A failed attempt to raise the Savannah hotel / motel tax, which would have raised funds for more than $ 60 million worth of projects south from River Street, will come with setbacks, according to local hoteliers.
The increase should take effect next January. As the city continues to compete with other popular travel destinations, the investment would help guests return to the Hostess City in the future, several hotel managers agree.
For subscribers:The Council Department is blocking the tax hike for hotels and motels in Savannah at Georgia Legislature
“It is certainly disappointing to hear that the bill has not made any headway this year. I hope it comes through next year. If approved in 2022 in terms of the additional marketing costs, we are now almost 2023 as the marketing is upfront, ”said Pritpal Singh, General Manager of Perry Lane Hotel and current Chairman of Visit Savannah’s Chair. “Product investments also follow a similar pattern.”
Singh said this is not the first time in a city that has tried to raise taxes.
“I’ve been to Nashville, worked in Nashville for over a decade, and seen this city do exactly the same thing and look at where they are today,” he said. Nashville is consistently one of the top 15 most visited cities in the United States.
The bill, which was dropped in the House of Representatives last week, did not have enough support from Chatham County lawmakers to move forward. The increase would have paved the way for the Council to issue a regulation increasing the tax from 6% to 8%.
City council adopted the resolution Seek the change through a 6-3 vote in February.
Last minute changes, advocated by four councilors last week, resulted in the support that members of the Chatham County delegation needed moving away from the issue.
Estella Shabazz, Kesha Gibson Carter, Alicia Miller Blakely and Bernetta Lanier tabled an addendum requesting $ 7.5 million for a variety of new projects, said Michael Brown, manager of Savannah City during a press conference on March 22.
While Shabazz, Gibson Carter and Blakely opposed the resolution considered by the Council on February 25, Lanier voted in favor.
Rep. Ron Stephens, chairman of the Chatham County’s local delegation, told the Savannah Morning News last week that the change in support was making things more difficult at the state level.
“We usually take a resolution from the city and act on their behalf,” he said. “Well, I don’t think anyone down there will agree on anything, so we find it extremely confusing when one is presented to us.” One day people come and say, “No, we’ve changed our minds, we don’t want that.”
“We have to invest”
While the topic isn’t always popular, Charles Roberts, a partner at HLC Hotels, said the group was helping the mayor and city council raise the tax. HLC Hotels operates a number of hotels in the city including the Marshall House, Kehoe House, Gastonian, and others.
“Nobody likes new taxes, but we know that these additional revenues will be used for projects that will benefit both the community and the hospitality industry,” he said.
At the current rate of 6%, half is from the city’s general fund, 33.3% from Visit Savannah, 13.5% from the Convention Center, and 3.2% from the Savannah Civic Center.
Under the proposed 8% tax, 37.5% would have gone to the Savannah City General Fund, 33.8% to Visit Savannah, and 14% to the Savannah Convention Center. The remaining 14.7% would be used to develop government tourism products.
These tourism development funds were intended for the rehabilitation of the waterfront. extension of Flood into the city urban network of roads; Renovation of the Historic waterworks building near the new city arena; Hiking trails, sidewalks and other connections between the historic district, the Westside districts and the new arena; Museum development; a new water access facility on the south side of Savannah; Signpost; and improvements to the West Bay Street gateway.
Visit Savannah President Joseph Marinelli said he is all about the visitor experience, no matter where they travel from.
“Whether this visitor is from Ohio or somewhere in Italy, or whether this visitor is from the South Side or Wilmington Island. When people visit our city, I want it to be the best it can be. And if it is, they will stay. ” spend longer, spend more and come back in the future, “he said.
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River Street and arena improvements were two of the projects that both Singh and Roberts were excited about.
“The proposed projects will enhance the experience of our visitors to Savannah and encourage them to return year after year,” said Roberts.
Singh agreed, saying that as Savannah continues to compete with cities like Charleston, Nashville and Jacksonville, there is a need to invest and improve the products that the city offers.
“Savannah has much, much more to offer than our competitors. There is history, there is architecture, southern hospitality, the food, ”he said.
“If you look at the new hotels and developments, we’ve drawn more visitors over the past three or four years. We are aimed at this discerning visitor who appreciates Savannah. To ensure that this customer continues to return to Savannah, we need to invest in our product. “
Marinelli said the dollars for River Street and the Canal District were well meant.
“With the great Plant Riverside District on one end and the new Eastern Wharf on the other end, many would agree that Savannah’s waterfront is ready for a minor facelift,” he said.
“And there are still a lot of strangers in the area around the new arena, so dollars spent on new infrastructures there make sense for me too.”
Marketing the city
The increase would also have updated an agreement with Visit Savannah that markets the city to visitors.
Visit Savannah has marketed the city since the organization was founded as the Savannah Convention and Visitors Bureau in 1976 and has long been working on an annually renewable agreement with the city government.
During the same meeting on February 25, the council voted 7-1-1 to approve an updated agreement with the organization. Blakely voted against the measure and Gibson Carter was absent.
The agreement set out various requirements, including developing and implementing a diversity, justice and inclusion plan to attract minority visitors, promote local minority-owned businesses to these visitors, and highlight cultural heritage sites and attractions that are open to minority communities Meaning are.
The agreement also provided for Visit Savannah to appoint a full-time employee to implement and monitor the Diversity, Equity and Inclusion Plan and to submit the plan to the council annually at the end of the year, along with a business plan.
Visit Savannah’s stake in the fund would have increased from 33.5% to 33.8%.
“While I’m disappointed that the tax bill didn’t go through this time around, I know the Visit Savannah team will continue to do an excellent job with the current resources,” said Singh.
While 2020 visitor numbers are not yet available and are likely to decline due to the COVID-19 pandemic, more than 14 million visitors spent $ 3.1 billion in 2019 while visiting the Hostess CityAccording to Longwoods International’s annual Visit Savannah Visitor Study.
Savannah hotel and motel tax dollars have increased every year since 2015, with the exception of 2020. In 2015, the collection was over $ 18.4 million and through 2019 it was over $ 22.6 million. Funds fell to $ 13.3 million last year due to the COVID-19 pandemic
The tax hike would have brought Savannah to the same level of hotel and motel taxes as many other cities across the state, including Atlanta, Macon, Vidalia, and Columbus.
According to Marinelli, to remain competitive as a prime visitor destination, executives need to think about the future.
“To remain competitive as a prime visitor destination, we need to think about the next 30 years,” he said.
“The new arena, an expanded convention center and a vastly improved flight service are all pieces of this puzzle. But we can no longer just rely on what our city has been for the past 30 years.”
Katie Nussbaum is the city and county government reporter for the Savannah Morning News. Contact them at knussbaum@savannahnow.com. Twitter: KmartSMN
