Letter: The occupancy tax and the soul of the city

Graphic by Lori Deaton

When my wife and I moved here in 2007, we were both so impressed with what Asheville had to offer. We still feel that way, as I do not want to sound like, “It’s Over” (Asheville has officially lost its soul). In fact, that last word, “soul,” is what we kept saying about Asheville upon moving here. The town had an earthiness — a soul.

But in more recent years, it became apparent that the developers, the hoteliers and the construction companies building these hotels all had their “eyes on the prize” here. Don’t get me wrong. Asheville really did need hotels, but how many and just as importantly, where they would be located (don’t dwarf the historical buildings people come here to see in the first place) could have been planned better.

The occupancy tax (here), once everyone learned just where the money would only go, seems to have created a vicious circle that especially benefits the building of more hotels. It’s ironic (I can think of different words here) that there are these really nice upscale hotels downtown that tourists will come and pay big bucks to stay in — and to get there, they have to traverse roads on the way into town that have potholes and nearby highways (I-26 and 240) littered with trash. When same tourists are walking about downtown, they have to also be careful where they step on certain sidewalks.

Ben Williamson’s recent Opinion article [“Rampant Tourism or True Progress? Buncombe Commissioners Must Rein in the TDA,” May 12, Xpress] really hits it on the head when he wrote, “Other cities have used their occupancy taxes to direct millions to infrastructure and social programs while still supporting vibrant tourism industries. Why can’t we?” Yes, why can’t we?

He also accurately states, “Let’s be clear: Turning off that money tap won’t signal the end of tourism here.” Indeed, it is not (and hasn’t been for quite a while now) a news flash that Asheville and the surrounding area are one of the East’s hot spots to vacation in. The secret was out long ago. So, just how many millions do we need to promote, to advertise this town?

Like Ben Williamson, I hope that the county leaders do the right thing, too. Otherwise, the soul of Asheville will keep slipping away.

— Brad Dawson


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23 thoughts on “Letter: The occupancy tax and the soul of the city

  1. luther blissett

    I’m not sure that the occupancy tax “especially benefits the building of more hotels” at this specific moment, though it did in the past. What it does is give the TDA millions of dollars to waste on paid media with diminishing returns and personally enriches its senior staff. Money’s fungible, though, so it gives big hoteliers and the owners/senior management of big attractions a heavy discount on their own marketing budgets. (A bunch of them are, coincidentally, on the TDA board.)

    Where has the TDA has been most successful? At making itself a focus for local residents’ distrust and resentment. It has done more in the last handful of years to destroy good faith towards the hotel and tourism industry than any of its opponents [golf clap]. We always suspected that the biggest players in local tourism were indifferent towards local concerns. Now we know they’re worse than that.

    • bsummers

      I have to agree with the author that the occupancy tax leads to the building of more hotels. The vicious cycle is this: Hotel occupancy rates rise, room rates rise, Asheville becomes more attractive to hotel builders. More hotels get built, occupancy rates and room rates fall, TDA spends more & more occupancy tax dollars on advertising to fill the rooms, occupancy & room rates rise. Rinse. Repeat. We’ve been seeing that for years.

      And I’ve been pointing that out for years.

      • luther blissett

        We’re not disagreeing here, but I’m emphasizing “this specific moment.” To me, it feels as though all the hoteliers who took advantage of that TDA-fueled land rush are taking a minute to consolidate their positions while the TDA continues to burn obscene amounts of money. Their attitudes may change when the Flatiron and Restoration (former Bank of America) are finished and have rooms to fill.

      • Ted Evans

        The war on AirB&B opened the doors to more hotels. Before moving here over 5 years ago, we came the previous 10 years and stayed at AirB&B properties. They were quaint, had that “Asheville Vibe”, and allowed us to meet as a family. We came from another Destination City, Virginia Beach. They had the same struggles, but used their room taxes to improve parking, access and roads. The Hoteliers had their own council, and as business men, knew how to allocate funds in a manner that supported business, as well as our residents. Our Council always appears to lose focus.

        • bsummers

          City Council has no control over the occupancy tax revenue. It’s controlled by the County and the TDA.

        • luther blissett

          There was no good answer to the AirBnB question, especially once property owners worked out that they could make considerably more from vacationers — especially for “quaint” or “Asheville vibe” places near downtown — than from long-term renters, and without any of the responsibilities of a landlord. All of the externalities were dumped around the city while AirBnB took its cut.

