LANSING, Mich. (Michigan News Source) – The David-versus-Goliath story might have ended differently if David represented Michigan’s small lodging businesses and Goliath represented large, out-of-state hotel chains. In the version described by a new report, Goliath wins.

The Private Property Rights Institute (PPRI) estimates that Michigan’s small lodging businesses collectively remit $10 million annually in mandatory tourism assessments supporting convention and visitors bureaus (CVBs).

PPRI, a nonprofit organization that advocates for private property rights, argues that large hotel chains wield disproportionate influence over how that money is spent and receive the greatest benefits.

Small inns, big bills

The report comes as independent inns compete for travelers during Michigan’s fall tourism season.

PPRI President Charlie Kolean told Michigan News Source that for small inns and independent hotels, every dollar matters.

“During Michigan’s slower seasons, occupancy declines but payroll, utilities, insurance and maintenance costs continue,” Kolean said. “These businesses are required to collect an assessment of as much as 5 percent of a guest’s room charge, yet they have little control over how that money is spent.”

Kolean added, “Many must then spend additional money on their own advertising because CVB campaigns tend to prioritize conventions and large hotels rather than the leisure travelers on whom smaller properties depend.”

A $500 fee becomes a five-figure bill

The report highlights the experience of Vince Rogala, whose family operates Mackinaw Mill Creek Camping near Mackinaw City.

In a statement published in 2018, Rogala said the campground’s annual visitors bureau membership fee increased from $500 to more than $10,000. He said the higher fees priced all three local campgrounds out of membership.

That membership fee was separate from the room assessments the campground collected on cabin rentals, according to an attorney quoted in the campground’s statement.

One innkeeper took the fight to court

Another dispute involved David Gersenson, who owned the Sylvan Inn Bed and Breakfast and Lakeshore Inn in Glen Arbor when he challenged the Sleeping Bear Dunes Visitors Bureau in 2017.

Gersenson sued after the bureau announced plans to increase its room assessment from 2 percent to 5 percent. He argued that he could advertise his own businesses and should not be compelled to fund the bureau’s promotional efforts.

The case ended without a ruling on the constitutional question. A judge dismissed it in September 2017 after the bureau promised not to assess Gersenson’s properties or seek past-due amounts, according to the Mackinac Center Legal Foundation, which represented him.

Political spending draws scrutiny

PPRI argues that small lodging operators subject to mandatory assessments lack an individual opt-out option.

The report also examines political spending, stating that the bureaus’ trade association PAC contributed $79,500 to Michigan campaign committees during the period it reviewed, beginning in January 2023.

That contribution figure, by itself, does not establish that mandatory lodging assessments funded the PAC’s donations.

Executive pay in the spotlight

The report also highlights executive compensation, identifying a CVB executive who received more than $412,000 in 2022.

For comparison, the State Officers Compensation Commission’s 2025 report listed the governor’s annual base salary at $159,300, plus a separate $54,000 annual expense allowance. The comparison requires distinguishing executive compensation from base salary.

Kolean’s proposed fix: A choice and a voice

Kolean said changes would need to come from Lansing.

“Lawmakers should reform the statutes authorizing these assessments to give lodging businesses a genuine choice and a meaningful voice,” he said. “At minimum, legislation should allow an individual property to opt out, require governing boards to fairly represent small lodging businesses, mandate greater transparency in spending and executive compensation, and require regular votes before an assessment can be renewed.”

He added, “The state should be removing barriers to entrepreneurship, not placing small operators at a government-created disadvantage.”