2 percent tax for sports complex requires referendum
Published 10:45 pm Saturday, February 20, 2016
While the Board of Mayor and Aldermen remain undecided on the plans and location of a proposed sports complex for the city, they are set on the way to pay for it.
The board plans to levy a 2 percent sales tax on hotel room rentals and food and beverage sales in city restaurants and bars. The Mississippi Legislature in 2015 approved a special bill authorizing the city to levy the tax with voter approval.
That means an election, or referendum, which under state law must be approved by at least 60 percent of the participating voters before it can be levied. A Feb. 11 poll on the sports complex commissioned by the city indicated people want the referendum included on the ballot for 2017 municipal general elections.
If the proposed special tax is approved, it would be the third special tax levied on hotels and the second special levy on food and beverages above the statewide 7 percent sales tax.
A special 1 percent tax that between 2011 and 2015 brought in an average of about $1.17 million a year, is levied countywide on hotel rooms and food and beverage sales to support the Vicksburg Covention and Visitors Bureau.
The city presently levies a special 2 percent tax on hotel room rentals that between 2011 and 2015 raised an average of $595,670 to support the Vicksburg Convention Center.
If approved, the proposed 2 percent tax for the sports complex means people staying in hotel rooms in the city will pay an extra 2 percent tax (or a total of 5 percent extra) on their rooms, and local residents and visitors will pay an extra 2 percent (or a total of 3 percent) when they eat at local restaurants.
Some officials say the sales tax is the most equitable way to fund the sports complex, because the tax burden is spread out among locals and visitors.
“Two percent is something our local people go out to a restaurant and pay into, but also the people who visit the city and stay in the hotels and eat in the restaurants, they’re also paying into the project,” South Ward Aldermen Willis Thompson said. “We do that when we go to other cities and stay in a hotel and eat at a restaurant. We’re probably more than likely helping them pay for a project, based on the 9 and 10 percent we’re paying.”
Thompson, like Mayor George Flaggs Jr., believes the tax can pass if the voters are educated on it.
“I think once you educate people on what it is, and what you’re paying for and what we’re doing, I think they have a better opportunity to make an educated decision,” Thompson said.
But North Ward Alderman Michael Mayfield said the board needs to be upfront with the voters when they start talking about the tax and its relationship to the sports complex.
“We need to be careful what the board presents,” he said. “If you’re going to put something out there, it needs to be close to the real numbers, and put those real numbers out there so the people can make an informed decision. I want to make sure the people know everything and then they can make an honest vote for the future of the city.”
That, Flaggs said, is his responsibility.
“That will be marketing the project, and that’s my job,” he said. “Once we decide what we want to do (with the sports complex), then that’s when we’ll unveil our marketing strategy. There’s no way we can pass this without having a marketing strategy. That includes video, pictures, everything, and have a rendering of it and put it in as many buildings as we can. They’ll understand if they have a visual picture.
“We need to educate the public on the hotel tax and the restaurant tax, and to show them that it’s for good use and the city of Vicksburg will benefit in the future, I think we can get 60 percent.”