Fourth quarter 2011 hotel/motel tax collections set a record for the quarter, up 52 percent from the same quarter the year before and 55 percent higher than the average for the past six years.
On March 13, the Iowa Department of Revenue issued its quarterly hotel/motel tax warrant to the city for $74,549, Newton City Administrator Bob Knabel reported to the council in his weekly report.
The amount of hotel revenue represented by the collection of the 7 percent tax - $1,064,988 - was also a record for the quarter, bettering the mark set in the last three months of 1998 of $976,580.
Knabel said there are two possible explanations for the huge increase. First, he noted, the hotel/motel tax revenues received in December for the third quarter of 2011 were lower than normal. Part of the increase could be attributable to a lag time in payments that should have been sent to the city in December, he said.
Secondly, Knabel said the increase could be due to increased activity at Newton hotels.
"Newton was the host to the Miss Iowa Pageant in October, which drew many people to the community and filled many hotel rooms," he said. "This was a definite boost to the local economy, and the tax revenues reflected that."
The hotel/motel tax helps fund the Newton Convention & Visitors Bureau, the Newton Development Corporation and improvement bonds at Westwood Golf Course, along with general city operations. The March proceeds puts the city on track to meet the $300,000 budgeted in hotel/motel tax proceeds in the coming fiscal year.