Special Election - March 2021

Hotel Motel Tax Special Election March 2, 2021

Tourism provides places to visit, jobs, economic growth and impacts our quality of life. In addition, tourism generates revenue for the people and places hosting visitors. One way this occurs for cities in Iowa is through a hotel motel tax. Overnight stays at hotels, motels, bed-and-breakfasts and other lodging accommodations incur a tax that is collected at the time of the stay. The percentage of tax varies from city to city up to an allowable amount of 7%.

In Oskaloosa the current hotel motel tax rate is 5%. The Iowa Department of Revenue collects the tax with hotel/motels’ quarterly tax returns then distributes the funds back to local governments on a quarterly basis. In turn, and per voter election results November 3, 1998, the revenue the city of Oskaloosa receives from this tax is disbursed quarterly to Mahaska Community Recreation Foundation for recreational purposes.

As a source of funding for economic development, most Iowa cities charge this tax at varying rates. After review of rates of cities throughout the state, including those neighboring Oskaloosa, the city will hold a special election posing a ballot question asking residents if they would support an increase in the hotel-motel tax from 5% to 7%.

Why is the increase being proposed?

Increasing the rate by 2% would generate additional funds that could be allocated for the promotion and encouragement of tourist and convention business in Oskaloosa and surrounding areas. It could also be utilized to address community projects such as an alley improvement program, downtown streetscape enhancements, entertainment space recruitment and development, parking lot improvements for downtown, or live music and entertainment.

This 2% increase would not impact the current allocation to the Mahaska Community Recreation Foundation, the foundation would continue to receive the previously approved 5% collected from the hotel motel tax.

Who will pay the tax?

This tax is 100% paid for by those visiting and staying overnight in a hotel or motel within our community.

How much revenue does the city of Oskaloosa currently receive under the 5% rate?

The 5% hotel motel tax revenue is included in the FY2021 council approved budget for $150,000, although could fall short of that figure due to the impact of the COVID-19 pandemic. Historically, this tax has generated the following amounts: FY2020 $94,238; FY2019 $112,081; FY2018 $96,452; FY2017 $107,240; FY2016 $111,945.

How much additional revenue is the tax projected to generate?

A rate increase from 5% to 7% could result in approximately $58,000 - $74,000 of additional revenue per year, with fluctuations based on market conditions during any specific fiscal year.

What do other cities in Iowa charge for this tax?

168 cities in Iowa currently impose a hotel motel tax ranging from 4% to 7%.   A specific breakdown of those includes 151 charging 7%, one charging 6%, 15 charging 5% and one charging 4%.  A list of those communities and their currently adopted hotel motel tax rate is available online at: https://tax.iowa.gov/reports?term_node_tid_depth=94&title=rates. Neighboring communities in the region such as Albia, Centerville, Chariton, Fairfield, Grinnell, Knoxville, Newton, Ottumwa, and Pella currently impose a rate of 7%. 

What are the next steps?

The election will be held March 2, 2021, with a simple majority vote determining the outcome.

  1. If passed, the hotel motel tax increase would be imposed beginning July 1, 2021.
  2. If declined, the hotel motel tax would remain at 5%.

Voter Information

Deadline to register to vote to take part in election:    

  • Early Voter Registration deadline – Friday, February 19, 5:00 p.m.
    • If registering after this date and prior to election day, contact the Mahaska County Auditor’s Office at 641.673.7148.
  • Election Day Registration – Oskaloosa citizens that are not registered at their Oskaloosa residence can register on election day.  They would need to bring a current photo ID with their current address.  If the photo ID does not have the current address, a piece of mail with their name and new address would need to be presented.

 Voting place for the March 2, 2021, Oskaloosa Special Election:

  • All Oskaloosa residents will vote at the Mahaska County Agricultural Extension Building, 212 North I Street, Oskaloosa, with polling from 7:00 a.m. to 8:00 p.m.
  • To check voter registration status or to register to vote: https://sos.iowa.gov/elections/voterinformation/
  • Absentee voting:  
    • An absentee ballot request form must be completed by each voter.
  • Last day to request an absentee ballot to be mailed – Friday, February 19, 5:00 p.m.
  • Last day to return voted absentee ballots in-person – Tuesday, March 2, 8:00 p.m.
  • Last day to return voted absentee ballots by mail – Monday, March 1 – MUST HAVE A MARCH 1, 2021, POSTMARK TO BE COUNTED and received in Auditor’s Office by noon Monday, March 8.
  • Last day to vote absentee in-person – Monday, March 1, 5:00 p.m. at Mahaska County Auditor ‘s Office.
  • In-person voting: Contact Mahaska County Auditor’s Office at 641.673.7148 when absentee voting begins.

Contact Mahaska County Auditor’s Office at 641.673.7148 for further voter and election information.