City council passes lodging tax increase & surcharge to fund VBC expansion

HUNTSVILLE, Ala. - The Huntsville City Council has approved a lodging tax increase and surcharge to fund an expansion of the Von Braun Center.

The vote came during Thursday night's meeting approving a 2 percent increase and a dollar surcharge for out-of-town visitors.  The project is expected to cost $42 million.

The lodging tax is considered a creative way to pay most of that cost.

"Not only is this a visionary project, but we have a very visionary way to pay for it," said Jennie Robinson, City Council President.

That point was made repeatedly before council members voted.

"I love the fact that this is pretty much being paid for by out-of-town visitors," Bill Kling commented.

"The burden is not on our local taxpayers. Our guests are footing the bill," added Charles Winters, Executive Vice President of the Huntsville/Madison County Convention and Visitors Bureau.

The CVB supported the lodging tax and surcharge increases to fund the project because its leaders believe the VBC is a major driver for tourism in Huntsville.

The VBC Expansion

Per the Von Braun Center's website, highlights of the project include:

-The addition of a new ballroom/multi-purpose space of 35,000 sq. ft. that will include an outdoor terrace.
-Renovation of the existing North Hall.
-The addition of 14,000 sq. ft. of breakout meeting space.
-New pre-function/lobby of 15,000 sq. ft.
-New concourse that will seamlessly connect to the existing South Hall concourse and the Embassy Suites hotel.
-Extension of the existing concourse leading from the Concert Hall and Arena to the newly constructed facilities.
-The addition of a new full-service kitchen.
-The extension of South Hall garage under the newly constructed facilities.
-The addition of a 1,200 capacity music hall and food and beverage venue.

Mayor Tommy Battle said this would help the whole community.

"We will have lots of people who will visit the city because of this facility and this is the starting steps of getting our tourism moving forward to where it really needs to be," he explained.

What is lodging tax?

Huntsville's current lodging tax is 13% with a dollar surcharge per room, per night.

According to Huntsville's website:

Lodgings Tax is imposed on all persons who operate any hotel, motel, rooming house, lodge or other place where accommodations are made available to travelers, tourists or transients. Charges for rooms, lodgings or accommodations provided for a period of 180 consecutive days or more in the same place are exempt from Huntsville tax.

City leaders say hotel and lodging associations are each supportive of the tax increase.

The tax would increase by 2% and the surcharge by $1 per the approved changes to the ordinance. It would take effect on October 1, 2017.

The way this is modeled, the ordinance allows money to be used for capital at the VBC and other venues that generate tourism in the community.

"We would not want to use it for a local park that's just used by a neighborhood," said John Hamilton, City Administrator.