The county commissioners appointed a task force four months ago in response to complaints over the way tourism promotion dollars were being managed. Roughly $650,000 is collected through a 3 percent tax on overnight lodging. The money is pumped back into tourism promotion at the discretion of the Haywood County Tourism Development Authority.
The task force was asked to develop recommendations that would improve the operations of the tourism authority and hopefully settle long-running arguments over how the tourism promotion dollars are doled out.
Complaints over how the money is spent reached a boiling point this summer when the tourism board suddenly slashed money it historically gave the Maggie Valley and Haywood County chambers of commerce to support their operations, including overhead, visitor center operations and advertising for festivals. Similar funding provided to Canton was also reduced.
The mayors of Maggie Valley and Canton called on the county commissioners to step in. In response, the county appointed a task force. Final reports from the task force will be presented to the commissioners at at 5 p.m. on Monday, Nov. 20.
The task force has one major disagreement in its ranks that will be left up to commissioners to decide: how much control the towns should have over tourism promotion dollars. A Maggie Valley contingency on the task force wants to create its own tourism authority to oversee a portion of the tourism dollars to benefit Maggie.
“Maggie Valley has a very unique situation,” said Sybil Mann, a task force member who supports a separate tourism board for Maggie. “They have their own distinct identity from the rest of the county and need the special ability to target their marketing and promotion.”
Austin Pendley, owner of Maggie Mountaineer Crafts, said Maggie leaders are considering a food and beverage tax and possibly even an amusement tax that would also generate revenue for tourism promotion.
“If we are going to be big in the industry we need money to participate in it. It is the only game that we have. We have one thing — that’s attracting tourists — and we need money to do it,” Pendley said. Those tax dollars would also be managed by the new Maggie tourism board.
Pendley said their hope was that each town would want to have its own tourism board to oversee a portion of the tourism tax dollars for its own use.
The recommendation calls for increasing the lodging tax from 3 percent to 4 percent. The extra percent would be divided among the towns to manage through their newly formed tourism boards.
Discussion at recent task force meetings, however, reveal that members are split on the idea of forming different tourism boards within the county. Roy Gass, a regional manager with Mast General Store, said it seemed too divisive.
“You should have one advertising campaign for the county,” Gass said.
Pendley pointed to Watauga County where there are four tourism authorities: one for the towns of Boone, Blowing Rock, Beech Mountain and one for all the areas not inside any town limits.
Gass, who has a store in Boone, said it is a bad model.
“They have four executive directors going four different ways trying to cut out their piece of the tourism pie for their own little niche marketing,” Gass said. “I don’t think it’s good stewardship of the tax money.”
Pendley and Maggie Valley Mayor Roger McElroy pointed out that it would eliminate a great deal of the headache the Haywood County tourism board goes through each year — namely trying to figure out how much money to provide for each community’s festivals. Every year the board wades through applications and has long discussions over who gets the grants. The town tourism boards could take over that role.
There is a major legal hurdle in Maggie Valley’s proposal. The Maggie tourism board would be managing tax dollars collected outside its town limits — beyond its legal jurisdiction.
If the town of Maggie Valley wants to have its own tourism board, it can. But it could only tax businesses inside its town limits. Instead, the proposal calls for Maggie to receive lodging tax dollars collected in the greater Maggie area — not just within the town limits. That amounts to taxation without representation and is not legal, according to county attorney Chip Killian.
Lodging owners outside the town limits don’t like the idea either. Mike Nelson, owner of a hotel in the greater Maggie area but outside the town limits, said he would rather see tourism dollars managed by a countywide entity. If Maggie wants extra money, it should be collected from inside the town limits, he said.
But lodging businesses just outside the town limits would benefit from Maggie’s promotions, and should therefore contribute their tax dollars, Pendley countered.
A similar problem would arise in the Canton area. The town itself has only one lodging business. Yet a Canton tourism board would manage tourism tax dollars collected in the Bethel area, which is several miles from the town. Steve Eaffaldano, a Bethel lodging owner and task force member, said Canton would take more of the money for its festivals and leave less for Bethel events.
“It shouldn’t be up to the town of Canton to say for the Bethel Heritage tour, ‘Well, you aren’t going to get any money,’” Eaffaldano said.
Faced with this legal issue, Maggie leaders came up with a new proposal for the make-up of the Maggie tourism board. The town board of aldermen would appoint most of the members from within the town limits. A couple of seats, however, would be reserved for people from outside the town limits. These seats would be appointed by the county commissioners, thus giving representation to the people being taxed outside the town limits.
This is still a sticky legal proposition, however, as it has never been done in this manner in any county. There is typically either a county tourism board that collects tax everywhere, or a town tourism board that collects tax only in its town limits. This proposal calls for something in between.
“The question is what will the state General Assembly allow,” said David Teague, Haywood County public information coordinator.