Published: Jan 22, 2013 07:00 PM
Modified: Jan 22, 2013 01:09 PM
CARRBORO - The Hampton Inn could bring in over $100,000 annually from the town’s new occupancy tax, but the Board of Aldermen hasn’t yet decided exactly how the money will be spent.
The board unanimously approved a 3 percent tax on receipts on renting rooms at the new inn. Visitors will pay the town tax in addition to the county’s existing 3 percent hotel/motel occupancy tax.
The Hampton Inn, Carrboro’s first hotel, is part of the redevelopment of the 300 E. Main St. shopping center that also houses the ArtsCenter and the Cat’s Cradle. Future phases will include more retail, dining and office spaces.
Town staff anticipates the occupancy tax on its 144 rooms – with an average nightly room rate of $110 and a 67 percent occupancy rate – will generate $9,552 per month for the town, or $114,618 annually.
The tax also requires the creation of a Carrboro Tourism and Development Authority. The aldermen approved a three-member tourism authority and membership application.
As an independent committee, the authority will disburse the occupancy-tax revenue. It must use at least two-thirds to promote travel and tourism in Carrboro and the rest for tourism-related expenses.
For the first five years, money for tourism-related expenditures will help pay for the project’s parking deck, located behind the hotel. The other two-thirds were also informally committed to the Chapel Hill/Orange County Visitors Bureau. Chapel Hill, which levies a similar tax, also contributes to the visitors bureau.
Alderman Sammy Slade asked what would happen if the authority chose not to allocate money to the parking deck. “In theory, if we chose people who did not honor that commitment, we would be left holding the bag and needing to find money elsewhere,” he said.
Town Attorney Mike Brough said the committee, while autonomous, would respect the aldermen’s informal commitments. “I fully expect them to adhere to the board’s recommendation,” he said.
Alderwoman Jacquie Gist said she was hoping some of the tax revenue could go toward the arts and help offset the cost of music and art festivals in Carrboro
“But it looks like under the current configuration that it will go towards the parking and an agency, and there really won’t be any to use towards arts and entertainment directly in the town,” she said.
Laurie Paolicelli, director of the county’s visitors bureau, said the bureau will still financially support Carrboro’s film and music festivals.
“What we do at the county will not change,” Paolicelli said. “Our agency will continue to promote Carrboro in every way we can.”