Peru council increases pillow tax

Lodgers in Peru hotels will pay about $3 to $4 more per night.

The Peru City Council voted Monday to increase the tax collected for hotel and motel stays within city limits from 5.64% to 7.5% – amounting to about $3 to $4 more per night, said Peru Mayor Ken Kolowski.

The tax increase is expected to generate about $150,000 more annually based on current projections, said Peru Director of Finance Justin Miller.

The measure, however, passed by a thin 4-3 margin, with Kolowski providing the tiebreaking vote in favor of the increase. Aldermen Jeff Ballard, Bob Tieman and Jim Lukosus voted in favor of the increase, while aldermen Tom Payton, Jason Edgcomb and Dave Waldorf voted against it. Aldermen Mike Sapienza and Aaron Buffo were not present at Monday’s meeting.

Payton said he voted against the increase — because of inflation and higher gas prices — the optics of increasing the hotel tax would not be right. He said, however, he believed the tax would be increased sometime down the road.

Waldorf said he voted no because he believed people would view it cynically as another tax increase at a time when the city doesn’t need the revenue.

Ballard, who voted in favor of the tax, said he doesn’t think the extra 1%-plus tax geared toward travelers will make a difference in their decisions of whether to stay in Peru.

Lukosus, who also voted in favor, noted the TBM Avenger Reunion was a beneficiary of the hotel tax, and it’s that revenue source that allows the city to contribute to these type of events.

In offering the tiebreaking vote, Kolowski said he understood Payton and Waldorf’s perspective, but voted in favor of the tax increase because it will be a good thing for the city.