Commissioners to send extra room tax to corridors

Haywood County commissioners agreed on Monday (Nov. 20) to ask the General Assembly for an increase in the room tax and to distribute the extra money to tourism board subcommittees in each zip code.


The decision came after two tourism task forces presented commissioners with a list of six recommendations regarding the Tourism Development Authority. The decision to seek the increase and questions about how to distribute it garnered the most discussion at the work session.

According to the consensus — which was not an official vote — commissioners will create tourism grant committees for each zip code in the county. Those committees will divide the $200,000 expected to come from the extra room tax. Each committee’s decisions on how to spend that money would have to be approved by the Tourism Development Authority, whose members are appointed by the county commissioners. County commissioners would also appoint members of each of the committees.

“You could take an additional 1 percent from the room tax fund, earmark it for a dedicated grant program to be expended on the recommendation of the subcommittee, which would be appointed by county commissioners from the collection area,” said county attorney Chip Killian.

The original proposal from one of the task forces was for Maggie Valley to create its own tourism board to control the share of the additional revenue that was generated in its borders, but commissioners did not support that idea.

“I find it difficult to support something that could end up with us having as many as five legal TDAs in one county. We are all one county, and we have differences among the towns and so forth, but having the possibility of five legal entities all doing related activity causes me problems,” said county board Chairman Mark Swanger.

Under this scenario, the TDA would still have the authority to turn down any requests it did not think met its goal of increasing tourism in the county. Maggie Valley was seeking the creation of its own TDA so it could make its own spending decisions without oversight from the Haywood County TDA.

“So, what we’re getting to is your proposal for a grant could be turned down, so you still don’t have a control,” Commissioner Mary Ann Enloe told Maggie Valley Mayor Roger McElroy at the meeting.

According to state law, counties can enact a room tax of up to 6 percent of the price of a room. Commissioners agreed to seek the 6 percent tax from the General Assembly — currently Haywood levies a 3 percent tax — but only enact 1 percent of the increase. By getting the entire 6 percent OK’d by the General Assembly, the county could decide on its own when to enact any future increases.

Each penny of the room tax generates approximately $200,000 per year. Since the county is only planning to enact one penny of the increase, that’s why the subcommittees would have about $200,000 to divide.

If the county OK’s the breakdown recommended by the task force, the extra money would be divided according to where it was raised: Maggie Valley at 59 percent; Waynesville at 28 percent; Canton at 11 to 13 percent; Lake Junaluska at 1 to 2 percent; and Clyde at 1 to 2 percent.

The commissioners also agreed on other recommendations:

• The TDA board make-up will be changed to include three members from the lodging industry with one from a facility with more than 20 rooms and two from facilities with less than 20 rooms; two from tourism-related businesses; the remaining four members would be recommended from each of the municipal governments; and there would be three non-voting members to include one Haywood County commissioner, the executive director of the Haywood County Economic Development Commission, and the county finance officer.

• Commissioners would set up a formal procedure for removing a TDA board member upon the recommendation of the TDA board.

Commissioners will meet at 5 p.m. on Nov. 27 to discuss and possibly vote on some of the recommendations.

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