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Wednesday, 01 August 2007 00:00

Room tax will pay for visitor center

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By Julia Merchant • Staff Writer

Swain County commissioners have approved a measure that will carve out up to one third of the Tourism Development Authority’s total budget to pay for the purchase of a new downtown visitor’s center.

The ordinance — adopted at the commissioners’ July 10 meeting after being approved by the state — also gives commissioners the authority to either increase or decrease the county’s 3 cent occupancy tax. The occupancy tax is generated by those paying to stay overnight in hotels and motels in Swain County.

However, the county has no plans to change the current occupancy tax rate at this time, according to County Manager Kevin King. Instead, Swain has opted for a second route, also dictated in the legislation, which allows it to spend up to 33 percent of its room tax collections to buy the First Charter Bank building in Bryson City and turn it into a visitor’s center.

The county’s decision not to inrease the occupancy tax by 1 cent to pay for the visitor’s center contradicts Swain County Chamber of Commerce’s original request. The building is priced at $535,000. Swain County is currently making payments on the property, but the TDA is scheduled to take over payment in September 2008 and pay the commissioners back for debt incurred up until that time. The TDA plans to shell out $50,000 a year for the building.

That number might seem small compared to the reported $300,000 TDA Director Lucretia Williams says is collected each year from the occupancy tax. Still, it’s certainly a dent in the overall budget, and questions have been raised as to where exactly the money to replace it will come from.

King and the county commissioners are banking on consistent increases in occupancy tax proceeds to cover the cost of the building. Since 1987, the year the occupancy tax was started, revenue has skyrocketed from about $75,000 a year to almost $300,000. Since last year alone, proceeds from the occupancy tax have increased by $60,000. That alone is enough to cover the yearly cost of the visitor’s center, King said.

Williams echoed King’s sentiment that no significant amount of money will be cut from TDA’s annual budget. She said there are no plans to cut TDA funding to existing programs.

“I wouldn’t expect there to be any noticeable changes from the community’s perspective as far as the wonderful things the TDA board has been able to provide the community with so far,” Williams said.

Williams added that any money taken from the TDA budget to go toward a new visitor’s center would be well spent.

“The way I see it, all of the money that is spent to upgrade our visitors services is all benefiting our mission. All of those things help us do our job. I don’t see it as taking money away from anything,” Williams said.

In contrast, Chamber of Commerce president Carolyn Allison expressed concern about where the money to buy the visitor’s center would come from. Allison worries that the marketing segment of the TDA might be the first to see a cut, especially if new TDA members brought on board fail to see the importance of marketing Swain County.

“My concern would be if we get some people on board that aren’t aware of the that close relationship between tourism dollars and needing to keep that engine moving,” Allison said.

“If they decide that they need to pinch some pennies (from marketing), it would sort of be biting the hand that feeds them,” she added.

King, though, said that with the steady increase in the number of visitors to Swain County, there may not be as much of a need to market the area.

“If you keep having years like that continually, there’s just so much marketing that you’re going to need to purchase,” he said.

King said that the county opted to have the ability to decrease, as well as increase, the occupancy tax, partly to keep a check on the large amounts of money pouring into the TDA’s coffers.

“Their budget last year was $240,000; this year it’s $300,000. Based upon that number, you see there might need to be a decrease in taxes,” he said. King did say that no plans are in the works to decrease the occupancy tax. The county simply wanted the option if it needed to utilize it in the future.

 

New board make-up

What the TDA did not know when it asked commissioners to amend legislation to include the option of an occupancy tax increase was that the board makeup had to be amended as well.

“It wasn’t clear that when you make changes to existing tax, you have to revert to the most recent legislation,” Allison said.

The previous TDA board consisted of five members — two appointed by the chamber of commerce and three appointed by the county. The new TDA board is composed of nine members. Under the legislation, all members must now be appointed by the county. The chamber can only recommend four members to the county commissioners; they no longer have the authority to place members directly on the board.

The chamber lost its ability to appoint members due to state law, which prohibits private entities from controlling money garnered from taxes. The chamber of commerce is a private organization in which members must pay dues. It cannot legally control monies acquired through the occupancy tax.

Allison remains optimistic about the new board make-up.

“We’ve always had a very strong relationship with the county and the county commissioners. We understand that they want to be a little bit more involved with the selection of the board,” she said.

“I think it’ll be good to get some fresh blood and new faces involved in marketing efforts of the county. Maybe some members of the board will bring some fresh ideas. Sometimes change is a good thing,” Allison said.

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