Tourism officials are pushing for a new fee and a new tax for funds to support tourism marketing and a $60 million renovation of the Memphis Cook Convention Center, which is part of an overall $900 million long-range plan for the center.
The Memphis City Council got its first look at the two proposals on Tuesday. If the new city laws move through the legislative process without delay, the new fee and tax could be activated in mid-September.
One proposed ordinance would create the "Memphis Tourism Improvement District," a zone bounded by the Memphis city limits. Hotels within that zone would levy a $2-room-night fee on travelers from January 1st, 2016, through December 31st, 2025. The fee would not apply to hotels inside established Tourism Development Zones, or for complimentary rooms, or on a person who stays in a hotel room for more than 30 days.
Revenues collected from the district would go to the Memphis Convention and Visitors Bureau (CVB) for "destination marketing," which means advertising Memphis tourism on the internet, television, radio, and in print. The funds are needed, CVB officials said, as tax revenues previously earmarked for tourism promotion will be redirected next year to pay off the FedExForum.
The CVB's annual budget is $9.3 million, compared to an average of $16.8 million for comparable agencies in peer cities such as New Orleans and Nashville. The CVB projects the new fee would provide $3 million to $4 million in new funds each year.
The other proposed ordinance would nearly double the current hotel tax rate from 1.7 percent of the cost of a room to 3.5 percent. Funds generated from the new tax would fuel a $60 million overhaul of the Cook Convention Center that would take place in two phases over the next 10 to 15 years. Officials announced the $900 million proposal on Tuesday. The price tag would include an expanded convention center, infrastructure around it, and, possibly, two new hotels nearby.
- Left to right: convention centers in Jackson, Mississippi; Nashville; and Memphis.
The first phase of the renovation would modernize the existing facility to "bring it up to 21st-century standards," according to CVB President Kevin Kane. The convention center would get a fresh look on the outside with new lighting and more. Inside, the center would be remodeled with new finishes, updated bathrooms, and more.
"It is still going to have low ceilings and columns and only one loading dock," Kane said. "So, it will still have its challenges. But the only way to correct that is to blow the thing up and start over."
That second phase would do partly that with a new addition to the current center that will be "just as impressive as what you see in Nashville," Kane said, referring to the massive Music City Center building that opened in 2013.
CVB officials said a renovated center is necessary to keep Memphis competitive in attracting conventions, trade shows, and meetings of national associations. Memphis is a first-tier leisure destination, they said, but it is a third-tier convention destination, thanks in large part to the condition of the Cook Convention Center, which is nearly 42 years old.
"When people come through [the Cook Convention Center], they look around and say, with all due respect, we can go to Jackson, Mississippi, [for a higher quality building] than we can get in Memphis, Tennessee," Kane said. "We're talking Jackson, Mississippi, here!"