Kankakee County Expands Hotel Tax to Short-Term Rentals

Local authorities in Kankakee County, Illinois, are set to implement a 5% hotel tax on short-term rentals, including popular platforms such as Airbnb and VRBO. This move aims to enhance funding for Visit Kankakee County, which promotes the region as a tourist destination. The initiative was discussed during a recent Manteno Village Board meeting, where Nicole Gavin, the executive director of Visit Kankakee County, clarified the implications of the tax.

Gavin emphasized that the tax is not a burden on local residents or business owners, stating, “It’s paid entirely by the visitor.” She explained that travelers are accustomed to such fees across the country. The revenue generated from this tax will support local marketing, infrastructure, and tourism-related events, directly benefiting the community of Manteno.

According to research conducted by Visit Kankakee County, visitors contributed approximately $167 million to the local economy, resulting in over $6.8 million in local taxes. Gavin highlighted the significance of tourism, noting, “It saved each household over $1,300 and supports over 1,200 jobs in our county.” This influx of visitor spending alleviates the financial burden on residents, making tourism a critical aspect of Kankakee County’s economy.

Data from AirDNA, a platform specializing in short-term rental analytics, reveals that there are currently 144 short-term rentals in Kankakee County, with 15 located in Manteno. This sector generated over $2 million in 2024 and is projected to exceed $3 million in revenue this year. The average nightly rate across all properties stands at $155, with an occupancy rate of 48%.

Gavin provided a conservative estimate indicating that the 15 properties in Manteno could yield around $33,480 per month. The resulting tax revenue would amount to approximately $1,674 per month, equating to about $20,088 annually. She remarked, “It’s one of the few ways to grow tourism funding without asking residents to pay more.”

During the meeting, Gavin clarified that Visit Kankakee County operates on a budget of just under $450,000 per year, underscoring the importance of the new tax revenue for sustaining their operations. She stated, “Manteno and its businesses are part of our membership, which gives you access to marketing support, visitor data, and statewide exposure through our campaigns.”

The next step for Manteno involves adopting an ordinance to begin collecting the hotel tax, similar to the existing framework for the two hotels in the village. Village Administrator Chris LaRocque confirmed that this issue will be discussed at the upcoming building and zoning committee meeting.

Kankakee City has already established mechanisms to collect this tax on short-term rentals, and Kankakee County is actively exploring its implementation. The successful expansion of this tax could significantly bolster funding for tourism initiatives, further benefiting the local economy and enhancing the community’s appeal as a destination for travelers.