City Council Takes First Steps to Put HOT Tax in Motion
POSTED: Tuesday, December 18, 2012 - 7:45pm
UPDATED: Wednesday, December 19, 2012 - 5:12pm
The HOT Tax items on the City Council agenda today focused on the financing of the new ballpark stadium. Council approved four specific ordinances that are meant to structure and organize ballpark financing.
The first ordinance that council approved was an ordinance to begin collecting the 2% HOT Tax from hotels starting January 1st, 2013.
Next, Council approved an ordinance that will be able to fine, prosecute, or close down hotels that don't pay their HOT taxes on time.
City Council approved a third ordinance that will establish a fund solely dedicated to collecting the HOT Tax to make sure the funds will only be used to pay the principal, interest, and maintenance costs for the stadium.
Finally, Council approved to set up a "Local Government Corporation," that will be responsible for managing the ballpark's finances.
"We have several other corporations that are very similar to that... One of the biggest benefits of that is that the debt doesn't go against the debt that the City owns, it's the debt of the corporation," said Mayor Cook today.
Council members say by establishing a corporation to handle the ballpark's financing instead of the City handling it, they will save about $44 million in interest payments.
City Representative Cortney Niland says it looks like the HOT Tax will get very close to paying the debt service payment. She says the gap will be covered by ticket surcharges, rent, parking fees, and the associated sales tax.