AUSTIN CONVENTION CENTER EXPANSION
Five Fast Facts:
◊ THE EXPANSION WILL BE PAID FOR BY HOTEL OCCUPANCY TAX, a tax levied on tourists who stay in hotels or short-term rentals. No property tax or sales tax dollars will be used. State law says the hotel occupancy tax can only be increased to fund an expansion of the convention center, and it only requires a vote of council to increase the tax for expansion.
◊ AN INCREASE IN THE HOTEL TAX BRINGS ROUGHLY $7 MILLION PER YEAR for cultural arts and historic preservation, which increases as HOT revenue grows. The $3.5 million for cultural arts will be allocated toward the local commercial music industry.
◊ LOCAL HOTELS HAVE AGREED TO TAX THEMSELVES EVEN MORE in exchange for a convention center expansion, and they’ll share 40% of that tax revenue (which they control) with the city in order to fund homeless services. It’s roughly $4 million per year and could increase to $8 million per year.
◊ AS PART OF THE EXPANSION, area improvements in the vicinity of the convention center can be made using hotel occupancy tax, including acquiring and preserving the Palm School and Palm Park, improving Brush Square, constructing new public safety facilities in the expansion, and improving connectivity between the Rainey Street District and the rest of downtown.
◊ PROPOSITION B WILL EFFECTIVELY STOP THE EXPANSION and will cause the city to forego hundreds of millions of dollars in tourist tax revenue for community benefits over the next few decades. It will limit the amount of hotel occupancy tax that can be spent on the convention center and will instead earmark those funds for further tourism promotion.
On Austin, Texas
On Austin, Texas
◊ There are an estimated 129,000 hospitality workers in Central Texas.
◊ The City of Austin will collect nearly $102 million in Hotel Occupancy Tax in FY2020.
◊ The overall economic impact of tourism in Austin was estimated to be $9.1 billion in 2017.
◊ 15% of eligible Hotel Occupancy Tax revenue goes to the Cultural Arts Fund, which is estimated to be $11.9 million in FY20.
◊ 15% of eligible Hotel Occupancy Tax revenue goes to the Historic Preservation Fund, which is estimated to be $11.9 million in FY20.
◊ A 5% tax on car rentals funds the Town Lake Venue Project, which includes Palmer Events Center.
◊ More than $24 million will be generated in FY20 by car rental and alcoholic beverage taxes.
◊ Hotels and Restaurants generate tens of millions annually for all local taxing jurisdictions, including the City of Austin, Travis County, ACC, Central Health, and AISD. Two of the largest convention center hotels, the JW Marriott and the Fairmont, generate nearly $14 million in annual tax revenue, including more than $7 million for AISD.
◊ Hotel revenue is expected to be more than $281 million in FY20.
◊ Convention attendees tend to be the best type of tourist: they stay downtown, they don’t drive much, they always eat out, and they usually have expense accounts.
ENTITIES & ORGS
Austin LGBT Chamber of Commerce
Austin Music Movement
Central Texas Building Trades Council
The Continental Club
ECHO - Ending Community Homeless Coalition
Empire Control Room & Garage
Greater Austin Asian Chamber of Commerce
Greater Austin Black Chamber of Commerce
Greater Austin Hispanic Chamber of Commerce
Laborers International Union Local 1095
The Long Center
Music Venue Alliance
Red River Cultural District
Save Palm School Coalition
Southwest Laborers' District Council
UMLAUF Sculpture Garden
The White Horse