By: Diane Benjamin
I don’t know how many math classes a journalism major has to pass, but evidently it isn’t enough to see obvious problems with what they are told and then regurgitate. There is a perfect example in today’s Pantagraph.
The story is about Airbnb and the new 6% City tax that starts April 1st. The local hotels didn’t think it was fair they have to pay it, so both Bloomington and Normal happily passed an ordinance requiring Airbnb to collect it too.
Here’s where the reporter needs a math class:
Maria Nagle printed the 2018 numbers for McLean County – numbers that came directly from Airbnb. 3700 people stayed in McLean County Airbnb’s and paid a total of $275,000 to property owners. (275,000 / 3700 = $74.33 per night)
Later in the story City Manager Tim Gleason claims the new 6% tax could raise between $70,000 and $100,000 in Bloomington-Normal.
See a problem yet?
First, the numbers from Airbnb are McLean County not Bloomington-Normal. No locations outside of B-N are going to get taxed. The article doesn’t say how many are outside of Bloomington-Normal.
Second, and the BIG ONE – 6% of $275,000 is a measly $16,500. Hint for the math challenged: That’s nowhere near $70,000- $100,000.
How much would Airbnb stays have to increase to rack in even $70,000 in taxes? Easy calculation: $70,000 / .06 = $1,166,667. $100,000 in taxes would take $1,666,667 in rental fees. At around $74 per night Airbnb rentals have to increase from 3700 to 22,523.
The article states 2000 people stayed in an Airbnb in 2017, that almost doubled in 2018 to the reported 3700. Even doubling again the number won’t be close to numbers needed for Gleason’s estimates.
The story also says there are around 60 locations just in Bloomington-Normal. Every one of them would have to be booked year around to get anywhere near 22,523.
Maybe Gleason is predicting more Airbnbs popping up. It would take A LOT more and of course a reason for people to come here. It sure won’t be for the great roads. If more do pop up, say goodbye to at least one already struggling hotel.
In another story the Pantagraph announced a new news service is starting in Springfield, sort of like state associated press. Illinois Press Foundation claims they will provide unbiased news. There is no such thing, but I hope somebody on the staff can read through the numbers Springfield barfs up. The budget is never really balanced, hope their journalism degrees don’t get in the way of calling technical fouls on lawmakers using fuzzy math.