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Perham hotels to start charging lodging tax

PERHAM -- Perham will enter the modern age of tourism marketing, following the approval of a local, 3 percent lodging tax that could generate about $30,000 a year.

Te tax only affects the two motels within city jurisdiction: The Crossings and the Super 8-though several local Chamber of Commerce officials would like to find support to extend the lodging tax out to the resorts on East Otter Tail lakes.

Lodging taxes are common throughout the nation.

Hotel lodgers are taxed an additional 3 percent, which is then pooled into a general fund that is used for marketing expenses to promote the area.

Based on approximate lodging revenues generated at the two hotels, the tax should generated about $30,000. Governing the tax revenues will be a "tourism bureau," made up of two representatives from the lodging industry; two representatives from the Perham Area Chamber of Commerce; and a member of the city council. The council has ultimate approval of the expenditures, which are earmarked for marketing and advertising-but in practice, it is likely that the council would simply rubber stamp recommendations from the Tourism Bureau.

The lodging tax, which was approved by the Perham City Council at the Nov. 9 meeting, will be in force Jan., 2010