Hotels would be able to tax themselves under bill approved by House Wednesday

May 30 2013 | Latest News

By Jeff Adelson, | The Times-Picayune
May 29, 2013



A bill allowing hotels to vote to add an extra charge to their customers' bills to pay for better marketing through the New Orleans Convention and Visitors Bureau passed the Louisiana House on Wednesday, the last significant step before becoming law. The measure would also direct some funds from any fee that is assessed to the city of New Orleans; city officials have said the money would be spent on public safety and infrastructure in the French Quarter.

Senate Bill 242 by Sen. Ed Murray, D-New Orleans, would let hotels vote on whether to add a 1.75 percent charge to the bills of their guests. Murray and other supporters have said the bill will help improve tourism in the city and boost the local economy.

Supporters have said that most of the money, 1.5 percent, would go toward marketing efforts through the Convention and Visitors Bureau and the New Orleans Tourism Marketing Corp., while the other .25 percent would go to the city. That split is not required by the bill.

The bill passed the House 79-18.

Rep. Neil Abramson, D-New Orleans, originally filed an amendment that would have required the money going to the city to be deposited in a separate fund that could be used only for infrastructure, public safety, sanitation, historic preservation or improving civic and cultural activity in the city. However, he withdrew that amendment after receiving an email from city officials, "memorializing that they will do what they said they will do," he said.

The bill would allow the Greater New Orleans Hotel and Lodging Association to call a vote of hotel owners to determine whether to impose the fee, and each member of the association would be able to cast as many votes as it has rooms. A two-thirds vote would be required to put the fee assessment into effect.

In order to avoid the assessment, if it passes, hotels would have to end their membership in the Convention and Visitors Bureau, presumably losing out on some of the benefits of the marketing done by that group.

Representatives of French Quarter groups have raised concerns about the measure, saying there is nothing in the bill that would require the money the city would receive to be used for specific purposes or directed to tourist-heavy areas. The nonpartisan Bureau of Governmental Research also raised concerns that the measure could limit the success of future tax proposals that would go directly toward funding city obligations.

The bill now heads back across the hall so that senators, who supported the measure 24-7, can agree to technical changes. Because those do not make substantial adjustments to the measure, the Senate is expected to agree to the revised bill and send it to Gov. Bobby Jindal for his signature or veto.