MN Hospitality Advocate

Ignition Interlock Bill Hearing Today

Posted in General Advocacy, Restaurant Issues, State Laws by hospitalityminnesota on February 25, 2010

Today, if you are a first-time offender for driving under the influence, you face a three-month license revocation. Governor Pawlenty has proposed legislation that would extend that revocation to six months, but allow one to drive if they install what is known as an ignition interlock (blow and go) device. The bill gets its first hearing today in the Senate Transportation Committee. The bill is S.F. 2741 and can be found here. The companion House file is H.F. 3106.

This is a very difficult issue for us. We do not condone drinking and driving. We absolutely believe repeat offenders and those with high blood alcohol level content should be subject to this provision. Our concern is in regard to that person who happens to have a couple of beers and tests at .085, gets picked up on a first-time offense, and must install one of these devices to avoid license revocation. These devices require a monthly monitoring fee of approximately $100 and may require an installation and removal fee as well.

Knowing that this fate that might await you, we are concerned that individuals simply will not drink when they are out, or will have one or two fewer drinks to ensure that they don’t get dinged.  This could have a substantial impact economically on an industry that’s already been hammered with declining sales, the smoking ban, a recent minimum wage increase with no acknowledgment for tipped employees and increased fees and regulations.

We would strongly support the ignition interlock piece for repeat offenders, or even for first-time offenders at .15. For more information on this issue, see http://interlockfacts.com/ The bill likely will visit several committees and we’ll keep you posted as it progresses.

David Siegel, CAE, IOM
Minnesota Restaurant, Lodging and Resort & Campground Associations and Hospitality Minnesota

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What Role do We Play in New Vikings Stadium?

Posted in General Advocacy, Lodging Issues, Restaurant Issues, State Laws, Tourism Issues by hospitalityminnesota on February 18, 2010

Governor Pawlenty today in comments to Star Tribune Columnist Sid Hartman mentions several possible solutions for funding a Vikings stadium. These include capturing additional tax revenue a new stadium would generate, as well as a new Minnesota lottery game that could generate up to $12 million annually.

Pawlenty also mentioned that a local partner (i.e. Minneapolis or Hennepin County) must come with some revenues to be part of the solution. That sounds to us like a tax on the hospitality industry. One other way in which a city or county might generate dollars would be through a sales tax, but we see that as unlikely given recent sales and gas tax increases.

The Minnesota Restaurant, Lodging and Resort & Campground Associations have a long-standing policy that we expect to be part of the solution, as that’s in part how stadiums are funded across the country. But we do not feel the burden should fall unfairly on our hotels and restaurants, already suffering from a terrible economy. For our position paper, see our website at www.hospitalitymn.org under Government Affairs.

The overarching funding philosophy from the perspective of key legislators we’ve spoken with is this: those who benefit should pay. And in the minds of most legislators, the hospitality industry is one of the significant benefactors from a new stadium. There is clearly an overall value to having a top NFL team in Minnesota from a tourism perspective. And our hotel industry in the Twin Cities acknowledges a benefit from the Vikings.

The Vikings need between $29 million and $42 million annually to service the debt on bonds issued to build a new stadium. The higher number reflects a retractable roof. This assumes an owner contribution of approximately one-third of the cost of a new stadium (without a roof), which has been typical of most NFL stadiums.

The Vikings have compiled a list of the various funding mechanisms stadiums have used in the past. They include items such as lottery proceeds, hotel taxes, liquor taxes, restaurant taxes, sales taxes, memorabilia taxes and car rental taxes.

We’ve begun conversations within our industry, with the Vikings and with key legislators in regard to the industry’s position. In fact, two key legislators engaged in this process recently asked us to visit on the issue.

