'To err is human, to learn from our mistakes is heavenly'
In 2008, the Woodcreek City Council adopted a Hotel Occupancy Tax in five minutes. It took five years to correct the mistake made on that day. Now, 10 years after the HOT rate was set to “0%,” the city of Woodcreek is about to make the same mistake, again.
The characters in this story are slightly different, but the Council Members’ arguments for a HOT remain exactly the same: 1) “every city in Texas has a HOT, we should, too”; 2) “HOT is not a tax on the hotels, it is a tax on their guests”; 3) “money collected will be managed by the City to bring in more tourism”; 4) “a committee consisting of all interested parties will make sure the money is spent wisely”; and 5) “if Wimberley has one, we should, too.” Before I tell you what happened with Woodcreek’s HOT, here are some facts you need to know. There are over 1,200 cities in Texas, and only 500 have a HOT — that’s 40%, not even half. The State of Texas HOT mandate for cities is clear. The only legal use of HOT funds is to generate overnight tourism from 51 or more miles away. HOT funds collected cannot be used as general funds for roads, sidewalks, parking, streets, parks, sewer, restoration and/or any other city infrastructure needs.
During the five-year (2008–2013) HOT experiment, the city of Woodcreek collected approximately $120,000 in HOT funds. The City Council member assigned HOT responsibility, Brent Pulley, expended HOT money collected in all sorts of creative ways, including payments to the Wimberley Chamber and advertising in Texas Highway Magazine. Yes, this all happened. Yes, Mr. Pulley is back on City Council.
The impact to the lodging community was significant. The owners did not experience the City Council’s promised “increase in tourism.” A few of the lodging owners went out of business. Others were forced to sell. The ones that survived experienced margin erosion as they tried to “pass-through” the city’s HOT to their guests in a “softening” economy. Lodging occupancy rates declined as guests stayed in surrounding areas where there was no HOT. Lodging owners were forced to discount their rooms to attract overnight guests, which meant they were now directly paying for the city’s HOT.
The Woodcreek HOT Committee was disbanded. It couldn’t agree whether the city should have a HOT and/or on how the money collected would be allocated to promote overnight tourism since the City offers no actual tourist attractions other than swimming.
Back then, as it is now, Woodcreek residents, 80.41% of which are age 55 and older (see Woodcreek Master Plan), had no interest in promoting tourism and did not support a HOT. Why would they? Tourism just creates more traffic, noise, potholes, waste and disruptions to everyday life.
Fast forward to today, and our Woodcreek City Council is once again beating the HOT drum. Why? Have we not learned the lessons from the first Woodcreek HOT? What has changed? How is the new HOT going to be any different? If the Woodcreek residents and “mom and pop” lodging owners don’t want a HOT, then who exactly are the elected City Council members representing in their push for re-enacting a HOT?
The Woodcreek City Council needs to learn from our past HOT mistake and failure, listen to the residents and take direction from our “mom and pop lodging” owners who are the ones you are proposing to tax. Don’t pass a HOT in the City of Woodcreek unless you are committed to upsetting our citizens, disrupting the “mom and pop” lodging owners, dividing our community and losing your City Council seat at the next election.
Hunter Jones
General Manager, The Lodge at Cypress Falls, Woodcreek
