Officials with Lawrence’s Convention and Visitors Bureau may ask city commissioners to increase the tax that is charged to visitors who stay in Lawrence hotels.

Judy Billings, director of the bureau, said she expected to ask city commissioners to increase the transient guest tax.

Billings said she hoped a tax increase would produce more revenue, which the department could use to advertise Lawrence as a destination spot for tourists and conventions.

“All our costs are going up, so we feel like we have to do something, unless people don’t want us to do our job,” Billings said.

Lawrence Mayor David Dunfield said he expected city commissioners to consider raising the tax from 4 percent to at least 5 percent sometime during the city’s June budget deliberations.

“It seems like a reasonable idea to me,” Dunfield said. “Attracting people to stay in the city’s hotel rooms is a part of economic development. This seems like a relatively painless way to support those efforts.”

Billings said the Visitors Bureau needed more money to do its job. The department has faced two years of stagnant budgets because the transient guest tax, its main funding source, has been affected by a decline in travel.

The department has responded by cutting the number of trade shows it sends staff members to. It also has quit marketing to motor coach tours and has put on hold plans to expand its advertising of Lawrence attractions in several Midwestern cities.

“It would be easy for us to solve our budget problems by cutting advertising, but that’s what we’re really supposed to be doing,” Billings said. “We’re supposed to be spreading the word about Lawrence.”

Billings said advertising rates in publications — ranging from a Kansas Speedway guide to magazines like Midwest Living — were increasing their advertising rates. The visitors bureau, which is part of the Lawrence Chamber of Commerce but receives city funding, would like to expand its advertising program to cities like St. Louis, Denver and Oklahoma City.

“We would be able to get pretty focused on attracting more conventions and more group tour business, and we would probably be able to expand our advertising in all areas,” Billings said.

A percent increase in the tax rate, based on 2002 hotel sales, would generate about an extra $110,000. The Convention and Visitors Bureau has a budget of $570,000.

Declining numbers

There are some signs that Lawrence is starting to see a loss of tourism and convention dollars. The city’s transient guest tax collections have declined from about $460,000 in 2000 to about $445,000 in 2002. The number of conventions held in the city also declined from 128 in 2001 to 120 in 2002. Attendance at those conventions dropped, falling from 23,500 in 2001 to 19,200 in 2002.

“It is tremendously competitive out there,” Billings said. “We all believe Lawrence is a wonderful place, and it is, but there are so many choices out there.”

Billings said she thought the city could raise the bed tax and still remain competitive with other cities in the state. She gathered data from nine other cities in the state and found that Lawrence and Hays had the lowest bed taxes at 4 percent. The highest was 7 percent in Wichita, but several area cities, including Overland Park, Kansas City, Kan., and Topeka, had rates of 6 percent.

Some concerns

Reaction to the possible tax increase was mixed among hotel operators.

Kate Kelly, general manager of the Days Inn, said she thought the tax increase would be acceptable as long as it didn’t push the Lawrence tax higher than those in Topeka or the Kansas City area.

“We’re right in the middle of Kansas City and Topeka, and if we had more exposure, I think people would see that we’re a definite alternative to staying in those areas,” Kelly said.

Rob Phillips, general manager of the Eldridge Hotel, said he was opposed to the idea.

“We have had to reduce the costs of our rooms to be competitive already,” Phillips said. “If you raise the tax, then that just makes us less competitive again. There’s a struggle going on out here, and this doesn’t help any.”

Phillips said he wasn’t convinced that more advertising would bring more visitors because he’s uncertain the department’s advertising efforts are effective.

“I think there needs to be a re-evaluation of how the bed tax is being spent,” Phillips said. “I think we should take a real in-depth look at it with city commissioners, hotel operators, maybe the new chamber president.”