Tuesday, April 17, 2012

Welcome to the Hostility Zone


Here we are, once again in the eleventh hour, facing a new bill being pushed in the state legislature that we knew nothing about.  Senate Bills 473, 573, 608 (sponsored by Ed Murray, J.P. Morrell) and House Bill 967 (sponsored by Helena Moreno and Walt Leger) just hit the insider's radar last Friday and the public radar yesterday via Bruce Eggler’s column in the TP.

The public is just hearing of this bill a week out before it would go to committee.  Why is that?  Why is a bill this important, one that will affect every citizen in this city, just now reaching the public’s attention? 

This “urgent”, “has to happen” bill would create a new taxing zone, the “New Orleans Hospitality and Entertainment District”.  It’s essentially another DDD on steroids emcompassing “hospitality” areas of the city.  What are those areas?  Well...the hospitality “stakeholders” will decide that as needed, in perpetuity, and you, the citizen, will be informed after those decisions are made for you.  If your French Quarter, Marigny, Treme, Warhouse District, or 7th Ward house happens to end up in their "Hospitality Zone" you will be expected to comply with the agenda, resistance is futile.

But for now, we have to do this because Superbowl is coming up next year and we will be totally fuck’snu’d if we don’t pass it now!

Are you nervous?  

The general pitch for the bill would essentially create a new taxing district and new layer of government in the city.  11 million dollars of the expected new revenue would be split 50/50 between the city's two tourism marketing entities, NOMCVB and NOTMC.  That additional 11 million is on top of their current income and woud be used only for marketing.  That amount is an estimated 1.5% of the new 1.75% additional hotel/motel tax.  The remaining .25% would go towards "infrastructure" and "quality of life" enhancements in the newly created district.


Let’s take a look at what the primary objectives of the New Orleans Hospitality Zone and Entertainment District are (per VCPORA and French Quarter Citizens):

  1. The Initial $30 million (generated by a pledge from the Convention Center):  Provide a mechanism for distributing the Convention Center’s pledge to the primary tourist areas of New Orleans and improving its infrastructure.
  2. Funding for tourism agencies, the http://www.neworleanscvb.com/ and the New Orleans Tourism and Marketing Corp. (NOTMC) :  Obtain additional millions for advertising and PR for the agencies responsible for marketing New Orleans so the city is on par with other similarly situated US cities.
  3. Recurring Revenue for Infrastructure:  Provide a recurring revenue source for infrastructure, sanitation, and other issues related to improving visitor impressions of the “hospitality zone”.

Ok, so that’s the basis of the pitch.  I’m going to address my concerns in a minute but I want to list some of the concerns VCPORA and FQC raised:

  • Flexible Boundaries:
  1. The content of the bills vary, but roughly the Zone includes the French Quarter, CBD, Warehouse District, and the Marigny (with some bills including the entire Marigny and others drawing the line at Elysian Fields).  The boundaries, however, are NOT fixed and can be adjusted by the board and/or the Mayor - NOTE: THIS ITEM HAS REPORTEDLY BEEN AMENDED OUT.
  2. Several bills empower the Mayor to enlarge the district by annexing “contiguous” areas into the zone.  The bills also empower the District itself to divide into smaller “subdistricts”, which could be used to enable the district to draw out significant pockets of opposition for tax election purposes. NOTE: THIS ITEM HAS ALSO REPORTEDLY BEEN AMENDED OUT.
  • Unelected Board
  1. The creation of the board would represent a shift of power from elected leaders (like the City Council) to an unelected board made up primarily of tourism industry officials, so observers are expressing concern about accountability.
  2. The bills generally set out the purposes of the district, but there is little in the bills that would dedicate a specific amount of money (say, at least 50%) to enhancing capital improvements in the Zone.  Further, the board is not legally required to seek the input of the public or even the City Council in choosing projects.  One excpetion:  In SB 473, the board MAY enter into a Cooperative Endeavor Agreement with the City for capital improvements in the zone.  But, “in the absence of ... (an) agreement” the funds (originally intended for improvments) are sent to the CVB and NOTMC.

Here we go again, eh?  Yet another “taxing district” to raise money for some urgent stuff we lack in regards to other “similarly situated cities”. 

In other words, the college fraternity next door just got a pool and a hot tub and we have to run out and get those things too or we just won’t be cool enough.  Never mind that we can’t afford those things, we’ll just jack up the rates on members’ fraternity dues in order to raise the money to get them.  But we have to hurry up because the big game is coming and we need that schwag for the tailgate party.

The only problem with the frat boy analogy in respect to this situation is that you can choose to leave a college fraternity, many people can’t simply choose to leave their house, job, friends and family and move to another area of the city or even out of the city.

