Jill Schramm/MDN Lisa Westman, Environmental Healtth director at First District Health Unit, speaks to the Minot City Council Monday. At left is council member Stephan Podrygula.

Council hears from industry

By JILL SCHRAMM

Associate Editor

jschramm

@minotdailynews.com

A discussion on Minot’s hotel industry honed in on certain problem properties and ongoing challenges with lodging tax collections during a Minot City Council meeting Monday.

Mayor Tom Ross had placed discussion of hotels and potential city licensing on the agenda, but before the council could take up the issue, hotel managers brought their own concerns about the damage that misdirected negativism could have on the tourism industry.

“Poorly run hotels are not a new issue or an issue limited to just Minot,” said Amanda Shappell, general manager of the Hampton Inn & Suites, who serves on the Minot Innkeepers Association and Visit Minot board. Citing the presence of problem properties, she asked, “What is the city doing about these specific hotels? No one running a reputable well-run hotel wants these places of businesses classified as hotels. Let’s call them what they are – hostels and homeless shelters. By changing the classifications, we can lower the chance of tourists having a negative experience while staying in Minot. The safety and well being of our visitors is a major priority of hotels that are operated correctly. Many of us follow strict regulations put into place by hotel chains that we are a part of.”

She suggested the city improve communication and obtain a better handle on hotel ownership changes to maintain better accountability in the industry.

“I do not believe you are looking for more bureaucracy, but the city’s knowledge of who is responsible for these assets is vital,” she said. “When there are specific issues related to tax collection or public safety, it should be addressed fairly and through systematic regulatory measures rather than blanket regulations that could potentially have negative economic impact on our city. I plead with you to instead work with city and industry leaders to make the changes happen that make the magic of Minot felt by all who are here.”

Amber Wright, general manager of Extended Stay America, agreed with Shappell.

“There are issues there that need to be addressed in the hospitality industry. But it’s not tearing the good ones down and lumping them in with the ones that need to be addressed,” she said.

Minot resident Joan Hawbaker also pointed out that most hotels get good reviews on popular review sites.

“It sounds like out of maybe thousands or tens of thousands of people staying in Minot that a few have had a bad experience and voiced it to someone in authority in the city government,” she said, questioning the need for more government bureaucracy in the form of licensing.

“I’m not real sure, I guess, in my mind that this would necessitate government intervention,” she said.

Ross said he has been discussing the hotel industry with city staff and others in the community for several months, and a recent conversation with an unhappy Canadian visitor was a final straw that prompted his decision to bring the matter to the council’s attention.

“We’re here to have a positive, solution-based discussion,” he said.

Lisa Westman, environmental health director with First District Health Unit, explained the existing licensing and the regular and complaint-based inspection processes through the health unit. Powers include shutting down rooms or portions of hotels or suspending licenses, although health officials typically work with hotels to correct problems.

Westman also stated her department would like to be part of the discussion to address any issues.

“We’re all kind of working in silos, and maybe the communication could be better,” she said.

City Manager Harold Stewart and Finance Director David Lakefield also highlighted unpaid lodging taxes collected by hotels. In the years 2020 and 2021, the city’s audit found $52,693 in unpaid lodging taxes from 21 hotels, with most of the overdue taxes accounted for by four hotels. The city was able to eventually collect all those dollars. One hotel had overpaid and was refunded, while the audit showed five hotels paid accurate amounts. One hotel was closed and was unable to be audited, and two were not audited due to ownership changes. The city still is auditing years 2022 and 2023.

City ordinance provides penalties for hotels that willfully misreport lodging taxes and charges a fee for delinquent taxes.

Two-thirds of the 3% lodging tax goes to Visit Minot and one-third to the All Seasons Arena after subtracting the city’s administration expense.

Stephanie Schoenrock, executive director for Visit Minot, said a primary concern is hotels that are operating as extended stay with inadequate amenities and the number of police calls to certain establishments.

“According to the police department, an average hotel ranges between 16 and 30 calls at a hotel in the course of the year. We have hotels that are going from 80 to over 200 phone calls,” she said.

Ross mentioned seven properties that in 2023 totaled 728 police calls.

“If you average those out to one hour a call, we had Minot police officers spending four and a half months at a hotel in Minot on one call or another. That kind of concerns me, too. We’re spending a lot of time, and maybe that’s the discussion we need to have – what do we do about those problems?”

Council member Carrie Evans said the core problem is certain establishments that fill with people who cannot afford housing or have criminal records and cannot obtain housing.

“Instead of addressing that problem, and why that is, we are going after an entire industry where the vast majority are in compliance,” she said. “Let’s talk about that issue because that’s really what this is about, and we’re going about it in a way that is tiptoeing around that.”

Westman said there is no distinction in First District’s rules for hostels versus hotels or long-term versus short-term stay hotels. City Attorney Stefanie Stalheim said city ordinance also doesn’t distinguish between the two.

The council took no action. However, Ross said afterwards that the discussion addressed misconceptions and opened lines of communication that will be continuing internally within the City of Minot and Visit Minot.