We certainly feel that the proposed owner’s commitment needs to increase. But nonetheless, roughly two-thirds of the funding will probably be from public sources. My questions for the industry are designed to generate feedback. Should we take an absolute positi0n against any lodging, food and beverage or liquor tax increases? What about one but not the others? If we did agree to any kind of tax, should a tax be statewide because the whole state benefits from the Vikings, or should it be more local because that’s what can pass politically? If we did agree to any kind of tax, what percentages should we consider? What are your thoughts on the hospitality industry’s participation in this Vikings stadium?

Whatever the solution, it’s going to be difficult to bring unity to our massive and varied industry. But leadership will be required to get this job done and as the statewide associations in the hospitality industry, we’re expected to play a role. We do agree that keeping the Vikings is important to our industry and our state. Undoubtedly, any decision our Legislative Committees and Boards of Directors reach will bring criticism. Such is the nature of leadership. It starts with feedback from you.

David Siegel, CAE, IOM
Minnesota Restaurant, Lodging and Resort & Campground Associations and Hospitality Minnesota

Vacation Home Rentals May See Solution

Posted in Lodging Issues, Resort Issues, State Laws, State Rules, Tourism Issues, Vacation Home Rentals by hospitalityminnesota on February 13, 2010

Over the past several years, the practice of renting out ones cabin to bring in revenue and offset property taxes and general maintenance expenses has become common. We call this vacation home rentals. In addition, websites have sprung up in significant numbers making it very easy for vacation homeowners to rent out their units (and many vacation homeowners have built their own sites.

For a good example, check out www.vrbo.com (vacation rental by owner). So why does our industry care? Because these vacation homes are now in the marketplace competing against private resorts and lodging properties, yet they do not have to meet the same regulatory requirements. They often do not collect sales tax, lodging tax, get inspected by the Department of  Health or meet DNR Shoreland Management standards.

The Minnesota Department of Health has the authority under current statute to inspect these properties, but has only recently begun to do so. In part it’s a manpower issue – they simply don’t have enough folks to chase down every private homeowner.  And in part, it’s because the problem has only become evident as the Internet has grown and the cost of entry into the marketplace has declined.

The Minnesota Resort and Campground Association and Minnesota Lodging Association care a great deal about this issue. Level playing field and public safety are key elements of the discussion. The Department of Health is preparing to move forward with some technical corrections to existing statute that will clarify their existing authority to inspect. It’s a great first step in ensuring that Minnesota’s vacationers are in safe facilities.

We’ll keep you posted as the initiative progresses.

David Siegel, CAE, IOM
Minnesota Restaurant, Lodging and Resort & Campground Associations and Hospitality Minnesota

Meetings with Key Legislators

Posted in General Advocacy, Resort Issues, Restaurant Issues, State Laws, Tourism Issues by hospitalityminnesota on February 11, 2010

As part of our 2010 Legislative Agenda, we felt it was important to meet with key legislators to share our issues and provide background and explanation. We met with House Commerce Chairman Joe Atkins (DFL-Inver Grove Heights) and talked about a wide range of issues, including beverage taxes, alcohol taxes, ignition interlocks, Labor Day School, video games of chance and more. We also had the opportunity to share time with the Chairman on the issue of Online Travel Companies and the possible taxation of their service charges for hotels.

We met with Senate Tax Committee Chairman Tom Bakk (DFL-Virginia) on many of the same issues. We visited with Rep. John Ward (DFL-Brainerd) on several key tourism issues, including Labor Day School, protection of local option Lodging Taxes, additional hospitality taxes and vacation home rentals.

In all cases, we are able to effectively share our concerns. With the session just under way, now is the perfect time to contact your legislators and share with them your issues. We have all of our issue briefs on our web site at http://www.hospitalitymn.org. Check those out and act today to reach your legislators.

Also, please prepare now to attend Hospitality and Tourism Day at the Capitol on March 18 at the Best Western Kelly Inn. This event is extremely important in showcasing the power of our industry.

David Siegel, CAE, IOM
Minnesota Restaurant, Lodging and Resort & Campground Associations