The Norman Transcript

November 20, 2012

Norman considers hotel/motel tax increase vote

By Joy Hampton
The Norman Transcript

NORMAN — Norman City Council members did not reach a consensus at Tuesday’s finance meeting over whether the time is right to ask voters to approve an increase in the hotel/motel room tax. Hoteliers at the meeting said they would support a small increase but ask that those dollars work to promote tourism in Norman.

Under discussion was the funding of the Norman Convention and Visitors Bureau, which is funded below the regional average.

“Our budget is below Stillwater,” said NCVB Executive Director Stephen Koranda, who told the finance committee that Norman’s CVB is the lowest funded of the Big 12.

“That daily hurts our efforts in trying to keep market share, much less get more market share,” Koranda said.

That doesn’t mean he believes a guest tax increase needs to come immediately. In fact, he thinks it may be better to hold off for a while on that increase. In the meantime, he’d like the city to look into alternative forms of tourism funding. He said Woodward is looking at the possibility of a Tourism Improvement District, a public-private partnership mechanism popular in California.

Tourism Improvement Districts have spread up the coast and into Texas. Officials in Woodward believe Oklahoma law will allow for the districts. If the state has the legislation, cities can look at whether that funding mechanism would be right for their locations.

Norman Arts Council Executive Director Erinn Gavaghan said money from the room tax is key to funding public art in the city.

“Norman is really looked up to as an excellent art community,” Gavaghan said. “We excel with a very limited amount of funds.”

The current room tax in Norman is divided between the convention and visitors bureau (which gets 50 percent of the money), the arts (which gets 25 percent) and parks (which gets 25 percent). In many cities, all of the money from city hotel/motel tax goes to tourism promotion.

Doug Kennon, proprietor of Sooner Legends Hotel, said the hotel/motel tax should be “seed-corn” to produce more heads in beds.

He said those tourists then also eat at restaurants, shop and spend money throughout the city, giving the entire community an economic boost. That boost, in turn, supports quality-of-life issues like art and the parks.

He believes the money should be earmarked to promote tourism. The arts money should be to help put on festivals that bring in people, and the parks money should help move the city closer to having facilities where tournaments can be hosted.

Kennon said second only after the recent Notre Dame football game in creating income at his hotel was the girl’s 13 and under AAU tournament. He wants the city to use the parks money to get more tournament events.

“Once people are here, they spend money,” Kennon said. “We’ve got to get them here for a reason.”

Michael Vance, general manager of Embassy Suites Norman, said the city needs to market for the future.

“We’re not opposed at all (to the tax increase),” Vance said. “We’ve got to put our finger on something that is out there that can bring in the money.”

When asked how a tax increase would impact the convention business his hotel has, Vance said a 2 percent increase would make Norman less competitive for conventions, but a 1 percent increase would be acceptable.

Paul VandRaamsdonk, of the Hilton Garden Inn, said convention business is affected by tax rates.

“We want more ball teams,” he said. “We need a plan. Give us a plan first. It’s a big advantage to be a low tax rate.”

“The challenge we face here is we’ve got to get a consensus,” Mayor Cindy Rosenthal said.

Council member Tom Kovach said he would favor a 1 percent hotel/motel tax increase.

“I honestly feel like we are missing out,” Kovach said. “There are a lot of attractions in Norman.

If the city council does not decide on a direction soon and put it before voters next spring, any tax increase would be delayed by a year, Kovach said.

Joy Hampton366-3539jhampton@normantranscript.com

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