Perham’s modest lodging tax has become a focused tool for community marketing and visitor development, but the city faces choices about broadening the tax base as local tourism grows. The 3% lodging levy on the city’s two hotels has averaged about $65,000 a year over the past three years, funds that the city and the Perham Area Chamber of Commerce deploy to attract and accommodate visitors.

City Administrator Jon Smith and Chamber staff attribute part of the uptick in visits to recent investments in amenities and attractions. Most notable among those is the completed Heart of the Lakes Trail connection, which links regional recreational routes, and a growing regional arts draw centered on a “troll” art theme. These developments have helped justify continued marketing investment and have prompted staff to pursue both proven visitor markets and new audiences through coordinated campaigns.

Governance of the lodging tax revenue rests with a board that includes city officials, Chamber representatives and hotel stakeholders. That board steers spending priorities for marketing campaigns, balancing efforts to sustain traditional markets with experimental outreach intended to deepen and broaden visitation. The arrangement concentrates decision‑making among a small group of institutional actors who manage how locally collected bed tax dollars are spent.

City leaders are now weighing the potential addition of vacation rentals to the lodging tax framework through a short‑term rental ordinance. Bringing short‑term rentals under the lodging tax umbrella would broaden the tax base beyond the two hotels and could increase revenues available for visitor promotion and related services. It would also create new administrative responsibilities for registration, collection and enforcement, and raise questions about fairness between commercial hotels and individual hosts.

For Perham residents and local stakeholders, the issue intersects with several community priorities: economic development tied to tourism, the regulatory burden on property owners, and transparency in how tax proceeds are allocated. Expanding lodgings subject to the tax could bolster funds for marketing and infrastructure that benefit local businesses and public amenities, but it would require clear policy choices on implementation, monitoring and accountability.

The city will need to navigate the ordinance process, which typically includes drafting regulations, public hearings and structured enforcement mechanisms. Given the role of a mixed board in deciding spending, residents seeking oversight or influence on priorities are likely to engage the Chamber, hotel representatives and city staff as the discussion advances.

As Perham balances a growing visitor economy with community expectations, local officials will face tradeoffs between generating additional revenue and ensuring equitable, transparent administration of any expanded lodging tax regime. The outcome will shape how the city markets itself and who ultimately bears the cost of supporting that tourism growth.