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Wednesday, 01 March 2017 15:06

Franklin considers room tax hike

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All of Franklin’s big plans for improving the appearance and infrastructure around town won’t be possible without some additional revenue.

But where is the additional revenue going to come from? Property values are down slightly, commercial growth is still stagnant and federal and state grant opportunities are drying up quickly. 

During a recent board of aldermen planning retreat, Franklin Mayor Bob Scott asked board members what they thought about proposing an increase to the town’s occupancy tax.

By state law, local governments have been able to levy an occupancy tax since 1983 up to 6 percent and use the revenue for tourism marketing and advertising purposes. Macon County levies a 3 percent tax and Franklin charges an additional 3 percent for lodging within the town limits. 

Scott said the law has been loosened in recent years to allow local governments to use a portion of the tax revenue for tourism-related infrastructure needs.    

“We need to be spending money on the amenities tourists use when they come here,” Scott said. 

Alderman Billy Mashburn said he’d want to have the Franklin Tourism Development Authority weigh in on whether the tax should be increased. The Franklin TDA board is the entity tasked with allocating the occupancy tax revenue for tourism advertising. 

“At this point, I’m not sure if the request shouldn’t come from the TDA,” Mashburn said. “And it would have to go through the legislature.”

If and when the town board and TDA decide to ask for an increase to the occupancy tax, the local legislative delegation — Sen. Jim Davis and Rep. Kevin Corbin — would have to introduce a local bill in the General Assembly.

If all stakeholders are in agreement regarding the increase, it’s usually not a difficult thing to accomplish in the legislature, but any controversy over the issue could keep it in limbo. 

Haywood County has tried unsuccessfully since 2013 to increase its occupancy tax from 4 percent to 6 percent. County commissioners and every town board in the county passed a resolution supporting the proposal and Rep. Joe Sam Queen, D-Waynesville, and Sen. Davis were willing to introduce the bill, but Rep. Michele Presnell, R-Burnsville, — whose district includes part of Haywood County — was the holdout. 

Presnell is adamantly opposed to any kind of tax increase and is unwilling to introduce any tax increase even if her constituency wants it. Since Presnell does not represent Macon County, Franklin could have a shot at getting legislation introduced. 

While Haywood County TDA brings in more than $1 million in occupancy tax a year, Franklin’s TDA budget is about $110,000 a year. 

Scott received consensus from the board to discuss a proposal for increasing the occupancy tax with the TDA board. 

— By Jessi Stone, News Editor

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