Some cities and towns could tax short lodging stays

A city or town could charge lodging businesses a flat tax of up to $5 per night. Only cities and towns without authority or a requirement to charge a lodging tax under another chapter qualify. The tax covers listed lodging rented for fewer than 30 days. Student dorm stays while earning credit from a local college are exempt. The tax would be added to state and any county lodging tax. If enacted, this chapter would take effect July 1, 2026.

A local finance officer would put the tax money in a dedicated visitor and tourism fund. This applies if a city or town imposes the tax. Local lawmakers must approve spending before the money is used. The money may support tourism, parks, and services for special events, but cannot pay event salaries or operating costs.

A person would commit a Level 6 felony for knowingly approving a barred transfer or knowingly misusing transferred tax money. This covers people who approve transfers and people who receive transferred money under this chapter. The transfer must go to someone ineligible or serve a purpose the law bars. A recipient who knowingly spends transferred money for a barred purpose is also covered. If enacted, the criminal provision would take effect July 1, 2026.

A lodging tax imposed under this chapter would end automatically. This applies to a city or town tax imposed under this chapter. The end date is tied to the effective date in the local tax ordinance.