Salisbury-Rowan tourism board approves change in occupancy tax

Published 12:10 am Tuesday, March 14, 2017

By Josh Bergeron

SALISBURY — The Salisbury-Rowan Convention and Visitors Bureau board voted Monday to increase the county’s occupancy tax from 3 percent to 6 percent.

Monday’s vote came after an hour and a half of debate. Next, the issue needs approval from the N.C. General Assembly. If approved by legislators, the change will increase occupancy taxes only for hotels or other temporary lodging outside the Salisbury city limits. A 6 percent occupancy tax already applies to hotels in the city.

The CVB board unanimously voted in favor of the occupancy tax increase. But for most of the meeting, there was no clear agreement about the best way to proceed.

Initially, members of the board were considering action that banker and CVB board member Mark Lewis likened to “eradicating” Salisbury’s part of the CVB.

The bureau is actually two separate tourism authorities — one for Salisbury and another for Rowan County. The two authorities collect taxes under the umbrella of the CVB. There’s a 3 percent Salisbury occupancy tax and a 3 percent county occupancy tax. Outside the city limits, only the county tax applies. Hotels that are outside the city would be cheaper as a result, argued County Commissioner Craig Pierce and others.

Currently, an overwhelming majority of occupancy tax revenue comes from hotels and other temporary lodging in Salisbury. Because of a planned interstate exit at Old Beatty Ford Road and water line extension in the area, board members expressed confidence that one or more hotels will locate in southern Rowan County.

Board member Shannon Stewart-Hill said it’s important to avoid a situation in which multiple tourism agencies operate in the same county. As an example, she cited Guilford County, where there’s a Convention and Visitors Bureau in Greensboro and in High Point. Depending on growth in southern Rowan County, China Grove might decide to create its own tourism authority, multiple board members said.

Ensuring there’s one organization for the entire county would maximize tourism efforts, Stewart-Hill said.

A significant portion of debate on Monday focused on ensuring Salisbury officials that Rowan County’s largest city would not be left out of tourism promotion and activities.

Instead of a complete merger between the Salisbury and Rowan County tourism development authorities, the solution became changing tax rates and setting board appointment powers.

CVB board member Barbara Perry noted a significant shift as the meeting came to a close. Perry said CVB Chairwoman Krista Osterweil initially proposed creating one tourism authority.

“There’s a lot of difference in what she’s saying now and what she said in the beginning,” Perry said. “You were asking for one board, one board. Now, we’re just asking to increase it to 6 percent. There is a big difference.”

“Huge difference,” Salisbury Mayor Karen Alexander added.

At one point, Salisbury City Councilman Brian Miller offered a motion to create a study group before taking a vote. Perry seconded the motion. The board voted 8-7 against Miller’s motion, but a lengthy period of debate came first.

Alexander said she didn’t want to make a decision without more planning.

Discussion about a merger or tax increase first started last week. Osterweil said she called the meeting in part because the county was missing out on a “tax opportunity.”

Alexander said it made sense for Rowan County to bring its tax rate up to the same 6 percent rate that city hotels pay.

Pierce said there was no need to further study the matter, as Miller suggested.

“Thirty days from now, it’s going to be the same thing,” Pierce said. “I don’t know about y’all, but I’ve been on enough boards this past year, including the (branding) task force and all those things. Ten more lunches and six more night meetings is not going to change the facts of what we’re here to vote on right now.”

The final motion approved by the CVB board will ask state legislators to draft a bill with a 6 percent countywide occupancy tax, one-third of which can be used for capital projects. The City Council will appoint five board members. Another five will be appointed by county commissioners. The final members will be picked by the Rowan County Chamber of Commerce.

Convention and Visitors Bureau CEO James Meacham said he believes Monday’s vote will be enough to approach state legislators. Because his agency mostly functions independently of city and county government, Meacham said he doesn’t believe he needs to receive approval from the Salisbury City Council and Rowan County Board of Commissioners.

Before Monday’s meeting, state Rep. Carl Ford, R-76, said he has already been approached about drafting a bill related to the CVB’s structure. Ford said he was waiting on an official request before he started drafting a bill.

Contact reporter Josh Bergeron at 704-797-4246.