Since the Government of Alberta announced it was talking with the cities of Edmonton and Calgary about the administration of DMFs, the AHLA has been actively engaging with both levels of government and monitoring this issue. We are working closely with the local hotel associations in both cities to ensure that our industry delivers a unified message – that we oppose giving municipalities authority over the administration of DMFs.
Earlier this month, we met with the Ministry of Municipal Affairs to discuss the status of the administration of DMFs as part of the fiscal framework that will be part of city charters for Edmonton and Calgary. What we heard at this meeting is consistent with what we have been told by other contacts in the provincial government. Below are some highlights from our conversation:
- The provincial government has made no commitment to give cities the authority to administer the DMF, regardless of what the cities might suggest.
- The most significant element of the fiscal framework is around funding for municipalities, which the provincial government and the cities are presently negotiating. We were informed there is a gulf between what the cities want, and what the province is prepared to give them, particularly in light of the current budget deficit. Other elements of the fiscal framework, such as the changes to the administration of DMFs, are unlikely to be addressed until this is resolved.
- The cities have been advised that an accommodation tax is off the table. We informed Municipal Affairs representatives that giving cities the authority to administer DMFs and the ability to require all hotels to contribute is, in fact, a new tax on hotels – one that every other municipality in the province will seek. The existing voluntary system operates with a high level of transparency and accountability, with a clear and direct line of sight between how funds are spent and whether they resulted in overnight visitation. Any changes to the current system should be made with a focus on driving tourism revenue – not municipal revenue.
- No decisions have been made at this time with regard to the administration of DMFs. The onus is on the cities to show that:
- Changes would improve the transparency and accountability of DMFs
- They have consulted with and have the support of stakeholders.
We made it clear that the AHLA and our members do not support municipalities being given authority over the administration of DMFs.
The AHLA believes that any consideration of the administration of DMFs should be done with a focus on driving tourism revenue, not municipal revenue. We will continue to fight for our industry on this issue.