Hotel tax nets more than expected
By Steve Herring
Published in News on August 4, 2017 5:50 AM
Wayne County's 1 percent countywide hotel occupancy tax generated $140,882.62 through the end of April -- $8,482.62 more than the budgeted amount of $132,400 for fiscal year 2016-17.
The total is expected to grow once the numbers for May and June are included.
Wayne County Finance Director Allison Speight Tuesday told county commissioners she did not include the figures through June in her report to them because the numbers have not been audited.
There will be some year-end adjustments, but the county can expect to end the year at approximately $170,497, she said.
"In the expenditures, we paid out an audit fee and most of the expenditures that we have are toward advertising and promotion and then toward our contractual agreement with the city (of Goldsboro) to pay half of their tourism-related salaries," Speight said.
Wayne County Commission Chairman Bill Pate called the growth "tremendous" and said most people would be surprised to know so the amount of tourism dollars generated by hotels in the county.
The growth is particularly noteworthy since what are expected to be the county's two biggest attractions -- the Maxwell Center and Goldsboro's new soccer complex -- have yet to open, County Manager George Wood said.
The tax has been in place since Dec. 1, 2015.
Initially a local bill was introduced in the state House to increase Goldsboro's hotel tax from 5 to 6 percent. But to comply with state travel and tourism guidelines, the tax was switched to a county one.
A 12-member Wayne County Tourism Development Authority oversees how the money is spent.
Mount Olive does not get a seat on the authority because of a compromise agreement with the county in which 70 percent of the tax revenue raised in the town is used to promote tourism there.
The other 30 percent is for "overhead" for administering the tax.
Also, Mount Olive is not eligible to use any of the revenue generated by Goldsboro's 5 percent occupancy tax.
The budget for 2017-18 is for $158,880 and reflects $12,278 for Mount Olive.
"As you can see we have reserved the portion that goes to Mount Olive -- the 70 percent of the 1 percent that is derived from the hotels in Mount Olive," Speight said.
Commissioner Ed Cromartie, who lives in Mount Olive, asked if Mount Olive would get 70 percent of the $12,278.
No, the $12,278 represents the 70 percent of revenues raised through the 1 percent tax that the town will receive, Wood said.
"That is a lot higher than what we thought it would be," Pate said.
"Yes, it is a lot higher," Wood said.
The town of Mount Olive has to make a request to the authority for the money, Wood said.
For example, the Mount Olive Town Board could take action, such as asking for money for the N.C. Pickle Festival, and if is tourism related, it will be approved, he said.
"The only reason we look at it to review it is to make sure the expenditure meets the statutory requirement that it is tourism related because ultimately the responsibility for that falls on the county because you have levied the tax," Wood told commissioners.
If it is tourism related, the county is not going to debate how much Mount Olive gives someone, he said.
"That is their call," Wood said. "As long as it is tourism related we are going to approve it."
Cromartie asked if the town had access to just the $12,278.
That is what is budgeted, but the total available is more, Speight said.
As of June 30, the county had collected $10,232 during the previous year for Mount Olive, she said.
Another $6,875 was collected during the six months that the tax was in effect for fiscal year 2015-16 for a total of $17,107 already available for Mount Olive, she said.
It will grow by the anticipated $12,278 this year, Wood said.
Mount Olive has yet to request any of the money, Speight said.