In a two-hour special meeting Friday between the two groups, Wendell Trapp as attorney for the city of Corinth and attorney Bill Davis for Alcorn County, explained the limits and discretionary decisions allowed under the law that established the tourism tax that funds both organizations.
The law requires that the 2 percent tax on restaurants and hotel/motel stays in Corinth be divided 1 percent to the arena and 1 percent to the tourism council. Arena funds are designated to retire debt on the building, while tourism funds are to be used for capital improvements, events, marketing and promotion.
Trapp and Davis essentially agreed that under the umbrella of expenses related to sponsoring events, the Crossroads Arena has broad leeway in what they can request and what the tourism board can approve as legitimate expenses.
“The tourism tax was designed to promote tourism, and an argument can be made that the arena does that,” Davis said. “Neither elected officials nor the tourism council have complete control over it. It’s not to be used for general purposes.”
An event is not defined in the law, Davis said, but it is a fairly broad category.
Trapp said the most reasonable way for the arena to request funds is to continue using the same application process that tourism has used for several years, and which all other entities use to request grant support, submitting a form detailing cost estimates, then providing documentation of expenditures after the event.
“There are still some gray areas,” Trapp said, “but this method has the least of them.”
The nature of the arena’s business will necessitate that some expenses be met in advance of an event. Several city and county government officials who attended the Friday meeting indicated their approval for granting those up-front expenditures.
Tourism council board members still have the challenge of figuring out how much of their budget remains for office expenditures and other grants, while keeping the arena allocation intact.
Arena board members, working with new general manager Tammy Genovese, will submit their requests as far in advance of an event as possible detailing what the needs are, and a record of expenditures will be provided to the tourism board.
With the two groups working together, the goal is to generate surplus from arena events to support the facility’s operating expenses.