City nears motel tax allocations
Jan. 18, 2011 at 7 p.m.
Updated Jan. 17, 2011 at 7:18 p.m.
The City Council approved, on its first reading, the transfer of $114,000 from the motel tax fund to seven art organizations.
Pending approval of the second and third reading at the council's next session, the funds will be distributed quarterly throughout the year.
The council allocates the tax revenue from Victoria's hotels every year in accordance with state statute, City Attorney Thomas Gwosdz said.
"That money is collected and can only be used for certain purposes statute sets out," he said in the session Tuesday.
Those purposes include putting "heads in beds" - meaning attracting travelers to the area - and spending must fall into any of eight categories, including historical restoration, convention promotion and promotion of the arts, Gwosdz said.
"They're collected from travelers who stay in Victoria, so technically you perpetuate that fund," city spokesman O.C. Garza said. "It's not paid by local taxes, and it can't be used for public infrastructure, roads, things like that."
The amount of money each organization receives is based on a budget it submits to the council that also outlines how the money will be spent to comply with state law, Garza said.
This year's motel tax budget is around $1.1 million, of which $750,000 will go to the Convention and Visitor's Bureau, Garza said. Some will also be used to maintain the community center.
If the hotel tax revenue comes in under budget, each organization will have its funds cut by the same percentage. But the latest numbers show this year's figures are above budget, Garza said.
"Right now, with the growth, motels are doing well."