Hillsborough County set to raise hotel tax

TAMPA — Nights spent in a Hillsborough County hotel or rental home will come with a heftier price tag under a new plan to raise the tax on overnight stays to 6 percent.

Hillsborough County commissioners voted 6 to 1 Wednesday to move forward with a plan to add an additional penny to the tax on hotel and rental stays, which currently carry a 5 percent sales tax. Once a county ordinance is approved, it will make Hillsborough only the ninth county in Florida to levy the so-called "sixth-cent tax," an option the state only makes available to "high-impact tourism counties."

Hillsborough qualified for that designation by collecting about $673 million in hotel revenue during the 2018 calendar year — well above the $600 million threshold required. The tax would add about $2 to a $200 overnight stay.

After commissioners approve the ordinance, likely in the next few months, the tax would go into effect on the first day of the month after their final vote.

As of Wednesday, there was no plan for how the extra revenue would be spent. But Commissioner Ken Hagan said he expects there will be no shortage of requests from tourism-related businesses.

Under state law, the revenue can be spent on efforts to promote tourism, including marketing campaigns, but also on tourism-related projects such as museums, beach re-nourishment and the construction of sports facilities.

"I would caution the board against the inevitable money grab that will happen, I'm sure," Hagan said during the meeting. "We should be very prudent on making decisions on approving dollars."

Commissioners already have one request. Visit Tampa Bay and the Hillsborough County Hotel and Motel Association both approved levying the tax, but recommended that one third, or roughly $2.2 million, be spent on marketing and promotion of the county.

The tourism industry is already investing heavily in Hillsborough, said Visit Tampa Bay CEO Santiago Corrada. He said examples include the new 519-room JW Marriott hotel and Marriott Edition hotel, both under construction in downtown Tampa's Water Street district, and new rides opening at Busch Gardens.

Corrada estimated that in three years Hillsborough County, will add about 2,700 hotel rooms — a major feat for a county that's added only 790 hotel rooms over the past 6 years.

That investment needs to come with an additional marketing blitz so the county can continue to grow its estimated 23 million annual visitors, Corrada said.

"We're just very proud we've been able to make this option available to our county," Corrada said.

Hillsborough reached the high-impact threshold for the first time in 2017, when it reported $644 million in taxable hotel revenue. But county leaders took no action the following year to enact the tax.

Commissioners might have put the revenue opportunity on hold in case the tax was needed to help pay for a new $892 million Tampa Bay Rays ballpark proposed for Ybor City.

But after unveiling a design for the stadium and launching a campaign to attract corporate boosters, the Rays were never able to agree with the county on how to finance the project.

Commissioner Stacy White, who was the lone vote Wednesday against drafting an ordinance for the tax, recommended the county restrict the new revenue from being used for professional sports facilities. His motion died for lack of a second as other commissioners pointed out that tourism taxes have already been used for Amalie Arena, George M. Steinbrenner Field and Raymond James Stadium.

In other action, county commissioners committed to dedicating an additional $10 million annually to pay for additional affordable housing within the county, beginning with the budget for the upcoming fiscal year.

About 75 members of the Hillsborough Organization for Progress and Equality, known as HOPE, attended Wednesday's meeting to advocate for additional funding

Staff writer Christopher O'Donnell contributed to this story. Contact Anastasia Dawson at adawson@tampabay.com or (813) 226-3377. Follow @adawsonwrites.