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Wauwatosa hotel room tax revenue increases 3.7 percent

But the full impact of construction yet to be felt

March 28, 2012

As the economy becomes more hospitable to the travel industry, local hotels have started to increase their rates and the number of bookings. As these businesses prosper, so does the city in the form of increased hotel/motel taxes.

In 2011, the city collected $907,871 in room tax from the seven hotels in Wauwatosa. That's a 3.7 percent increase over the prior year, said John Ruggini, city finance director.

"The hotel/motel revenue continues to outgrow expectations," he said. "Overall, it bodes well for the local economy."

The city has charged a 7 percent tax on lodging gross receipts since the 1970s. The city turns over about a third of that tax revenue to VISIT Milwaukee, the area's convention and visitor's bureau, for marketing purposes.

State statute requires all municipalities that impose room taxes to give a set percentage to a tourism promotion organization or spend it directly on such activities, City Attorney Alan Kesner said.

"We fulfill that obligation by funding our part of VISIT Milwaukee," he said. "Other cities do it other ways."

Keeping people coming here

The money helps the city provide services and maintain infrastructure necessary to keep people coming back, including police and fire protection, road and parks maintenance and economic development initiatives.

In 2011, the Police Department responded to 503 calls from hotels in Wauwatosa, while the Fire Department responded to these establishments 47 times.

The city does get benefits from its involvement in VISIT Milwaukee. For instance, Economic Development Director Paulette Enders worked with the tourism organization to create a print marketing piece to sell people on the city as a place to live, do business and play.

Former Mayor Jill Didier called VISIT Milwaukee "a natural choice" to promote tourism in Wauwatosa. She sat on the board while she was Wauwatosa's mayor and worked on a video that showcased Tosa's entertainment, shopping and restaurant options. She continues to serve on the board as she works in economic development for Milwaukee County, and Wauwatosa remains a focus.

"The economic growth and viability of Wauwatosa has been a reason people come to Milwaukee for business travel and leisure," she said.

VISIT Milwaukee helps find lodging for conventions and motor coach groups, said Rose Murack, general manager of Radisson Hotel Milwaukee-West and fellow board member. "If downtown is booked, we get the overflow."

Patrick Palmer, director of sales and marketing for the Crowne Plaza Hotel just off Mayfair and Watertown Plank roads, credits the Brewers for a significant increase in occupancy in 2011. The hotel offered transportation to the stadium on game days for its guests.

He recalls one exceptionally busy weekend when the Brewers were playing at home as Summerfest was jamming the lakefront.

"On a weekend in the summertime, it's very hard to get a hotel room," he said.

As for the rest of the year, local hotels are noticing a thaw in the previous freezes on corporate travel. People are coming to the Milwaukee County Research Park, medical campus and the University of Wisconsin-Milwaukee Innovation Park.

"People realize there is a strength in meeting one-on-one or in a group to get deals done," Murack said. "It's still the best possible way to do business."

Fluctuation still expected

Ruggini has budgeted $900,000 in hotel/motel tax revenue for 2012 but he's hoping to see another 3 to 4 percent increase over the 2011 numbers.

Revenue likely will fluctuate in the next couple of years. For instance, the Days Inn is under new ownership, which could bring in new business, Ruggini said. On the other hand, the state's plans to reconstruct the Zoo Interchange include removing the Super 8 Motel next to the existing freeway ramp.

The Radisson at the corner of North Avenue and Mayfair Road underwent a major renovation last year so it was difficult to truly gauge the extent of economic recovery business because a portion of guest rooms were closed off for refurbishment throughout the year.

The changes included the addition of Jimmy's Island Grill and Iguana Bar, a Key West-themed eatery that serves many local residents and hotel guests, Murack said. While the restaurant started serving customers in late August, Murack is looking forward to the first summer of outdoor seating on the tiki torch-lit patio.

"We wanted an entirely new product to present to existing and hopefully new clients," Murack said. "We're calling 2012 the year of no excuses. Every month, every week we see a little uptick in business."

As for the Crowne Plaza, which celebrated its fourth anniversary this month, people are still becoming aware of its existence. Three awards placing it among the Intercontinental Hotel Group's top properties in North America have been helping attract people to the high-end facility, Palmer said.

At a glance

The Wauwatosa Police Department responded to more than 1,300 incidents at hotels and motels within the city from 2009 through 2011. The following is a look at those police calls broken down by year and location.

Business 2009 2010 2011
Super 8 92 113 148
Days Inn 64 52 68
Forty Winks 3 11 12
Extended Stay 58 92 66
Holiday Inn Express 28 35 38
Crowne Plaza 53 52 62
Radisson 78 85 109
Total 376 440 503

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