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Adler attacks plan to move hotel tax money

Wednesday, August 30, 2017 by Jo Clifton

Mayor Steve Adler made clear at Tuesday’s work session that he would try to derail Council Member Ellen Troxclair’s plan to reallocate money from the city’s Hotel Occupancy Tax revenue when it comes up for City Council consideration on Thursday.

Without saying exactly why, Adler expressed the idea that the Troxclair plan would prevent Council from adopting his “downtown puzzle” plan and interfere with a proposal to help the homeless.

Troxclair, along with Mayor Pro Tem Kathie Tovo and Council members Leslie Pool and Ann Kitchen, is sponsoring item 60, a resolution that would reallocate 15 percent of the city’s Hotel Occupancy Tax from Visit Austin (previously known as the Austin Convention and Visitors Bureau) to fund operations and maintenance of city historic facilities as well as funding for parks, music and small business.

The plan’s sponsors argue that state law allows the city to spend considerably more on music, the arts, historic preservation and parks from the hotel tax than is currently being allocated. If the city used HOT money for those operations, it could shift money from the General Fund to other uses. The resolution directs the city manager to allocate 15 percent of the hotel tax to fund operations and maintenance of city historic facilities and sites and then other allowable costs for non-city facilities and sites. The plan would free up $12.6 million in General Fund dollars, according to Troxclair.

But Adler complained that Visit Austin would lose more than $5 million in revenue under the plan. On the City Council Message Board, Adler offered an amendment to the resolution that would simply allocate a certain amount of funds to historic preservation but would not fundamentally alter the way the city allocates those funds.

The resolution points out that the city of El Paso uses local hotel occupancy taxes to fund its Museums and Cultural Affairs Department, as well as annual special events. The resolution also notes that the city of San Antonio appropriates 15 percent of its HOT revenues after debt payment to its General Fund for operations and maintenance in its “tourist zone.”

After the meeting, which started with a briefing on the city’s efforts to help provide shelter for the thousands of Texans displaced by Hurricane Harvey, and then a multi-hour presentation on financial options for downtown, Troxclair finally got to talk about the resolution. She noted that she had asked that it be called up at 4 p.m.

Adler responded that he would call up item 60 at the same time as his item on the downtown puzzle, which is 101 on the agenda. Some of his colleagues said that they had believed that 101 would be postponed. In fact, Adler had previously indicated that he thought Council should vote on the downtown puzzle in September.

Kitchen said she did not understand. Adler responded he would not postpone his item, and he hoped that his colleagues would not approve item 60, or would at least “limit it, as we had talked about.” He said, “There are lots of details in this,” referring to the resolution, and complained that it had just been handed out two days earlier, even though Troxclair and her co-sponsors presented the plan about two weeks ago.

Troxclair made a few changes to the plan this week, including the elimination of funds from short-term rental occupancy taxes.

Tovo told Adler she did not understand his objections and that possibly those objections were merely about how much money should be allocated to Visit Austin and how much could be redirected to the historic venues, parks and other city facilities used by tourists. She said the city cannot allocate any money from the Hotel Occupancy Tax to the homeless and she could see no reason for the public to come and weigh in on that question.

Troxclair has said repeatedly that her plan remains separate from any expansion of the Austin Convention Center and was presented as a way to redistribute tax dollars that could lead to some property tax relief for Austin taxpayers.

Troxclair said she hopes Council will consider Item 60 separately from any other pending resolution. She told the Austin Monitor, “Item 60 deals with existing Hotel Occupancy Tax revenue. Right now we’re spending about 85 percent of that money on the convention center and visitors bureau and 15 percent on cultural arts. We can spend an additional 15 percent on historic preservation and that’s what it really comes down to. That’s what my resolution does. It takes money from the convention center and visitors bureau and puts it towards historic preservation, which can include projects in parks,” including the Barton Springs bathhouse, Fiesta Gardens and the Zilker Botanical Gardens.

Photo by M.Fitzsimmons made available through a Creative Commons license.

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