The Haywood County Tourism Development Authority Board unanimously agreed Monday that upping its lodging tax from 4 percent to the maximum 6 percent allowed by the state would raise money for projects the county otherwise couldn’t afford.
“We see this as an opportunity. This could be the funding source we are looking for,” said Mike Sorrells, both a county commissioner and member of the TDA board.
The tax is paid by overnight guests at hotels, motels, bed and breakfasts, vacation rental homes. The 4 percent tax brings in about $900,000 annually, which is pumped back into tourism promotions and initiatives.
An extra 2 percent would translate to $450,000 more a year. The agency would earmark the extra 2 percent solely for capital projects.
One project already at the top of the list is a sports complex in Jonathan Creek. The county bought 22 acres for $1 million in 2007 with an eye toward building league-caliber ball fields in the future. The county even paid a consultant to design a master plan for the site — including several baseball fields, tennis courts, batting cages, a walking track, playground and more — but has not had the money to invest in its construction. The cost was pegged at $6 million.
Another possibility is adding two more fields to a baseball complex in Canton.
The sports complexes could host tournaments, attracting hundreds of parents, children and spectators to the county — and thus qualifying as a tourism initiative. Buncombe County in the past dedicated some of its tourism tax to building a tournament-scale soccer complex.
Canton Town Manager Al Matthews, who drafted a state bill asking the legislature to approve an increase in the lodging tax, emphasized that the money would not only pay for sports-related infrastructure.
Those are just ideas, however, and how to actually spend the money would have to be vetted and voted on by the TDA board in the future.
“It doesn’t just have to be a sports complex,” said Al Matthews, Canton Town Manager and tourism board member.
But those two projects have been on the county’s to-do list for a while, and have emerged as a priority, based on the tourism board’s discussion this week.
“The main focus right now is sports,” said Sue Knapko, a TDA board member. “(The sports complex) is not just for our visitors. It will benefit the kids of Haywood County.”
Tourism and county leaders envision the sports complex as a place where they could host baseball tournaments from April to October, attracting thousands of visitors to the county for days at a time. The investment in the complex would equal more heads on beds in Haywood County, according to tourism leaders, and therefore generate more revenue for the tourism authority to spend on advertising or reinvest in tourism-related infrastructure projects.
“I think this is an opportunity that we cannot let slip through our fingers,” said Ben Glover, owner of Maggie Mountain Vacations. “I don’t think we have an alternative. I don’t think we have a choice.”
The idea to increase the lodging taxes seems to have come out of left field. It was broached publicly for the first time at a special meeting of the tourism board called on Monday, but no details were listed on the advance agenda of what would be discussed at that meeting. It not only was unanimously endorsed by the board, but a sample legislative bill to had already been drafted to introduce in the General Assembly.
While it was the first direct discussion of a room tax increase, tourism leaders have discussed the subject in the past using non-committal terms such as “if,” “maybe” and “in the future.”
But, the subject recently resurfaced in meetings for Move Maggie Forward, a movement to promote economic growth in the valley, said TDA Executive Director Lynn Collins. Upon further investigation, tourism leaders realized that it was “do or die” time, Collins said.
If the bill is not submitted to the General Assembly by March, the county would have to wait two more years before the legislature would consider its proposal — to many board members, that is two years of wasted time, time when the county could be collecting the additional tax revenue. Within the last week, tourism leaders drafted a bill and started serious talks about an increase.
The only way
Tourism leaders see the increase as the only way to find revenue in a still recovering economy.
“If we want to expand, I don’t think there is another choice,” said Lyndon Lowe, a member of the board. “Otherwise, we are just stagnant. We only have the infrastructure we have.”
And no one wants to raise property tax, which would affect county residents.
“As long as people are out of work and struggle with keeping taxes paid on their property, you just aren’t going to find money,” Sorrells said.
Lodging owners on the tourism board said that many tourists don’t realize or care how much the taxes are for a room.
“I find that it doesn’t really matter what the tax is,” said Lowe, owner of Cabins and RV’s at Twinbrook Resort in Maggie Valley. “They don’t even look at it.”
Vacation cabin renter Knapko agreed.
“Most of them are like, ‘Just give me the bottom line,’” she said.
The TDA board briefly considered only raising the lodging tax by 1 percent, but why leave money on the table?
“We need stuff to start happening,” Knapko said. “If we just go up to 5 percent, we are kind of dinking along. It will take us twice as long.”
To increase the room tax, county commissioners would have to ask state legislators to introduce and pass a special bill in the General Assembly giving the county permission to hike the room tax.
County Manager Marty Stamey spoke with Sen. Jim Davis, R-Franklin, before the tourism meeting Monday to “test the water.” Although Davis told Stamey that he did not support tax increases, he would back a local bill to raise the lodging tax if that is what county leaders want.
“If that is something at the local level that you want to do, we will push that,” Stamey said, relaying Davis’ response.
Now that the TDA has placed its seal of approval on the increase, the county commissioner must vote to support the measure as well. The commissioners’ rubberstamp seems inevitable. Sorrells, Commissioner Kevin Ensley and Chairman Mark Swanger are already backing it.
Ensley knows first-hand from attending his own son’s out-of-town ball tournaments how much parents spend on sports trips. But he wants to make sure the increase is dedicated to capital projects and not generic marketing.
Since time is of essence — the bill would need to be introduced by mid-March.
The county commissioners would need to decide at their meeting on March 4 whether to formally ask legislators to introduce the bill. If approved by the General Assembly, Haywood County could implement the 6 percent lodging tax by July 1 this year.
The legislation will also create a special subcommittee to assess tourism-related capital projects and recommend how to spend the special pot of tourism dollars.
During the next couple weeks, TDA board members will work to educate lodging owners about the possible increase and why they think it’s needed.
“We would like to have everybody on board; we would like to have everybody educated,” Sorrells said. “Time is of the essence.”