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City council delays special hotel tax

Tia Lynn Ivey News

The Madison Mayor and City Council voted unanimously to delay the vote to raise the Hotel/Motel Tax until the December regular meeting after receiving some pushback from the Madison-Morgan Lodging Association (MMLA), which is made up of local hoteliers.

The council decided to delay the vote in order to give the MMLA a chance to publicly make their case against raising the Hotel/Motel Tax, since the director of the Madison-Morgan Convention and Visitors Bureau (CVB), Ellen Sims, appeared before the council to argue for raising the tax last week, at the request of Councilwoman Chris Hodges. A Hotel/Motel Tax is a fee tagged on to the price of lodging rooms, paid for by the customer. A percentage of that money is used to fund the CVB, which promotes Madison and Morgan County as a tourist destination.

“I thought it was only fair for us to hear both sides before taking a vote,”  said Madison Mayor Fred Perriman.

The MMLA opposed the increase last year, too, when the CVB was pushing for the increase.  The current rate is five percent. Surrounding counties have rates as high as eight percent. The MLLA argued that raising the rate would diminish Madison’s competitive edge with other surrounding lodging markets. The council actually passed a two percent increase from 5 percent to 7 percent last January in a narrow vote. But the increase was never finalized because Morgan County’s delegation, Representative Dave Belton and State Senator Burt Jones, refused to bring the matter before the state legislature to be enacted.

Belton and Jones refused to take the tax increase before the state legislature to finalize the two percent increase. Belton claimed the council must have a “unanimous, or near-unanimous” vote in order to get approval from the legislature. The council passed the tax increase in a 3-to-2 vote, with Councilmen Rick Blanton and Joe DiLetto opposing the increase. However, the entire council as a whole signed a letter objecting to the delegation’s refusal to honor the vote. But the protest was to no avail.

Councilwoman Hodges asked the council to readdress the issue recently, hoping the council, the CVB and the MLLA, could reach a compromise to pass a modest increase to the Hotel/Motel Tax in order to expand the CVB’s marketing reach. The CVB, which promotes Madison and Morgan County, is funded through the Hotel/Motel Tax, which is currently at 5 percent. According to The City of Madison, “The Madison-Morgan County Convention & Visitors Bureau (CVB), a nonprofit corporation partially funded through Madison’s hotel/motel tax, guides the very successful community tourism effort. The CVB employs a full-time director. In addition to operating the Madison Welcome Center, the CVB coordinates all regional marketing initiatives and concentrates upon promoting Madison and Morgan County to both national and international visitors. Tourism has become Madison’s leading economic engine and is instrumental to local economic vitality and community development.”

The MMLA asked the council to delay discussing the tax increase at Monday evening’s council meeting. The MLLA will return to present their perspective to the council during the Friday, Nov. 2 work session.

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