Owen Sound city hall. (photo by Claire McCormack)
Owen Sound looks like it’s going to be moving ahead with a municipal accommodation tax (MAT).
Council passed a recommendation at its meeting Monday evening to have a municipal accommodation tax by-law brought forward for approval, following a legal review of a draft document by the city’s solicitor.
City councillors also signed off on another recommendation from the community development, tourism and culture advisory committee to direct staff to prepare and issue a request for proposals to identify and select an eligible tourism entity to administer half of the revenue raised from the MAT, to promote tourism in Owen Sound.
“I think this is a great step forward. It’s one of the very few options the province allows us to tax,” says Coun. Travis Dodd. “We always talk about how everyone else uses our services. Here’s one option the province has given us to actually apply a tax to pay for the things we’ve continued to say, we need help and support to pay for.”
The MAT is a four per cent fee levied on short-term accommodations of 30 days or less. It includes stays at hotels, motels, hostels, bed and breakfasts, campgrounds and other short-term rentals (such as Airbnbs).
“There are several exemptions provided in the by-law,” says Owen Sound’s Director of Community Services Pam Coulter. “Things like the County of Grey, where they’re using it for short-term or emergency shelter, would be exempt from paying the MAT. Boards of education, long-term care type uses (are also exempt).”
Coulter told councillors there are 46 municipalities in Ontario which have implemented municipal accommodation taxes. South Bruce Peninsula and Northern Bruce Peninsula are some of the nearby municipalities that already have it in place.
Provincial regulations allow for half of MAT revenues to be used by the municipality at its discretion, while the other half must be used for tourism in the area.
Investments in trails, playgrounds and weekly events/activities were among the leading survey responses from accommodations providers to a question about how the city could direct MAT funds to support business and attract more people to the area.
A potential short-term rental licensing program is also being looked at in committee as part of Owen Sound’s MAT process. The city’s corporate services committee will review feedback on short-term rentals gathered in a survey of citizens, visitors and operators at its July 13 meeting.
Owen Sound City Manager Tim Simmonds says it will be important for MAT and short-term rentals to move forward in unison; the target for implementing the MAT is during the first quarter of 2024.
“This depends a little on the timing for any future short-term rental licensing by-law and the other next steps identified,” Simmonds explains in an email.