Iowa State University

Inside Iowa State
April 2, 1999

Hotel tax vote set for April 27

by Anne Dolan

Ames residents will vote April 27 on a proposal to raise the city hotel tax from 5 to 7 cents on the dollar to help pay for improvements to Hilton Coliseum. Last week, the City Council passed an ordinance to increase the tax and set the date for the special election.

If approved, the tax increase will go into effect July 1. For 10 years, up to $2.5 million of the additional tax revenue will go to the university to help fund an estimated $5.9 million renovation of the arena. Iowa State will fund the rest of the project, which includes 1,465 additional seats, more restrooms for men and women, and structural changes that bring the facility in line with current federal accessibility and state fire codes.

If voters reject the tax increase, all elements of the project except the additional seats will move forward, funded by the university. With or without a seat component, construction work should begin next January and continue for 12 to 18 months, according to Mark North, executive director of the Iowa State Center.

One of the discussion items for the council has been the Memorial Union's traditional practice of not assessing the hotel tax on overnight guests. The solution worked out is that, if the hotel tax increase is approved, the university will pay to the city the equivalent of a 7 percent surcharge on sleeping rooms. The funds will come from the Memorial Union, but this arrangement doesn't jeopardize the Union's tax-exempt status.

Council member Herman Quirmbach cast the only dissenting vote on the ordinance. Among his objections are the use of city tax money for a university facility, the absence of an agreement assuring the city access to Hilton in the future, and the fact that the State Board of Regents won't be asked to approve the Hilton improvement plans until design drawings are prepared -- months after the tax vote.

Vice President for External Affairs Murray Blackwelder told the council he expects the regents will like the university's plans for Hilton, both the physical improvements and the funding proposal.

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