Aiken City Council and staff will meet Monday to discuss the details regarding the proposed 1 percent hospitality tax.
The discussion will be part of Council's 7 p.m. regular meeting in the Municipal Building's Council Chambers, 214 Park Ave.
Despite initial reports Council would take its first vote on the topic, interim City Manager Roger LeDuc said there still seems to be some public confusion over where the collected money would actually go and what projects the money would go toward.
A hospitality tax is a tax on the gross proceeds from the sale of prepared meals, food and beverages. The tax is usually set at 1 or 2 percent. If Council does pass this tax, an additional 1 percent would be tacked onto the total bill of those who eat or drink at restaurants.
More than 100 South Carolina municipalities have a hospitality tax - many of them charge a 2 percent rate. Less than 30 minutes away, the City of North Augusta has a 1 percent hospitality tax, and Charleston and Columbia charge a 2 percent tax.
Recently, the City announced one of its largest public-private partnerships with local hotel owner Neel Shah. Shah is proposing to gut and revitalize Hotel Aiken on Richland Avenue. The City's part of that partnership would be covering 100 percent of the estimated $2.5 million to $3 million cost of constructing a public parking deck next to the hotel across Bee Lane, and Shah would cover the cost of revitalizing Hotel Aiken.
Council member Philip Merry, who proposed the tax, said he estimates at least $1.2 million in revenue could come from the tax per year. Some of those funds could then be turned around and allocated into different areas, including the construction of the downtown parking garage.
According to Council's agenda, the use of the tax funds would be split into four major categories - $600,000 for business-related investment, $160,000 for business license relief, $110,000 for business vitality and $330,000 for enterprise capital reserves.
In other business, Council will hold the second and final reading of an ordinance to approve re-purposing Capital Project Sales Tax funds and an ordinance to amend the agreement with the S.C. Transportation Infrastructure Bank for both the University Parkway widening project and Dougherty and Whiskey roads widening project.
Under new business and first reading, Council will vote whether to approve a contract to acquire the right-of-way for the Dougherty Road widening project.
Maayan Schechter is the local government reporter with Aiken Standard. Follow her on Twitter @MaayanSchechter.
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