Last night, over 100 concerned citizens attended a meeting hosted by VCPORA, French Quarter Citizens, and Faubourg Marigny Improvement Association to learn more about the proposed Hospitality and Entertainment Taxing Zone legislation. What we heard loud and clear was the the public is unhappy with the bill (SB 573) as written. You can read the article in the Times-Picayune here, and see the WWL-TV story here.
And below is the informational document that we passed out at the meeting. In it, we try to answer as many questions as possible about the bill as filed.
SB 573 – sponsored by request of the Mayor
and Tourism Industry Representatives
What’s this all about?
There are some signficant concerns with a proposed Hospitality Zone (HZ) proposal, an initiative of Mayor Landrieu and the tourism industry to “promote tourism in the hospitality zone” and to improve the overall experience of tourists. Concerns include its structure, lack of oversight and even the way in which it has been planned to date, in private meetings with no public planning. Here are some basics:
· New taxes would be implemented in the downtown neighborhoods, including French Quarter, Marigny, Treme, CBD and Warehouse District. Taxes are expected to include:
o Hotel rooms
o Food and beverage (all restaurants and bars in the Zone)
o Parking at hotels
· Most of all the annual funds raised will be used for additional marketing to attract more tourists.
· A smaller amount will go to enhanced sanitation, improved infrastructure, and security in the Zone.
Bills: There are multiple bills (SB 473, SB 573, SB 608, HB 967 with possible companion bills SB 588, SB 598, HB 855, HB 859) but the primary bill now is SB 573 which may be heard in the Senate’s Local and Municipal Affairs Committee. Multiple amendments have been proposed, but none of been made public or adopted.
What is this $30 million pledge by the Convention Center?
In anticipation of the 2013 Super Bowl, the Convention Center pledged $30 million (to be matched with federal money) for infrastructure improvements in the HZ, including the French Quarter. This money was raised from Hotel-Motel taxes levied to build Phase IV of the Convention Center, which was canceled. Those dollars, according to published reports, will be spent on Super Bowl-inspired improvements REGARDLESS of whether a hospitality zone is created or not this year. On the other hand, unpublished reports say the Convention Center will renege on its offer unless a hospitality taxing zone is created to ensure future funding.
What is proposed in the bill (as written today)? All quotations are taken directly from SB 573.
· Unelected Board: A proposed “Superboard” will be made of tourism-industry appointments, excluding residents of the zone or even “regular” citizens of New Orleans unless they have a “substantial business interest” in the zone. It is made up of 9 tourist industry leaders and 8 mayoral appointees – with all mayoral appointees serving “at his pleasure.” This means, the Mayor or any future Mayor could remove board members at his discretion. If negotiations add residential seats, it is anticipated they will be in the minority.
· Gerrymandering: The HZ can grow or shrink. As written now, SB 573 includes the French Quarter, CBD, Warehouse District and “any other contiguous area formally designated by the mayor of New Orleans.” (Some of the other bills specifically mention the Marigny triangle and Treme.) The bill also empowers the District itself to divide into smaller “subdistricts” enabling the district to draw out significant pockets of opposition for tax election purposes.
· Taxes on tourists AND residents: Taxes include increased hotel-motel taxes with the vast majority of those proceeds funneled to the NOCVB and Marketing Corporation for marketing. Other taxes, which will be paid by residents and other visitors, include an additional tax on prepared food and beverages consumed in the zone and “other activities within the Hospitality Zone that, as a class, benefit directly from tourism or tourist- related activities…”
· Spending without accountability: The unelected board is allowed to spend money “in furtherance of its purposes” without input from citizens, neighborhood organizations, the City Council or bodies like the French Quarter Management District. There is little explicit guidance on how funds are spent.
What are bill backers saying?
· The bill will be amended to reflect our concerns. While amendments are being discussed, there is no guarantee at this late date that or how the bill will be amended for residents or even FQ businesses. Conference committees are notoriously non-transparent in the Legislature: Ideas, once dismissed as dead, often come back to life. Last minute changes can be made without time for citizens to respond.
· Distrust must end for the betterment of the French Quarter! We couldn’t agree more! Discussions about a hospitality taxing zone began between city government and industry officials nearly two years ago. Residents and even FQ businesses were not brought into discussions until months later, after SEVEN bills were filed, and only after we requested information. Trust is built with open dialogue and transparency – not by filing bills in the Legislature without input.
What neighborhood associations are saying?
· What’s the rush? While HZ proponents state without permanent funding, the $30 million investment in capital improvements will over time deteriorate –like investments made for the 1984 World’s Fair – there’s not a reason to rush. We can do everything we need in the next Legislative session. The Mayor, Governor, and most (if not all) of our Legislative delegation will be the same persons. The $30 million in improvements should not need intense maintenance so soon – there’s time to get this right.
· What about FQMD? The logical body to manage any funds targeted to the French Quarter is the French Quarter Management District, which already has the state-granted legal authority to do so. It was set up after many months of discussion and compromise. It represents residents, businesses, neighborhood associations, and elected leaders. It was set-up to improve the Quarter for EVERYONE.
· A tourism-dominated “Superboard” is a bad idea. We welcome visitors! However, our neighborhoods, including the world-famous French Quarter, do not belong to the tourism industry. And, tax money, even when collected in hotels, does not belong to the tourism industry. So, while tourism leaders should have a place at the table, they should not have so much power over the care and maintenance of our historic neighborhoods.
What should I do next?
Time is running out. Tell your Legislators now how you feel. To find your legislator, go online to http://senate.la.gov/Senators/ByAddress.htm Send a copy of your e-mail or letter to your neighborhood association. We want to know your thoughts as well!