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Letter to the Editor

Oppose city bed tax increase

To the editor: The Alaska Hotel and Lodging Association stands firm in its opposition of the proposed 8% to 9.5% for 2019, 10% for 2020 and 10.5% for 2021 hotel-motel room tax increase. A few thoughts:

Ordinance No. 6084 will burden only Fairbanks hoteliers and no other industries. Neither hoteliers nor Explore Fairbanks requested or favored this targeted tax increase.

Ordinance No. 6084 proposes an increased targeted industry tax, which will negatively impact Fairbanks hoteliers. Although the percentages seem small, they will impact the ability to expand and hire and will reduce margins from already sold nights/packages.

The argument this is a “pass-through tax” is not accurate. Average daily room rates will be adjusted to offset the increase, resulting in less money for items like safety upgrades and local giving. If rates stay the same with the added tax, occupancy rates will decrease. Nothing is a pass-through.

This tax would not only burden visitors but also would have a profound impact on Alaska travelers as well as put a constraint on convention business to the Fairbanks area.

The city budget is in the black, and I would conclude there is no need for targeting Fairbanks hoteliers for more taxes than the healthy amount they already pay.

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