Executive Committee Mtg 04-16-24

President's Report

Page 55 of 55

Governor Signs Bill Allowing Some Cities and Counties to Raise Lodging Taxes Last week, Governor Whitmer signed House Bill 5048, a bipartisan bill that would allow qualifying counties and cities in Michigan to leverage excise taxes on hotels in order to invest in tourism-friendly projects. Next, voters will have to support the tax before it can become effective.

Under House Bill 5048, which was passed by the legislature back in November 2023, cities and townships in Kent County, including Grand Rapids, will be

able to levy a 2% excise tax on lodging, pending the approval of city councils or township boards as well as the approval of voters. Meanwhile, 9 counties also meet requirements under House Bill 5048 to raise excise taxes on lodging from 5% to 8%, though this is also subject to county leadership and voter approval. The funds from these taxes must be used exclusively for tourism-related purposes, including the construction of convention centers, arenas, athletic stadiums, and more. Grand Rapids, in particular, is already planning to direct funds to the development of a massive outdoor amphitheater and a new soccer stadium.

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