Minneapolis Proposes Hotel Fee Hike to Boost Tourism

Minneapolis, Minnesota, is enjoying a resurgence in tourism, with visitors returning in droves to the Twin Cities. Now, local hotels are campaigning to create a Tourism Improvement District (TID), which would involve implementing a hotel tax to fund various tourism initiatives.

Last summer, the city recorded a "record-breaking" number of hotel guests, raking in $131 million—an 8% increase compared to the summer of 2019, according to Meet Minneapolis, the city’s tourism bureau. Approximately 680,000 hotel rooms were booked, achieving a 68.1% occupancy rate across the city.

The Minneapolis Convention Center played a big role in this revival, hosting nearly 50 events, conventions, and trade shows, which brought in over 116,000 attendees to its downtown venue. It’s clear the city is back on its feet, and tourism is driving much of that momentum.

State legislation passed in 2023 requires that at least 51% of hotels opt into the TID plan along with City Council approval. So far, the numbers look promising, with 73% of hotels expressing support, according to Meet Minneapolis CEO Melvin Tennant. And they’re not stopping there; Tennant stated the group is pushing for even more buy-in to create what he described as a real "mandate."

The proposed plan includes a 2% surcharge on hotel bookings, which would directly fund tourism efforts to keep Minneapolis at the top of travel wish lists. Tennant and his team believe this will help maintain and grow the city’s appeal as a prime destination, especially after last year’s impressive tourism stats.

Minneapolis has rebounded spectacularly in the tourism sector, but whether a 2% hotel tax will make visitors balk or embrace the city’s efforts remains to be seen. Either way, the city is betting big on its newfound momentum to keep the ball rolling.