- December 15, 2025
A 16-county class-action suit against online travel companies could go to trial in May.
Flagler, along with 15 other Florida counties, concluded mediation last week with Priceline, Expedia, Travelocity and Orbitz, fighting for the online-booking companies to pay bed tax, sales tax and revenue sharing on their virtual room sales.
According to County Commissioner Milissa Holland, who represented Flagler along with County Attorney Al Hadeed in the proceedings, the counties agreed to forgo all back-pay from the agencies if they agree to “pay it forward,” or contribute 12% of their sales from now on.
If the agencies do not agree, the case will go to court May 21. But to Holland and the other counties, that option is beginning to look more and more appealing.
“Let’s just take this to court and see what a judge determines,” Holland said, in an interview March 30. “We feel strongly that we have good legal standing in our position that they owe us these funds.”
In bed tax alone, which makes up 4% of the full 12% the counties feel they are owed, the tri-county area of Flagler, Putnam and St. Johns would collect an estimated $1.6 million dollars annually, Holland said. Flagler would collect about $500,000 per year, not including sales tax or revenue sharing.
“We know the numbers are real, and we know they’re significant,” Holland added. “It’s just such a huge loss to us that, in these times, we can’t afford not to be receiving it. … We believe this is a form of tax evasion, in which (these companies) have found a loophole.”
In similar class-action suits in Georgia and Texas, she added, the Supreme Court has sided with the counties, ruling that travel agencies must pay local taxes.
“This is a national issue,” Holland said. “It was almost like a David and Goliath story when we were there, because obviously these corporations are making billions. … But in our community, 15% of the workforce works in the hotel industry, so we’re also talking about an economic development issue.”
Because out-of-county booking companies purchase hotel rooms wholesale and then resell them virtually, they have avoided paying local taxes, Holland explained. But to Vice President of Tourism Development Georgia Turner, the technicalities don’t matter as much as the outcome.
Less revenue means less marketing potential.
“Our neighbors to the north and south have almost triple (the promotions budget) than we have,” Turner said. “The competition is really tough out there right now. Any extra money we get, we can put into our online presence or going into new markets. The sky would be the limit.”
Flagler County’s current promotions budget is $800,000, Turner said, as compared to Daytona’s $5.4 million, or St. Augustine’s $3 million.
“In the scheme of things, we have a very small amount of money for promoting, and it doesn’t go a long way,” she added.
In other cases, Holland said, counties have settled out of court for two years of partial back-pay, with the stipulation that another suit cannot be filed against the booking firms in that two year’s time.
But to Holland, that was not an option for Flagler.
“We didn’t want to end up here again in two years … then start this fight all over again,” she said, adding that a lump payout also means less money in the long term. “We just want our fair share. All we want is for them to pay it forward.”
Holland expects to hear the travel agencies’ response to the counties’ settlement request within a week.
