City should consider tax's bottom line

It sure sounds good, that whole restaurant tax idea, especially when its promoters and the city council continue to ignore or at least refuse to question the reality of the situation.

The sales pitch presented Monday by tourism officials giddily ignored the proposal's economic feasibility, and did so with an enabling assist from council members who asked only a couple of benign questions, including if the money could be used to build a pool. (More on that in a moment.)

Let's assume, for argument's sake, that the Kentucky League of Cities' estimate that the tax will raise $320,000 a year is accurate. After splitting that amount with the city, tourism will have at its disposal about $160,000, plus another $15,000 from its hotel room tax.

With that $175,000, tourism officials say they plan to hire an executive director to the tune of about $75,000 a year. Conservatively, let's add another $10,000 in taxes and benefits to that position, bringing the cost to $85,000 and leaving about $90,000 to actually promote Anderson County.

But wait. The tourism folks, not the city and its existing staff, will be tasked with enforcing and collecting the tax on a monthly basis. Unless it expects its $75,000 a year director to serve as a bookkeeper and enforcement agent, it better budget for those jobs, too.

Again being conservative, let's figure enforcing and accounting will cost about $1,000 a month, which reduces the actual amount left to $78,000 a year, and that's before expenses for travel, conventions, phones, office space, Internet and other obvious items are deducted.

Again, because none of these issues are discussed by tourism officials while making their pitch (or city officials when they hear them), we can only guess that, when expenses are totaled, the tourism director will be left with somewhere in the neighborhood of $70,000 - or less than $6,000 a month - at his or her disposal to promote Anderson County.

No, we didn't forget about the city's share of the money, but we might as well, considering the city is sticking to its guns that it can be used to enhance the parks. Heck, it can even build a swimming pool, according to what was said Monday afternoon. Given that no other counties in our area have such a facility, it's a sure-fire bet that people would flock in from Franklin, Mercer and Woodford counties, right? Moreover, it certainly will put an arrow in our economic development quiver when companies shun our pool-less neighbors in favor of us.

Here's the bottom line, folks, and one that is being roundly ignored: only about a quarter of the money ($70,000 of $320,000) the restaurants will be forced to pay will actually be used to promote Anderson County. The other 75 percent will be used to provide a high-paying job to whoever lands the position, and give the city revenue to improve its parks.

But what do we know? Heck, the former mayor of Mt. Sterling gave a glowing revue Monday of his city's experience with a restaurant tax, enacted under his watch in 1990.

Since that time, he said restaurant receipts in the city have swelled from $11 million to $25 million. In other words, they have more than doubled in 18 short years! We wonder how much of that increase is due to the addition of a Cracker Barrel, Applebee's and assorted other restaurants since 1990, not to mention 18 years of price increases.

It's a shame no one on the city council thought to ask those questions or wondered aloud if restaurant receipts in Lawrenceburg have increased that much since 1990 without the help of a city tax.

We bet they have but, unfortunately, we will never know for sure unless the city council sees fit to removes its cheerleader skirt and asks some tough questions.