Dozens of community members filed into the bottom floor of Asheville’s Pack Memorial Library on April 24 for a public forum on the potential restructuring of hotel occupancy taxes, a multimillion dollar revenue stream managed by the quasi-governmental Buncombe County Tourism Development Authority. Titled “Re-Imagine the TDA” and hosted by the Western North Carolina Green Party, the meeting included speaker Stephanie Brown, Explore Asheville Convention and Visitors Bureau President and CEO, who represented the agency’s perspective on its role and the impacts of tourism.
“What if our community had direct control over those dollars that are produced?” event organizer Ben Williamson asked those in attendance. “[Brown] mentioned that 3.9 million overnight visitors come to our city each year. What if you knew that their occupancy tax dollars were going to directly address community needs? What might that look like and sound like?”
Brown explained that state law requires 75% of the revenue generated from the occupancy tax, which is charged to those renting accommodations in hotels or other lodging, to be invested in tourism advertising and marketing. The remaining 25%, she said, is allocated to a fund that manages projects designed to increase overnight stays.
Williamson countered that, under different laws, the more than $23 million in occupancy tax revenue raised last year could have been used to support community priorities like infrastructure, transit and affordable housing. He proposed a budget that would not allocate any money toward tourism advertising and marketing and argued that corporations and hoteliers should shoulder more — or all — of those costs. “Why not share the burden of advertising Asheville with these private corporations or let them take it?” he asked.
While the notion of restructuring the occupancy tax to fund priorities outside the tourism sector may seem revolutionary in Asheville, WNC Green Party Coordinator Andrew Kunza pointed out that cities in North Carolina and across the country use money generated from the occupancy tax for a variety of purposes. Some, he said, only use the money to fund public services and do not reinvest in tourism advertising and marketing.
“How money is spent affects people, and what money is spent on affects people. It has material consequences,” Kunza said. “This is state law. It ain’t the Ten Commandments, it’s not the Constitution. It’s not an impossibility to change these laws.”
Asheville City Council member and ex-officio TDA board member Julie Mayfield responded that challenging the current law may prove more difficult than proponents anticipate. Instead, she suggested two additional countywide taxes, including a tax on prepared food and drinks, to help offset the costs of public services and infrastructure. City officials have explored placing both proposals on a voter referendum in 2020.
“As we’ve said, the law can change, but going and doing a full-frontal assault on the law right now, or even probably in the next couple of years, would be a massive fight that would likely be extraordinarily unsuccessful with this legislature,” Mayfield said, who recently announced her 2020 candidacy for the NC Senate District 49 seat. “The biggest dollar that we can get would be a food and beverage tax. That would help us capture tourism dollars in a way that the occupancy tax will never do. That’s the fight that I want to have if we’re going to have a fight with the legislature.”
A question-and-answer period followed the presentations, with public comments and concerns taken up by a panel including Brown, Mayfield, County Commission Chair Brownie Newman and activist Ponkho Bermejo with the nonprofit BeLoved Asheville.
Beyond how the occupancy tax is distributed, other issues raised by community members included the negative effects of tourism on minority communities, gentrification, overpolicing and a lack of jobs outside of the hospitality industry.
Brown said that while the agency remains obligated to follow the limitations of the current law, she welcomed the opportunity to engage with the community.
“We don’t have a chance to engage in these conversations very much, to admit the problems that we recognize with the growth of not only tourism but workforce impacts and residential growth,” Brown said. “But our job right now is to follow the law how it’s intended to be. I think that the community benefit is widespread and appreciated by a lot of people who depend on it.”
Is there another industry for which the state collects a special tax which it then turns over to said industry for the purposes of said industry to promote and advertise itself?
“As we’ve said, the law can change, but going and doing a full-frontal assault on the law right now, or even probably in the next couple of years, would be a massive fight that would likely be extraordinarily unsuccessful with this legislature,” Mayfield said, who recently announced her 2020 candidacy for the NC Senate District 49 seat.
What reason is there for keeping this law in place? Mrs. Mayfield, declaring that is going to be too hard to do is not an acceptable response. If you don’t want to do the hard work to get real changes made, then you probably should not be a candidate for any office, especially that of NC Senate. Changing this law would make a huge impact on the well-being of our city and should be considered high priority. Anyone that says otherwise is not looking out for the tax payers, voters or anyone else other than their special interest groups.
A couple of issues back, someone wrote in to say that the occupancy tax used to apply only to accommodations that rented four units or more, i.e., hotels and other larger scale accommodations. Then the law was amended to include single unit Air BNB’s. If a complete alteration of where the occupancy tax is spent is not currently achievable, and the prior writer is correct, why not have the law revert to how it was. The County could then separately tax the one to four unit Air BNB’s and share those proceeds with the City, based on location of the rental unit, inside or outside the City proper. Last year my guests collectively paid a considerable amount of occupancy tax under existing law. I believe the amount redirected would be substantial.