Oregon local governments could use lodging taxes for local services

Local governments would use at least 40% of covered lodging tax money for tourism purposes and could use up to 60% for local services. These limits cover new or increased local taxes on overnight stays. Services may be provided by a city, county, or special district acting in their place. The percentages apply to money remaining after charges that reimburse tax collection costs. Tourism debt financing costs could be paid only if the government provides a tax collection reimbursement charge. The tax increase used to finance that debt would have to end when the debt is paid off. The spending amendments would apply to money collected before, on, or after the act’s effective date.

Local governments could apply the spending limits to covered older, unspent lodging tax money and could reduce their tourism spending shares. Covered older money includes revenue from taxes not imposed on July 1, 2003, rates in effect on that date, and rate increases made on or after July 2, 2003. Older money must remain unspent and must have been collected before the act takes effect. Reduced tourism spending shares would still have to meet the 40% tourism minimum and 60% local services maximum. The act would take effect on the 91st day after the 2026 regular legislative session finally adjourns.

Local governments would report lodging tax collections and spending to the Oregon Department of Revenue, which would publish the reports in a public database. The duties cover local governments imposing lodging taxes and organizations receiving that money under agreements with them. Organization reports would be included in the local government reports. Reports would show tax rates, collections, and spending for the preceding two fiscal years. They would also describe reserves, changes in spending rules, and any oversight activities. Organizations receiving the money under local government agreements would report how they spent it, tourism results, and whether they met their agreements. Cities and counties could ask the League of Oregon Cities or Association of Oregon Counties, respectively, to file for them. Local reports would be due September 1 of each odd-numbered year, beginning in 2027. The reporting requirements would end January 2, 2041.