City Mayor opposes unilateral reduction sought by County
Clarksville, TN – Clarksville Mayor Kim McMillan called a proposed reduction in local investment in tourism development “unwise,” and said she would ask the City Council to sustain the City’s funding of the Clarksville-Montgomery County Tourist Commission.
“New Tennessee Department of Tourism data shows that every dollar spent on tourism development returns 19 dollars in state and local tax revenues,” McMillan said Friday. “I think it would be unwise to reduce our local investment in tourism, which is a key element of our overall economic development strategy.”
The Montgomery County Commission is expected to vote Monday on a plan to end a three-party interlocal agreement that sets out how shares of the hotel-motel taxes are distributed. Under the terms of the agreement, one party can withdraw and terminate the contract.
Approval of the plan could have the effect of reducing local funding of the Tourist Commission by 10 percent — 5 percent from the County and 5 percent from the City — or about $200,000 per year.
“If the County Commission pulls out, I will ask the City Council to approve a new interlocal agreement to continue devoting 5 percent of the City’s 25-percent share of hotel-motel taxes to our local tourism agency,” Mayor McMillan said. “Tourism spending is important to our local economy, especially in generating sales tax dollars that flow to our local school system. I don’t support diverting money away from an agency that is doing good work and bringing tourism money into our community.”
The Tourist Commission, which rebranded itself as “Visit Clarksville,” is a County agency funded primarily by the 5 percent hotel-motel room tax. It operates as one of four parts of the community’s long-standing economic development framework that includes the Visit Clarksville, the Industrial Development Board, the Chamber of Commerce and Aspire Clarksville, which combine operationally under the umbrella of the Economic Development Council.
Visit Clarksville brings tourism dollars to Clarksville-Montgomery County by promoting local attractions and recruiting events that draw visitors from elsewhere for overnight stays, such as AAU basketball tournaments, the Tennessee Miss USA pageants, and the recent Toyota East vs. West All-Star Classic at APSU.
Overall, state data for 2016 shows direct tourism spending in Montgomery County totaled $211.16 million, which yielded $17.63 million in state and local tax collections.
The tourism agency was established under the state law that authorizes a local “tourist commission” and collections of hotel-motel room taxes. A local act was approved by the State Legislature that set up how the hotel-motel tax proceeds would be distributed. That act sends 50 percent of the proceeds to Visit Clarksville, and 25 percent each to the City and the County.
In 2005, the Tourist Commission, the City of Clarksville, and Montgomery County entered an additional interlocal agreement whereby the City and the County agreed to bolster the Tourist Commission by sending 5 percent of their share to the agency. Last year each 5 percent share contributed about $100,000 to the Visit Clarksville operating budget.