Dunwoody’s mayor and City Council are expected to approve raising the city’s hotel/motel tax from 5 percent to 8 percent next month, creating a revenue stream they say will fund long-awaited park and trails projects in the busy Perimeter Center with scant green space.
But how much of the new money — an estimated $850,000 a year to the city and another $850,000 to the Dunwoody Convention and Visitors Bureau — will go to existing destination spots in the city, such as the Dunwoody Nature Center and the Donaldson-Bannister Farm, is a sticking point for some.
Economic Development Director Michael Starling in a memo to the mayor and council said 15 percent of the new revenue would be set aside in a “Tourism Facility fund” that would go toward funding projects at the Nature Center and Donaldson-Bannister Farm.
Nature Center Executive Director Alan Mothner and Dunwoody Preservation Trust President Jim Williams requested at the Nov. 13 council meeting that percentage be increased to 20 or 25 percent.
“These facilities are not just for citizens, but for tourism, so there is a connection,” Williams said.
Mothner added that 15 percent is just $127,000 and is not enough to fund any of the master plan projects at the Nature Center. “Trails are great, but they need to lead to somewhere,” he said.
But it is the hotels in Perimeter Center that agreed to be taxed and because it is their money, the money should be spent to enhance their resources, argued Bill Grant, a board member of the Dunwoody CVB.
“We told them the money would be in Perimeter … and this affects them,” Grant told the council. “The nonprofits are terrific assets and they need your support. But not with this money.”
The General Assembly approved the legislation earlier this year granting Dunwoody the authority to raise the hotel/motel tax.
City staff is recommending a majority of the new money go toward trails and parks in Perimeter Center that have had plans sitting on the shelves for several years. A recent CVB survey showed that the number one priority for business and recreational travelers staying in Dunwoody hotels is the desire for a running or walking trail and small parks to visit close to where they are staying.
“This is a unique situation … we do not often find a revenue source we did not have before,” Economic Development Director Michael Starling told the council. “We focused on parks and trails early in the process … because that is the number one wish from visitors.”
Using the money on proposed parks and trails in Perimeter Center that have been studied and designed with the Perimeter Community Improvement District on connectivity, bike and pedestrian plans, last-mile connectivity as well as commuter trails was a major selling point to gain legislative approval.
Councilmember Jim Riticher said he would never vote for a hotel/motel tax increase, but is supporting it because the hotel owners supported it.
“I don’t have heartburn … but I’ve got some minor unease with allowing 15 percent to go to a fund, but I’m OK with it,” he said.
He added that state Rep. Fran Millar (R-Dunwoody) “quizzed me … and wanted the money going into that district. The money really hits an underserved area.”
The proposed parks and trails also benefit Dunwoody residents and continue the city’s mission to create more connectivity throughout the city.
“I’d like to be able to bike to Dunwoody Village from Georgetown and not have to take Chamblee-Dunwoody Road,” said cyclist Bill Black during a Nov. 15 open house at City Hall to view the proposed Perimeter Center trails and parks. “I like seeing Dunwoody taking non-automobile transportation seriously and this is a great step in that direction.”
New tax to go toward revenue bonds?
Starling told the council that hotel ownership would like to see some trail and parks projects completed quickly in Perimeter Center. He said that using the tax money to issue revenue bonds is an idea that received support in stakeholder meetings but staff decided not to “push it.”
The topic of revenue bonds will likely be discussed early next year, perhaps at the City Council retreat in February.
In Brookhaven, for example, which also raised its hotel/motel tax from 5 percent to 8 percent, the city is using the new revenue to finance a $9 million revenue bond to pay for the first phase of its Peachtree Creek Greenway, a linear park along the Greenway expected to connect to Chamblee and Doraville as well as to PATH 400 in Buckhead and eventually to the Atlanta BeltLine. The Brookhaven tax increase, however, expires once the Greenway is completed.
Councilmembers Lynn Deutsch and Pam Tallmadge in interviews said they support the idea of using the money to issue revenue bonds. Mayor Denis Shortal said he prefers to “pay as you go” with the new tax revenue but could be talked into supporting revenue bonds if the amount is conservative.
Councilmember Jim Riticher said he hasn’t made a consideration of bonds yet. Councilmember Terry Nall wants to wait and see the numbers before making a decision.
“We owe it to the people paying the tax, the visitors to our city, to get projects done as quickly as possible so that they can be enjoyed by all sooner rather than later,” Deutsch said.
Tallmadge said she also supports revenue bonds because she said she would like to see the projects completed quicker rather than later.
“I’ve been waiting for that bond word to surface,” Tallmadge said. “That’s a yes. … It’s a bond, it will be paid off. I want to see this in my lifetime.”
“Our first task is to understand expected annual revenue stream consistency and be very conservative in this calculation based on actual revenues received,” he said.
Construction project prices are continuing to increase at high rates in the metro Atlanta region, he said, and the current low interest rate environment may allow the city to build new parks and trails sooner using today’s construction prices and low interest costs rather than incurring higher construction costs in the future due to waiting to accumulate the funds.
“For me, the bottom line is it is a calculation of the overall least cost to implement the greatest amount of parks and trails amenities within the consistent revenue stream received over 10 years or less,” he said.