New Bill Would Let Tourism Counties Add Three Percent Lodging Tax

On November 21, 2025 legislators introduced a set of bills that would permit communities with significant visitor traffic to place a voter approved three percent tax on lodging, including hotels, motels and Airbnb style homestays. Sponsors framed the measure as a targeted tool for communities facing infrastructure strain from tourism, making tax proceeds available for roads, public safety, water and sewer capacity, and other essential services that see increased demand during peak seasons.

The bills have already prompted conversation about tourism revenue sharing across northern Michigan. Representative John Roth of Interlochen told The Ticker he thinks the measure is unlikely to pass in its current form but that it helps start the discussion. The conversation gained an unusual ally when Airbnb signaled support for the concept, a notable shift for homestay platforms that have historically resisted assessments on short term rentals.

Local leaders and stakeholders in Grand Traverse County are weighing practical and political implications. Because any assessment would require voter approval, ballot campaigns and turnout will be decisive. Residents will effectively decide both whether to authorize a new local tax and the priorities for spending. Municipal officials will need to clarify whether revenues flow to city governments, townships, counties or specific special districts, and what guardrails will govern expenditures.

Policy and institutional questions remain unresolved in the bills as introduced. Advocates say a dedicated lodging tax could provide a stable revenue stream to address seasonal wear on roads, increase emergency services capacity during festivals and tourist surges, and fund maintenance of parks and shoreline access that are heavily used by visitors. Skeptics raise concerns about accountability and transparency, arguing that statutes should specify permissible uses, reporting requirements and limits to prevent funds from being diverted to unrelated purposes.

For Grand Traverse County residents the proposal carries direct consequences. The county economy relies heavily on tourism, and a voter approved lodging tax could shift costs from property taxpayers to visitors, while also enabling targeted investments that reduce long term service pressures. At the same time the measure would require active civic engagement, as choices about rate, scope and spending would be made locally at the ballot box and through municipal budgeting processes.

The bills open a broader debate about how Michigan communities finance the impacts of tourism, and whether state law should create a uniform approach to revenue sharing and oversight. With state legislative action now underway, local officials and community groups in Grand Traverse County will need to follow the bills closely, educate voters on potential tradeoffs, and prepare for possible ballot campaigns should sponsors and local governments move to implement the new option.