City considering lodging fee

June 12, 2013 • Local News

City Council will hold a public hearing Thursday, 7 p.m. at City Hall, 425 N. Richardson Ave., regarding an ordinance that would impose [auth] fees on lodging facilities for the expansion of the Roswell Convention and Civic Center.

The state Legislature recently removed the population requirement from the Convention Center Financing Act, allowing smaller municipalities, such as Roswell, to impose such fees.

If approved, the ordinance would impose a $2.50 fee “per room for each day that a room within a lodging facility in the City limits is occupied by a vendee not otherwise exempted by the Act or the Ordinance.”

The fee would not be related to the city’s occupancy tax, or Lodger’s Tax, under which the city collects 5 percent from the total amount paid for lodging by tourists — not including the state gross receipts tax or local sales taxes.

Dollars from the Lodger’s Tax are used for a number of different things that relate to promoting the city and attracting tourists, said City Manager Larry Fry.

This includes helping to fund the cost of advertising for events, marketing the city and maintaining the Convention and Civic Center.

“Basically, it is to be used for tourist-related items that will bring people into a town — hopefully to spend the night because that’s how the tax is replenished,” said City Finance Assistant Janice Self.

The city follows the state’s statutes regarding the Lodger’s Tax, she said, and submits a report quarterly to the state of what’s spent and how.

The Lodger’s Tax fund is divided between two funds: promotional (i.e. event advertising and publicity materials) and non-promotional (i.e. performing audits and providing sanitation and safety for events).

Money from both funds is sometimes transferred to the city’s general fund, Self said, and is still used for tourism-related activities or promotion.

In March, the city submitted its most recent report to the New Mexico Department of Finance and Administration. At that time, the report shows the city’s total revenue from the tax was $704,593. Of that, the city spent $631,632 total, with $138,454 spent on tourist-related events and $493,178 going toward contractural services.

The city also provides monthly reports of Lodger’s Tax collection by month and by year, going back as far as 2010. According to the city’s Lodger’s Tax report for May, the city has collected $876,178.96 so far this fiscal year through the tax.

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