Originally created 02/17/99

Businesses say fee discriminatory



AIKEN -- Representatives of Aiken's restaurants, hotels and inns were briefed Tuesday on possible taxes that city officials are considering to help pay for big-money projects.

If approved, the hospitality and accommodations taxes would likely pump funds into a proposed tournament-class tennis center, expansions of Citizens Park, a skate park, downtown theater, and beautification projects. Some of the money also could be used to promote tourism and get more overhead wires underground.

City Manager Roger LeDuc said the council will discuss the proposed taxes at a retreat this weekend, and they could show up on a council agenda soon.

A 2 percent hospitality tax and 3 percent accommodations tax would generate more than $1 million a year -- enough in a decade to pay off the cost of multimillion projects that would serve local residents and draw visitors to the city as well, he said.

State law allows local governments to impose those taxes, which are passed on to consumers in restaurant and lodging bills,

then used for specific local projects. North Augusta recently instituted the taxes, and Aiken County is considering them, Mr. LeDuc said.

If the city of Aiken does not act before the county does, revenues collected in its restaurants and hotels would go to Aiken County for countywide use.

None of that sat well with some of the business representatives who would have to collect the money as additions to what they already charge. Several had pointed questions about how their businesses would benefit from the projects and why only their industry would be tapped.

The city has to play by rules the Legislature wrote, Mr. LeDuc said, and there are few options open to municipalities with large goals.

State law also allows local governments to enact a local-option sales tax, above the state sales tax, but that would have to be a countywide initiative.

Tuesday's meeting was tentative and preliminary, but hospitality and accommodations taxes are expected to generate a flurry of debate -- and soon.

Margaret N. O'Shea covers the city of Aiken for The Augusta Chronicle. She can be reached at (803) 279-6895 or scbureau@augustachronicle.com.