Establishing a tourism commission and a visitors bureau first takes support from the lodging community that will collect and remit the tax. Hotel and lodging owners in Indiana are very supportive of the innkeeper’s tax as long as that tax is used appropriately. Studies show a misdirected tax can actually be financially detrimental to the hotels that collect it, which is why local support and understanding about how tourism works is imperative.
The county must first pass an ordinance that adopts the Indiana Uniform Innkeeper’s Tax. Once this is passed, a collection process can begin.
Most communities form a task force that includes a representative from the county commissioners and council, which administer the tax, the lodging and attractions industries, community leaders and someone familiar with non-profit management. The Association of Indiana Convention and Visitors Bureaus can provide this task force with a mentor to assist in the process. This task force can identify and develop:
- The local structure of the tourism commission as this does vary depending on the community. Sample structures are available from the AICVB. Most are separate non-profit entities, although a few serve as quasi-governmental agencies.
- The tax collection methodology to be used: whether the funds will be collected via the state or the local treasurer’s office. Most bureaus collect through the local treasurer’s office.
- Articles of incorporation for the local entity that will serve as the “bureau,” as well as related documents such as by-laws.
- An application for non-profit status (most bureaus are what is known as 501-c-6 organizations, or trade associations.) Again, the AICVB has data on this.
- A leadership structure for the organization. Most bureaus have an executive director who runs the bureau and who has expertise in marketing and promotions, and preferably non-profit management.
- Suggested policies and procedures, which again can be provided by the AICVB, ranging from transparency to audit requirements. Because the bureau uses public tax funds, it is held to a high level of transparency.
- A timeline for the bureau to begin. Most bureaus take about a year to create, which allows for tax collection over the year and seed money for the start-up of the organization.
