPOINT – If city voters approve a local option tax on visitor accommodations when they go to the polls on Tuesday, Sandpoint officials say they can finally complete a number of street projects that have been sought since. long time.
If voters approve the measure, the city’s existing tourist tax would be extended through December 31, 2035, and increased from 7% to 14%.
A qualified majority of 60% is required for the measure to be adopted.
The proposed “tourist tax” applies only to lodging stays of 30 days or less at hotels, motels and vacation rentals located within the city limits.
The additional 7% sought by the city would only fund street and pedestrian projects. The existing 7% tax will continue to fund public safety, parks and other infrastructure improvements, Sandpoint City Administrator Jennifer Stapleton said.
The increase would put the city roughly in line with the national average. According to a 2019 study published by the American Hotel and Lodging Association, the average lodging tax is 13.5%, with several cities now charging over 20%, especially in cities that are a major tourist destination.
If approved, the proposed tourist tax increase will take effect on January 1, 2023.
The need to address the decline of the city’s streets and sidewalks has been evident for some time, city officials said at a council meeting in October. The long-standing question was how to pay for these upgrades.
In recent years, the Sandpoint City Council has doubled the annual budget for pavement maintenance and reconstruction to $500,000 per year, with funding coming primarily from local property taxes.
The local budget has also been increased for sidewalk and trail projects, Sandpoint officials said.
“Even with this increase, more sources of funding are needed to increase investment in pavement and sidewalk projects to recommended levels and prevent more streets from reaching poor/very poor or failing condition,” respondents said. managers on the website.
Like the rest of Idaho, Sandpoint’s growth has exploded in recent years. Sandpoint officials said the city’s growth rate has increased and is expected to hold steady at 2.5 times its historic growth rate.
“In addition to house price increases, this affects our infrastructure and we are unable to cope with these impacts,” Sandpoint officials said. “Like all local jurisdictions in the state, Sandpoint relies on property taxes and local fees to meet demand.”
All remaining tax revenue collected – including personal and corporate income taxes, capital gains taxes, gasoline taxes and sales taxes – goes to the state and is controlled by the governor and the legislature. Only a small percentage of sales tax revenue (11.5%) is returned to local jurisdictions, city officials said.
In 2014, Sandpoint voters approved a 7% Resort Town Local Option Lodging Tax on all short-term room occupancy for each rented or leased hotel-motel room in town.
Stapleton said the current tax began on January 1, 2015 and is scheduled to end on December 31, 2025. Revenue generated from this tax is primarily used to benefit public safety services, public park operations such as the City Beach program Lifeguard and the SPOT. Bus service.
City officials said current lodging taxes average almost $600,000 a year. A majority – about 60% – came from hotels/motels, with the remainder coming from licensed short-term rental properties. Over the past two years, short-term rental properties have accounted for over 50% of revenue and taxes generated by hotels/motels have decreased to less than half.
The city’s transportation system includes approximately 102 miles of street lanes, with a replacement value of over $86 million.
“Even with good maintenance, streets deteriorate and eventually need to be repaired,” Sandpoint officials said on the city’s website. “Signs of wear and distress include rutting, cracking and potholes.”
If voters approve the ballot measure, they said they would be able to start working through a backlog of paving projects and other street repairs.
Among the projects are the reconstruction of Cedar and Fir streets and sidewalk connectivity on Larch, Oak, Ella and Fourth. In addition, sidewalk connectivity at Washington Elementary, Sandpoint Senior Center and downtown accessibility improvements will be completed, officials said.
Projects have been identified as part of the City’s Multimodal Transportation Master Plan. Although the plan found pavement conditions on city streets to be within the national average, Sandpoint has a backlog of pavement projects for streets in very poor or poor condition of 21%, double the average. national.
The report recommended that the city’s annual investment in street pavement projects be increased to more than $1 million a year to avoid further increasing this backlog, officials said. The MTMP also includes a Pedestrian Priority Network Improvement Program that identifies necessary accessible improvements to existing sidewalks and paved pathways and expansion needs to complete the network, officials said.
If voters reject the ballot measure, city officials said the current local option tax would end on Dec. 31, 2025.
“Funding for street and pedestrian improvements will continue to be lacking unless grants are obtained or future ballot measures are passed by voters,” officials said. “In addition, existing funds for public safety, parks and other improvements will be reduced when the current local option tax ends.”