ASHEVILLE — Buncombe County leaders Tuesday will again take up an issue relating to the hotel room tax, a topic that has split county government and stirred a fight in the community over how tax revenue from tourists should be used.
The Buncombe County Board of Commissioners is scheduled to make an appointment to the board that controls the $14 million in hotel occupancy tax, the Buncombe County Tourism Development Authority. The appointment is set to happen at commissioners’ regular Tuesday meeting, which starts at 4:30 p.m. in commission chambers at 200 College St.
The commissioners are making one appointment to the authority, newly expanded by state legislators from seven to nine members.
Two applicants are seeking the spot, reserved by state law for a representative of a hotel or other type of lodging with more than 100 rooms: Managing Director of the Grove Park Inn Gary Froeba and Craig Madison, vice president of hospitality for the FIRC Group, the company founded by Tony Fraga that owns the Haywood Park Hotel.
On Sept. 1, commissioners voted 4-3 to raise the hotel tax 50 percent, from 4 cents to 6 cents. The tax increase was part of state legislation, but commissioners had the final say.
The split reflected arguments building in the community over the tax that is paid by hotel guests and controlled by the authority which is by law a majority are hoteliers. The increase, which will go into effect in November, is expected to generate an additional $5 million, bringing total revenue to $14 million. The authority will spend all of that on marketing and projects intended to boost hotel business.
But some city and county government leaders have argued that part of the money should go to pay for city infrastructure, such as roads and sidewalks and other public services.
Hoteliers said the tax hike was needed because of the large number of new hotels being built in the county. The money would be used for more marketing. That would bring more hotel guests and help fill the growing number of hotel rooms, they said.
On Oct. 13 City Council members appointed Asheville’s two members to the authority. For the first time the application process included public interviews, during which council members grilled applicants over whether they would try to steer more money toward city needs.
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