BLUFF CITY, Tenn. – City officials’ plans to impose a hotel tax have upset the owner of a business they annexed six weeks ago, and the plan could take on an unusual twist before any revenue is collected.
The city’s Board of Mayor and Alderman will vote whether to get the ball rolling on the process during tonight’s meeting at 7 in city hall.
Forty-five Tennessee municipalities currently charge a hotel tax, including Bristol, Kingsport, Johnson City, according the University of Tennessee’s Municipal Technical Advisory Service. The most common rate charged is 5 percent, though some charge as much as 7 percent.
While Bluff City does not have any hotels, City Recorder Judy Dulaney said the proposed tax would apply to visitors at the Lakeview RV Park, which the board voted to annex on Dec. 20.
"I wouldn’t like that at all," Lakeview owner Worley Fain said Wednesday when he heard about the city’s plans to move forward with a tax.
Fain set up his business in March 2006 on land his family owned along U.S. Highway 11E, 3.5 miles south of the Bristol Motor Speedway.
Fain said he’s received help from Bluff City police officers in the past so he didn’t object to the city’s annexation. But he’s worried the city’s plans to charge a hotel tax would hurt his business and keep others from moving to the area.
"I understand they need the income," he said, adding it takes three to five years to get an RV park truly established. "But they have to do it in a balanced way."
If the board votes in favor of the hotel tax tonight, the measure must then get special permission from the Tennessee legislature to charge the tax through a private act. The plans may take an unexpected turn, given another bill currently in the Tennessee legislature that would require local governments to spend any new hotel tax revenue on tourism.
State Rep. Craig Fitzhugh, D-Ripley, is sponsoring the proposal, which is currently in the House’s State and Local Government Committee and scheduled for a vote next week.
Fitzhugh argued in his legislation that because hotel taxes can hurt tourism-related businesses, the money they generate should help those businesses by attracting more people to the area.
The proposal would apply to any money generated from a new hotel tax – like the one Bluff City hopes to push forward – or an increase in an existing tax.
Sen. Joe Haynes, D-Nashville, sponsored a similar bill in the Tennessee Senate last year but does not plan to bring it up again during this year’s session.
gmclean@bristolnews.com | (276) 645-2518
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