State says VCVB must pay back $70,000

Published 12:00 am Friday, October 27, 2000

State tax officials are asking the Vicksburg Convention and Visitors Bureau to pay back $70,000 the state accidentally sent to the local tourism bureau.

The State Tax Commission says it is due a 3 percent administrative fee, but that fee has not been collected since it took effect in December 1996.

A letter from the tax agency to VCVB director Lenore Barkley said state officials want the money by the end of the state fiscal year that started July 1.

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The new fee, along with the back payments, could take a big chunk out of the $1 million VCVB budget, which has been funded by a 1 percent tax on nights spent in Vicksburg hotels and bed and breakfasts, on bar tabs and meals at larger-volume restaurants.

“If we have to come up with $70,000 by the end of June, that’s going to have a significant impact,” Barkley said. “It’s going to have to come out of our print advertising.”

The agency, created in the 1970s to promote the city’s tourism industry, planned to spend about $200,000 this year attracting visitors with ads in publications such as Southern Living and on Rand McNally road maps.

Bobby Bailess, a Vicksburg attorney and member of the VCVB board, said it was possible that the payments could be financed over a longer period.

“We got money that we shouldn’t have gotten, and we have to pay it back,” Bailess said. “The question is, how long are they going to give us to do it?”

The state wants to deduct $7,787 from the VCVB’s monthly rebate checks each month as the amount owed in arrears plus 3 percent of every new check. The checks average about $67,000.

Vicksburg and Warren County were among the first localities to create a freestanding tourism development agency and to obtain legislative approval for the tax to approve it. With the addition of many other special, local taxes across the state, the Tax Commission got permission from the Legislature to impose a fee for collecting and distributing the money.

In other business, the board moved ahead with approving the bureau’s $1 million budget for fiscal 2001 Thursday, acknowledging that it would have to be adjusted to deal with the payments to the Tax Commission.

The breakdown remained the same as the previous year, with 15 percent of the budget going toward office operations, 29 percent toward salaries and 56 percent toward advertising and marketing.

“We do more marketing than most visitor’s bureaus percentage-wise,” Barkley said.

The board also discussed the economic impact of several conventions that were held in Vicksburg in October, with six multiple-night events totaling about $700,000 in the community.

The majority of that amount, more than half a million dollars, came from a rally of Harley-Davidson motorcycle owners at Rainbow Casino last weekend.

The economic impact is determined by estimating that each convention visitor spends about $125 per day on hotel, food and shopping.

The three-day motorcycle rally brought 1,350 people into Vicksburg. The second largest convention, the Mississippi Council for Social Studies, brought in 300 people.