The Mobile City Council is considering increasing the city's lodging tax from 8% to 10%.
A portion of the increase would go toward paying for the relocation of the Mobile Regional Airport. If any funds are left over, another portion would pay on the debt for the new arena, but that portion would depend on the tax creating enough revenue. However, it is unclear exactly what another portion would go towards.
The City has a Tourism Improvement District (TID), and funding for the district must be renewed every five years. Part of that renewal includes financing for Visit Mobile, a destination marketing organization. So, the city council will also have to approve that measure. City leaders met Friday with the Airport Authority to discuss the renewal of the TID and the lodging tax increase.
Breaking down the numbers, a large portion of the city's lodging tax, 33.5%, already goes to Visit Mobile. With the increase, that would change to 37.5% to promote tourism. Last year, Visit Mobile received $4.2 million from the City.
The City's website states, "Visit Mobile is the official point of contact for leisure travelers, convention and meeting planners, bus tour operators, and travel agents."
Mobile's director of communications, Jason Johnson, told 1819 Visit Mobile is the Convention and Visitors Bureau (CVB) for the City of Mobile and Mobile County.
"As a registered non-profit organization, Visit Mobile is regularly vetted by the IRS to maintain its 501(c)(3) status," Johnson said. "The organization is governed by a 20-member board comprised of representatives from local industries and appointees from the City of Mobile and the Mobile County Commission. This board reviews Visit Mobile's financial statements regularly and approves its budget, and the staff at Visit Mobile is accountable to the board. As with all Convention and Visitors Bureaus (CVBs), Visit Mobile plays a key role in marketing Mobile to a global audience, helping attract millions of visitors to our community each year."
Visit Mobile promotes annual events such as Madi Gras and Moon Pie Over Mobile and Pride events, including the annual Pride parade and fair in Cathedral Square.
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While Visit Mobile is Mobile's primary marketing arm, it is independent of the City and not a city department," Johnson said.
David Clark, president and CEO of Visit Mobile, told 1819 News it is time for a lodging tax increase since there hasn't been one in nearly 20 years. He said with the new arena and airport, Visit Mobile anticipates more tourism and they will need more money to market more attractions.
"So that's why these tourism improvement districts form, and that's why the city understands that our budget as a DMO, a destination marketing organization among the big cities, is the lowest by far," Clark added. "So, they realize the need to invest in more marketing with all these new assets coming too."
The lodging tax for the City of Birmingham is 6.5%, Montgomery is 11%, and Huntsville is 9%. Additionally, tourists pay county and state lodging taxes. In 2020, Huntsville Mayor Tommy Battle vetoed a council-approved 1% lodging tax increase, stating the increase would make the City less competitive in tourism.
Clark said hoteliers in Mobile favor the increase to renew and improve the tourism district.
"You know, we have the majority of hoteliers totally on board supporting the lodging tax increase," Clark said. "So, I think it's one of these things whereas a city, when you're making financial investments like that, you know, and you're going to increase the wealth of a proprietary purpose, which is entertainment and tourism, you have to look at who's benefiting from that."
Visit Mobile manages digital ads, metrics, print ads and social media, but Clark said a budget breakdown was unavailable.
"We do a general branding market. We do a whole lot of digital and social media and print. We don't really break it out per event," he said.
Johnson told 1819 News the City does not have a breakdown of funds spent by Visit Mobile.
1819 News asked the City of Mobile if there were concerns that the City could not account for taxpayer funds but has not received a response. Johnson said that because tourism plays such an important role in the local economy, it is important for Visit Mobile to promote the region and bring in more visitors.
To connect with the author of this story or to comment, email erica.thomas@1819news.com.
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