A tax program aimed at boosting tourism in Orillia got off to a slow start, but the city is hopeful it will be effective when the time comes to welcome visitors back to the area.
The municipal accommodation tax came into effect late in 2020. It puts a four per cent tax on every room used for short-term accommodations in the city. The revenue generated from the tax is split between the city and Orillia and Lake Country Tourism and is intended to be used for marketing and product development to encourage tourism to the area.
That focus shifted because of the COVID-19 pandemic.
“We’re always mindful of the optics of promoting Orillia as a destination during the pandemic,” said Michael Ladouceur, the city’s manager of tourism and special events.
The tax generated $62,584.89 in revenue in 2020, and the city put that money toward a 2023 Ontario 55+ Winter Games bid and the launch of self-guided tours through the Tripvia Tours app, among other projects. The self-guided tours were a way of encouraging locals to explore their own community.
The revenue from 2020 represents only a few months of that year. That’s why the projected revenue in 2021 is expected to be much greater, at $323,700.
“We’re hoping to use the municipal accommodation tax to its full potential in 2021,” Ladouceur said, but added it will depend on the situation with the pandemic and restrictions on travel.
He is encouraged by recent reports that show people are itching to travel as soon as possible.
A Destination Canada report from March 2021 showed 75 per cent of Ontarians feel safe when thinking about travelling to nearby communities and 64 per cent feel safe when thinking of travelling within Ontario.
“That positions us well,” Ladouceur said.
It’s good news for hotels and other operations that provide accommodations.
The occupancy rate at Orillia’s 14 hotels or motels, representing a total of 678 rooms, was 52 per cent in September 2020. It declined almost every month since, sitting at 32 per cent in March 2021, according to Ladouceur’s recent bi-annual report on the municipal accommodation tax.
“The tourism industry has definitely taken a hit during the pandemic,” he said. “We never want to see occupancy rates drop below 40 per cent. It’s more significant this year because of the climate that we’re in.”
Those occupancy rates would likely have been much lower if not for the level of construction activity happening in town, with many workers staying at hotels and motels.
“It’s a great industry to kind of buoy the hotels,” Ladouceur said.
The city and Orillia and Lake Country Tourism will contact tourism-related businesses to determine the best ways to support them now and when the time comes to encourage people to visit the area again. At the moment, the plan is to continue to urge people to shop locally and explore their community.
“They can look at their own backyards first,” Ladouceur said.
His next report on the municipal accommodation tax, with updated numbers and figures, will be presented to council in the fall.
