What's Going On with the A&P Commission?

The March collections for Fayetteville's Hotel, Motel, and Restaurant tax are now in; the leading restaurant in terms of reported sales is Red Lobster, which paid $3,878, and the leading hotel is the Clarion Inn, which paid $2,389. Those figures represent 1% of their monthly sales, and the money is supposed to be spent by the Advertsing and Promotion Commission on advertising and projects or events that promote tourism in Fayetteville.

Past funding from A&P tax dollars have been spent on things that don't seem to fall within the ordinance or the state statute and hardly qualify as promotion of tourism. NWA BEST got money for a high school contest to build robots and encourage students to pursue careers in engineering. The Barbara Mashburn Scholarship Foundation gives money to students preparing for a career in vocal music with tuition and expense support for up to ten semesters provided the students participate in Singers’ rehearsals.

That's not all that is being funded under the guise of tourism. First Night is a big New Year's Eve Party of fantasy and fun for local residents. Pagnozzi Charities gives sports scholarships to grade school children for equipment purchases, travel expenses, uniforms, camp registration fees, recreational program fees, monthly instructional classes, and Razorback game tickets for families. No one seems to think it is a blatant conflict of interest that CVB Director Allyson Twiggs is also on the board of Pagnozzi Charities.

Mayor Dan Coody, who appointed himself to the A&P Commission, said he had planned to ask for about $250,000 from the commision for remodeling the Square Gardens last year, but Commissioner Bob Davis made the motion to give him $460,000 from the commission's reserves. According to the city's website, A&P tax revenues cannot "be utilized for expenditures that are normally paid from general revenues of the City," but Coody said he would find city funds to match the money.

Executive Director Marilyn Heifner says the Advertising and Promotion Commission has no funds in its budget this year to support the Fayetteville Arts Festival that brings in thousands of visitors and boosts the city's reputation as the regional center of arts and culture.

There are also problems with businesses not paying what they owe. "Patrons to restaurants in Fayetteville pay a built-in tip to the city, but in some cases the restaurants never pay their tab," according to the Arkansas Democrat-Gazette. "Thousands of dollars a year paid by customers in the form of a hospitality tax never make it out of the business’ coffers and into the city treasury. ...Nonpayment of HMR tax is neither a felony nor a misdemeanor but a violation of city ordinance."

Commissioner Pat Gazzola said businesses that do not turn in HMR taxes are pocketing the money that other businesses are being forced to pay, and he proposed shutting off city water service to hotels and restaurants that do not pay what they owe. Gazzola owns the Catfish Hole, which ranked No. 13 and paid $1,852 for March.

Other restaurant owners serving on the Commission are Neal Crawford, owner of Jose's, and Maudie Schmitt, chef and co-owner of Café Rue Orleans. Neither of them were among the Top 60 local restaurants in terms of self-reported sales and HMR tax, that included Hooters (29),Starbuck's (43), Razorback Cinema (50), and Slim Chicken's (58).

Maybe it's time for an audit?