* 3/18/26 - Sun Times - To pay for tourism boost, Chicago ramps up hotel tax, making it nation's highest + Crains - City Council approves new downtown hotel surcharge.....
Buzz Sawyer
(1) from first article:
budget of $457 million, according to a comparison prepared by Choose Chicago
. That’s followed by Visit Orlando ($116 million), Discover Los Angeles ($62 million),
the San Diego Tourism Authority ($56.9 million) and New York’s NYC &
Company ($45 million).
(3) a related Choose Chicago press release is at link below:
Chicago’s Tourism Improvement District approved by City Council,FOR IMMEDIATE RELEASE
March 18, 2026
To pay for tourism boost, Chicago ramps up hotel tax, making it nation's highest
Choose Chicago will get revenue to market Chicago to tourism competitors after the City Council Wednesday agreed to raise the hotel tax to 19% at hotels in all or parts of 14 different wards, including Downtown, McCormick Place, the Illinois Medical District and Hyde Park.
Chicago will raise its tax on Downtown hotel rooms to 19% to bolster spending for the city’s convention and tourism agency, Choose Chicago.
Tyler Pasciak LaRiviere/Sun-Times
The City Council made it happen on Wednesday by unanimously agreeing to create a Tourism Improvement District and raise the tax on hotel rooms within that district to 19%. The current combined city, county and state tax on hotel rooms is 17.5%.
Alderpersons who normally wince at raising taxes jumped at the chance to boost the marketing budget for the convention and tourism agency known as Choose Chicago.
South Side Ald. David Moore (17th) jumped on board after voting no in committee to protest the fact that the 1.5 percentage point increase would also be paid by Chicago residents on staycations.
Hotels in all or part of 14 different wards — including Downtown, McCormick Place, the Illinois Medical District and Hyde Park — have volunteered to impose the increase for the next five years.
The tax is expected to generate more than $50 million a year to sell Chicago, and double a marketing budget that pales in comparison to other cities.
The Las Vegas Convention and Visitors Authority has an annual operating budget of $457 million, according to a comparison prepared by Choose Chicago. That’s followed by Visit Orlando ($116 million), Discover Los Angeles ($62 million), the San Diego Tourism Authority ($56.9 million) and New York’s NYC & Company ($45 million).
The increase would apply to room rates at hotels with 100 or more rooms that agree to opt in. Revenue would be used to market the city, bankroll incentives and cover bid fees, such as the $1 million required to enter the competition to host the Democratic National Convention.
Choose Chicago CEO Kristen Reynolds has argued that Chicago’s convention competitors “know very well that Chicago is underfunded, and they use it to their advantage” to attract the same conventions, visitors and events Chicago is eyeing, but also to “lure away legacy clients that have been coming to Chicago for decades.”
By Danny Ecker
March 18, 2026 01:12 PM CDT
Downtown hotel guests will face a 1.5% surcharge on their room rates beginning May 1 under a landmark initiative approved today by the City Council.
Aldermen signed off on a new Tourism Improvement District covering hotels in the city’s urban core, creating an assessment on guest stays that is projected to generate more than $40 million a year to help the city compete for visitors and conventions — more than doubling the budget of city’s marketing arm Choose Chicago.
The vote caps a long-running push by hotel owners and city tourism officials to establish the financing tool, which is widely used in major U.S. markets other than Chicago. The surcharge will add to the existing 17.5% combined city and state hotel tax rate, making the total assessment on downtown Chicago hotels the highest in the nation at 19%.
Backers say the hotel industry’s self-tax will provide a critical boost to Chicago’s war chest to lure conventions and visitors as the city continues to recover from the COVID-19 pandemic.
The new money would supercharge Choose’s annual tax-backed $33 million budget, which is far lower than that of other major U.S. cities. Leaders of the non-profit tourism agency have lobbied for more funding since shortly after the Emanuel administration created it in 2012.
Kristen Reynolds, who took over as Choose CEO last year, said recently that one important use for the funding will be offering financial incentives and subsidies for meetings and trade shows like covering transportation and other event costs. Such sweeteners are commonly offered by mid-tier cities like Indianapolis, Nashville, and New Orleans that are encroaching on Chicago’s convention business turf — historically one of the area’s most important economic engines.
Attendance at meetings and conventions has dipped since the pandemic, accelerating a trend of fewer, smaller events at McCormick Place and other large convention centers. That has brought more mid-sized cities in direct competition with Chicago.
“This is a transformative moment for Chicago’s tourism industry,” Reynolds said in a statement. “With the TID in place, we now have the enhanced resources to match the ambition and vibrancy of our city.”
The approval creates the downtown Chicago TID for an initial period of five years before it would need to be renewed for a new term. Unlike regular hotel tax proceeds, TID surcharge fees would be handed to Choose and an 11-member board representing large and boutique hotels within the district to decide how it should be deployed.
Choose and the Illinois Hotel & Lodging Association will now lead the effort to select those 11 board members, who will set the group’s bylaws and governance as hotels prepare to enact the surcharge.
IHLA President and CEO Michael Jacobson told aldermen last month that much of the new funding would be dedicated to rebuilding Chicago’s profile to international travelers and marketing and promotion to domestic leisure travelers, in addition to providing incentives for conventions and trade shows.
“The TID is a solution crafted and supported by the private sector, offering a sustainable path to enhanced tourism funding,” Jacobson said in the statement. ”It will help attract more visitors and events to Chicago, which will allow the tourism industry to continue to create jobs, drive economic activity, and generate long-term revenue for the city."
Chicago welcomed roughly 55.3 million visitors in 2024, up 6.5% from 2023. That total still trails the all-time record of 61.6 million tourists that visited the city in 2019.