PANAMA CITY — City commissioners heard a public outcry Tuesday for a new tax on the city’s books.
A 5 percent bed tax on lodgings of less than six months came before commissioners with the backing of business and government interests alike. Commissioners unanimously supported the tax, as well.
The turnout was not surprising to Mayor Greg Brudnicki.
“They understand the value of putting heads in beds,” Brudnicki said.
With projects like the African-American Cultural District and the Marina Redevelopment Project underway, Brudnicki said the city is on its way to offering something no other place in Bay County does.
“We want to create diversification for tourists,” he said. “We need to let them know not everybody shucks and jives at [Club] La Vela.”
Panama City does not have a “tourist development tax,” as city documents refer to it, and adopting one would put the city on par with Panama City Beach and Mexico Beach under the Tourist Development Council’s (TDC) guidelines.
The city’s ordinance more closely resembles that of Mexico Beach, as the city would be able to determine where revenues from the tax would be spent and not have representation on the TDC.
Alongside Bay County Chamber of Commerce representatives, a delegation of about 25 hoteliers showed up in support of the tax.
“We have been leaving a lot of dollars on the table that could be used for the betterment of Panama City,” said Harry Patel, owner of three hotels in Panama City. “We can use that to promote the marina and downtown festivals.”
Patel said the tax partly gives hoteliers more political clout as another tax base but also could be used to keep businesses from moving to Panama City Beach.
“We need the tax dollars to promote Panama City and attract more tourists,” Patel said. “The retailers and restaurants are moving to the beach, and we have to start some momentum and energy here to sustain and survive.”
The amount the tax would garner each year was unknown Tuesday.
The tax would be imposed on the rental of hotels, motels, apartments, condominiums and homes if the rental is less than six months. Though commissioners unanimously approved moving forward with the tax, one commissioner expressed concerns.
“I have an aversion to any type of tax,” said Commissioner John Kady. “Believe it or not, people have a set amount of money to spend, and if they spend 5 percent on a hotel they aren’t going to spend it somewhere else.”
Kady conceded the revenue, if used for the common good, could be justifiable. He wanted a goal expressed by the commission beforehand to keep from infighting over spending of the additional funds.
“I know we can’t avoid that, but I would like to see some vision beforehand,” Kady said.
Commissioners will have to determine a use for the tax — whether it would be promotions for culture, historic downtown, St. Andrews, festival events, museums or auditoriums — before the ordinance can go before TDC and Bay County commissioners.And the revenues could be spent only on that plan.
If adopted by TDC and county commissioners, the ordinance accepting Panama City into the Tourist Development Tax District would be placed on a ballet for an at-large vote by Panama City residents.