City representative wants to make sure County using HOT tax money properly

An El Paso city representative said this week she has been “suspicious” the County does not properly use its share of Hotel Occupancy Tax, something that would violate state law.

Hotel Occupancy Taxes (HOT taxes) are paid by visitors who stay in El Paso hotels. The County gets about $3.3 million a year in HOT taxes.

State law requires municipalities and counties use the money on tourism. Counties, however, can also use the money on historic preservation.

During a City budget meeting on Wednesday, Niland said she had been suspicious the County of El Paso was using HOT tax revenue to balance its budget, instead of tourism. She told City staff she wanted to “see the numbers” for the County.

County Judge Veronica Escobar said she had received a phone call alerting her to Niland’s comments.

“The problem when two organizations are separate but sometimes working toward the same things is we can’t just pick up the phone and call and both parties are guilty of it. We’ve had folk on the County side who’ve been critical of the City and said things and I’ve said hold on, let’s call them, give them a chance,” Escobar said on Thursday.

A day after saying she was suspicious, Niland said she just wanted to make sure the County’s funds were going in the right place.

“I know the County has had some financial issues over the last year and they’ve struggled. I know Judge Escobar, when it comes to taking care of the County, has done a great job but I just want to make sure those funds are being used exclusively for what they’re supposed to,” she said.

County officials said out of the $3.3 million of HOT taxes the County gets, 76 percent goes to the Sports Commission or the County Coliseum because of a long-standing contract.

What’s left is invested on efforts to improve the mission trail and attract tourism events, such as the Conference USA basketball tournaments and a national bowling tournament – things the County teamed up with the City to attract.

After 76 percent of the County’s HOT tax money is allocated to the Sports Commission, only about $521,000 is left.

In the last fiscal year, about $212,000 went toward attracting the C-USA men’s and women’s basketball tournaments and about $133,000 was used for the women’s national bowling tournament. An estimated $150,000 in HOT tax rebates from the County was also given back to the DoubleTree as part of a development agreement the City also agreed to.

The rest is used on historic preservation at the Mission Trail, a place the County believes can be a major tourist attraction in the future. The County invests in Los Portales Visitors Center there, the San Elizario Jail – a historic landmark – and events like the first Thanksgiving.

Escobar said the County cannot legally use the HOT taxes to balance its budget and the court sometimes uses the funds on initiatives both the County and City are working on, like the bowling tournament and C-USA.

“By participating and helping the city with these initiatives, it’s helpful to the community,” she said.

Niland said she plans to speak to Escobar.

“I haven’t had a discussion with the judge. I should and I will. I think they’re a great partner,” Niland said.