Hotel Tax Increase -vs- New Auditorium in McAllen

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Thursday, August 25, 2011 - 9:23am

Hotel Officials Upset About Potential Hike

VP of Castle Hospitality Rick Guerra is worried about his company. He owns five hotels in McAllen and he's been battling this economy for quite some time. But a new battle is on the horizon.

"We want to have options available to us. One of those options is this available two cent hotel tax," said McAllen Mayor Richard Cortez.

Two points may not seem like a lot of money but it's actually a 30% increase in occupancy tax.  For hotels that have lost a lot of business due to the mexican violence and restricted corporate travel, the increase could be detrimental the industry in McAllen.

"We're trying to cut down on everything that we can so it's tough in McAllen, it's tough to be in business anywhere and it's tough in McAllen," said Guerra.

If the tax increase is approved, McAllen will have the highest occupancy tax in the region.

Ten years ago residents in McAllen voted for a new auditorium. The city looked at several different ways to pay for it and taxing the hotel industry was one of them.

Guerra tells us he isn't against a new auditorium but he is against forcing his guests to pay for it. He says he just doesn't feel that the hotel industry should shoulder 42% of the cost of the new auditorium. The city of McAllen is leaving the decision up to its residents. Come November, they will decide whether or not its fair to raise the tax. City officials say it has yet to be determined whether it will have an impact or not.

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