letter to the editor: pro occupancy tax
This is a great time to be in Farragut! Our new community center and several upcoming development projects are sure to make 2020, the 40th anniversary of our incorporation, a year to remember. With these things in mind, I need to respond to some of the issues brought up in the Letter to the Editor from our hoteliers regarding the Town’s proposed hotel tax.
• Tourism requires a dedicated funding source. While our FY2020 budget shows a surplus, those funds are slated for specific capital items. The Town will need $30 million in road improvements over the next 20 years, and we are in the process of researching needed repairs to our aging stormwater infrastructure. We don’t know yet what the cost for repairs will be. Having extra room in our budget is what allows us to address infrastructure costs without borrowing money or instituting a property tax, and I think Farragut residents appreciate this.
• The Town is not “singling out” nine small businesses with a tax. In fact, the Town taxes wholesale beer and liquor, mixed drinks and cable television franchises, and we are not required to spend revenue raised from those taxes to promote the taxed businesses. A hotel tax would be different because the State of Tennessee would require the Town to use revenues from the tax solely for tourism projects. Funding received through a hotel tax cannot legally be used to improve roads or stormwater infrastructure; it could only be used to attract visitors to Farragut.
• The Town has a plan for future proceeds from a hotel tax. In 2018, the board implemented a Tourism/Visitor Advisory Committee to advise and assist elected officials, citizens and staff on tourism initiatives, and the committee includes a representative of the hotel industry.
Recommendations for initial projects were sought from Design Sensory, a local ad agency that has worked on successful tourism projects for several small communities, and the Town’s Tourism coordinator created a budget plan based on those recommendations. This budget has been discussed at several public workshops, and local hoteliers have participated in each one.
Our hoteliers have asked us to produce proof that our tourism initiatives will result in quantifiable results. But without a crystal ball, this simply isn’t realistic. Farragut residents probably had similar doubts when the Town was founded 40 years ago. After all, there was no board, no ordinances, no staff and no money. We started small and made good decisions, and the result is the thriving community we have today.
That’s what I envision for our tourism program. If we start small and make good decisions, we’ll grow a program that benefits the whole town, including our hoteliers.
For those who wonder if Farragut can be marketed as a tourist destination, I’ll borrow some words from a previous ’Press article that said exit 373 is “The Safest, Cleanest, Most Charming Exit on the Interstate,” and calls Farragut a “hospitality, travel and shopping destination.” I agree.
These qualities can be used to market Farragut to visitors, which would benefit all our businesses and help us avoid a property tax. That’s why I support a hotel occupancy tax that is paid for by visitors, not our residents.
Mayor Ron Williams