Although Mount Airy’s budget for the upcoming 2017-2018 fiscal year has been approved, some lingering issues persist — including local tourism representatives’ dissatisfaction with a city decision to commandeer a portion of occupancy-tax revenues.
The Mount Airy Board of Commissioners had voted 4-1 during a budget workshop in early June to take up to 3 percent of that funding, which comes from a tax levied on persons who stay at lodging establishments in town. The main purpose of the occupancy tax is to provide revenues for tourism promotions in regional publications or other means, with that money managed by the Mount Airy Tourism Development Authority (TDA).
However, state law on tourism taxation allows a local governing unit such as the city of Mount Airy to receive 3 percent of occupancy tax revenues as an administrative fee to cover accounting services for processing the funds. These are provided locally by city Finance Director Pam Stone.
“This is a pretty big job for Pam,” said Commissioner Shirley Brinkley, who led the movement to begin taking the 3-percent cut, an option the city government has not exercised up to this point. Brinkley said this represents a loss of $108,000 over a 10-year period, with the figure for the next fiscal year beginning on July 1 put at $13,000.
“It already should have been done years ago,” Brinkley said of implementing the 3-percent fee.
She suggested pursuing it because of a tight revenue situation facing the municipality, which included a proposal to raise the property tax rate by 5 cents for 2017-2018 which subsequently was defeated.
“I’m bringing this up because it’s money,” Brinkley explained. “I think we should take what is allowed us by the state of North Carolina.”
TDA blindsided
The 4-1 decision by the commissioners — with Commissioner Steve Yokeley in dissent — has caused a ripple of discontent among the city tourism community, including for its timing.
“We had no warning of this prior to our budget preparations,” Jessica Roberts, a local tourism coordinator who works with the Tourism Development Authority, said on its behalf during an open forum at last Thursday night’s city commissioners meeting.
Lenise Lynch, a member of the board of the Tourism Development Authority for the past eight years before rotating off in early January, also addressed the issue of the city taking part of its revenues during the forum.
“I personally don’t think it was right, and it was not done in an appropriate manner,” Lynch said of the nature of the city’s action impacting the TDA. “I just feel like they should have been warned.”
Lynch implied that this is part of a pattern with the city commissioners.
“I just think a lot of things are done without proper research,” she said. “I don’t think that’s the way to do things.”
Lynch believes the Tourism Development Authority was a handy target for the cash-strapped municipality “because they’re healthy and successful.”
She also said the $13,000 to be removed in the next fiscal year represents much to the TDA, but only a small percentage of the city’s revenues overall. “I don’t think taking $13,000 from them is going to help you that much,” Lynch told council members.
Roberts, the tourism coordinator, said during the open forum that she is aware Mount Airy’s budget was tight and “the city has made a lot of tough choices this year.”
But she said the TDA is now directing funding to other needs besides tourism promotion, including continuing to pay for a digital projection system at the Earle Theatre. It also recently allocated $2,500 for the Mount Airy Bluegrass and Old-Time Fiddlers Convention. Roberts further pointed out that the group had funded a hotel feasibility study for the city earlier.
Both Roberts’ and Lynch’s comments drew applause from audience members.
Despite their concerns, the commissioners did not act to reverse the earlier action.
Commissioner Yokeley, in voting against taking the tourism funding, had questioned such a move this late in the budget season.
“I think it’s going to complicate things,” Yokeley said of the action he believes should have been delayed for purposes of the 2017-2018 fiscal year.
