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Natchez Aldermen In Limbo Over Hotel and Sales Tax Increase

Natchez aldermen said Wednesday they still haven’t decided whether they will support a hotel-restaurant sales tax increase to finance an expansion of the city’s convention center and to also help pay debts still owed from its original construction 12 years ago.

By John Mott Coffey

The aldermen met with Mayor Butch Brown and financial advisor Demery Grubbs to discuss the city’s existing debts and options on how to borrow more money.

The Natchez Convention Center opened in 2002. However, the city stills owes about $9.6 million of the original $12 million borrowed for building the facility. The debt was structured so that the city annually repaid smaller amounts at first and then be obligated to pay much higher increments beginning next year.

Brown is urging the aldermen to support a sales tax increase on restaurants and hotels to generate additional revenues to expand the convention center and also help pay the original debt with lower interest rates and more years to repay it.

The proposed convention center tax increase calls for the restaurant sales tax to rise from 1.5 percent to 2 percent while the hotel sales tax would go from 3 percent to 4 percent. This increase would generate about $400,000 a year, said convention center General Manager Walter Tipton.

With the state Legislature now in session until April, Brown is pushing for the board to formally ask state legislators to file the bill required for such a local tax increase. However, aldermen said they need more time to assess the implications of borrowing more money and raising taxes.

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