The City of Port Alberni is considering implementing a “hotel tax” for travellers in the community.
Alberni Valley Chamber of Commerce excutive director Bill Collette was in council chambers on Monday, Jan. 14 to talk about the Municipal and Regional District Tax program (MRDT), which he believes is a “missed opportunity” for the City of Port Alberni.
MRDT allows local accommodations to collect a two or three percent tax from travellers. This tax is passed on to the Ministry of Finance and eventually finds its way back through local government to be used for marketing and promotion of the community. The tax has to be supported by 51 percent of hoteliers in the community before it can be implemented.
Port Alberni is currently one of the few municipalities on Vancouver Island that does not leverage the tax.
This is not the first time Collette has brought the concept forward. He was at the ACRD board of directors meeting on Nov. 14, 2018 to propose the tax, which was referred to the Alberni Valley and Bamfield Services Committee for consideration. He has also made the delegation to past councils.
“We believe we’re missing out on financial opportunity for the city of Port Alberni,” he said on Monday, pointing out that the tax could be used for many different tourism initiatives, as well as housing initiatives.
MRDT has a bit of history in the Alberni Valley. Prior to 2012, hotels in the city did collect the tax.
But Peter Mugleston, chair of Alberni Valley Tourism and the owner of Best Western Plus Barclay Hotel, was also in council chambers on Monday, and said that hoteliers didn’t like how their money was being spent.
“There was approximately $90,000 of revenue coming in, and $50,000 of that was spent on a marketing coordinator,” he said. “$40,000 to market the Alberni Valley wasn’t significant enough to do a good job.”
Four Alberni Valley properties—the Best Western, the Hospitality Inn, the Howard Johnson Hotel and the Somass Motel—chose to continue collecting two percent of room rates on a voluntary basis. Mugleston said that 100 percent of this money is going towards the marketing of the Alberni Valley. His organization, Alberni Valley Tourism, recently released a video produced by Tyler Cave that had more than 64,000 views as of Wednesday, Jan. 16.
However, Collette believes the city could be collecting much more.
“There are properties in Port Alberni that voluntarily collect money,” he acknowledged. “The problem we have is that we’re missing out on a bigger number.”
Campbell River, which had the highest hotel occupancy percentage in the province in 2017, started collecting a three percent hotel tax two years ago. More than $400,000 in revenue was collected by the city for its tourism fund after the first nine months.
Collette estimated that more than 400 rooms in the Alberni Valley could potentially be collecting a revenue of between $275,000 and $325,000. As of February 2018, Airbnb accomodations can also participate in the MRDT program.
Mugleston, meanwhile, said that he is not “100 percent against” MRDT, but he did not like the way the program was being brought forward.
“I think we all have to sit down at a table and see how we can present this in a better manner,” he said.
Councillor Debbie Haggard acknowledged the disagreements of the past, but proposed directing staff to work with the Chamber and hotels about the potential implementation of MRDT.
“My philosophy is when things happen ten years ago, you learn from those mistakes and you respect what happened, but you have to move forward,” she said.
Mayor Sharie Minions agreed that it is “important” to bring Alberni Valley Tourism to the table for discussions.
“There’s a lot more to this than what we’ve heard today, there’s a lot of history that goes into it and a lot of potential for our community,” she said.
Council agreed to hold conversations with the Chamber of Commerce and other agencies about the potential implementation of a hotel tax.