Is ‘heads on beds’ tax working?

Published 12:04 am Sunday, June 16, 2013

NATCHEZ — Nearly five years since the $2 “heads on beds” tax passed in Natchez to generate additional tourism marketing dollars, the effect is mixed.

Some local businesspeople say the tax clearly is working and the hundreds of thousands of extra marketing dollars are doing well, and others say they just don’t see much of a difference.

The $2 hotel and bed-and-breakfast occupancy tax, which was passed in 2008, provides the Natchez Convention and Visitors Bureau with money to be used only for marketing Natchez. Approximately $331,000 was collected in the 2011-2012 fiscal year.

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Natchez Tourism Director Connie Taunton said the CVB takes that money and combines it with other marketing money in the budget for a total of approximately $400,000 to market Natchez each year.

Since the tax passed in 2008, the tax money collected has incrementally increased each year, from approximately $274,000 in 2008 to $331,000 last fiscal year.

That means, Taunton said, the $2 tax money marketing is successful because more people are coming to Natchez and staying in hotels and beds-and-breakfasts.

Dunleith Assistant General Manager Lyn Fortenbery said Dunleith has seen a direct impact of the CVB’s marketing efforts, especially the push to make Natchez a destination wedding location.

“I would absolutely say we have seen a direct effect,” she said. “We have had an increase in weddings and business due to the fact that the CVB has been able to market to larger publications and larger magazines, and the $2 money as a whole has benefited Natchez.”

The CVB’s website, which Fortenbery said the $2 tax money made possible, has also been a big benefit for local tourism businesses. The site allows local businesses to provide more information directly to potential conferences or meetings coming to Natchez on what the businesses can offer.

“Whenever they have conventions that come to town and need more information … you can log on and put in how many room nights you can offer or catering or other services,” Fortenbery said. “All of the tourism entities have access to that, and before it took a lot more than that to get that information out.”

Fortenbery, along with several other tourism professionals, also serves on the committee that advises the CVB on how the $2 tax money should be spent.

But other businesses that benefit from tourists visiting Natchez are not so sure they have seen a benefit from the $2 marketing money.

“I would say, ‘No,’” said Guy Bass, owner of Cotton Alley Café on Main Street.

Bass said he believes the Natchez Convention Center and the New Orleans Hotel Consultants group do a lot to get people to Natchez.

But he said isn’t sure how to tell the benefit of the $2 money on his business.

“There’s absolutely more people here, no question,” he said. “How they heard about us, there’s no way I could possibly tell you. It’s an enigma.

“We all want the best bang for our buck, so I hope our (marketing) dollars are being spent well.”

Wilkins Town House bed-and-breakfast owner Spike Newman said he hopes the same. Newman said it is also difficult for him to say if he has benefited from the $2 marketing money, but he does say his business has increased every year in the 8-10 years he has owned the bed-and-breakfast.

“I don’t mind giving them the $2 (tax money), if they’re going to do the advertising,” Newman said.

But Newman said he hopes the CVB’s marketing efforts go beyond the bigger properties and benefit all tourism businesses.

Taunton said she would ask one question to business owners who say it is difficult for them to say what has been the benefit of the $2 money on their business.

“Is there business up or down?” she said. “I know the tax revenue has steadily increased, and also the restaurant and lodging tax, too.”

According to figures from the city clerk’s office, the restaurant and lodging actually slightly decreased last year, from approximately $365,800 in the 2010-2011 fiscal year to $362,200 in the 2011-2012 fiscal year.

The tax jumped from, approximately $339,600 to $350,900 from the 2007-2008 fiscal year to the 2008-2009 fiscal year, the first year the $2 tax was implemented. It then decreased to approximately $320,900 in the 2009-2010 fiscal year.

Overall, Taunton said she believes the $2 tax money has benefited Natchez. She said the CVB is grateful for the tax since the state eliminated a matching-grant program the year after the tax passed that supplied the CVB with marketing dollars.

“If we hadn’t got the $2 marketing money, we wouldn’t have any marketing for Natchez,” she said.