Austin, Texas, Raises Occupancy Tax 2 Percent

The Austin Convention Center

The Austin City Council has voted to raise the city's occupancy tax from 7 percent to 9 percent in order to finance its approved plan to expand the Austin Convention Center, which will cost about $1.2 billion. The levy seems already to have gone into effect, as the city's information on the hotel tax notes the addition of the 2 percent "venue project tax."

The move raises the total tax on hotel rooms from 15 to 17 percent, putting Austin in the top 20 cities with the highest total occupancy taxes in the nation, according to the Lodging Tax Report from industry research firm HVS (Omaha, Neb., is number one with a 20.5 percent rate; Overland Park, Kan., is number two at 18.1 percent).

In May, the Austin City Council approved plans for the convention center expansion, which will redesign the facility and its surroundings. The city manager was expected to present preliminary designs at the end of July.

The move is a natural progression for the city that has welcomed two major convention properties in the past four years, both with more than 1,000 rooms. The 1,012-room JW Marriott Austin opened in 2015 with more than 85,000 square feet of meeting space of its own, and the 1,048-room Fairmont Austin, with 140,000 square feet of event space, debuted in March 2018. Currently, the Austin Convention Center features 247,052 square feet of exhibit space and 54 meeting rooms. Details on how much larger the facility will become have yet to be determined.

While the expansion plan seems to be garnering approvals and support very quickly, it is not without its opponents. According to the Austin American-Statesman, the political-action committee Unconventional Austin announced at the end of July that they have the signatures needed to force a public vote on the plan. No firm announcement has been made yet about putting a question on the Nov. 5 ballot.