    • NFB

      “Money’s fungible, though, so it gives big hoteliers and the owners/senior management of big attractions a heavy discount on their own marketing budgets. (A bunch of them are, coincidentally, on the TDA board.)”

      According the the law, a majority of the TDA must be hotel owners. Thus, the kind of inbreeding that results compounds the zero motivation the board has to attune itself to the thoughts of the public and for it not to feel any particular concern for the negative public image it has and which gets worse every time it refuses to cooperate in addressing the public’s concerns.

    • Ted Evans

      I’d have to say that street improvements, especially our sidewalks, need attention!

      • Virginia Ritter

        I’ve been trying for 9 years to get a sidewalk on Oakland Street so the children don’t have to walk to school in the middle of the street! Never any money-after all their only African American children. But Haw Creek have sidewalks to no where!!!!

  2. NFB

    Asking this over the years results in nothing but crickets, but I’ll give it another go.

    In 2016 as part of his effort to get city council to approve his plans to turn the BB&T building into a luxury hotel, John McKibbon promised to advocate to change the law to allow a portion of the room tax to go to help local governments pay for infrastructure and services that are used by tourists. That was 5 years ago. What actions has he taken on this promise?

    Can someone answer this? Someone? Anyone?

    • bsummers

      I for one appreciate you pursuing this. It’s the best clear-cut example of how developers manipulate public opinion and city officials for personal gain. It’s the tip of the iceberg of how tourism development doesn’t serve local residents.

      • NFB

        None of the local media, not even MX seem to want to touch it. Yeah, I get that Asheville has a significant mill town mentality when it comes to tourism, where any hint of criticism of it is taboo, but why such hesitancy to hold somebody to their word?

        • bsummers

          XPress – you want to demonstrate that you’re on this issue? A real simple way would be to try to track down whether McKibbon followed through on that promise, and if not, why not, and why wasn’t he held to his word by the City?

        • Mark Barrett

          I’m not sure how much coverage there may have been as to what John McKibbon has or hasn’t done personally. But, there has been media coverage of the larger issue of changing how room tax proceeds are distributed. Here’s a story I wrote about a year ago that Xpress published on its website: https://mountainx.com/news/from-avl-watchdog-travel-industry-controls-north-carolinas-room-tax-laws/ .

          I wrote a story several years back about how other localities use their room tax money for the Citizen Times when I worked there.

          By the way, I’m a freelancer and do not speak for Xpress on this issue.

          • bsummers

            Mark – Don’t you agree that this is a perfect microcosm of the issue? McKibbon was facing opposition to his mega-millions BB&T hotel project, and so attempted to grease the PR skids with a “promise” to work to accommodate public insistence that more tourism tax dollars went to infrastructure. He got approval for his project – did he follow through at all on that promise?

            I’d read THAT story.

  3. Curious

    Am I correct that it is the state legislature, not local elected officials, who mandate the composition, purposes, and funding priorities of the TDA? If that is the case, can local voters have any impact on their state legislators in seeking changes that would channel more TDA funds to infrastructure, which is used by by tourists? If all those who write letters to Xpress also wrote letters to their legislators, would that carry any weight? Presumably local elected officials have lobbied local legislators . . .

    • NFB

      The law that maintains that the TDA must spend 75% of room tax revenue on marketing for more tourists, and 25% on grants to projects that will appeal to more tourists is controlled by the state legislature. The local delegation could introduce a proposal to change that, but Rep. Chuck Edwards has made it clear he will not go along and since Republicans control the legislature it will not happen as long as he and his fellow Republicans are driven by a “screw cities in general and Asheville in particular” agenda.

      No county is required by law to even have a TDA, so Buncombe County Commission could vote to abolish the Buncombe TDA. It could also vote to cut the room tax which it voted to increase a few years ago.

      That increase was an prime example of how the TDA talks out of both sides of its mouth.

      When there was some talk about increasing the room tax from 4% to 6% and having the extra 2% go to city and county services that tourists use the TDA opposed it, saying it would make hotel rooms too expensive and we would lose tourists to other places — as if those other places have the Biltmore House, downtown Asheville, etc. and as if people plan their trips based on how much a hotel room is rather then finding a hotel room that fits their budget. The proposal went nowhere due to the TDA opposition.

