Aldermen Monday postponed action on a proposal to expand the scope of Evanston’s hotel-motel tax to include bed and breakfast establishments.

The new tax was sought by Alderman Judy Fiske, 1st Ward, who campaigned against approval of Stone Porch by the Lake, the city’s first, and so far only, operating licensed bed and breakfast, at 300 Church St. in her ward.

Fiske said imposing the 7.5 percent tax on B&Bs “is a matter of fairness to small hotel operators,” which appeared to be a reference to The Homestead, at 1625 Hinman Ave. in her ward, less than a quarter mile from Stone Porch.

The city’s hotel-motel tax now applies to facilities with 10 or more rooms for rent, while bed and breakfast establishments, by ordinance, are limited to having five or fewer guest rooms.

The city code also limits the stay of guests at B&Bs to no more than 28 days, while hotels don’t have to collect the hotel-motel tax on guests who stay for longer than 30 days.

The Planning and Development Committee Committee voted 4-3 against sending the measure on to the full City Council and requested that city staff gather more information about its possible impact — especially on what aldermen claim are a number of unlicensed bed and breakfast operations in the city and how they might be brought under a new tax regime.

Alderman Ann Rainey, 8th Ward, said taxing just the one bed and breakfast would cost more than the revenue the tax would generate and said it would be very unusual to have a tax that only applied to one entity.

She said opponents of the bed and breakfast had claimed that “it would be an out of control, crazy party house — but it has ended up being an exquisite renovation of a home and the guests have been very well behaved.”

In addition to Rainey, aldermen Burrus, Holmes and Tendam voted to postpone action on the measure, while aldermen Wilson and Wynne joined Fiske in voting to move it on to the full City Council.

The hotel tax is budgeted to generate $1.5 million in revenue for the city, which is allocated to the city’s economic development efforts, including its participation in the regional tourism marketing organization, the Chicago’s North Shore Convention and Visitors Bureau.

Stone Porch owner Jennifer Pritzker is in the midst of renovating another home, at 1622 Forest Place, for use as a B&B, and Fiske claimed that at least two additional B&B projects are “in the works.”

Bill Smith is the editor and publisher of Evanston Now.

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1 Comment

  1. Did Alderman Rainey mention

    Did Alderman Rainey mention where the profitability point was in taxing B&B's? Two? Three? Ten? Since there are several more in the works, it seems like this probably should have been mentioned so the city knows when to bother with taxing them.

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