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Tax bump first step for big projects
David Damron and Mark Schlueb | Sentinel Staff Writers
Posted July 16, 2006
Orange County leaders are poised to cast a pivotal vote Tuesday that would raise more than $900 million over 25 years -- half to help fund a new sports arena, performing-arts center and Citrus Bowl overhaul and half for new tourism advertising.
County commissioners are almost certain to hike the existing 5 percent resort tax on hotel guests by another percentage point.
Tourism officials should walk away with an average $19 million a year for marketing campaigns area hoteliers say are desperately needed.
But it won't be enough for the civic projects.
The three projects touted by Orlando Mayor Buddy Dyer carry a combined $1 billion-plus price tag. City and county officials want to issue bonds to finance the deal, but the sixth penny -- along with a portion of the existing 5 pennies -- will produce about half that.
Where will the rest of the money come from?
"It kicks off . . . a very strenuous negotiation process where there's a pretty big gap between the ask and the available funding," Orange County Mayor Rich Crotty said.
There are several possibilities. Dyer told the Orlando Sentinel he would contribute "at least $100 million" from the city's downtown taxing district. He also hopes that allowing private development such as hotels, restaurants and shops around the venues will produce money through land sales or development fees. Private contributions could play a large role. It remains unclear where a new arena would go, what the city would do with the old arena site, and how much money that could bring in.
Although Dyer won't reveal details of his funding plan, he's confident the projects are within reach.
It's an ambitious lineup:
In May, arts patrons unveiled a blueprint for a $376 million performing-arts center that would sprawl over two downtown blocks, sit on a European-style public plaza and be surrounded by a half-billion dollars in private development, including a hotel, condos and office space.
While the arts project holds some of the more promising private fundraising prospects, organizers say more than $300 million must come from taxpayers.
Orlando sports boosters are pushing a $252 million Florida Citrus Bowl face-lift that would add more-roomy seating and vastly expand its upscale seating. Bowl officials say private fundraising possibilities for this venue are more limited, but Dyer has signaled that it, too, could get a boost from private development on adjacent city-owned land.
Orlando Magic executives are lobbying elected leaders to help build an arena more than double the size of the current one, modeling it after the FedEx Forum, the home of the Memphis Grizzlies. The cost: an estimated $350 million to $395 million. Team officials say they will offer a "significant" contribution to help pay for a new arena, but they won't say how much.
Too high a price tag?
The Magic's share of the cost is just one question local politicos want answered.
Orlando Commissioner Phil Diamond said he wants to know how much financial risk city taxpayers will take on.
"I have questions about how these venues are going to be paid for other than the resort tax," Diamond said.
City Commissioner Robert Stuart shares that concern.
"I support them all. I just don't know how much the community can afford and what priority to give them," Stuart said. "If we come to an agreement that there is $500 million available from the tourist tax, I don't know how you get to $900 million."
In the next two months, boosters for the Magic, the arts and the Citrus Bowl will lay out more detailed funding plans to the County Commission, which, with the city, must decide how to split the money among the projects.
Given the high price tags, Commissioner Bill Segal said, "there's probably going to have to be some paring back."
Getting hoteliers on board
The tourist-tax increase, which will take effect Sept. 1, would follow years of lobbying by arts and sports boosters. Until now, most of the revenue has been used to market the region to tourists and pay for the convention center and special events.
But earlier this year, Crotty signaled his willingness to push the penny increase and use money on the civic projects. The 50-50 split between more advertising and the projects is the result of a carefully orchestrated compromise among hoteliers, tourism officials, politicians, and arts and sports boosters.
Tourism officials are expected to submit a detailed marketing plan to commissioners for another vote this fall.
The industry's windfall would emerge at a time when Orange saw a record 51 million visitors last year and collected a record $122 million in resort taxes.
Still, industry leaders convinced politicians that sagging international tourism, along with other factors such as low occupancy rates and less in-state travel, signaled a need for more marketing.
Sharing tourism taxes
Crotty initially opposed adding an additional percentage point to the tax. But after he agreed to split the money with tourism leaders, they agreed not to fight his plan to give the rest of the cash to the downtown venues -- an idea many International Drive hoteliers vehemently oppose.
In fact, one influential hotel magnate, Harris Rosen, still is privately lobbying commissioners to divert more of the sixth penny into even bigger ad campaigns.
County leaders have reacted coolly to the idea so far. Doug Head, chairman of the watchdog group CountyWatch, said many residents are eager to see tourist taxes spent on something other than travel-related projects and used to help nourish the local economy.
"I think there's a general mood . . . that the tourism industry doesn't return an awful lot to the community, so spreading [resort-tax revenues] out is the right way to go," Head said. "Maybe we need to spread the fertilizer out beyond I-Drive."
