Escambia County to consider raising hotel bed tax, sets public hearing

A tax increase on hotel rooms is officially on the table in Escambia County.

The County Commission voted 3-0 Thursday to hold its public first hearing Oct. 1 on raising the "fifth cent" of the Tourist Development Tax, which taxes stays at hotel rooms and short-term rentals in the county.

The tourist development fund has been hit hard by the fallout from the coronavirus pandemic. The county currently collects four cents on every dollar spent for a hotel room in the county.

Visit Pensacola, the primary organization that uses TDT funds to promote tourism to the Pensacola area, has reduced its staff by half and cut $1.6 million, or 30%, in marketing and programming to make up for the lack of funding but is still facing a projected $1 million shortfall.

The County Commission on Thursday approved dipping into the TDT reserves to provide $500,000 to address the shortfall and plans to use another $500,000 of federal CARES Act funding to make up the difference. The move leaves the county with just $500,000 in its reserves for the TDT fund.

Tax recommended: TDC recommends fifth-cent bed tax to help with tourism recovery from COVID-19

The Escambia County Tourist Development Council, which includes representatives of the tourism industry and advises the County Commission on TDT spending, has recommended increasing the bed tax to five cents and approved a spending plan for the tax increase earlier this month that focuses on marketing Pensacola as a tourist destination.

Commissioner Lumon May said he didn't want the funds limited to just marketing and said he believed in the future, they would be needed to build a convention center or sports complex.

Escambia County first adopted a bed tax in the 1980s to fund the construction of the Pensacola Bay Center.

Commissioner Robert Bender said the development council would be discussing how to better spend the four cents it already collects and possibly use part of the funds to increase the county's TDT reserve for future economic downturns.

The commissioners agreed that setting an Oct. 1 hearing would allow for enough time for details of the spending plan to be worked through and enough public notice to be given.

Jim Little can be reached at jwlittle@pnj.com and 850-208-9827.