City hikes hotel tax

Published 12:00 am Monday, September 8, 2003

For those living in Demopolis, news that the city council raised the lodging tax by 50 percent on Thursday night won’t make much of a difference. Those who regularly travel to Demopolis may feel a different way.

At Thursday’s council meeting, Caldwell recommended that the city increase its lodging tax from three percent to six percent. In other words, people who stay in hotels in Demopolis will have to pay three-percent more in city taxes. All told, the lodging tax will increase from seven percent to 10 percent because the state of Alabama charges a four-percent lodging tax.

According to Caldwell, hotel owners were notified of the idea two weeks ago.

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This tax increase &045;&045; though not deliberately &045;&045; comes less than a week before Demopolis citizens will join others around the state to vote on Gov. Bob Riley’s $1.2 billion tax increase.

The reason for the tax has nothing to do with Riley’s plan, though.

Kathy Leverett, the current chamber of commerce director and industrial development board director, announced her resignation earlier this year. When Leverett leaves, Caldwell and other city officials believe the city needs to consider bringing on someone who can spend more time luring industry to the area.

According to the mayor, the increased lodging tax will generate between $65,000-$70,000 a year. That money, he said, would help what the Demopolis Industrial Development Board would need to hire "somebody really good," Caldwell said.

Caldwell and the city council have nearly completed budgeting for fiscal year 2004, and the increased tax will help balance the budget and allow the city to help fund a higher paid position.

Since Leverett’s resignation announcement, some talks have centered on whether Demopolis needs to divide her job. Serving as both the chamber and IDB director is an enormous job, and Olen Kerby &045;&045; chairman of the IDB &045;&045; said replacing Leverett with two people is an option his board has considered.

Whether or not that will happen has not been decided, Caldwell said.