People who live in a city are privy to their city government’s machinations but their government must also answer to the people.  Government is imposed on the populous in the form of laws and taxes but citizens have a representative voice in the process through the election of government officials.  If the citizens don’t like what is happening they can always vote out the lawmakers.

It’s this pregnant, little notion commonly referred to as a “representative democracy”.

A college fraternity is more often a monarchy....a fiefdom.  Seniority and title rule the roost.  This is the mindset that is imposed in a fraternity and the fruit of that vine usually carries that attitude to the grave.

On that note, let me briefly explain the CVB and NOTMC.  Both organizations obtain funding from a tax known as the “Hotel/Motel tax”.  This tax was created shortly after the 1984 Louisiana World Exposition failed miserably and had to be subsidized by government funding just to keep it running through its ending date.  The failure of the event was largely blamed on the lack of marketing to promote the event and as a result the two respective marketing agencies were created in order to market the city to tourists.  To fund the organizations a city tax was placed on hotel/motel rooms and restaurant meals with the blessing of the business owners.

NOTMC was designed to market to the “leisure tourist”, people who are simply visiting the city on a vacation or for festivals, etc.  NOTMC is wholly funded by the hotel/motel tax.

The CVB was originally designed to market more towards large conventions and business-based tourism but they also started taking on the role of marketing to leisure tourists as well.  The CVB does receive funding from the hotel/motel tax but they also receive private funding (I’ll get to this in a minute). 

There has always been an uneasy relationship between the two entities with the CVB being the aggressor.  NOTMC’s budget has repeatedly been in the crosshairs for the CVB and that power play climaxed last year in a rather hostile attempt by the CVB’s President/CEO, Stephen Perry, and a handful of CVB board members to collapse the NOTMC into their organization and essentially cannibalize their budget.  The merit of this move is up for debate, regardless, it was thwarted largely by the influence of then newly-elected Mayor Landrieu.  NOTMC is under the umbrella of the mayor's office; CVB is autonomous.  

I bring these facts up because one point of contention that surfaced during this battle between the two entities was that after repeated requests for their budget, including public records requests from more than one local media outlet, the CVB denied all requests to open their books.  Their lawyers claimed that since the CVB was a public/private entity they did not have to comply with the requests.  They finally buckled a little last year and agreed to open up their books only on the public monies they received from the hotel/motel tax. 
   
NOTMC has repeatedly made their books public. 

The CVB’s spending and bookkeeping has been the subject of much speculation for years, particularly since Katrina.  The organization has continually operated at a deficit since the storm; their spending largely unscrutinized and hidden from public view.  The organization’s hostility towards its sister organization, NOTMC, is the stuff of New Orleans’ political lore and last year’s battle was no exception, voodoo even made it into the mix (buy me a drink and I’ll tell you a tale).

What we have in the CVB is essentially a fiefdom....little to no accountability, self-rule, unelected legacy rulers. 

Now, at the last minute, we’re being told of a bill being pushed in the state legislature that would greatly expand that fiefdom’s territory, power and wealth by yet another tax imposed on the city.  We’re being told this “Zone” must be created in order for us to properly host the Superbowl next year.  We’re being told this plan was hatched by the “stakeholders” in the New Orleans’ tourism industry and apparently that elite group does not include all the citizens of the city.  

We’re being told this "Zone" will initially be the French Quarter, the Warehouse District and CBD (which will apparently overlap an already existing tax district, the DDD), Marigny, Treme, and the 7th Ward.

We’re being told we must simply accept all of this and agree to the tax without having any voice in the matter or course of action through standard governmental channels such as City Council.

We’re being told we have no voice on who runs this "Zone", the board will be appointed by the “stakeholders” and we “simply ain’t in that numbah’”.

Once agian, it's a fiefdom.  It’s called taxation without representation.

The spearhead of this ploy being primarily the CVB, an organization that has shown a blatant contempt for transparency.  However, what little we do know of the organization’s budgetary performance is cause for great concern.  


Now, they have the balls to tell us, not ask us, that they are going to create a whole new taxing zone in the city and they are going to spend that generated income at their own discretion.

Not very hospitable for an organization whose business is hospitality, huh?

This city...this amazing city....is amazing because of its residents.  What makes New Orleans unique, what gives these tourism “stakeholders” their jobs and income is the eclectic mix of culture, music, food....people....that comprise this city.  Yes, some tourists come to New Orleans simply to get plowed and hang out in the “Zone” but what sets this city apart from Las Vegas, Disney World....Branson....is that we’ve always had this amazing ability to walk the fine line between exploiting our culture and keeping it fo‘ true.  

