Enterprise Rent-a-Car has hired Bill Phillips — until late last year Mayor Bill Purcell’s deputy mayor — to lobby against a suggested 1 percent rental car tax for out-of-town customers to help fund the proposed new $455-million-plus downtown convention center.
Phillips, who was recently listed in Metro records as a lobbyist for the company, could not be reached for comment Wednesday.
Metro Council members confirmed Wednesday they have been contacted in recent weeks by Enterprise representatives, though not by Phillips, and Enterprise spokeswoman Laura Bryant said the company — along with a coalition of several other rental car companies including Alamo Rent-A-Car, Avis Rent A Car, Hertz and Budget Car Rental — is indeed opposing the new tax in synch with a national effort against all such car rental “excise” taxes.
Metro legislation that would create the tax along with several other new tourist taxes, such as an increased hotel occupancy tax, is scheduled for the second of three required votes in the Metro Council next Tuesday. The ordinance would let Metro begin collecting the new convention center taxes even though the actual construction of the center still needs city approval.
Supporters of the Music City Center (MCC) say the pending ordinance makes exemptions for most local vehicle rental customers and say they think Enterprise is exaggerating the number of local customers who would be affected by the tax. Butch Spyridon, president of the Nashville Convention and Visitors Bureau, said yesterday Enterprise has continued to lobby against the new tax despite an extra exemption — for long-term rental car customers — that MCC supporters added to state-enabling legislation for the new tax during discussions with Enterprise early this year.
But Bryant, speaking for the Coalition Against Discriminatory Car Rental Excise Taxes, which was formed in the past year to back pending Congressional legislation to ban all such taxes nationwide, said rental car taxes such as these are discriminatory whether they are levied on local and out-of-town customers together or out-of-towners solely.
She said pending legislation in Congress, sponsored by U.S. Reps. Rick Boucher (D-Va.) and Chris Cannon (R-Utah), would definitely affect Metro if it passes because it would ban all such rental car excise taxes approved by local governments since the Congressional legislation was introduced in May. She said the coalition is not fighting normal sales taxes or airport concession fees.
“Discussion of the [Nashville] legislation has, in large part, been centered on the pledge that local residents will not be impacted by these increased taxes. However, the fact is the legislation fails to protect the Davidson County resident renting a car from paying the higher tax. The Council may easily remedy this situation by removing the rental tax component,” wrote Darren Gottschalk, the general manager of Enterprise in Middle Tennessee, in a July 2 letter to Metro councilmembers.
“Last year, Enterprise alone completed more than 33,000 rental transactions to local Davidson County residents at our 13 non-airport locations found throughout our community. These rentals, which were for personal or business purposes would still be subject to the proposed 1% rental car tax. In 2006 Auto Rental News, the industry’s major trade publication, reported home-city renting now accounts for 54% of the rental car market today, compared to 46% generated by airport sites.”
Spyridon, however, said he believes the 33,000 number is inaccurate, emphasizing the ordinance exempts locals who are renting temporary replacement vehicles and exempts out-of-town customers renting vehicles more than five days.
“We’re not completely surprised — I’d say we’re disappointed. I would tell you that [Enterprise] contacted us very early on, expressed their concerns, we met with them at length, [and] we had another meeting with them where we agreed in principle to compromise.”
“We’re sensitive to their concerns, and we’ve responded to their concerns to the best of our ability. … They’re a partner to the hospitality industry — they’re an important partner. They stand to benefit from this [the new convention center] a great deal,” Spyridon said. “And I would also add that when Nashvillians drive, they’re paying a lot of taxes in other markets.”
Bellevue-area Councilman Charlie Tygard, who sits on the Council’s Convention and Tourism Committee, said Enterprise representatives have contacted him about the tax but said he still plans to support the new levy.
“The [Music City Center] Coalition has worked hard to present a funding plan that does not affect average Nashvillians — it affects only tourists, conventioneers and visitors,” Tygard said. “There is a possibility that a small number of [local] people would be impacted by this, but … the whole formula is critical if this thing is going to work and if we’re not going to make mistakes as we have in other large public measures such as the stadium and the arena.
“It’s important to me that we identify any and all sources and spread it around to eliminate any possible impact on the average Nashvillian.”