Monday, October 14, 2019 by Chad Swiatecki

Task force to recommend uses for hotel tax money for music industry

With millions of dollars from the city’s hotel tax expected soon to be available for use by the local music industry, the Music Commission is forming a task force to advise City Council on the best way to use those funds.

At last week’s meeting, the commission voted unanimously to create an 11-member task force, made up of five commission members and six at-large members of the public. The task force will dig into how the city could legally use an estimated $3.5 million that will be available by the end of the year.

The money became available following a series of changes by Council to the city’s Hotel Occupancy Tax, including an increase on the levy to 17 percent and a decision to make for-profit music-related businesses eligible for a portion of the tax money dedicated to cultural arts.

During a vote last month, Council directed the Music Commission to take the lead in recommending how best to use the money, which music supporters say is needed to help musicians and live music venues that are struggling under increasing affordability pressures.

Before the vote commissioners discussed the questions surrounding the recent Council actions that have all been tied to a planned $1.2 billion expansion of the Austin Convention Center. If voters approve Proposition B on the ballot next month, an expansion would require voter approval, with supporters of the proposal arguing money currently dedicated to convention center operations could be redirected to cultural arts and music.

“This issue has divided a lot of music community folks, and environmentalists and people who are typically on the same side of most issues in town are polar opposites,” Commissioner Gavin Garcia said

“Whatever happens with this issue politically with the convention center expansion, in both camps there’s still money on the table for the commercial music industry. … If it doesn’t pass, do we want to get ahead of proceeding with a recommendation on what to do in the event of this money being available?” he added.

The commission will work with staff to determine which of its members will serve on the task force and select the six at-large members from an 11-candidate field made up of one nominee from each commission member.

The goal of the task force is to deliver recommendations to Council by the end of this year or early next. No ideas were offered about possible programs during the meeting, though prior to last month’s Council vote one potential use suggested was reimbursing clubs for booking local acts.

Garcia said the task force could consider whether the music funds would best be deployed by an economic development corporation, which would receive money from the city but might have more leeway in how to spend it than the city itself.

Commissioner Paul Pinon said the task force will need clear guidance from the city’s legal staff and a member well versed on what types of programs could be allowed by the state laws governing use of the hotel tax.

“With the Artist Access program through (the Parks and Recreation Department), just getting a little bit of that funding and figuring out the details of what we could use it for was a mess. I’d like to make sure we have that part covered and aren’t recommending projects that wouldn’t fall under the scope of the hotel tax usage since it has to put heads in beds and promote tourism and then also benefit cultural arts,” Pinon said.

“There’s going to be certain uses that will be easier to approve than others and I’d be curious to know other programs that have passed, like Artist Access.”

Commissioner Graham Reynolds said the success of programs created within the city government by the Cultural Arts Division can serve as one model for how the hotel tax money can be used effectively and legally.

“I’d be careful not to squash too many dreams too early,” he said. “We know that Cultural Arts has a very active program supported by HOT that’s been going on for years and it’s been successful helping to sustain the arts community, so maybe we’re looking to do something similar on our side, not with the same structure but in the mission.”

Photo by Ralph Arvesen made available through a Creative Commons license.

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Key Players & Topics In This Article

Austin Music Commission: The Austin Music Commission guides city practices on music development issues, including the SxSW music festival.

Hotel Occupancy Tax: A tax on the rental of a room in a hotel or other rental properties (including apartments) that cost 6 percent of the cost of a room.

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