May 29, 2025

Yesterday, the Buncombe County Tourism Development Authority Board of Directors reviewed the proposed FY26 $25.9 million operating budget presented by the Finance Committee and Explore Asheville staff. To support the community's economic recovery, $4.2 million from fund balance will be combined with the $21.7 million forecasted in net lodging tax revenue to balance the budget.

Explore Asheville has been working closely with the Economic Development Partnership of North Carolina (EDPNC) and North Carolina Lodging and Restaurant Association (NCLRA) to monitor our economic recovery and the changes in spending patterns over time. With both the city and state HUD Action Plans approved, we will continue to see progress, albeit in fits and starts, as project contracts are awarded over time.

The FY26 budget supports our ability to shine a spotlight on our creative community, invite visitors to be a part of our economic recovery, and enjoy meaningful and memorable experiences. It is our role to invest lodging taxes paid by visitors to work as wisely as possible to encourage customers from near and far to enter through the front doors of various businesses and introduce new dollars into our economy. 

Other takeaways from the May board meeting include:

• April lodging occupancy and demand;
• A report on Hurricane Helene’s economic impact on Buncombe County, the Asheville MSA’s hospitality industry, employment, and potential pending funding sources and legislation that could supply business grants;
• Two existing sports facilities received expedited approval for $2.65 million in TPDF investment to help restore the county’s competitive position as a premier sports destination.
  

As we reflect on these efforts to strengthen our community and its future, we also pause to honor the legacy of a visionary who helped shape our past and present. This week, we recognize the passing of local legend and leader Oscar Wong, a pioneer of the craft beer industry whose vision helped transform our city into the craft beer destination it is today. Oscar's influence lives on through his daughter, Leah Wong Ashburn, who leads Highland Brewing, as well as through the vibrant craft beer community he helped nurture and the collaborative, generous spirit he championed throughout his life.

April hotel occupancy was 64%, down five points from 2024 and 10 points from 2019. Hotel demand was seven percent down from last year.

April vacation rental occupancy was 51%, down two points from 2024 and three points from 2019. Vacation rental demand fell 21% compared to last year.

North Carolina economic consultant Dan Gerlach presented recent data regarding the impact of Hurricane Helene on the region, specifically the Asheville Metropolitan Statistical Area (MSA), and its local travel and hospitality industry. It was initially assumed that HUD’s Most Impacted and Distressed designated areas accounted for 53% of all damages. Recent data indicates it accounts for 95%.

The original damage estimate for the region was close to $60 billion; however, when factoring in economic losses, the total cost is significantly higher. From the fourth quarter alone, Buncombe County experienced a $910 million economic loss, representing more than half of the total loss for all impacted counties combined.

Business loss is defined by the following three factors: Physical Capital (such as buildings, equipment, and inventory), Financial Capital (including revenue and additional costs imposed by Helene), and Human Capital (jobs and the labor force).

In terms of human capital, the hospitality sector experienced the most significant impact from October to April, representing the majority of job losses and unemployment claims in Buncombe, Haywood, and Madison Counties. Before the storm, an average of one in ten travel and hospitality workers applied for unemployment insurance; now, that number has risen to one in two.

Potential Silver Linings: Sales Tax Collection & Pending Business Grants

In February, statewide sales tax collections were down four percent year over year, while Buncombe County’s collections were flat. While it's uncertain whether this stabilization is real or short-lived, there are pending business grants that could further boost the recovery of the travel and hospitality sector. Our region needs customers returning through the front doors of businesses AND business grants to help sustain them in the meantime.

The governor has requested an additional $100 million for business grants, while House Bill 1012 proposes $60 million through the Department of Commerce. Additionally, the recently approved City of Asheville's HUD Action Plan allocates $17 million for business grants aimed at economic revitalization. This brings the total proposed funding for business grants to $177 million.

More information about the economic impact of Hurricane Helene will be included in an upcoming report from EDPNC.

The Finance Committee and Explore Asheville staff developed a $34.2 million gross lodging tax forecast, representing a net revenue forecast of $32.5 million and the Buncombe County administrative fee of $ 1.7 million. The forecast is based on revenue projections provided by Tourism Economics in March.

The lodging tax revenue is split, with two-thirds, or $21.7 million, going to the operating fund, and the remaining third split evenly between the two project funds, the Tourism Product Development Fund (TPDF) and the Legacy Investment for Tourism (LIFT) Fund, at $5.4 million each. This October, $15.8 million is expected for the TPDF grant cycle, while $13 million is projected for the LIFT grant cycle in October 2026.

To support the community's economic recovery, $4.2 million from fund balance will be combined with the $21.7 million in net lodging tax revenue to balance the FY26 proposed operating budget of $25.9 million.

The authority will vote to approve the FY25 budget in compliance with state legislation at the June 25 board meeting. Public comments are welcome at the meeting, whether in person or virtually via the Zoom webinar platform.

The authority approved $2.65 million in expedited funding through its Tourism Product Development Fund (TPDF) for two essential sports facility projects designed to restore the county's competitive position as a premier sports tourism destination.

The expedited investments will support the restoration of the John B. Lewis Soccer Complex and parking improvements at Bob Lewis Ballpark, both of which are previous TPDF-funded projects with proven track records of driving visitation to the Asheville area. Both projects are anticipated to be completed by this fall, enabling Buncombe County to capture significant tournament revenue during the upcoming season.

During the March 2025 BCTDA planning session, board leadership identified three key priorities to guide investments for this TPDF cycle:

• Large entertainment and cultural facilities
• Sports facilities, especially indoor multi-use venues
• Family-friendly experiences that enhance the visitor economy

Following today’s decision, $13.1 million remains available for the eight other projects advancing to Phase II, with investment recommendations to be presented to the board this fall.

Oscar was a pioneer in the Asheville craft brewery scene, founding Highland Brewing Company in 1994, the first brewery in Asheville since Prohibition. 

Wong was an active participant in the Asheville non-profit and brewing communities, tirelessly encouraging collaboration and relationships that strengthened our entire region.

In 2011, Explore Asheville and the BCTDA awarded Oscar the William A.V. Cecil Award for Tourism Community Leadership, recognizing his role in establishing Asheville as a world-class destination for craft beer enthusiasts.

"He makes us believe we can do great things, fun things, hard things, new things, things that matter. Together." - Leah Wong Ashburn

MORE INFORMATION & NEXT MEETING OF BCTDA

Find documents from the May 28 board meeting HERE >>

THE NEXT BCTDA BOARD MEETING
Wednesday, June 25 | 9–11 a.m.
Explore Asheville | 27 College Place
Details to be posted HERE >>

Delivering Balanced 
& Sustainable Growth

Encouraging Safe & Responsible Travel 

Engaging & Inviting More Diverse Audiences

Promoting & Supporting Asheville's
Creative Spirit