Lowell collects new tax, establishes A&P; commission

LOWELL -- The city's new Advertising and Promotion Commission is collecting about $30,000 a month from a new tax and must decide how to spend the money, the city's finance director said.

The City Council in November passed a tax on hotels, motels and restaurants, meaning gross receipts of hotel and motel accommodations and prepared food and beverages are now taxed an additional 2 percent. People eating or staying in a hotel or motel in the city now pay an 11.5 percent tax.

Meeting

Who: Lowell Advertising and Promotion Commission

When: 6 p.m. Wednesday

Where: Super 8 Motel, 509 Hospitality Lane

The tax has brought in about $31,000 per month since the city began collecting it May 1, Jerry Hudlow, finance director, said.

The commission had its first meeting June 5.

Montine McNulty, chief executive officer of Arkansas Hospitality Association, said cities are required to have an advertising and promotion commission if they have a tax on lodging or prepared food. The association is the umbrella organization over Arkansas Lodging Association, Arkansas Restaurant Association and Arkansas Travel Council.

McNulty estimated about 34 cities in the state have commissions and most of those cities have a tax on hotels, motels and/or restaurants. Cities generally may not tax either hotel and motel accommodations or prepared food by more than 3 percent.

Two City Council members, Linda Vannoy and Todd Fenix, are on Lowell's commission. Other members appointed are Bill Adams, Rodney Lowe, Lisa Clark and Chuck Desai, according to the minutes from the April 17 meeting.

Fenix said the commission has mostly been taking care of housekeeping items, such as establishing bylaws, in its first few meetings. The commissioners will soon begin looking at the budget and how to spend the money. The commission may consider hiring an outside agency to help, he said.

Adams, owner of The Grove Comedy Club on South Bloomington Street in Lowell, said the hotel, motel and restaurant tax should be used to get people to spend time in Lowell and spend money at businesses -- and buy gas and stay in hotel rooms while they are in town.

Adams pointed out that business owners on the commission have to be careful to avoid conflicts of interest.

"I can't vote on anything that will benefit me," Adams said.

Desai said he would like to see the commission bring more events to the city to attract visitors.

Fayetteville has an established advertising and promotion commission. Commissioner Adella Gray said she was glad to hear Lowell now has one as well. In Fayetteville, the commission promotes the city using tax money by giving grants to venues such as TheatreSquared and Art Escape and events such as Bikes, Blues & BBQ, she said.

Lowell Mayor Eldon Long called the tax "another tool in the city's toolbox" to encourage development and said he would like to see the commission put money toward festivals and help established businesses in town.

Chris Moore, Long's opponent in the mayoral race, isn't a fan of the tax, he said. Moore said while he understands some other cities have a tax on lodging and prepared food, there are better ways to promote the city, such as through the Rogers-Lowell Area Chamber of Commerce.

NW News on 10/22/2018

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