Organizations: Lodging tax could promote arts
With a new president taking over at the Chattanooga Convention and Visitors Bureau, some leaders at local arts and cultural organizations are hoping to start talks on sharing the wealth from Hamilton County’s hotel-motel tax.
The idea started with county Commissioner Tim Boyd, who believes the CVB can market Chattanooga and Hamilton County as a tourism and convention destination for far less than it now spends. The 4 percent county tax is projected to raise about $8.2 million this year for the visitors bureau.
In early January, Boyd invited leaders of 15 arts and cultural organizations ranging from the Association for Visual Arts to the Tennessee Aquarium to a meeting where he unveiled his “75-25 Plan.” He said he was “shocked” when 45 people showed up for the meeting, where he proposed raking off a quarter of the 2019 projected lodging tax receipts — a bit more than $2.1 million — for capital and community projects. That would leave nearly $6.5 million for the CVB’s use.
Sharing some of the funds would “use the money as the state legislators wanted it to be used in the first place and be transparent and accountable for every dime you invest,” said Boyd, who took on the CVB last year over its spending, management and lack of transparency. A Tennessee Comptroller’s Office investigation documented some of his concerns, and the organization implemented some reforms.
A second meeting was held Jan. 31 to talk about ideas and formulate a presentation, he said, and then he handed the whole thing over to the arts and cultural groups.
“As an elected official, I think I’ve done as much as I’m charged to do,” he told the Times Free Press. “I hope you guys [in the cultural groups] come together as a coalition … and get the CVB to reinvest in our community like many, many other communities do.”
Since then, said Arts Build President Dan Bowers, the cultural groups have been working to build a partnership with the marketing organization.
“CVB’s focus is getting people to come to Chattanooga and partake of all the good things that go on [in the city and county],” Bowers said.
He said arts and culture are “a significant player in why people want to come. It’s not an either-or. It will be obvious that investing in cultural vitality is at the same time an investment in sustaining tourism.”
Representatives of other organizations at the Jan. 3 meeting, including the Chattanooga Theatre Centre, the Hunter Museum of American Art and the Sculpture Fields, couldn’t be reached for comment.
Bowers said many other communities set aside a portion of lodging taxes for arts and culture.
New CVB President and CEO Barry White spent 26 years in a similar role in Augusta, Ga., where his organization was funded from just 33 percent of the lodging tax take. The city also funds tourism grants to let local organizations market themselves outside the region, White said Friday after just five days on the job.
White said “there’s certainly a possibility” of tax sharing but he will have to consult with the CVB board.
“I certainly can’t commit myself at this point,” he said.
St. Louis, Mo., gives 27 percent of its 3.75 percent lodging tax to the St. Louis Regional Arts Commission, according to the Explore St. Louis website. And San Antonio, Texas, invests 30 percent of its 7 percent hotel-motel tax in local arts and historic preservation programs, its website says.
Boyd and Bowers said giving money to local agencies would be a return to roots, as well. In the early days of the tax, local programs such as the Chattanooga Symphony and Opera, the Tennessee Valley Railroad Museum and the Moccasin Bend Task Force came in for a share, according to Times Free Press archives.
The lodging tax was established in 1980 by a private act in the Tennessee General Assembly specifically to pay off $3 million in bonds for the construction of what’s now McKenzie Arena. A 1983 amendment set up a nine-member Tourist Development Agency to recommend to the Hamilton County Commission how to spend leftover lodging tax dollars on projects that promoted tourism.
The CVB began as an offshoot of the Tourist Development Agency but soon outstripped its parent in size and influence. TDA was locally focused, showering money on a host of youth sports tournaments, fairs and festivals and other causes not seen as promoting big-time tourism. That included projects some critics labeled as “pork” for county commissioners, such as walking tracks and school libraries.
In contrast, the CVB’s strategy of marketing Chattanooga’s attractions and amenities in other Southeastern cities such as Atlanta, Birmingham, Ala., and Nashville was a huge success, with visitation and room tax revenues growing year by year. Room tax money helped pay for the Chattanooga Convention Center and the 21st Century Waterfront, among other projects.
Commissioners gradually shifted more and more lodging tax revenue from the Tourist Development Agency to the CVB until, in 2007, they passed a resolution dissolving the TDA and directing the entire lodging tax take to the visitors bureau.
At the time, then CVB director Bob Doak said arts-related projects would not be ineligible for funding, according to newspaper archives.
“I think the intended use for these funds is to promote this community,” Doak said. “That does not exclude the arts community by any means.”
His replacement, White, said he hasn’t yet spoken any of the cultural group members, though he did meet Bowers during his first week.
“I’m looking forward to sitting down and having a conversation,” White said.