Council reopens public hearing on proposed 5% visitor tax; hosts warn small operators would be hit while chambers push marketing benefits

Adams County council reopened a public hearing on a proposed 5% inkeepers tax (branded by supporters as a "visitor investment") and heard sharply divided public comment about whether the levy would help tourism or harm small local hosts.

Colton, an economic development representative, told the council that 78 Indiana counties impose an inkeepers tax and that a 5% local rate would apply to short-term lodging (hotels, motels, Airbnbs and similar rentals under 30 days). He said the county’s lodging spending measured by the state was roughly $1.5 million–$1.6 million in recent years and that a 5% tax would generate an estimated $75,000–$80,000 annually dedicated to tourism promotion. Colton said 100% of the receipts would be directed to tourism initiatives and that the commissioners — not council — would establish and oversee the statutory tourism commission that administers the funds.

During public comment, several small short-term rental hosts said the proposed tax would fall on family visitors, visiting nurses and other non‑tourist guests and would further squeeze hosts already paying platform fees and rising property taxes. Kelly Masman, owner of the Cottage on Fifth, said 92% of her recent guests come to visit family or for work and that a 5% local fee would hit those visitors and reduce thin margins for small hosts.

Other speakers urged caution or asked for more study: some said many stays are local or work-related and noted that stays crossing a 30‑day mark can have different tax treatments. Dar Rajkuma, a local pastor and property owner, said the county should postpone the tax and analyze how heavily lodging is used by residents and low‑income households before adding a new local levy.

Champions of the tax included representatives of local chambers of commerce. Floyd Luke of the Burn Chamber argued that rural counties commonly use the levy to fund cooperative marketing (state travel guides, festival promotion and motor coach outreach) and that Adams County’s attractions are under-promoted compared with neighboring counties that already collect the tax.

Following the public comments and internal discussion about logistics — how the tourism commission would be constituted under state code, collection and audit responsibilities, and whether the council or the commissioners would reallocate existing LIT/seed funds instead — a council member moved to void the ordinance that had been introduced last month. The motion was seconded and carried on a voice vote; the chair announced the motion passed. Council and staff then discussed alternatives, including re-appropriating a portion of local income tax (seed) allocations to fund tourism promotion and returning to the issue during budget deliberations to identify a sustainable funding source.

The council did not adopt a new inkeepers tax at the meeting. Staff and EDC representatives said they would model the cost of a full-time tourism position and the marketing budget needed to meet local goals and return with more specific budget recommendations for the council and commissioners to consider during the annual budget process.