      A few years later the TDA was in panic mode over so many new hotels being built and fear that there would not be enough tourists for them. So, it got the legislature to approve giving the county the option to increase the room tax for a bigger marketing budget. Suddenly making rooms more expensive was not a problem. Thus, the county could vote to cut the room tax if the idea of abolishing the TDA seems to go too far for commissioners.

      The TDA always hides behind the law that 75% of the funds much be spend on marketing. When it is suggested that they could advocate that the law be changed they claim that they don’t do lobbying. But when the tourist industry was in meltdown mode this time last year they happily lobbied the legislature to allow some of the funds to be used in grants to help out struggling local businesses (but only those that served tourists, of course) so they are happily willing to do lobbying when it serves its interests.

      The complete contempt the TDA has for the local yokels is astounding. The question is though is all the pearl clutching it does over the criticism it gets and the poor public image it has feigned or is it genuine and just another example of the bubble its inbreeding has put it in?

      • luther blissett

        I think they’re high on their own (revenue) supply. If a business increases its revenues year on year, its owners and managers will probably think it’s a good business and they’re doing things right, right? (Sometimes that’s true and sometimes it isn’t and complacency is a killer of businesses.) Well, the TDA board looks at the revenue numbers and thinks everything it does must be right.

        (It does not have any real metrics to assess the value of the dollars vomited into paid media like a downtown bachelor party, because those dollars are other people’s money and not their own. This should be raised at board meetings. The ex officio non-voting members from city council and the county commission are apparently unwilling to mention this because it’s not their circus and not their monkeys.)

        But amateur psychology is a waste of time. The TDA is unfit for purpose. The pandemic year made clear that it isn’t even necessary. The county commission doesn’t have the power to abolish the TDA. The TDA could potentially live on as a zombie even if the county repealed the occupancy tax. Here’s the relevant language:

        “A room occupancy tax levied by a county may be repealed or reduced by a resolution adopted by the governing body of the county. Repeal or reduction of a room occupancy tax shall become effective on the first day of a month and may not become effective until the end of the fiscal year in which the resolution was adopted”


        The fiscal year ends June 30. The clock’s ticking.

    • luther blissett

      You are correct and no they can’t.

      The NCGA is controlled by Republicans, who have drawn the state legislative districts to retain firm control. All of Buncombe’s representatives are Democrats aside from one: state senator Chuck Edwards, who is from Hendersonville and whose district mostly covers Henderson County but extends into south Buncombe. (Fun fact: his district includes the Biltmore estate but not Biltmore Forest.) All legislation that specifically affects Buncombe has to go through him, as was the case with the special bill reallocating money from the BCTDA capital projects fund into small grants last year. He is our colonial governor, and he has decided that there will be no changes to the TDA law.


      The only power in the hands of local government is that of the county commission to set the occupancy tax rate. That’s where local voters should direct their attention. A one-year reduction or moratorium on the occupancy tax for the TDA’s next fiscal year would force it to live within its means and get its attention. The next commission meeting is Tuesday June 1, i.e. tomorrow.

      • Curious

        Thank you for that reply. Are any individuals or groups organizing to lobby the Commissioners to lower or abolish the occupancy tax? It would seem the only way to get the attention of the TDA and its enablers in the legislature.

  4. Taxpayer

    Asheville does not need to bring in more tourists than we already have. Tourists are already using up and wearing out infrastructure and resources for which the city gets no reimbursement. To squash growing the number of tourists, Buncombe County should rescind the occupancy tax used to recruit more tourists (at least for now). If we ever need more tourists in the future, the TDA will be happy to once again take the millions.

  5. indy499

    How occupancy taxes $ are used is one discussion, but the underlying economic logic in this letter and commentary is rather silly. The TDA is a construct like any collective. Hoteliers presumably concluded at some point that they were better off on their bottom line with basically an ad co-op.

    Any semi-competent economist will tell you that demand for a product is a function of the total price—base plus relevant taxes. The TDA could go away tomorrow and hoteliers could raise prices 6% with little if any impact on demand. Revenue would increase and hoteliers could decide what to do with it. Hoteliers would lose some buying efficiency but that’s about it. Customer’s revenue pays for operations, including the advertising for the next set of customers. Nothing esp unique or even interesting about this type of occupancy tax.

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