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|February 25, 2021 City Council Regular Meeting|
41. Approval of Memorandum of Agreement with the Savannah Area Chamber of Commerce/Visit Savannah Regarding the Hotel-Motel Tax
State Law requires a certain percentage of proceeds derived from the collection of hotel/motel tax revenue be allocated to a private-sector registered 501(c)(6) nonprofit organization for the purposes of promoting tourism, conventions and trade shows. Visit Savannah, the largest business unit of the Savannah Area Chamber of Commerce, is a qualified 501(c)(6), and was designated by City Council as Savannah's destination marketing organization (DMO) under an agreement approved in 1999.
Under that agreement, Visit Savannah receives 33.3% of the total amount of hotel-motel taxes collected, revenue that must be accounted for separately from the rest of the Chamber of Commerce budget and can only be used on marketing, public relations and advertising to promote tourism, conventions and trade shows.
The City now proposes to increase the hotel/motel tax rate to 8% under provisions of OCGA 48-13-51(b), which requires a new tax proceed distribution and a new Memorandum of Agreement with the Savannah Area Chamber of Commerce/Visit Savannah.
Under the proposed agreement, as required under State Law, Visit Savannah would receive 33.8% of the total amount of taxes collected under the new 8% rate. As under the existing agreement, the revenue can only be used to promote tourism, conventions and trade shows. The agreement also requires Visit Savannah to:
The proposed agreement only goes into effect upon implementation of the 8% tax rate, and runs through December 21, 2023.
Michael Brown, City Manager
MOA HMT CVB 2021 V3 022021.pdf