Plan for hotel tax is solely marketing

Published 12:16 am Sunday, June 1, 2008

NATCHEZ — Tourism officials hope they’ll soon turn back hotel bedsheets to uncover $600,000.

Passage of the $2 per room hotel tax on Tuesday’s city election ballot would mean the budget of the Natchez Convention and Visitors Bureau would soon become five times larger than its current amount — $120,000.

Tourism Director Connie Taunton said it is a difficult feat to properly market Natchez within the constraints of the current budget.

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“It’s a really big chore for a small town like Natchez to have these amenities offered but not have enough money to market them well,” Taunton said.

And even if the hotel tax passes Natchez’s marketing budget would still be less than some other cities around Mississippi.

Executive director of the Vicksburg Convention and Visitors Bureau, Bill Seratt, said Vicksburg’s marketing budget is approximately $1 million.

Seratt said that money is generated from a 1 percent hospitality tax on rooms and restaurants throughout Vicksburg.

The hospitality tax is vital to Vicksburg’s marketing, he said.

In Tupelo marketing dollars are generated from a 2 percent hotel tax and a 2 percent restaurant tax.

Executive director of the Tupelo Convention and Visitors Bureau, Linda Johnson, said those taxes generate slightly more than $3 million for the city.

Johnson said of that money approximately $1 million is spent on marketing Tupelo.

“We do a little of all kinds of advertising,” she said of marketing expenditures.

Print, Internet, radio and some television ads are all funded by Tupelo’s hotel and restaurant taxes Johnson said.

But other towns market themselves for even less.

Executive director of the West Felicaina Tourism Commission, Kitty Martin, said St. Francisville is using a marketing budget of just $50,000.

Martin’s marketing budget is also derived from an occupancy tax of 3 percent.

“On a $100 hotel stay its not even $3,” she said. “It’s not a whole lot.”

The cost of marketing

Selling your city is costly, Taunton said.

The CVB places a full-page advertisement in the AAA travel guidebook every year at a cost of $13,821.

“If you don’t advertise in (AAA,) you’re missing out on a whole market,” she said.

A small 2 inch by 4 inch ad to run once in Southern Living magazine costs $6,800.

And Taunton said only running ads in two publications is not enough.

“You’re defeating the purpose if you’re not running an ad in three publications,” she said.

Sally Durkin, media liaison for the CVB, said the extra money from the tax can open the doors to a wide variety of magazines.

She said they would like to do television and radio advertisements in Nashville, Atlanta, New Orleans, Houston and Little Rock.

“What we would like to do is do cable ad insertions say on the Weather Channel, the Travel Channel and maybe Lifetime,” she said. “In the world I know, it’s mostly women that make travel plans for families and Lifetime reaches a predominately female audience.”

The marketing funds can also go to advertising on the Internet.

“With the new funding, those are media we can afford that we never could afford in the past.”

No room for corruption

One of the major apprehensions among citizens about voting for this tax is that the money could be misappropriated and spent on other things, perhaps pet projects of the city, instead of marketing the town.

The idea of a hotel tax began early this year when tourism officials asked the city for a $1 per room tax and a 2 percent restaurant tax. The restaurant tax — a .5 percent increase on the existing 1.5 percent tax — was eventually dropped after concerns from citizens and aldermen.

The Natchez Board of Aldermen unanimously approved the $2 hotel tax. Next, the tax was approved by the state legislature.

The legislation outlines how the money can be spent and who will govern its use.

A marketing committee — yet to be established — will create a budget for the funds, which can only be spent on marketing.

“It’ll be a separate check that will go into a separate account and be audited separately,” Taunton said. “There’s no way it’ll be mingled with any other money.”

The CVB will appoint the 12-member committe that will determine the annual budget. The committee will consist of three members from the hotel industry, two members from the restaurant industry, one member from Natchez Pilgrimage Tours, one member from the business community at large to be recommended by the Natchez-Adams Chamber of Commerce and one member from the Natchez Association for the Preservation of African American Culture, one member from the Historic Natchez Foundation, one member from the Natchez Business and Civic League, one member from the Isle of Capri Casino and one “representative from a corporate or ownership relationship which may cross multiple sectors of the tourism industry,” according to the legislation of Senate Bill 3191.

Members from future casinos will be added after they open.

The budget constructed by the advisory committee will be approved by the CVB and will receive a final stamp of approval from the mayor and board of aldermen.

No money at the inn

Each fiscal year, the CVB has received a Tourism Marketing Matching Grant from the Mississippi Development Authority Tourism Division.

Taunton said in the last year, they received about $40,000 from the development authority.

For the 2009 fiscal year, the state has notified cities that the money will no longer be available.

While $40,000 was never enough, Taunton said it did help.

No longer receiving these additional funds will have a negative impact.

Durkin said she really wants to encourage people to go out and vote for the tax.

“I understand everyone’s doubts and concerns,” Durkin said. “If I weren’t working with the CVB and closely watched the way the legislation was written, I too would have my doubts it was a good thing.”

“Hopefully people will be able to place enough confidence in the new political regime to support and vote for this legislation because it is a different day.”