The city of Ashland is a step closer to raising its lodging tax to 9 percent.

On Tuesday night, an Ashland City Council majority voted to schedule a public hearing to gather input on raising the city's 7 percent lodging tax by 2 percent.

The hearing will take place during a regular council meeting that begins at 7 p.m. on Tuesday, June 3, in the Ashland Civic Center, 1175 E. Main St.

If Ashland raises its tax to 9 percent, it would match the lodging tax rates in Medford and Jacksonville.

The current 7 percent tax will bring in an estimated $1,525,000 for the fiscal year that starts July 1.

A bump up to 9 percent would bring in approximately $1,961,000, or $436,000 more, according to Ashland Finance Department projections.

That money could be used to boost Ashland Chamber of Commerce marketing of the town &

especially during the slower fall, winter and spring months.

More money would also be available for city Economic and Cultural Development Grants that go to nonprofit groups such as the Ashland Independent Film Festival, ScienceWorks Hands-On Museum and the Ashland Gallery Association. The gallery association organizes events like First Friday Art Walks each month and the annual A Taste of Ashland wine, food and art tour.

Sandra Slattery, executive director for the Ashland Chamber of Commerce, said the chamber has not taken a position on whether the city should raise its lodging tax.

But she said Ashland should not raise its tax unless it plans to invest significant amounts of the new revenue on marketing.

"We are far behind in the amount of money we are spending," Slattery said.

If the lodging tax rate is left at 7 percent, the city will give about $88,000 to the chamber's Visitors and Convention Bureau for marketing.

A council majority indicated early support for giving $225,000 to the chamber for marketing if the tax is raised to 9 percent. City staff had recommended giving the chamber $300,000.

Slattery said Medford provides about $600,000 for its Chamber of Commerce visitor center, while Grants Pass and Klamath Falls are spending about $500,000. She said there has been significant construction of new hotels in Medford, and those chain hotels will be marketing stays in Medford.

Meanwhile, Ashland is coping with a loss of large group meeting space after the Windmill Inn announced in 2007 it would no longer offer conference facilities.

With the country in the midst of an economic downturn, Slattery said Ashland should put more money into marketing, not less.

However, some owners of tourist-related businesses are worried that an increased lodging tax would make Ashland a less attractive destination and could cause the visitors who do come here to spend less on theater, dining and other activities.

Chuck Young, representing the two-dozen members of Ashland's Bed and Breakfast Network, said there is already a perception among tourists that Ashland is expensive. He said many tourists are feeling the impacts of a slowing economy and rising gas and food prices.

"We're concerned about the perception. We don't want to kill the golden goose," Young said.

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