Yuma city council considers options for hospitality tax

Two potential options for renewing the soon-to-sunset hospitality tax were presented to the Yuma City Council during its roundtable meeting Tuesday afternoon.

Either option would extend the tax for 20 years, with the revenue to be used to support tourism, the riverfront and parks and recreation, said City Administrator Mark Watson.

One option is to retain the hospitality tax at its current 2 percent, extending it to rental cars as well, Watson said.

The second option, he said, is to retain the tax at 2 percent for bars and restaurants and extend it to rental cars. The tax rate for hotels would be raised to 3.5 percent.

"The hotels need the promotion efforts of the Yuma Visitors Bureau," Watson said in his presentation. "It's like a pooled resource for them."

But that effort benefits the rest of the community, he noted.

"As more people come to the community, the more they go to the bars and restaurants," he said.

Currently, the 2 percent tax on hotels, bars and restaurants generates about $4 million a year, said Mark Watson, city administrator. Hotels generate 20 percent of the dollars and restaurants and bars the other 80 percent. The money is used to fund the promotion of tourism, parks and recreation projects and riverfront activities.

Any measure would need to be "palatable" to voters who rejected an earlier effort to extend and increase the tax.

By starting the renewal effort now, the city would have the summer to make presentations and gather input from the community, Watson said. By Oct. 15, the council could have a first reading to place the measure on the ballot in March.

The hospitality tax was originally approved in April 1970 to build the Yuma Civic Center, Desert Hills Municipal Golf Course and a baseball complex. In 1993 voters extended the tax to 2009. In November, voters rejected a proposal to increase the tax to 2.5 percent and extend it for 25 years.

---
Joyce Lobeck can be reached at jlobeck@yumasun.com or 539-6853.