April 8, 2024

At the end of March, BCTDA leadership (Board of Directors, TPDF and LIFT committee members, and Explore Asheville executive staff) held its annual planning session at Highland Brewing. The day included presentations from national and local experts on issues impacting the travel and hospitality industry and the community.

Presentations from the 2024 BCTDA Annual Planning Session included:

• The Role of Tourism Development Authorities and Occupancy Taxes in North Carolina from Magellan Strategy Group;
• National, State, and Local Travel Economic Outlook from Tourism Economics;
• Local Housing Supply and Affordability Overview from Local Housing Expert Scott Dedman;
• Results of the 2024 Resident Perspectives on Tourism from MMGY.

The last session focused on workforce development with a panel of young travel and hospitality professionals sharing experiences and insights to help BCTDA leadership better understand challenges and opportunities. Explore Asheville is developing a workforce development program for high school students to be launched later this year.

Finally, there are only a few days remaining to nominate a non-managerial employee or volunteer who has demonstrated exceptional service for our Heroes of Hospitality Awards. The deadline for nominations is April 12.

Tourism Development Authorities (TDAs) are vehicles created by the state to oversee the collection and investment of occupancy taxes in most communities in North Carolina. In 1983, Buncombe County passed its own occupancy tax legislation, which was one of the first in North Carolina. Today, 90 counties and 110 cities and towns have been enabled to collect occupancy tax.

The 2022 changes to Buncombe County’s lodging tax legislation expanded the authority’s scope to include the Legacy Investment From Tourism (LIFT) Fund and debt service capacity. It is the BCTDA’s fiduciary duty to ensure that lodging tax dollars are spent in accordance with the specific legislation and rules governing their use. 

In his presentation, Chris Cavanaugh of Magellan Strategy Group spoke about the recent North Carolina Court of Appeals ruling against Currituck County about permissible uses of occupancy tax dollars.

Director of Destination Partnerships Travis Napper, Tourism Economics, presented a forecast that looked ahead 18 months and provided context through national and regional comparisons for Asheville and Buncombe County's travel and lodging sector. His main findings included:

• Asheville's hotel room revenue and lodging tax collections declined by 1% and 1.3% in FY2023. In FY2024, baseline projections show a decline of 3.4% and 5.7% in hotel room revenue and lodging tax collections. Lodging revenue is generally a leading indicator for spending throughout the community and sales tax revenue that ultimately fuels City and County government budgets.
• Similar declines have been seen across the U.S. for all market locations other than large urban areas.
• The U.S. is likely to experience a mild economic slowdown in 2024.
• Although macro forecasts have been revised upward, personal savings have generally dwindled, which may impact consumer travel spending.

Housing affordability is an important issue for our entire community. Like so many places across the country, our region has housing affordability challenges due to a lack of suitable housing inventory. Housing affordability is a product of both supply and demand and cost versus income. Scott Dedman, a now-retired housing executive who worked in our community for nearly 40 years, shared a comprehensive overview of how we got here and his recommendations for a way forward. Below are the main takeaways from his presentation:

• Unified Development Ordinance Needs Updating: The City of Asheville’s Unified Development Ordinance (UDO) was approved by City Council in 1997 and has undergone few significant changes since. Its adoption reduced the density of approximately half of the multi-family zoned areas in Asheville. Seven thousand residential acres in Asheville are now restricted to single-family housing only.
• Population Growth Below State Average: Buncombe County has grown less than 2% year-over-year over the past decade. North Carolina counties average growth from 2020 to 2023 was 3.7%, placing Buncombe at the middle of the pack. The population of the City of Asheville decreased by 1% according to 2022 American Community Survey 2-year data.
• Development Not Keeping Pace: Despite moderate population growth, the number of housing permits issued has not kept pace. In fact, no permits were approved for multi-family structures in 2011 and 2012, and very few were approved in 2013. This lack of construction over the past decade has contributed to a rise in property values and made housing less affordable in the area. Additionally, City Council has rejected several private development proposals totaling over 1,000 units.
• Second Home Sales Have Increased: Currently, around 65% of the county's available housing is occupied by homeowners. However, vacant housing units have increased due to the pandemic-driven surge in secondary or vacation home purchases.
• Affordability Recommendations: Increasing the supply of housing will help counteract affordability issues. City and County zoning codes, including the UDO, need to be updated to increase development in our urban centers and near jobs, schools, shopping, and services. Citizens, business leaders, and elected officials must act with a sense of urgency or our affordability issues will continue to worsen.

As part of its commitment to deliver balanced and sustainable growth, the BCTDA and Explore Asheville conduct an annual survey in partnership with MMGY Travel Intelligence to gauge the awareness and perceptions of residents regarding the impacts and contributions of tourism to the community. The following key insights came from a random sample survey (with a 95% confidence level) of Buncombe County residents in February:

1. Residents agree even more so than previous years that tourism is beneficial to the community. Nearly nine in 10 residents believe tourism has a positive economic impact including creating entrepreneurial opportunities and support for independent businesses.
2. Asheville residents take great pride in their community, especially its diversity and inclusivity, how the community rallies together, and its culture and character.
3. While parking and traffic remain the primary concerns for Asheville residents, the perception of the impact of short-term rentals on housing options for year-round residents has increased in both positive and negative ways.
4. Natural greenspaces and protecting the environment are important aspects of Asheville for residents, and 8 in 10 agree the visitor economy helps support these natural and cultural amenities.
5. Supporting local businesses is important to Asheville residents, and most expect the same of visitors to Asheville.
6. There is continued opportunity to educate residents about how taxes paid by visitors are used to benefit residents.
7. While Asheville city residents agree that tourism has an overall positive economic impact, they also are more likely to highlight the challenges that impact their day-to-day life, such as parking and traffic.

MORE INFORMATION & NEXT MEETING OF BCTDA

Find documents from the March 22, 2024 annual planning session HERE >>

THE NEXT BCTDA BOARD MEETING
Wednesday, April 24, 2024 | 9–11am
Explore Asheville | 27 College Place | Asheville
Details to be posted HERE >>

EXPLORE ASHEVILLE'S STRATEGIC IMPERATIVES
Delivering Balanced & Sustainable Growth | Encouraging Safe & Responsible Travel |
Engaging & Inviting More Diverse Audiences | Promoting & Supporting Asheville's Creative Spirit

Established by state law to administer the occupancy tax paid by overnight visitors according to the enabling legislation, the Buncombe County Tourism Development Authority is a public authority with a public purpose to enhance the economic vitality of Buncombe County. It is led by 11 local, appointed volunteers (two of whom are ex-officio members) who provide professional expertise to ensure the effective use of the tax to benefit our community and the people who live here. BCTDA meetings are open to the public.