Orange County legislative priorities include expanded use of bed-tax money

For the first time, Orange County’s legislative priorities next year will include expanding authorized uses for hotel-tax revenues, a lucrative money stream expected to top $350 million next week when collection totals are updated.

The idea of pursuing a “tourist impact” tax to fund affordable-housing projects sprouted this summer from a citizens panel created by Orange County Mayor Jerry Demings.

“We’ve had somewhat of a mandate from our Tourist Development [Tax] task force to advocate for tourist-development impact fee eligibility,” Demings said Tuesday after a briefing by Kelley Teague, legislative affairs director.

Commissioners said little about the priorities Tuesday before their unanimous vote.

But including expanded TDT use as a county priority is a significant step forward, said Jane Healy, a former Pulitzer Prize-winning editor of the Orlando Sentinel, co-chair of the mayor’s task force and the person who proposed it.

“They’ve never done this before — never told the legislative delegation, their lobbyists or anybody — to lobby for expanded use of the hotel tax,” Healy said. “Whenever the issue has come to the Legislature, it’s always been limited to other counties.”

Orange County’s priorities, set annually by commissioners to guide its lobbying teams in Tallahassee and Washington, include a range of issues deemed important to the county — from supporting legislation to improve water quality in lakes to opposing measures that erode local government authority by restricting decisions to the state.

TDT stands for tourist development tax, the 6% county charge added to the cost of a hotel room, an Airbnb rental or other short-term lodging. Sometimes called a bed, hotel or tourist tax, it raised a record $336 million in fiscal year 2021-22 and $333 million through 11 months of fiscal year 2022-23 with September’s collections not yet included.

Over the years, the money has primarily paid to build, expand and operate the Orange County Convention ($2.7 billion since 1986) and fund Visit Orlando’s global ad campaigns to attract visitors (about $59 million in calendar year 2022.)

Visit Orlando received $101.7 million from the tax in 2022, according to a financial statement on its website.

TDT revenues also have helped build the Dr. Phillips Center for the Performing Arts and Amway Center; renovate Camping World Stadium; and boost local arts and cultural groups, performance venues and programs.

Florida law doesn’t allow the money to be spent on affordable housing or transportation unless the county spends at least 40% of the revenue on tourism promotion. The mayor contends the county does not meet the statutory threshold.

The county also cannot impose a new tourist-impact tax without a change in state law.

It also would need the approval of county voters.

Orange County TDT task force members offer other spending ideas

Monroe County, which includes the Florida Keys, has had a similar tax in place since 1985, using proceeds to buy land for conservation and affordable housing projects. The 1% tax on the cost of a hotel room or other short-term lodging has pulled in $64.1 million over the last five fiscal years, Monroe County Tax Collector Sam Steele said.

Healy described that kind of option as “perfect for Orange County,” but the mayor’s task force was divided.

Among those voting no was S. Brendan Lynch, an attorney with Lowndes who served on the panel representing the Central Florida Hotel & Lodging Association. He dismissed an added tax on tourists and instead touted the Legislature’s “Live Local Act,” which took effect July 1, as the largest affordable-housing measure ever adopted in Florida.

“I would say quite frankly we have to see how that works before we … start pushing for other changes,” Lynch said.

Task force member Chris Mueller, manager of the Hilton Orlando, opposed expanding uses.

Jay Galbraith, Valencia College vice president, who represented Universal Orlando on the task force, suggested the proper “venue to have a global conversation about TDT use is with the Legislative
delegation.”

Orange County sets rules for statewide Live Local Act. Some worry they’re too restrictive.

State Rep. Anna Eskamani, D-Orlando, has promoted flexibility in TDT spending during her tenure in the Legislature, introducing bills to allow tourist-tax revenues to be used for workforce housing in the tourism corridor.

She described a tourist-impact tax as a positive step, but expected tourism leaders would oppose it.

Orange County commissioner Nicole Wilson, whose growing west Orange district includes Disney properties, said she supports expanding potential uses for tourist-tax revenues and the 1% hotel-tax option the county may seek.

“Tourism impacts our community,” she said. “It’s water use, roads driven on. Those impacts cost us money.”

Fellow commissioner Christine Moore, whose northwest county district includes Apopka and Ocoee, said she had misgivings about trying to persuade state legislators to allow the county to levy an additional tax on visitors.

“It’s worth it to ask,” she said. “But you have to be careful about overtaxing people who come here.”

Commissioner Michael Scott, whose district includes the International Drive tourist corridor, also was skeptical.

“Both things are great ideas,” he said of the local option and TDT flexibility. “I just don’t think they are practical for the current political climate we’re in. … If the Legislature’s not even going to take them up or approve them, what recourse do we have?”

Rep. Eskamani: We must explore options to spend hotel tax | Commentary

The mayor said the county will need help to persuade the Republican-dominated Legislature.

County leaders have started a conversation with colleagues through the Florida Association of Counties, hoping to gain some allies on TDT issues but we “don’t know where the association is going to land,” Demings said.

He added, “We’ve got some heavy lifting to do.”

shudak@orlandosentinel.com