It’s also dragged North Carolina Speaker of the House Thom Tillis of Cornelius back into the fray. Tillis says verbal hostilities have escalated to near the point of no return, and both sides need to settle it quickly before things get out of hand.
House Bill 508, which was essentially penned by Tillis but ushered through the North Carolina House of Representatives by Rep. Beverly Earle of Charlotte, codified funding of Visit Lake Norman (VLN) at the previously established levels of 28 percent of hotel room taxes and 25 percent of the prepared meals taxes remitted back to the towns of Cornelius, Davidson and
Huntersville. The towns effectively receive 50 percent of those all those taxes collected in their jurisdictions to use for the promotion of travel and tourism. The rest goes to Charlotte for the same purposes.
The expiration of a three-year interlocal agreement between the towns and VLN and what was regarded by industry insiders as effort to de-fund VLN launched by some Huntersville and Davidson officials led to the squabble that was settled, partially, by the Legislature But an interlocal agreement that would redefine the governance of VLN and establish a payment schedule to the organization — which for the last decade, the first seven years with no interlocal agreement at all, was paid quarterly — has left both sides at an impasse for weeks.
House Bill 508 requires payment to VLN by the end of the fiscal year (last year it amounted to about $480,000), but did not set a payment schedule. Nor did it prescribe how the organization should be governed. That, Tillis says, was on purpose.
During interlocal agreement negotiations, the towns recognized they had leverage with no payment schedule set forth in the bill. But that was countered by the Lake Norman Chamber of Commerce, which in VLN’s articles of incorporation has approval authority over any change in VLN’s bylaws.
The Chamber spun off Visit Lake Norman in 2002 after it led the charge in Raleigh to require a portion of the prepared meals taxes be remitted back to the towns, ostensibly for the purpose of creating a local travel and tourism bureau.
A demand by the towns to play a role in how VLN selects its nine members of a new, 18-member board of directors, countered by a VLN demand that at least some of the nine members named by the towns have some tourism industry expertise, is the current sticking point.
And Tillis has about heard enough.
“I have found myself in the middle of a family squabble,” Tillis says, “but it is important for them to remember that they are friends, they have all done some valuable things for this community and they need to check their emotions a the door and get back to some serious discussions to resolve this issue among themselves.”
The Speaker, who has close friends on both sides of the issue, held high-level talks with representatives of the towns and VLN Tuesday, and suggested they get back to the table. A meeting between VLN officials and the three town managers was set for Thursday afternoon.
Tillis says he approves of the concept of an 18-member board of directors, but adds that the towns should name only one elected official each to the panel, their remaining two members each from the local travel and tourism industry. He further says the towns have no business being involved in the nine members VLN names to the board, but adds that the Chamber should yield its veto authority over VLN bylaw changes.
Lake Norman Chamber President Bill Russell says it has used that authority only three times in the last 10 years in approving minor changes to the bylaws. Beyond that, he says the Chamber exercises no oversight over Visit Lake Norman’s activities. Among the prickly issues for some officials of the towns is the fact VLN rents space from the Lake Norman Chamber, what some regard as an incestuous arrangement.
Russell says the Chamber’s Board of Directors is reluctant to give up the authority as the towns demand because it protects VLN from overzealous government intrusion, and also protects the Chamber itself from its membership being cannibalized. Visit Lake Norman currently recruits no membership, and the Chamber wants to keep it that way.
“The board doesn’t want there to come a time when Visit Lake Norman and the Lake Norman Chamber are competing for the same membership,” Russell says. “That was the primary reason that was written into the articles of incorporation of Visit Lake Norman at the time it was created by the Chamber.
“We don’t control anything Visit Lake Norman does,” he continues. “These bylaws have been in place for 10 years but nobody knew about it. Why? Because there is no over arching control by the Chamber to manage Visit Lake Norman.”
Those directly involved in the negotiations are tight-lipped, but as the matter drags on, VLN officials have said they have been unable to bid on future amateur and other events for the Lake Norman region because its regular first installment hasn’t been paid, and event organizers are uneasy about the future of the travel and tourism industry here. The impasse reached new eights last week when it was reported in another news outlet that the Chamber is considering legal action in the matter, something Russell vigorously denies.
“I was extremely disappointed that anyone would mention legal action being brought by anyone,” Russell says. “That simply polarizes people and entrenches them, and it is damaging to business relationships. The Chamber will not discuss or be a party to any lawsuit. We don’t think that’s a solution.”
Russell did say that, because attorneys for the towns and those for Visit Lake Norman differ on interpretations of the legislation, it may require a judicial definition.
“At some point, it may require someone in a judicial capacity to interpret what is the meaning of this legislation, but I don’t perceive that as being a lawsuit,” Russell says.
State watch
The local convention and visitors bureau funding fight has gotten state-wide attention. Even as House Bill 508 was matriculating through the General Assembly, officials of the North Carolina Travel and Tourism Coalition (NCTTC) — of which VLN is a member, as are most other CVBs and tourist attractions across the state — expressed concerns over the inconsistency of the travel and tourism funding from those dedicated funds in Mecklenburg County in general, and Lake Norman in particular. In all other jurisdictions across the state, hospitality taxes go directly back to local CVBs for the purpose of attracting more tourism.
The local convention and visitors bureau funding fight has gotten state-wide attention. Even as House Bill 508 was matriculating through the General Assembly, officials of the North Carolina Travel and Tourism Coalition (NCTTC) — of which VLN is a member, as are most other CVBs and tourist attractions across the state — expressed concerns over the inconsistency of the travel and tourism funding from those dedicated funds in Mecklenburg County in general, and Lake Norman in particular. In all other jurisdictions across the state, hospitality taxes go directly back to local CVBs for the purpose of attracting more tourism.
Only in Mecklenburg does the money go to the municipalities for distribution, and only in Lake Norman do the towns control the bulk of those dollars. The NCTTC didn’t care for the state-wide attention the matter was getting, particularly in light of the precedent it sets. Dana Simpson, legislative counsel for the NCTTC, says the group is generally supportive of the codification of funds to VLN, but not so much the level of funding.
“The Coalition supports the change in the law that ensures that monies from tourism taxes go to the CVB to promote travel and tourism, and that it not be used for non-tourism-related purposes,” says Simpson. “We want to ensure the significant portion of tourism taxes are reinvested in tourism promotion that creates jobs, and that is where the CVB is in the best position to generate. This is about jobs.”
Simpson says the NCTTC isn’t interested in getting involved in the local minutiae, but it is keeping an eye on developments here.
“The coalition will remain vigilant in promoting the existing occupancy tax guidelines that have helped grow the tourism industry in our state, and it would oppose any efforts to undermine those long-standing guidelines.”
By that definition the guidelines have already been undermined. Simpson says Mecklenburg has been out of compliance with the rest of the state since the 1980s when enabling legislation to collect tourism taxes here was first approved.
Tillis, meanwhile, says the matter needs to be resolved quickly.
“If it does get to the point where I do feel like both sides haven’t negotiated in good faith, they can’t assume just because the bill was passed that they need not continue down that path,” he says. “We do have a way we could pull the legislation if we felt people aren’t working together toward a productive end.”
