AIKEN - The Aiken City Council voted by a narrow margin Monday to extend a 3 percent tax on hotel and motel charges.
The controversial measure drops the hospitality tax, which affects local residents and visitors, but keeps the accommodations tax. Councilman Michael Anaclerio made the motion, and Mayor Fred Cavanaugh and council members Pat Cunning and Lessie Price supported him.
The tax, in effect since 1999 along with a 1 percent hospitality tax on restaurant tabs, was put in place to help pay for tourism-related improvements. The city now expects to pay for those with its share of a countywide penny sales tax voters approved last year.
The city plans to hire a tourism promoter and pay for more tourism-related activities with the revenue, officials said. Some of those are items already covered in a budget that will be affected by some statewide changes. One change is a reduction in vehicle taxes that will cost Aiken $500,000 in revenue. Another is $200,000 in telecommunications fees the city would have collected if a new state law hadn't ruled them out.
City officials also fear cutbacks in the state budget will affect the amount of funding filtering down to local governments. City Manager Roger LeDuc recommended the 3 percent accommodations tax, as opposed to 2 percent or no tax, to offset losses - those already known and those likely to come.
At a public hearing before the vote, resident Richard Alvanos reminded the council of a promise they made when the tax was first passed.
"When you presented this tax to the public, you said that when the projects were finished the tax would be repealed," he said. "If we're going to be a city of character, we need to be what we're proposing to be. All I'm asking is that you live by your word."
Mr. Cavanaugh said that what the council said two years ago, vs. what it's doing now, is a technicality.
"We're not being dishonest or hiding behind the rock," he said. "I'm sure we'll get some flak. But in my heart, I know we're being as honest as we can by saying we've got some needs coming down the pipe that we don't know about yet. We've got to be prepared."
The mayor added that the city is spending a lot of its general fund money on projects, including Hopeland Gardens and Rye Patch, that should be paid for with revenue from tourism. Because the tax passed, money from the general fund now can be used to pave roads and for other projects, he said.
Council members Eric Radford, Don Sprawls and Beverly Clyburn said they were sticking to the council's word and voted against keeping the tax.
"I think we owe it to the citizens to do what we said," Mr. Sprawls said.
Reach Katie Throne at (803) 279-6895.
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