Hotels respond to possible tax increase

Published 11:29 am Monday, July 27, 2015

The Pelham City Council discussed the possibility of increasing the lodging tax in Pelham from 3 percent to 6 percent, and some hotels in the area have expressed concern for their business. (Special to the Reporter / Dawn Harrison)

The Pelham City Council discussed the possibility of increasing the lodging tax in Pelham from 3 percent to 6 percent, and some hotels in the area have expressed concern for their business. (Special to the Reporter / Dawn Harrison)

By JESSA PEASE / Staff Writer 

PELHAM— At it’s July 20 meeting, the Pelham City Council discussed the possibility of increasing the lodging tax in Pelham from 3 percent to 6 percent, doubling the current tax rate.

The decision would allow the city to designate a portion of related proceeds to be used for economic development, which includes funding for a Commercial

Development Authority and the employment of an economic development professional.

At the meeting, City Council President Rick Hayes said this issue has long been a topic of discussion, especially the employment of an economic development professional.

“A professional can significantly help with bringing in business and actively, and proactively, going out and helping our current businesses by expanding them,” Hayes said.

Council member Ron Scott also commented in favor of this resolution at the meeting, stating that many cities have development professionals and have seen great results from the position.

“This is not something that is out in left field or out of the box,” Scott said. “This is a very commonplace position in many municipalities across the state.”

Some Pelham area hotel owners and managers expressed concerns with the possible increase. Annie Gilbert, the general manager at Comfort Suites in Pelham, said she thinks this decision will negatively affect business at the hotel.

She said that the hotel already has a “high lodging tax” and that raising the lodging tax would cause them to lose revenue. If the tax for lodging increases, Gilbert said Comfort Suites would have to raise rates.

Gilbert also said someone came out to the hotel to speak with them about the increase and the addition of a CDA, but she said she felt there was no concern for the hotel or what it would cost them.

Samket Desai, manager of Holiday Inn Express Pelham, said the decision would “most definitely” negatively affect his business, stating that travelers will pass the city and choose to lodge in Jefferson County.

“I don’t think it’s a good idea because it gives an unfair advantage to hotels in Jefferson County and in Hoover,” he said.

The decision will be voted on at the Aug. 3 Pelham City Council meeting.