Tourism group wants tax hike for advertising|[7/14/06]
Published 12:00 am Friday, July 14, 2006
Three months after local elected officials decided not to support a tax increase on lodging to benefit the Vicksburg Convention and Visitors Bureau, tourism advocates are back – asking that taxes rise specifically to buy advertising.
Members of the private Vicksburg Warren County Community Alliance Tourism Council will begin garnering support from local hotels and restaurants in October in hopes of having a proposal for the state Legislature when it convenes again in January.
“We are interested in the idea of raising the tourism tax up to 3 or 4 percent,” said council chairman Ann Jones. “That’s what’s being done on the Coast and in Tunica.”
Although assorted groups, including Vicksburg and Warren County governing boards, allocate money to advertising the community for business development and tourism, it is the specific responsibility of the Vicksburg Convention and Visitors Bureau.
The city-county bureau has an 11-member appointed board, which, in January, hired Compass Facility Management as its contract operator.
Larry Gawronski, vice president of Compass and manager of Compass Vicksburg activities, said he, along with the VCVB board, support what the Alliance is doing.
“We are certainly in favor. We’re limited with what we can do with the 1 percent tax, which we currently have,” he said. “It’s split between salaries, (utilities), as well as advertising. We’re not only in favor – we can’t wait. Let’s go.”
Increasing the 1 percent targeted sales tax that has funded VCVB operations since its founding was discussed by various groups in 2004 and 2005, but amid fractious votes on the organization’s future leadership, the idea floundered.
Imposing a sales tax is a specific power of the Legislature and is accomplished through local and private legislation. Such bills rarely pass without unanimous support of local governments, said senior legislative delegate Rep. George Flaggs Jr., D-Vicksburg.
“It’s the fact that the VCVB can’t afford to allocate very much for advertising. There is not enough in the VCVB budget to do an adequate job,” Jones said.
If a majority of hotel and restaurant owners support the tax increase, the proposal will then be taken to the Mayor and Board of Alderman and the Warren County Board of Supervisors.
The 1 percent tax is collected on sales on rooms rented by the night, bar tabs and meals at larger volume restaurants. It generates about $1 million per year.
In turn, the VCVB has been allocating about $300,000 per year to ads and ad-related spending. The balance has been for staff and operations at two welcome centers.
An increase could push the total tax on a hotel room to 13 percent – the sum of the state’s 7 percent tax, Vicksburg’s special bed 2 percent tax for support of the Vicksburg Convention Center, also operated by Compass, and a 3 or 4 percent VCVB tax.
A jump to 3 percent would make the total tax on a $40 restaurant meal $4. A jump to 4 percent would make the tax on the same meal $4.40.
The Warren County Board of Supervisors and state Sen. Mike Chaney did not support a proposed increase to 2 percent made in October by six member hotels of the Vicksburg Chapter of the Mississippi Hotel & Lodging Association.
Lynn Foley, vice president of the hotel and lodging association and Tourism Council board member, said she believes the increase will be better received this time around because of the renewed enthusiasm in Vicksburg’s tourism industry.
“We’re taking a more aggressive approach,” she said. “We’re speaking a little louder today than we were in October.”
Jones said the council is still in the beginning stages of creating a specific plan to let people in tourism entities know how the money will be spent.
“This depends on us being able to get our plan together in order to work with the whole industry so that everybody understands how this will work,” she said.
The plan will include what percentage of the total tax increase will go to radio, billboard, television and print advertisements. It will then explain how much of that will be spent on ads in a 250-mile radius and how much in the 500-mile radius.
“The message here is that we have a lot of planning as far as how it will be done and to make sure everybody is comfortable,” Jones said.