URBANA — Mayor Laurel Prussing plans to tell city council members Monday (today, Jan. 7) that Urbana's hotel activity has grown faster than Champaign's since city officials pulled funding from the county's tourism bureau and raised hotel-motel taxes by 1 percentage point.
Her comments are listed on the agenda for the Urbana City Council meeting, set for 7 p.m. in the Urbana City Building, 400 S. Vine St.
In a hotly debated 2011 move, Prussing vetoed $72,000 in funding for tourism promotion through the Champaign County Convention and Visitors Bureau. Weeks later, Prussing proposed that the city's hotel-motel tax be raised from 5 to 6 percent.
The city council upheld her veto and passed the tax increase.
Now, Prussing says the verdict is in — and there has been no adverse effect.
"Some people worried that this would adversely affect Urbana hotels relative to those in Champaign," Prussing said in the memo. "However, Urbana hotel-motel tax revenues not only did not suffer a lack of growth but grew significantly faster than those in Champaign."
In fact, she said, even without the tax raise, Urbana's hotel-motel revenue grew last year at a pace faster than in Champaign. Receipts jumped 18 percent in Urbana, compared with 9.6 percent in Champaign.
With the tax increase added in, total hotel-motel tax revenues jumped 35.6 percent, from $651,499 to $883,598.
"Clearly, the modest tax increase and the ending of the subsidy from Urbana to the CVB did not harm Urbana hotels and motels, but together provided a much-needed help to balance Urbana's city budget," Prussing said in the memo.