Legislature Says NO to Raising Taxes in New Orleans

By Louis R. Avallone

Should Caddo/Bossier Follow Suit?

It’s a popular business adage that you have to spend money to make money. The question for taxpayers on November 4 is how much money, and whose money are you spending?

You see, there’s an initiative on the ballot in November that will increase the sales tax on hotel guests in Caddo/Bossier by 2%, making the total occupancy tax 6.5% (and among the highest in the state). If passed, this means for every $100 in hotel bills, paid by guests to our area, $6.50 will be collected from them in taxes.

The added 2% will generate an estimated $3 million in dedicated revenue for the Independence Bowl Foundation, as well as the Shreveport-Bossier Sports Commission and the Ark-La-Tex Regional Air Service Alliance. These organizations are composed of hundreds of volunteers and supporters who give their time, and considerable talent, to promote our communities, and improve our quality of life, not only for today, but as a legacy for the next generation.

They are a big reason that the Independence Bowl is the largest sporting event in the state of Louisiana outside of New Orleans and LSU home football games. And that it’s the 11th oldest bowl in our country, and that it is being televised for the 23rd year in a row on ESPN. So, with their share of the almost $1 million in recurring annual revenue expected from the proposed tax, the Independence Bowl Foundation says that it can attract even better teams to the bowl, and preserve the bowl for years and years to come.

Indeed, the Independence Bowl has pioneered sports tourism for our region, opening the doors to events like the Bassmaster Classic last year – which generated an estimated $7 million for the local economy. The Shreveport-Bossier Sports Commission says it can attract even more of these quality sporting events with its $750,000 share in taxes that it is expected to receive each year, if voters say “yes” next month.

And, of course, if you are going to invite folks from all over the country for such events, you surely have to make an easy path for them to get here. But with our region’s current air service, that’s not always convenient, or affordable. Maybe that is why over 50% of all travelers flying from the Ark-La-Tex do so from anywhere else but Shreveport Regional. This is why the non-profit organization, Ark-La-Tex Regional Air Service Alliance, says it needs their expected $1 million share of the annual revenue provided by the proposed tax. They say that if they could get just one (1) new route, with a 50-seat regional airliner, it could make as much as a $4 million impact each year.

Yes, objectives of these organizations are honorable, no doubt, and deserve our support and attention. We have to be careful, though, when folks start saying that such support, through an additional 2% hotel tax, will be at “no cost to the citizens of Caddo and Bossier parishes” or that it will be paid entirely by “out-of-town visitors”.

That’s just not necessarily true – it affects our entire economy. In fact, for this very reason, Louisiana legislators just recently voted down Mayor Mitch Landrieu’s efforts to raise the New Orleans’ hotel-motel occupancy tax by another 1.75%. If they had raised the tax, New Orleans would have been on the same level as New York City, which has the highest hotel-motel taxes in the country. And according to Lieutenant Governor Jay Dardenne, he says doing that would have made it difficult to position ourselves as a “destination”, or even to attract events like the Superbowl, back to Louisiana.

The proposed tax in Caddo/Bossier could mean that folks will stay fewer nights in our community, or hoteliers will offer less services, in an effort to compete with hotels in surrounding parishes, where the taxes are lower. After all, taxes can literally “move” people.

Consider the meteoric population growth of Bossier Parish, and the stagnating population growth in Caddo Parish, over the past 20 years. Is it just a coincidence that Caddo Parish also has the highest property taxes in the state? Probably not. Or look at the number folks migrating from Louisiana to states with no state income taxes whatsoever. Again, coincidence? Probably not.

You see, supporting this tax increase in November may be worthy of voter support, but it should never be because we can persuade enough people that “somebody else will pay the bill”.

After all, we cannot tax ourselves into prosperity. If we could, we would have reduced the nation’s unemployment rate, paid down the federal debt, decreased the poverty rate, lowered healthcare costs, and increased national security at our borders years and years (and billions of wasted tax dollars) ago.

No, we have to be careful here, on this slippery slope of increasing taxes in our community, whether it’s an occupancy tax or any other, for that matter.

As we go to the polls in November, we need to remember, as Ronald Reagan said, that we have some people around here “who have never met a tax they didn’t hike”.

And to those folks, I’d just say, remember whose money you’re spending – and that folks vote with their feet too.