Daily Progress, Jacksonville, TX

Local News

August 27, 2009

No room at the inn: ‘Catch 22’ for city of J’ville

By Nathan Straus

nstraus@jacksonvilleprogress.com



Lon Morris College and its students got a fantastic deal when area motels America’s Best Value Inn and Trade Winds Motel let the school use their buildings for student housing. However, the city of Jacksonville will lose out on around $500 each day in hotel occupancy tax money while students, rather than tourists and travelers, occupy the motels.

According to the Texas State Comptroller’s Web site, Lon Morris is exempt from the state portion of the occupancy tax, which is six percent of the room fee. The college is not exempt from the local option for the tax in most cases.

Lara Feagins, Jacksonville’s interim finance director, said the city’s portion of the hotel occupancy tax is seven percent, though the new allocation for the next fiscal year is yet to be determined.

“After a guest becomes a permanent resident or provides notification, the guest isn’t eligible for the local portion,” Feagins said. A guest becomes a permanent resident after 30 days or if the resident provides notice of intent to stay for 30 days or longer.

Money from the local option goes toward putting more heads in more Jacksonville beds, she added.

RJ DeSilva, spokesperson for the comptroller’s office, said city’s aren’t required to put a local option into effect, but also stated if the city does, seven percent is the upper end of the local rate which can be levied.

“We don’t collect local hotel taxes,” DeSilva said. “The state portion is used for general purposes.”

Hotel occupancy tax funds are a sizable chunk of state revenue. Last year the state posted $371 million from the state’s portion of the tax. This year to date up to $313 million has been cited as revenue.

DeSilva also stated there’s no plan to raise the six percent state portion, which has been in effect several years, any time soon.

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