JEROME - The Jerome Town Council has voted and it's become official: The "bed tax" goes up and a new commercial rental tax is on the books after discussions at an Aug. 9 regular meeting.
"That (bed) tax will increase to 3 percent as of November 1, 2016, bringing the local tax rate for hotels and other transient lodging facilities to 6.5 percent," said Town Manager Candace Gallagher.
Ever since it was proposed during budget talks earlier in the year, the hike in "bed tax" has attracted controversy. Some felt it puts Jerome's "bed tax" in-line with other neighboring communities and that it brings additional funding for tourism. They say the State-mandated one-percent tourism expenditure from the "bed tax" could be applied towards such proposed projects as a public restroom and shuttle van.
Others voiced the view that the adoption of a "bed tax" last year and a hike this year has placed an unfair burden on hospitality owners at the exclusion of other town businesses. They also point to council's adoption of a one-year "sunset clause" on the tax last year as a rationale to cover budget shortfalls, but that the clause has not since been revisited.
In addition to increasing the "bed tax," Jerome Town Council also approved a new Transaction Privilege tax on commercial rentals, joining other Verde Valley communities such as Clarkdale and Cottonwood.
"Although residential rentals have been subject to a 3.5 percent local tax since 2010, commercial rentals were previously exempted," said Gallagher. "Beginning on November 1, 2016, commercial rentals will be taxed at the same rate as residential rentals."
The next meeting of Jerome Town Council is scheduled for 7 p.m. Sept. 13 at Town Hall, 600 Clark St.