David Damron and Mark Schlueb | Sentinel Staff Writers
Posted July 16, 2006
Orange County leaders are poised to cast a pivotal vote Tuesday that would raise more than $900 million over 25 years -- half to help fund a new sports arena, performing-arts center and Citrus Bowl overhaul and half for new tourism advertising.
County commissioners are almost certain to hike the existing 5 percent resort tax on hotel guests by another percentage point.
Tourism officials should walk away with an average $19 million a year for marketing campaigns area hoteliers say are desperately needed.
But it won't be enough for the civic projects.
The three projects touted by Orlando Mayor Buddy Dyer carry a combined $1 billion-plus price tag. City and county officials want to issue bonds to finance the deal, but the sixth penny -- along with a portion of the existing 5 pennies -- will produce about half that.
Where will the rest of the money come from?
"It kicks off . . . a very strenuous negotiation process where there's a pretty big gap between the ask and the available funding," Orange County Mayor Rich Crotty said.
There are several possibilities. Dyer told the Orlando Sentinel he would contribute "at least $100 million" from the city's downtown taxing district. He also hopes that allowing private development such as hotels, restaurants and shops around the venues will produce money through land sales or development fees. Private contributions could play a large role. It remains unclear where a new arena would go, what the city would do with the old arena site, and how much money that could bring in.
Although Dyer won't reveal details of his funding plan, he's confident the projects are within reach.
It's an ambitious lineup:
In May, arts patrons unveiled a blueprint for a $376 million performing-arts center that would sprawl over two downtown blocks, sit on a European-style public plaza and be surrounded by a half-billion dollars in private development, including a hotel, condos and office space.
While the arts project holds some of the more promising private fundraising prospects, organizers say more than $300 million must come from taxpayers.
Orlando sports boosters are pushing a $252 million Florida Citrus Bowl face-lift that would add more-roomy seating and vastly expand its upscale seating. Bowl officials say private fundraising possibilities for this venue are more limited, but Dyer has signaled that it, too, could get a boost from private development on adjacent city-owned land.
Orlando Magic executives are lobbying elected leaders to help build an arena more than double the size of the current one, modeling it after the FedEx Forum, the home of the Memphis Grizzlies. The cost: an estimated $350 million to $395 million. Team officials say they will offer a "significant" contribution to help pay for a new arena, but they won't say how much.
Too high a price tag?
The Magic's share of the cost is just one question local politicos want answered.
Orlando Commissioner Phil Diamond said he wants to know how much financial risk city taxpayers will take on.
"I have questions about how these venues are going to be paid for other than the resort tax," Diamond said.
City Commissioner Robert Stuart shares that concern.
"I support them all. I just don't know how much the community can afford and what priority to give them," Stuart said. "If we come to an agreement that there is $500 million available from the tourist tax, I don't know how you get to $900 million."
In the next two months, boosters for the Magic, the arts and the Citrus Bowl will lay out more detailed funding plans to the County Commission, which, with the city, must decide how to split the money among the projects.
Given the high price tags, Commissioner Bill Segal said, "there's probably going to have to be some paring back."
Getting hoteliers on board
The tourist-tax increase, which will take effect Sept. 1, would follow years of lobbying by arts and sports boosters. Until now, most of the revenue has been used to market the region to tourists and pay for the convention center and special events.
But earlier this year, Crotty signaled his willingness to push the penny increase and use money on the civic projects. The 50-50 split between more advertising and the projects is the result of a carefully orchestrated compromise among hoteliers, tourism officials, politicians, and arts and sports boosters.
Tourism officials are expected to submit a detailed marketing plan to commissioners for another vote this fall.
The industry's windfall would emerge at a time when Orange saw a record 51 million visitors last year and collected a record $122 million in resort taxes.
Still, industry leaders convinced politicians that sagging international tourism, along with other factors such as low occupancy rates and less in-state travel, signaled a need for more marketing.
Sharing tourism taxes
Crotty initially opposed adding an additional percentage point to the tax. But after he agreed to split the money with tourism leaders, they agreed not to fight his plan to give the rest of the cash to the downtown venues -- an idea many International Drive hoteliers vehemently oppose.
In fact, one influential hotel magnate, Harris Rosen, still is privately lobbying commissioners to divert more of the sixth penny into even bigger ad campaigns.
County leaders have reacted coolly to the idea so far. Doug Head, chairman of the watchdog group CountyWatch, said many residents are eager to see tourist taxes spent on something other than travel-related projects and used to help nourish the local economy.
"I think there's a general mood . . . that the tourism industry doesn't return an awful lot to the community, so spreading [resort-tax revenues] out is the right way to go," Head said. "Maybe we need to spread the fertilizer out beyond I-Drive."