 Make no mistake, this tax is going to affect all the people of this city, not just the self-ascribed “stakeholders”.  An increase in taxes on parking is going to put a burden on the folks who have to commute downtown to run the stakeholders‘ businesses.  An increase in restaurant prices is going to make folks think twice about going to the “Zone” to enjoy a meal in their own city.  I doubt folks in Gentilly and Lakeview paying for new shocks, struts and tires due to the damage caused by the gargantuan holes in their streets are going to feel like traveling to the “Zone”, pay an extra tax to park and eat, then watch already useable dowtown streets get repaved.

In the past few years we’ve seen red light cameras, we’ve seen speeding cameras, and most recently we’ve seen booting for a single overdue parking ticket.  Have you been down to the “Zone” recently?  There is a booted car on almost every block.  Those cars do not belong to tourists, they belong to New Orleans‘ citizens trying to make a living in this city.  

How much more can we exploit...tax...our own citizens before we cross the line and destroy what truly makes this city special?  (Answering my own question) When the price of admission for local folks to get into the “Zone” is too high, you will most certainly destroy what makes this city special.   

If the “stakeholders” behind this bill did not know how to “bring the public to the table” before they pushed this bill into the legislature announcing it at the eleventh hour....perhaps they have no business dealing with New Orleans’ citizens or their money.  If you scratch the surface of this bill it begins to look like a classic power grab to wrest control of the city's most valuable assets from the citizens who live in these areas.  There has always been a push to "disnefy" the Quarter and the only thing that has kept the balance of authenticity and the integrity of the residential neighborhood in the Quarter in tact is the homeowners and preservationists who fight to maintain a decent standard of living.  That dynamic is what makes the Quarter unique.  This bill appears to be an end-around those pesky preservationists and neighborhood associations who stand in the way of turning the quarter into a full scale timeshare, condo-driven amusement park.




I’m not opposed to taxing districts in general and I think we should look at ways to garner funding to better our city’s crumbling infrastructure but what I am opposed to is the way this was done.  I am sick of the blatant disregard, even contempt, for the public by public officials dealing with public monies.  For that reason alone, I hope this thing is shot down before it gets out of committee.  Maybe that will send a message to industry officials that we are all “stakeholders” in the business of our city’s tourism.


The bottom line is there is no possible way to publicly vet all the issues this bill will potentially create in the short amount of time there is to bring it to the legislature floor.  Make no mistake, this was by design.  Don't know about you but that really pisses me off.  I am hoping it backfires on them and the next time they won't be so arrogant.

I don’t think the authors of these bills fully understood their consequences when they threw their support behind them.  At least I don’t think Sen. Murray and Sen. Morrell did.  Apparently Rep. Leger is all on board; I’m not sure what’s going through Rep. Moreno’s head.  I would encourage you to contact all of them and let them know how you feel, even if you disagree with me.

Senator Ed Murray - murraye@legis.state.la.us

Senator J.P. Morrell - morrelljp@legis.state.la.us

Rep. Helena Moreno - morenoh@legis.state.la.us


Rep. Walt Leger - wleger3@legershaw.com

Ashe’
     
 UPDATE:  I failed to mention that the Yellow Blog had already broached this issue and sounded the warning bell.  
  

6 comments:

jeffrey said...

The public is just hearing of this bill a week out before it would go to committee. Why is that? Why is a bill this important, one that will affect every citizen in this city, just now reaching the public’s attention?

Not to be too much of a pain but some of us have been paying attention to this for a few weeks now.

http://librarychronicles.blogspot.com/search/label/Hospitality%20Zone

Anyway, thanks for doing this. It's pretty amazing.

Dambala - Jason B. Berry said...

My apologies. What I meant was that the "stakeholders" waited to broach the issue with community groups just last week.

Anonymous said...

This looks very much like Mayor Moon's Core Area Development District.

jeffrey said...

More today

http://www.nola.com/politics/index.ssf/2012/04/hospitality_zone_taxes_on_down.html

Anonymous said...

The public is just hearing of this bill a week out before it would go to committee. Why is that? Why is a bill this important, one that will affect every citizen in this city, just now reaching the public’s attention?

Perhaps because they really don't care what the public thinks? As yesterdays "public" meeting about this new taxing district showed, what is the point of pretending to have community participation, when the decision has already been made. Unfortunately, they seem to be doing this way too often lately; giving the public only a certain amount of tailored information, hours before voting for something, while patting themselves on the back for having such an open and public process.

Anonymous said...

Will the proposed taxation and development district have expropriation authority and its own master plan, as does GNOBEDD?