Owensboro City Commissioners on Tuesday approved a 10% transient room tax that would apply to all visitors staying in hotels and Airbnbs/VRBOs. The revenue would help fund the potential SportsPlex the City is looking to build. As part of instituting the tax, the City is also required to approve a commission that would handle tourism in the city.
City Manager Nate Pagan noted that since the Owensboro already has a Convention & Visitors Bureau, this new commission will not be taking efforts away from the CVB/Visit Owensboro.
“We don’t want the board to really to do anything, certainly not to duplicate efforts of the existing CVB. We just envision it being sort of a contractual relationship where this new board would get the funds and they have a contract with us for certain services and they contract with the existing CVB for services and marketing,” Pagan said.
While the two boards may be similar in theory, Pagan said that the CVB could not serve directly as the new commission due to legal advice.
Mark Calitri, President/CEO of Visit Owensboro, said the two boards will be entering a Memorandum of Understanding to establish their lines and so Visit Owensboro can “keep doing what they’re doing.”
“As long as we’re not going to have a duplication of effort — I think that would be an issue if we did, but I think we’re working it out,” Calitri said.
The new transient tax, often called a “Hotel/Motel tax,” will only be effecting temporary lodging areas like hotels and Airbnbs/VRBOs.
County officials previously approved a 6% transient room tax rate. The City is now stacking a 4% rate on top of that — making it a total of 10% inside city limits.
Pagan said that any impact from the taxes is more than offset by the significant economic impact that will be generated by what officials are calling the SportsPlex (an indoor sports facility which has not been approved but has been discussed in recent meetings).
Estimates suggest that the facility will conservatively generate 12,360 new room nights in the city per year — an increase to the local hotel occupancy of 3 percentage points.
Pagan said that the taxes would be received by a monthly return from the lodging entities. It would operate on a 30-day delay. He added that all primary hotels in the area have been notified already about this ordinance.